Prysmian — Interim / Quarterly Report 2016

May 10, 2016

Q1 2016 Financial Results

Milan – May 10th , 2016

Q1 2016 Highlights

• o Group overview
• o Results by business
• o Outlook
• Financial results
• Appendix

Organic Growth at +2.3%, mainly driven by a sound execution in Energy Projects and a resilient performance in Telecom.

Adj. EBITDA at € 150m (8.3% on Sales), with a general margin improvement thanks to the ongoing implementation of efficiency measures and a better business mix.

New segment reporting: Oil&Gas, which groups "Core Oil&Gas Cables" business (formerly included in "Industrial & Network Component" segment) and SURF business.

Oman Cables Industry consolidated line-by-line starting from January 1, 2016 included in the Energy&Infrastructure division.

New segment reporting

Q1 2016 Key Financials

Euro Millions, % on Sales

* Org. Growth

Continued organic growth and profitability improvement

Margin increase driven by Energy Projects, Telecom & OCI Consolidation.

Key Technology Milestones

Prysmian P-Laser 525kV HVDS cable section

P-Laser 525kV HVDC cable system homologation:

• Faster manufacturing process
• More efficient power transmission (up to 10%) thanks to higher thermal stability
• Reduced CO2 emissions and fully recyclable

Offshore wind farm

66kV submarine system for Offshore Wind farms:

• Key technological development for Inter-array connections.
• Enabling 15% cost reduction for overall project
• Testing and certification supported by Carbon's Trust OWA

Flextube® 2112F installation:

• World highest fiber count cable installed to-date (Australia)
• Developed in partnership with Australian TPG Telecom (Total Peripherals Group)
• Capacity of 2112 fibers in a 24mm diameter; world's highest fiber density

Q1 2016 Highlights

• o Group overview
• o Results by business
• o Outlook
• Financial results
• Appendix

Energy Projects

Euro Millions, % on Sales

Sales

* Org. Growth

Submarine

• Strong growth benefitting from sound project execution and low phasing in Q1 2015.

Highlights

• Margin improved thanks to a strong project management and full utilization of the new installation assets.
• The market of Submarine interconnections remains solid in Europe. Positive signs from tendering activity in offshore wind projects (France, UK and the Netherlands).

Underground High Voltage

• Positive performance driven by the execution of high quality projects in France, the Netherlands, China and North America.
• Continued growth in Middle East.

Transmission - Orders Backlog Evolution (€m)
	Dec '13	Dec '14	Mar '15	Jun '15	Dec '15	Mar '16
Underground HV	~450	~450	~650	~600	~600	~550
Submarine	~2,050	~2,350	~2,450	~2,900	~2,600	~2,650
Group	~2,500	~2,800	~3,100	~3,500	~3,200	~3,200

Q1 2016 Financial Results 9

Energy & Infrastructure

Euro Millions, % on Sales

* Org. Growth

Highlights

Trade & Installers

• Slightly negative organic trend affected by the decline in Brazil and Argentina, partially offset by the positive performance in the UK, Eastern Europe, North America.
• Trimming low margin businesses in Europe (especially Italy and Germany).
• Stable pricing environment. Improving efficiency thanks to first effects of manufacturing refocusing.

Power Distribution

• High single digit organic growth driven by strong performance in Germany and the Nordics. Continued growth in APAC region.

Industrial & Network Components

Euro Millions, % on Sales

* Org. Growth

Sales Highlights

Specialties & OEMs

• Overall positive trend, with solid performance of Crane, Marine and Defense, partially offset by shrinking Mining and slow start of Nuclear, Railway & Rolling stock applications.
• Continued slowdown in Brazil as the macroeconomic scenario remains challenging.

Elevator

• Double-digit organic growth supported by market share expansion in North America and APAC with an increase in margin.

Automotive

• Softening volumes with better margin thanks to on-going strategic refocusing toward higher profitability applications and a continued effort on manufacturing efficiency.

Network Components

• Positive performance driven by the solid trend of Underground HV business and production footprint optimization.

