Connect to Lead: Prysmian Group’s new business strategy
During the Capital Markets Day, held in Naples on the 5th of October, Massimo Battaini, Prysmian CEO-designated, presented the Group's new business strategy.
Prysmian Group’s Capital Markets Day gathered the Executive Leadership Team to unveil to the Group’s shareholders the details of the Company’s new strategy to lead the energy transition and the digital transformation.
It is on this occasion, in fact, that the Group presented Connect to Lead, the new 5-years (2023-2027) business strategy aimed at capitalizing on the Company’s market position to seize the opportunities offered by the new market trends that are currently shaping the cable industry.
Embracing the convergence of key emerging market trends, such as the growing emphasis on renewable energy generation, the rapid proliferation of electrical applications, the pressing need for power grid enhancement and the pervasive impact of digital transformation, Prysmian Group has positioned itself at the forefront of innovation and adaptation, reflecting an astute understanding of the evolving market dynamics.
During his speech, Massimo Battaini, Prysmian Group’s CEO-designate, provided a comprehensive explanation of the pragmatic interplay between the company's new business strategy and these prominent market trends, shedding light on the implications and practical significance of this fusion for both the Company and the cable industry.
As stated by Battaini, the main goal of the Company to be achieved through the new strategy is to transform the Group from a cable player into a cabling solution provider, mainly by focusing more on systems than just cables, and on more integrated and combined energy and telecom solutions.
While the new strategy will guarantee continuity with the past, conserving the strong stand for the company’s culture, it will also bring a new focus to drive the company through a new pathway of growth.
Connect to Lead: the pillars of the new strategy
“Connect, to lead. This is the name of our strategy: we want to lead the market while we connect the world, while we are enabling the energy transition and the digital transformation”.
Massimo Battaini
So, what does the new strategy consist of?
It is based on four pillars, crucial to addressing the new market dynamics and seizing the growth opportunities:
- Self-funded capacity expansion
- Balanced and innovative product portfolio
- People empowerment
- Business segmentation
Self-funded capacity expansion
The first pillar of the strategy consists in investments to support organic growth through consistent cash flow generation. This means that the company will keep investing in capacity expansion and capability enhancement to continue serving its customers and keep pace with demand growth.
In order to support this growth, capex is going to double from 310 million to 540 million over the next 5 years.
Balanced and innovative portfolio
Prysmian Group’s portfolio reflects the focus - or, as we could say, obsession - the company has for innovation. One of the goals the Group aims to achieve with this new strategy, in fact, is no longer just the traditional innovation related to the improvement of electrical performance; it is a new innovation approach that consists of electrical performance enhancement, surely, but that mainly focuses on moving towards more sustainable cabling solutions.
A balanced portfolio and continuous innovation are hence crucial to achieve the Company’s goal to help its customers decarbonize their operations and achieve their sustainability goals.
To provide some examples of the latest innovative products and cutting-edge technologies launched by Prysmian and connected with the highlighted market trends:
- 525 kV P-Laser HVDC interconnectors, in terms of renewable energy generation;
- E3X technology for OHL power enhancement, in terms of power grid enhancement;
- Sirocco, the first 180μm fibre cable, in terms of digital transformation;
- PRYSOLAR and PRY-CAM, in terms of electrical applications growth.
People empowerment
At Prysmian, the true value of the workforce is recognized and valued as a key pillar of the Company’s success. This is why the Group invests a lot in fostering creativity and collaboration among the employees and in the development of their skills, in order to boost capabilities and knowledge.
And this is where the true value of the company lies, and the reason why Prysmian continues to invest in its human capital , always finding new ways to make its people feel more included and engaged.
Business segmentation
Last but not least, the Groups structure will evolve from the current three segments to four new segments of businesses, which exactly mirror the four market trends identified (i.e. renewable transmission, power grid, electrification, and digital solutions). Of course, the new segments won’t operate as separate and distinct entities, but synergically, in order to leverage on opportunities such as one-stop-shop, operational efficiencies and - more importantly - market edging.
This new segmentation drives more focus on market trends and enhances the go to market effectiveness, also providing more visibility of how the Group plays in the different spaces.
This is what the new segmentation consists of:
Through Connect to Lead, meaning through leveraging on the four drivers of the strategy mentioned above, Prysmian Group is expecting to drive the Com
pany’s EBITDA from 1.5 billion of last year to 2 billion EBITDA by 2027.