Prysmian Sets Sights on U.S. Market

Prysmian is close to a “very interesting” contract to develop a high-voltage underground network in the U.S., the Italian company’s chief executive said on Thursday.

Valerio Battista said Prysmian, the world’s largest cable maker, was “not far” from striking a deal on the U.S. project, which would be similar to one it has already signed in Germany.

“It’s similar to the German Corridor, smaller in size, but very interesting,” Battista told analysts after presenting estimate-beating first-quarter results which were supported by an “excellent” energy business performance.

“I am confident we can close the deal by the end of this year,” Battista added.

Prysmian last year signed three contracts, worth a total of more than 1.8 billion euros ($2.2 billion), to develop the “German Corridor”, a 2,300-kilometer high voltage underground cable interconnector in Europe’s economic powerhouse.

Battista also said the company was considering building a plant in the U.S., which would be a first there, to produce submarine cables to support President Joe Biden’s push towards offshore interconnection.

The U.S. said this week it had approved the Vineyard Wind project, its first major offshore wind farm, billing it as the launch of a new domestic energy industry that will help eliminate emissions from the power sector.

Prysmian said its adjusted core earnings (EBITDA) rose 8.1% to 213 million euros in the first quarter, slightly above a company-provided analyst consensus of 202 million euros.

The margin was broadly stable at 7.6%, as efficiency measures offset raw material price increases, it said.

Battista said Prysmian was increasingly confident it would achieve full-year targets, although it was too soon to raise forecasts.

Prysmian shares rose as much as 4.3% and closed up 2.76%, versus a 0.14% rise in Milan’s blue-chip index.

The company had forecast an adjusted EBITDA of between 870-940 million euros this year and free cash flow generation of 300 million euros, plus or minus 20%.

Chief Financial Officer Francesco Facchini told analysts he was confident Prysmian could deliver free cash flow at the very high end of guidance.

($1 = 0.8280 euros)

Reporting by Giulio Piovaccari; Editing by Jane Merriman and Alexander Smith