Oil & Gas Euro Millions, % on Sales

Sales

* Org. Growth

Highlights

Market outlook:

• Market remains uncertain, with tough commercial environment
• Steady tendering activity at low levels and slowdown in Offshore investments.

Core Oil&Gas Cables: Prices and volumes drop across all supply chain. Leveraging Asia supply chain to respond to price pressure.

SURF

• Umbilicals & Flexibles: New framework with Petrobras reflecting the slowdown in off-shore capex.
• Downhole Technologies: Integration with GCDT progressing well. Resilient performance thanks to a broad customer base and geographic presence. Completed Kaombo (Angola) Phase 1 delivery.

Key Priorities

• Umbilicals & Flexibles: products cost reduction, supply chain optimization, synergies with key suppliers. Focus on technology.
• Downhole Technologies: complete integration with Gulf Coast. Close collaboration with Customers on intelligent completion solution. Focus on Africa, Middle East as key regions to sustain business.
• Core Oil&Gas Cables: organization and geographic footprint optimization, focus on customer service and operational excellence.

Telecom Euro Millions, % on Sales

Sales

* Org. Growth

Adj. EBITDA

Telecom Solutions

• Margin benefitting from fiber production cost reduction, growth of copper business in Australia and improved results of YOFC.
• Strong optical cable demand in Australia and North America offset by a weak market in Europe; slowdown in Brazil.
• Solid demand for copper telecom cables in Australia and South America.

MMS

• Solid trend of sales benefitting from growth in Datacom and Multimedia markets.

Quarter organic growth* and LTM Adj. Ebitda evolution

* % change vs. same quarter of previous year

Q1 2016 Financial Results 13

Q1 2016 Highlights

• o Group overview
• o Results by business
• o Outlook
• Financial results
• Appendix

FY 2016 Outlook

Margin improvement mainly driven by Energy Projects and Telecom. Negative FX.

* Includes management expectations on OCI incremental contribution to FY 2016 adjusted EBITDA. Assuming current consolidation perimeter of Prysmian Group.

Mid-point target assumptions:

• Continued positive trend in Energy Projects and Telecom
• Moderate volumes growth in cyclical businesses with stable prices.
• Negative trend in Oil&Gas, mostly offset by Industrial and Network component.
• Adverse Forex impact.

* Pro-forma fully combined with Draka.

Q1 2016 Highlights

• o Group overview
• o Results by business
• o Outlook
• Financial results
• Appendix

	Q1 2016	Q1 2015	∆ OCI contribution Q1 '16 vs. Q1'15
Sales YoY total growth	1,810 3.3%	1,753 11.0%	143
YoY organic growth	2.3%	5.9%
Adj.EBITDA % on sales	150 8.3%	120 6.8%	1 2
Non recurring items	(10)	(14)
EBITDA % on sales	140 7.7%	106 6.0%	1 2
Adj.EBIT % on sales	111 6.2%	8 4 4.8%	1 0
Non recurring items Special items	(10) (25)	(14) 1 3
EBIT % on sales	7 6 4.2%	8 3 4.7%	1 0
Financial charges	(18)	(20)	(0)
EBT % on sales	5 8 3.2%	6 3 3.6%	9
Taxes % on EBT	(18) (30.8%)	(21) (33.3%)	(2)
Net Income % on sales	4 0 2.2%	4 2 2.4%	8
Minorities	8	1	6
Group Net Income % on sales	3 2 1.8%	4 1 2.3%	2

	Q1 2016	Q1 2015
Antitrust investigation	-	(6)
Restructuring Price adjustments	(7) -	(8) -
Other	(3)	-
EBITDA adjustments	(10)	(14)
Special items	(25)	1 3
Gain/(loss) on metal derivatives	2	2 0
Assets impairment	(15)	(6)
Other	(12)	(1)
EBIT adjustments	(35)	(1)

