INSIGHT ISSUE 02 | 2021

34 Enabling the Digital and Energy transition GROUP SALES amounted to €2,810 million with a +4.6% organic change, excluding the Projects segment, sharply reversing the trend compared to Q4 2020. In the first quarter, signs of a sharp recovery were mainly recorded by the Telecom segment, with an organic growth of +11.4%, and the Energy segment, which reported a +3.4% organic growth, fuelled by the recovery of the construction and renewable energy sectors. The Projects segment continued to be impacted by the phasing on the projects in the portfolio, although signs of a recovery are expected in the second quarter following the acceleration of the development of the German Corridors. ADJUSTED EBITDA rose to €213 million compared to €197 million for the first quarter of 2020, despite the negative impact of exchange rates (€14 million). The Adjusted EBITDA improvement was driven by both the volume recovery and the resilience shown by the whole organization in ensuring business continuity and customer proximity. Margins remained significantly stable, with the ratio of Adjusted EBITDA to sales at 7.6%, confirming the soundness of the efficiency-building measures undertaken, which offset the impact of the increase in raw material prices. The Energy segment reported an excellent performance, with margins that improved also compared to the pre- pandemic levels. Thanks to the cost containment measures, the Telecom segment was also able to limit the impact of the persistent price pressure and report gradually improving margins compared to Q1 2020. In the Projects segment, profitability is expected to recover in the second half of the year. EBITDA grew to €199 million (€183 million in Q1 2020), including net expenses for company re-organizations, net non-recurring expenses and other net non-operating expenses stable at €14 million. OPERATING INCOME rose to €123 million, compared to €58 million in the first quarter of 2020. NET PROFIT attributable to owners of the parent improved markedly to €76 million compared to €23 million in the same period of 2020. FREE CASH FLOW The strong cash flow generation continued, with a Free Cash Flow of €553 million in the past 12 months (excluding the €112 million cash out for the dispute with antitrust authorities). NET FINANCIAL DEBT In the first quarter of 2021, the cash generation allowed the Group to forge ahead with the further reduction of its Net Financial Debt, which amounted to €2,325 million at the end of March 2021 (€2,606 million at 31 March 2020 - €1,986 million at 31 December 2020). The factors that allowed to reduce the net financial debt were: \ net operating cash flows (before changes in net working capital) amounting to €813 million; \ net cash flows for payments related to restructuring and non-operating costs amounting to €76 million; \ net flows generated by the €255 million decrease in net working capital; \ cash outflows for net investments amounting to €221 million; \ net finance costs paid amounting to €90 million; \ taxes paid amounting to €137 million; \ dividends collected totalling €9 million. Financial results