Strategy of the Nexans Group works: clear growth in sales and profit

Paris/Mönchengladbach, February 6, 2008 – Only one year after its strategic realignment, the “three-year” plan of Nexans has borne fruit: at the presentation of the 2007 financial statements on January 31, 2008, the Board of Directors of Nexans Paris offered proof of clear growth. Sales came to 7.412 billion euros. Adjusted for the effects of the fluctuating prices of non-ferrous metal, sales increased by 8.5% from 4.442 billion euros to 4.822 billion euros. On the basis of an unchanged scope of consolidation and constant exchange rates, sales growth amounted to 4.8%. At 409 million euros, the operating margin*) increased 57% on the previous year’s figure. Net profit (consolidated share) in 2007 came to 189 million euros. In 2006, it came to 241 million euros. However, this included a one-off amount from the sale of the Swiss distribution business. Leaving this out of consideration, net profit doubled within one year.


Growth of 12% in cables for infrastructure, industry and construction


Gérard Hauser, Chairman and CEO of Nexans: “Our 2007 results represent a solid achievement. With organic growth of over 12%, the sales figures for our cable business in the infrastructure, industry and construction segments record growth in all geographical regions.” The results show that the aims of the strategic three-year plan – including a realignment of the global presence and making the energy sector the focus point of business activities – are the correct ones.


Board of Directors proposes a 2 euro dividend per share


In light of these very good results, the Board of Directors will propose the payment of a 2 euro dividend per share, a 67% increase compared to 2007 (1.2 euro). The shareholders will be able to vote on this proposal at this year’s General Shareholders’ Meeting.


Nexans to aim at growth of 6% in 2008 and 2009


For 2008 and 2009, Hauser forecasts organic growth of around 6% for the cable business in light of the purchase and sales figures being aimed at. According to Hauser, this will allow the company to continue growing more quickly than the market.


Concentration on core expertise fields to continue


Strategic purchases and sales which help to round off the product portfolio will ensure ongoing business success. The focus here is on cables and leads for the infrastructure and construction markets. With this in mind, Nexans spun off its winding wire business in 2006. For the middle of this year, the company is planning to take over the cable company, Madeco. This company is the industry leader in South America. In addition, Nexans wants to intensify its commitment to LAN cables. As revealed at the balance sheet press conference, the company will dispose of its telecommunication copper cable business in Spain.


Sale of Nexans autoelectric GmbH under discussion


Discussions are also being held regarding the sale of the cable sets division. Nexans autoelectric GmbH in Floß belongs to Nexans Deutschland and manufactures cable sets for the automotive industry. It has a market share of around 2% in Europe. Only last year, the company expanded its production capacities thanks to new production sites in Slovakia, Ukraine, the Czech Republic and Tunisia. As further development of this division runs counter to Nexans’ desire to concentrate on core products and target markets, the Group regards selling the division to be the best solution. “Under the management of a new owner, who would turn this division into a core business, Nexans autoelectric could use new market opportunities”, says Dr Francis Krähenbühl, CEO of Nexans Deutschland GmbH.


A detailed press release with the Nexans results for 2007 is available online at
http://www.nexans.de/Corporate/2008/PR_resultats2007_en_1.pdf (English)


*) Control variable used by the Group to measure its operating performance


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