	Q1 2016	Q1 2015
Net interest expenses	(15)	(21)
of which non-cash conv.bond interest exp.	(2)	(2)
Bank fees amortization	-	(1)
Gain/(loss) on exchange rates	7	(11)
Gain/(loss) on derivatives 1 )	(9)	1 4
Non recurring effects	(1)	(1)
Net financial charges	(18)	(20)

1) Includes currency and interest rate derivatives

	31 Mar 2016	New Perimeter Acquired	31 Mar 2015	31 Dec 2015
Net fixed assets of which: intangible assets	2,449 708	271 180	2,260 560	2,480 722
of which: property, plants & equipment	1,535	91	1,442	1,552
Net working capital	641	223	716	342
of which: derivatives assets/(liabilities)	(27)	-	3	(41)
of which: Operative Net working capital	668	223	713	383
Provisions & deferred taxes	(286)	(24)	(283)	(307)
Net Capital Employed	2,804	470	2,693	2,515
Employee provisions	332	4	367	341
Shareholders' equity	1,434	-	1,286	1,424
of which: attributable to minority interest	140	107	40	146
Net financial position	1,038	7 9	1,040	750
Total Financing and Equity	2,804	190	2,693	2,515

	Q1 2016	Q1 2015
Adj.EBITDA Non recurring items EBITDA	150 (10) 140	120 (14) 106
Net Change in provisions & others Share of income from investments in op.activities Cash Flow from operations (bef. WC changes)	(16) (7) 117	(6) (7) 9 3
Working Capital changes Dividends received Paid Income Taxes Cash flow from operations	(294) 2 (24) (199)	(286) 1 0 (15) (198)
Acquisitions Net Operative CAPEX Free Cash Flow (unlevered)	- (50) (249)	- (22) (220)	LTM Q1 2016 Free
Financial charges Free Cash Flow (levered)	(16) (265)	(16) (236)	Cash Flow (levered) excl. acquisitions
Free Cash Flow (levered) excl. acquisitions	(265)	(236)	368
Dividends Treasury shares buy-back & other equity movements Net Cash Flow	(11) - (276)	- 2 (234)
NFP beginning of the period	(750)	(802)
Net cash flow Other variations	(276) (12)	(234) (4)
NFP end of the period	(1,038)	(1,040)

Q1 2016 Highlights

• o Group overview
• o Results by business
• o Outlook
• Financial results

Appendix

New segment reporting

Sales and Adj.EBITDA breakdowns

Bridge Consolidated Sales

Profit and Loss Statement

	Q1 2016	Q1 2015	∆ OCI contribution Q1 '16 vs. Q1'15	Full OCI Q1'16 Results
Sales	1,810	1,753	143	143
YoY total growth	3.3%	11.0%
YoY organic growth	2.3%	5.9%
Adj.EBITDA	150	120	1 2	1 6
% on sales	8.3%	6.8%		10.9%
of which share of net income from OCI	-	4	-	-
Non recurring items	(10)	(14)	-	-
EBITDA	140	106	1 2	1 6
% on sales	7.7%	6.0%		10.9%
Adj.EBIT	111	8 4	1 0	1 4
% on sales	6.2%	4.8%		9.4%
Non recurring items	(10)	(14)	-
Special items	(25)	1 3	-
EBIT	7 6	8 3	1 0	1 4
% on sales	4.2%	4.7%		9.4%
Financial charges	(18)	(20)	(0)	(0)
EBT	5 8	6 3	9	1 3
% on sales	3.2%	3.6%		9.3%
Taxes	(18)	(21)	(2)	(2)
% on EBT	(30.8%)	(33.3%)		(11.7%)
Net Income	4 0	4 2	8	1 2
% on sales	2.2%	2.4%		8.2%
Minorities	8	1	6	1
Group Net Income	3 2	4 1	2	1 1
% on sales	1.8%	2.3%		7.7%

Energy Projects Segment – Profit and Loss Statement Euro Millions

	Q1 2016	Q1 2015
Sales to Third Parties	346	281
YoY total growth	23.3%
YoY organic growth	26.4%
Adj. EBITDA	39	26
% on sales	11.2%	9.4%
Adj. EBIT	31	19
% on sales	8.8%	6.9%

