(Recasts to add CEO comments on M&A)
By Francesca Landini and Massimo Gaia
MILAN, March 1 Italian cable maker Prysmian is
considering potential acquisitions, but could buy back shares if
the opportunities do not come to fruition, its chief executive
said on Wednesday.
Since 2011, when Prysmian became the world's largest cable
maker after buying Dutch rival Draka, the company has purchased
small or medium-sized companies in high-growth areas.
Acquisitions are seen as a way to grow in a sector that is
fragmented and oversupplied.
"We have some transactions under discussion, but we do not
want to waste the money we earn," CEO Valerio Battista told an
analysts' call after the Milan-based group reported a rise in
2016 earnings and said net debt fell more than expected.
Battista did not give details of the options the group is
But he added that if no deals were finalised, the group
intended to use 500 million euros ($527 million) it raised
through an equity linked bond in January to launch a further
share buy-back programme.
Prysmian, which manufactures cables for industries including
telecoms and power, said 2016 core earnings rose 14 percent, in
line with analysts' consensus forecast provided by the company.
Adjusted earnings before interest, tax, depreciation and
amortisation (EBITDA) came in at 711 million euros ($750
million), towards the top of a 670-720 million euro range the
group gave as guidance last year.
Net debt was 537 million euros at the end of last year, down
from 750 million at December 2015 and below analysts' average
forecast of 648 million.
"The debt will continue to come down in 2017 but slower than
in the previous two years," finance chief Pier Francesco
Facchini said during the conference call.
The group's sales rose 2.8 percent year-on-year to 7.57
billion euros, with high-margin energy projects and telecoms
cables driving growth.
"The outlook remains positive both for submarine cables and
for the telecom business, where optical cable demand remains
high," the company said. It will release guidance for 2017 when
publishing first quarter results.
($1 = 0.9476 euros)
(Reporting by Francesca Landini and Massimo Gaia; Editing by
Valentina Za and Mark Potter)