Prysmian — Interim / Quarterly Report 2017

May 10, 2017

Q1 2017 Financial Results

Milan – May 10th 2017

Q1 2017 Highlights

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

Q1 2017 Financial Highlights

Organic Growth at -3.7%, driven by project phasing in Energy Projects business and continued weakness in Energy Products markets.

• Adj. EBITDA at € 154m (8.3% of sales), up from € 150m in Q1 2016, mainly driven by:
• Solid growth in the Telecom business.
• Substantial stability in Energy Projects business.
• Market weakness in the cyclical business in some European countries.
• Oil&Gas business slowdown, mainly in Brazil.

Net Financial Debt at € 998m, including approximately € 50 m cash-out related to the shares Buy-back.

Q1 2017 Business Highlights

ENERGY PROJECTS BUSINESS TELECOM BUSINESS

Sound order intake exceeding €700m in January-April 2017 period.

New supply agreement with Verizon worth approx. \$ 300m

SHARES BUY-BACK PROGRAMME

2,053,001 share purchased as of March 31st , equal to 0.9% of shareholder's capital.

Q1 2017 Key Financials

Euro Millions, % on Sales

* Org. Growth

Operative Net Working Capital (2) Net Financial Debt

Moderate organic decline with stable profitability.

Positive performance in Telecom offset by weakness in Energy Products and Oil&Gas businesses.

Q1 2017 Highlights

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

Energy Projects

Euro Millions, % on Sales

Sales

* Org. Growth

Highlights

Submarine

• Positive market momentum confirmed by the recent projects awarded both in Interconnection (IFA2, approx. €350m) and Offshore wind (RTE Offshore, approx. €300m). January-April '17 order intake at approximately €700m.
• Adj.EBITDA margin improved on a favourable project mix, increase of MRO activities and the full utilization of the new installation assets (new vessel Ulisse, new jetting system).
• Organic decline related to project phasing.

Underground High Voltage

• Negative organic trend driven by soft market demand in France, Netherlands and the US and missing 2016 land portion of Turkey submarine project. Negative impact from change of perimeter in China in line with expectations.
• Adj.EBITDA margin improved thanks to a better project mix and the increase of service activities.

Orders Backlog Evolution (€ m)
	Dec '13	Dec '14	Dec '15	Mar '16	Dec '16	Mar'17*
Underground HV	~450	~450	~600	~550	~350	~400
Submarine	~2,050	~2,350	~2,600	~2,650	~2,050	~2,200
Group	~2,500	~2,800	~3,200	~3,200	~2,400	~2,600
* Excludes RTE offshore wind export cable worth approx. € 300m

Offshore Wind Market Prospective.

Cost reduction driven by technological innovation and projects scale.

LROE* Analysis of traded offshore wind projects

0 50 100 150 Anhold (2010) East Anglia One (2015) Horns Rev 3 (2015) Borselle I+II (2016) Vestarhav Nord Sud (2016) Kriegers Flak (2016) Borselle III+IV (2016) LROE (€/MWh) -55% -46%

* LROE: Levelised Revenue Of Electricity

Source: WindEurope

Key Highlights

• LROE reduced by half in the last 2 years.
• Larger projects scale and increasing turbine dimension fueled LROE reduction over the past few years.
• Technological innovation like 66kV Inter-array system should contribute to further cost reduction.
• Grid parity achieved in Europe: latest tenders awarded at market price, with no public incentives required.

North Sea Power Hub Project

Location: Dogger Bank, North Sea.

Characteristics: shallow waters with optimal wind conditions.

Status: feasibility study.

Developers: TenneT TSO (Netherlands/Germany) and Energinet TSO (Denmark).

Power Link Island:

Purpose 1: artificial islands offering near-shore connections to a large number of offshore wind farms (up to 100 GW).

Purpose 2: transmission DC cables to be used also to interconnect countries.

North Sea Power Hub:

Energy & Infrastructure

Euro Millions, % on Sales

Sales

* Org. Growth ⁷⁵⁴⁸⁰⁶ 2016 Q1'16 Q1'17 -2.3%* 3,016

Adj. EBITDA / % of Sales

Highlights

Trade & Installers

• Positive trend in the Nordics and Oceania, counterbalanced by a weak performance in Central-Eastern Europe, Turkey and Argentina.
• Profitability in the quarter temporarily affected by sharp increase in copper price.

Power Distribution

• Stable volumes despite the tough comparison with strong Q1 2016, with an increase in profitability.
• Nordics and APAC regions best performing areas, while Central-Eastern Europe (mainly Germany) and Argentina recorded a weak performance.

Quarterly organic growth* evolution

Q1 2017 Financial Results 10

Industrial & Network Components

Euro Millions, % on Sales

333 340 2016 Q1'16 Q1'17 -3.7%* 1,343

* Org. Growth

Sales Highlights

Order Backlog

• Order backlog started to recover after 2 consecutive quarters of decline.