Energy Products Segment – Profit and Loss Statement

		Q1 2016	Q1 2015	∆ OCI Contribution Q1 '16 vs. Q1'15
	E&I	754	686	143
s e	YoY total growth	10.0%	0.0%
rti	YoY organic growth	(0.5%)	0.0%
a P	Industrial & Netw. Comp.	333	352	-
d r	YoY total growth	(5.4%)	0.0%
hi	YoY organic growth	1.4%	0.0%
T o	Other	2 3	2 5	-
s t	YoY total growth	(9.4%)	0.0%
e	YoY organic growth	(2.8%)	0.0%
al S	ENERGY PRODUCTS	1,110	1,063	143
	YoY total growth	4.4%	0.0%
	YoY organic growth	0.1%	0.0%
	E&I	3 8	2 6	1 2
A	% on sales	5.0%	3.8%
D T	Industrial & Netw. Comp.	2 9	2 6	-
BI	% on sales	8.7%	7.2%
E	Other	(1)	1	-
dj.	% on sales	(2.3%)	4.0%
A	ENERGY PRODUCTS	6 6	5 3	1 2
	% on sales	6.0%	4.9%
	E&I	2 8	1 6	1 0
	% on sales	3.7%	2.4%
T	Industrial & Netw. Comp.	2 4	2 0	-
BI E	% on sales	7.2%	5.6%
dj.	Other	(2)	0	-
A	% on sales	(7.0%)	2.0%
	ENERGY PRODUCTS	5 0	3 6	1 0
	% on sales	4.5%	3.4%

Oil&Gas Segment – Profit and Loss Statement

	Q1 2016	Q1 2015
Sales to Third Parties	8 2	130
YoY total growth	(36.8%)
YoY organic growth	(33.9%)
Adj. EBITDA	3	1 3
% on sales	3.8%	10.3%
Adj. EBIT	(2)	1 0
% on sales	(1.8%)	7.7%

Telecom Segment – Profit and Loss Statement

	Q1 2016	Q1 2015
Sales to Third Parties	272	279
YoY total growth	(2.6%)	18.4%
YoY organic growth	3.3%	13.1%
Adj. EBITDA	4 2	2 8
% on sales	15.4%	10.1%
Adj. EBIT	3 2	1 9
% on sales	11.7%	6.8%

		SALES and ORG. GROWTH
	FY 2013	Q1 2014	Q2 2014	Q3 2014	Q4 2014	FY 2014	Q1 2015	Q2 2015	Q3 2015	Q4 2015	FY 2015
ENERGY PROJECTS	1,248	250	302	300	389	1,241	281	358	355	423	1,416
						1.1%	8.4%	14.7%	15.8%	8.9%	11.9%
E&I	2,747	638	678	699	662	2,677	686	782	707	620	2,795
						2.7%	3.3%	7.1%	1.6%	-0.2%	3.0%
INDUSTRIAL & NETW.C.	1,507	349	370	350	371	1,440	352	400	385	362	1,499
						-0.6%	-5.8%	-0.6%	4.6%	-1.2%	-0.8%
OTHER	114	2 3	2 3	2 6	3 4	106	2 5	3 0	3 1	3 5	121
						-4.8%	1.8%	26.5%	17.6%	4.4%	11.8%
ENERGY PRODUCTS	4,368	1,010	1,072	1,074	1,067	4,223	1,063	1,212	1,123	1,017	4,415
						1.4%	0.2%	4.8%	3.0%	-0.4%	1.9%
OIL&GAS	393	8 3	8 3	9 5	121	382	130	115	8 6	9 0	421
						3.0%	49.2%	33.4%	-3.4%	-21.7%	10.0%
TELECOM	986	236	252	257	249	994	279	299	269	262	1,109
						4.0%	13.1%	13.1%	5.1%	8.7%	9.9%
TOTAL	6,995	1,579	1,708	1,727	1,826	6,840	1,753	1,984	1,832	1,792	7,361
						1.8%	5.9%	9.1%	5.1%	1.4%	5.3%

