13
QUARTERLY OVERVIEW
Ratings stayed widely
positive, targets raised
After the release of Q1 results, almost all
the brokers confrmed their positive view
on Prysmian stock.
Among them, Goldman Sachs confrmed
its “Buy” rating with an increase of its
target price from €19.5 to €21 and
highlighted positively the all-time high
backlog in SUB/HV.
Citi improved the rating from “Neutral” to
“Buy” and increased its target From €18 to
€22.5, while Morgan Stanley confrmed its
“Overweight” and increased the target to
€22.5 mentioning higher than expected
organic growth. Equita sim reiterated the
“Buy” as well and increased the target to
€22 as it said it sees the stock at a 13%
discount compared to the Capital Goods
sector. Also Mediobanca confrmed the
“Buy” and liFted its target price to €20.8
stating that Telecom and Energy projects
were the main drivers.
No brokers had a negative rating on
the stock.
Brokers’ Recommendation*
Neutral
Positive
Negative
28%
0%
72%
Adjusted EBITDA for FY 2015 expected to mark
a significant improvement
The macro environment saw signs of slight
improvement in Europe, while remaining
sturdy in the U.S. Geopolitical tensions in
the Middle East and Russia and the slow-
down of some economies such as China
and Brazil continued to raise doubts over
the short-medium term. In such a context,
the Group’s expectation For ±Y 2015 is
that demand in the cyclical businesses of
medium voltage cables for utilities and
building wires will record a slight recovery
with signs of price stabilising. In the Energy
Projects segment, the Group confrmed
an improving trend, with potential growth
in the Submarine and SUR± businesses,
though partially o²set by weak demand For
HV underground.
In the Submarine cables business, the
negative impact of the Western Link
project is expected to be signiFcantly
lower in 2015: €56 million on Adjusted
EBITDA against €94 million in 2014.
*As of May 15, 2015
In the Industrial O&G business, the
reduction in the industry investments are
likely to have a negative impact, particularly
during the second half of the year.
The Telecom business is expected to see
continued recovery in demand for optical
fbre
cables
in
the
coming
quarters,
especially in Europe and the United States,
albeit at a slower pace than in 2014. Based
on the existing order book and considering
all these factors,
the Group is forecasting
Adjusted EBITDA for ±Y 2015 in the range
of €560–610 million (€616–666 million
excluding the negative impact of WL),
marking
a
signiFcant
improvement
from the €509 million reported in 2014
.
FY 2015 Adj. EBITDA target
vs FY 2014
(€ 509m)
616
560
666
610
Mid-point € 641m
Western Link
effect on FY’15
ADj. EBITDA
Mid-point € 585m
€ 56m