Specialties, OEMs & Renewables

• Sound performance in Railway, supported by increasing order inflow, more than offset by slowdown in Renewables, Crane and Nuclear segments.
• Negative organic trend, also driven by uneasy comparison. Slowdown in Europe partially offset by positive performance in APAC.
• Profitability negatively impacted by unfavourable mix in OEM and volume decrease in Renewables.

Elevator

• Positive volume trend in EMEA and North America, offset by slowdown in China mainly due to projects delays.
• Continued focus on market share expansion in the After Market and service segments.

Automotive

• Double digit organic growth and margin increase. Solid performance in APAC, North America and Latin America.
• Production footprint reorganization as a positive competitiveness driver in Europe.

Network Components

• Strong growth of MV and LV accessories mostly offset by the slowdown in HV and EHV segment driven by a weak performance in Europe.

Oil & Gas Euro Millions, % on Sales

Sales

Adj. EBITDA / % of Sales

Highlights

• Umbilical: volume and price drop in line with expectations driven by the low level of orders in Brazil in 2016. 2017 bids characterized by continued price pressure.
• DHT: positive result in North America shale, offset by major deep-water projects postponement.

Core Oil&Gas Cables

SURF

• Mid-single digit organic growth driven by onshore projects (Middle East, Russia, ASEAN) and drilling activities in North America.
• Design-to-cost and supply chain initiatives helped offsetting continued price pressure in the market. * Org. Growth

Quarterly organic growth* evolution

Q1 2017 Financial Results 12

Telecom

Euro Millions, % on Sales

Sales

* Org. Growth

Adj. EBITDA / % of Sales

* Adj. EBITDA margin excl. €8mln bad debt provision in Brazil

Highlights

Telecom Solutions

• Solid performance mainly driven by the strong demand of the optical business.
• The new supply agreement signed between Prysmian and Verizon in the US (approx. \$300m in 3 years) confirms the solid market momentum in the country.
• Positive market trend in Europe.
• General fiber shortage in the market

MMS

• Positive trend in all regions, in particular in Europe and South America.
• Capacity increase due to acquisition of Corning business in Germany (in H2- 2016) allowing to follow solid market growth in Europe.

Q1 2017 Highlights

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

FY 2017 Outlook

Q1 2017 Highlights

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

Profit and Loss Statement

Euro Millions

	Q1 2017	Q1 2016*
Sales	1,849	1,810
YoY total growth	2.2%	0.0%
YoY organic growth	(3.7%)	0.0%
Adj.EBITDA	154	150
% on sales	8.3%	8.3%
Adjustments	(24)	(10)
EBITDA	130	140
% on sales	7.0%	7.7%
Adj.EBIT	110	107
% on sales	5.9%	5.9%
Adjustments	(24)	(10)
Special items	(8)	(25)
EBIT	7 8	7 2
% on sales	4.2%	4.0%
Financial charges	(26)	(18)
EBT	5 2	5 4
% on sales	2.8%	3.0%
Taxes	(15)	(17)
% on EBT	(28.0%)	(31.5%)
Net Income	3 7	3 7
% on sales	2.0%	2.0%
Minorities	1	6
Group Net Income	3 6	3 1
% on sales	2.0%	1.7%	* Restated figures

	Q1 2017	Q1 2016
Non-recurring Items (Antitrust Investigation)	(15)	-
Restructuring	(5)	(7)
Other Non-operating Income / (Expenses)	(4)	(3)
EBITDA adjustments	(24)	(10)
Special items	(8)	(25)
Gain/(loss) on metal derivatives	3	2
Assets impairment	-	(15)
Other	(11)	(12)
EBIT adjustments	(32)	(35)

	Q1 2017	Q1 2016
Net interest expenses	(17)	(15)
of which non-cash conv.bond interest exp.	(4)	(2)
Bank fees amortization	-	-
Gain/(loss) on exchange rates	1	7
Gain/(loss) on derivatives 1 )	(7)	(9)
Non recurring effects	(1)	(1)
Other non-operating financial expenses	(2)	-
Net financial charges	(26)	(18)

1) Includes currency and interest rate derivatives

Statement of financial position (Balance Sheet)

Euro Millions

	31 Mar 2017	31 Mar 2016*	31 Dec 2016
Net fixed assets	2,656	2,546	2,630
of which: goodwill	447	446	448
of which: intangible assets	340	272	344
of which: property, plants & equipment	1,653	1,535	1,631
Net working capital	788	646	325
of which: derivatives assets/(liabilities)	3	(27)	7
of which: Operative Net working capital	785	673	318
Provisions & deferred taxes	(359)	(308)	(360)
Net Capital Employed	3,085	2,884	2,595
Employee provisions	381	332	383
Shareholders' equity	1,706	1,514	1,675
of which: attributable to minority interest	212	221	227
Net financial debt	998	1,038	537
Total Financing and Equity	3,085	2,884	2,595