		ADJ. EBITDA and % ON SALES
	FY 2013	Q1 2014	Q2 2014	Q3 2014	Q4 2014	FY 2014	Q1 2015	Q2 2015	Q3 2015	Q4 2015	FY 2015
ENERGY PROJECTS	215	6	2 6	5 2	5 6	140	2 6	7 3	5 3	6 8	221
	17.2%	2.4%	8.6%	17.3%	14.4%	11.3%	9.4%	20.4%	14.9%	16.1%	15.6%
E&I	127	2 1	3 3	3 1	2 3	108	2 6	3 7	3 6	2 9	128
	4.6%	3.3%	4.9%	4.4%	3.5%	4.0%	3.8%	4.8%	5.1%	4.7%	4.6%
INDUSTRIAL & NETW.C.	124	2 6	3 3	2 9	2 7	115	2 6	3 6	3 1	3 0	122
	8.2%	7.4%	8.9%	8.3%	7.3%	8.0%	7.2%	9.0%	8.1%	8.3%	8.1%
OTHER	8	2	3	2	(2)	5	1	1	(0)	0	2
	6.9%	8.7%	13.0%	7.7%	-6.4%	4.6%	4.0%	2.5%	-0.6%	0.0%	1.9%
ENERGY PRODUCTS	259	4 9	6 9	6 2	4 8	228	5 3	7 4	6 7	5 9	252
	5.9%	4.9%	6.4%	5.8%	4.5%	5.4%	4.9%	6.1%	6.0%	5.8%	5.7%
OIL&GAS	3 3	5	6	5	9	2 5	1 3	4	4	(5)	1 6
	8.4%	6.0%	7.2%	5.3%	7.4%	6.5%	10.3%	3.5%	4.7%	-5.6%	3.8%
TELECOM	106	1 8	2 5	3 2	4 1	116	2 8	4 3	3 5	2 8	134
	10.8%	7.6%	9.9%	12.5%	16.4%	11.7%	10.1%	14.2%	13.0%	10.7%	12.1%
TOTAL	613	7 8	126	151	154	509	120	194	159	150	623
	8.8%	4.9%	7.4%	8.7%	8.4%	7.4%	6.8%	9.8%	8.7%	8.4%	8.5%

Reference Scenario

Commodities & Forex

25 50 75 100 125 150 J-08 J-09 J-10 J-11 J-12 J-13 J-14 J-15 J-16 Brent \$/bbl Brent €/bbl

Based on monthly average data Source: Nasdaq OMX

Disclaimer

• The managers responsible for preparing the company's financial reports, A.Bott and C.Soprano, declare, pursuant to paragraph 2 of Article 154-bis of the Consolidated Financial Act, that the accounting information contained in this presentation corresponds to the results documented in the books, accounting and other records of the company.
• Certain information included in this document is forward looking and is subject to important risks and uncertainties that could cause actual results to differ materially. The Company's businesses include its Energy Projects, Energy Products and Telecom Operating Segments, and its outlook is predominantly based on its interpretation of what it considers to be the key economic factors affecting these businesses.
• Any estimates or forward-looking statements contained in this document are referred to the current date and, therefore, any of the assumptions underlying this document or any of the circumstances or data mentioned in this document may change. Prysmian S.p.A. expressly disclaims and does not assume any liability in connection with any inaccuracies in any of these estimates or forward-looking statements or in connection with any use by any third party of such estimates or forward-looking statements. This document does not represent investment advice or a recommendation for the purchase or sale of financial products and/or of any kind of financial services. Finally, this document does not represent an investment solicitation in Italy, pursuant to Section 1, letter (t) of Legislative Decree no. 58 of February 24, 1998, or in any other country or state.
• In addition to the standard financial reporting formats and indicators required under IFRS, this document contains a number of reclassified tables and alternative performance indicators. The purpose is to help users better evaluate the Group's economic and financial performance. However, these tables and indicators should not be treated as a substitute for the standard ones required by IFRS.