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Nexans targets more responsible copper production – 28/11/2022 at 18:29


(AOF) – As an active partner of the Copper Mark working group, Nexans indicates that it participates in the review process related to the assessment of risk preparedness with a view to promoting responsible copper production practices, thus contributing: to the transition to a circular economy, respect for human rights, social and economic development, increased transparency, strengthening the fight against climate change and fostering compliance.

In addition, Nexans is the only wire rod manufacturer in the world to have requested, as part of a pilot project, the Copper Mark label for its two plants in Lens in France and Montreal in Canada.

The Group has completed Phase 1 of the pilot – self-assessment, and has just entered Phase 2: its sites will undergo a third-party assessment of their performance with regard to 32 environmental, social and governance (ESG), carried out by an independent audit firm. The results of this evaluation will determine the awarding of the Copper Mark label.

Through the Copper Mark commitment letter, its two wire rod plants in Lens and Montreal commit to fulfilling all Copper Mark criteria within 24 months of signing the commitment letter; demonstrate compliance with Copper Mark criteria through participation in the Copper Mark assurance process; appoint a focal point and provide them with the necessary support and resources to coordinate with the Copper Mark; share information with the Copper Mark and the public as stipulated in the Copper Mark assurance process.

The Copper Mark is an assurance framework aimed at promoting responsible practices and attesting to the contribution of the copper industry to the United Nations Sustainable Development Goals (SDGs).

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Key points

– Group created in 1901 specializing in cables for electrification;

– Turnover of €6.1 billion achieved at 82% with 4 target sectors: buildings & territories for 41%, industries & solutions for 23%, high voltage & projects for 13%, telecoms and data for 5%;

– Breakdown of sales at 45% in Europe, 31% in the Americas, 14% in Asia Pacific and 8% in the Middle East, Africa and Russia;

– “Electrifying the future” business model focused on the electrification value chain covering from energy production to transmission, distribution and consumption;

– Split capital with 3 strong positions – the Chilean Invexans Pack for 28.8%, BPI France for 7.69% and the employees for 6.3%-, Jean Mouton chairing the 14-member board of directors, Christopher Guérin being general director ;

– Very healthy financial position with debt reduced to €74m, hence an upgrade in its rating, cash of €1.8bn, giving an equity ratio of 5% and a leverage effect of 0.2 .

Challenges

– Strategic ambition 2022-24 “Winds of change”:

– concentration on 4 sectors and reorientation of the portfolio towards electrification,

– €200 million investment in submarine high voltage by 2023 in Norway and the United States,

– deployment of the SHIFT Performance program

– financial objectives: €6 to 7 billion in turnover and operating margin between 10 and 12%;

– Dynamic innovation strategy with 100 M€ invested in the 15 R&D centers (1,800 patents):

– efficiency: eco-design approach,

– intelligence: use of digital twins to increase the return on assets and limit working capital requirements,

– simplicity: Plug & Play cabling for renewable energy installations?

– AmpaCity, a new global innovation hub dedicated to carbon-free electrification;

– 2030 environmental strategy validated by the SBTi:

– 46.2% reduction in scope 1 and 2 CO2 emissions of 46.2% vs 2019 and 24% by 2030 for those emitted in scope 3 (suppliers),

– intermediate objectives for 2023: certification of industrial sites at 93%, 70 to 80% of sales of products contributing to the energy transition and 80% of connected and recyclable cables,

– full deployment of the E3 tool (Economy, Environment, Commitment) for measuring performance;

– Contribution of the Colombian cable manufacturer Centelsa to the strategy of electrification offers;

– Good start for the cable ship Aurora and the American cable factory and increase in the order book of €2.1 billion in power transmission and production.

Challenges

– Diversity of profitability between branches, buildings & territories being the lowest margins;

– Inflation, in particular of the price of copper, offset by the SHIFT Performance and Prime and Amplify plans and the increases in selling prices;

– Shortage of semiconductors and raw materials: launch of Ultracker, a set of solutions for supply chains;

– After a 6.7% increase in sales at the end of September, the 2022 target has been raised twice by operating profit of between €500 and €600 million, and free cash flow between €225 and €250 million;

– Redemption of shares.

The Threat of Open Technology, RAN

Equipment manufacturers will have to face this threat in the next few years. This new architecture consists in replacing the traditional antennas by software allowing more interoperability thanks to the cloud. Telecom operators will thus be able to reinforce innovation and increase their choice of suppliers. They will also be able to have access to more services and flexibility for network deployment and management costs which should decrease. For the moment, none of the major operators has switched to this new technology. Nevertheless, the freedom of choice of suppliers is a decisive element, underlined by the decision of Europe and the United States to sanction the Chinese Huawei for national security reasons.



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