* Restated figures

Cash Flow Euro Millions

	Q1 2017	Q1 2016	12 Months (from 1/4/2016 to 31/3/2017)
Adj.EBITDA Adjustments EBITDA	154 (24) 130	150 (10) 140	715 (80) 635
Net Change in provisions & others Share of income from investments in op.activities Cash Flow from operations (bef. WC changes)	(1) (10) 119	(17) (7) 116	1 6 (34) 617
Working Capital changes Dividends received Paid Income Taxes Cash flow from operations	(483) 3 (20) (381)	(294) 2 (24) (200)	(122) 1 1 (72) 434
Acquisitions & Disposals Net Operative CAPEX of which acquisitions of assets of ShenHuan Free Cash Flow (unlevered)	- (67) (33) (448)	- (49) - (249)	3 1 (245) (44) 220
Financial charges Free Cash Flow (levered)	(12) (460)	(16) (265)	(64) 156
Free Cash Flow (levered) excl. Acquisitions & Disposals**	(427)	(265)	169
Dividends Treasury shares buy-back & other equity movements Net Cash Flow	- (49) (509)	(11) - (276)	(91) (49) 1 6
Net financial debt beginning of the period	(537)	(750)	(1,038)
Net cash flow Equity component of convertible bond Other variations	(509) 4 8 -	(276) - (12)	1 6 4 8 (24)
Net financial debt end of the period ** Calculated as FCF (levered) excluding acquisitions of assets of ShenHuan	(998) and "Acquisitions & Disposals".	(1,038)	(998)

Q1 2017 Highlights

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

Appendix

Bridge Consolidated Sales

Euro Millions

Profit and Loss Statement

Euro Millions

	Q1 2017	Q1 2016*
Sales YoY total growth YoY organic growth	1,849 2.2% (3.7%)	1,810 0.0% 0.0%
Adj.EBITDA % on sales of which share of net income	154 8.3% 1 0	150 8.3% 7
Adjustments	(24)	(10)
EBITDA % on sales	130 7.0%	140 7.7%
Adj.EBIT % on sales	110 5.9%	107 5.9%
Adjustments Special items	(24) (8)	(10) (25)
EBIT % on sales	7 8 4.2%	7 2 4.0%
Financial charges	(26)	(18)
EBT % on sales	5 2 2.8%	5 4 3.0%
Taxes % on EBT	(15) (28.0%)	(17) (31.5%)
Net Income % on sales	3 7 2.0%	3 7 2.0%
Minorities	1	6
Group Net Income % on sales	3 6 2.0%	3 1 1.7%

* Restated figures

	Q1 2017	Q1 2016
Sales to Third Parties	275	346
YoY total growth	(20.5%)	0.0%
YoY organic growth	(15.2%)	0.0%
Adj. EBITDA	4 0	3 9
% on sales	14.4%	11.2%
Adj. EBIT	3 0	3 1
% on sales	10.7%	8.8%

Energy Products Segment – Profit and Loss Statement

Euro Millions

		Q1 2017	Q1 2016*
	E&I	806	754
	YoY total growth	7.0%
s e	YoY organic growth	(2.3%)
rti a	Industrial & Netw. Comp.	340	333
P d	YoY total growth	1.9%
r hi	YoY organic growth	(3.7%)
T	Other	3 4	2 3
o s t	YoY total growth	48.1%
e	YoY organic growth	(0.0%)
al S	ENERGY PRODUCTS	1,180	1,110
	YoY total growth	6.3%
	YoY organic growth	(2.7%)
	E&I	35	38
A	% on sales	4.3%	5.0%
D T BI	Industrial & Netw. Comp.	27	29
	% on sales	7.9%	8.7%
E	Other	(1)	(1)
dj.	% on sales	(1.5%)	(2.3%)
A	ENERGY PRODUCTS	61	66
	% on sales	5.2%	6.0%
	E&I	21	24
	% on sales	2.6%	3.2%
T	Industrial & Netw. Comp.	22	24
BI E	% on sales	6.5%	7.2%
dj.	Other	(2)	(2)
A	% on sales	(4.7%)	(7.0%)
	ENERGY PRODUCTS	41	46
	% on sales	3.5%	4.1%

* Restated figures

	Q1 2017	Q1 2016
Sales to Third Parties	6	8
YoY total growth	6	2
YoY organic	(19.4%)	0.0%
growth	(21.2%)	0.0%
Adj. EBITDA	0	3
% on sales	-	3.8%
Adj. EBIT	(4)	(2)
% on sales	(6.5%)	(1.8%)

	Q1 2017	Q1 2016
Sales to Third Parties	328	272
YoY total growth	20.6%	0.0%
YoY organic growth	12.3%	0.0%
Adj. EBITDA	5 3	4 2
% on sales	16.3%	15.4%
Adj. EBIT	4 3	3 2
% on sales	13.2%	11.7%

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 J-17 Brent \$/bbl Brent €/bbl

EUR / USD EUR / GBP EUR / BRL

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.