Fincantieri présente ses résultats pour le premier semestre

FINCANTIERI BOARD APPROVES 1H 2017 RESULTS

Results for the first half of 2017[1]

Results in line with the Business Plan 2016-2020 targets: revenues up 1.3% compared to the same period of 2016, EBITDA margin at 6.3% marking an improvement of more than 20% from 5.0% of the first half of 2016. Business Plan targets confirmed

Total backlog2 at euro 25.5 billion, covering approximately 5.8 years of work if compared to 2016 revenues: backlog as at June 30, 2017 was euro 20.4 billion (euro 19.3 billion as at June 30, 2016) with 102 ships in the order book; the soft backlog at the same date was approximately euro 5.1 billion (approximately euro 2.5 billion as at June 30, 2016)

Commercial success continues with orders and agreements signed in the first few months of the year for a total of 12 cruise ships (including options)

Consistently sound operating performance with the delivery of five vessels in the first six months, of which three cruise ships ("Viking Sky", "Majestic Princess" and "Silver Muse") and two naval vessels (the sixth units of FREMM program and the submarine “Romeo Romei”). Ongoing implementation of actions aimed at improving profitability also through further development of important production and commercial synergies with VARD

Signed a share purchase agreement for the acquisition of 66.66% of the share capital of STX France from its current shareholder STX Europe AS: the agreement entails a purchase price of euro 79.5 million, to be paid through available financial resources. The closing will be subject to customary conditions for this kind of transactions as well as the French state’s choice not to exercise the preemption right on share subject to sales by STX Europe AS. Fincantieri continues to negotiate with the French State for the finalization of the shareholders’ agreement for STX France. The creation of value remains an essential condition for the conclusion of the operation

Order intake: euro 4,369 million (euro 5,851 million at June 30, 2016)

Revenue and income: euro 2,295 million (euro 2,266 million at June 30, 2016)

EBITDA: euro 146 million (euro 113 million at June 30, 2016) with a consolidated EBITDA margin of 6.3% (5.0% at June 30, 2016), with an improvement of over 20%

Profit for the period before extraordinary and non-recurring income and expenses of euro 28 million (euro 19 million at June 30, 2016)

Profit for the period of euro 11 million was up euro 6 million from the first semester of 2016 (euro 5 million at June 30, 2016), notwithstanding the recognition of lower unrealized exchange gains for euro 18 million on translating a loan held by Vard Promar from US Dollars into Brazilian Reals, and also notwithstanding a greater impact from claims under asbestos-related lawsuits of approximately euro 7 million. The Group share of this result was a net profit of euro 13 million (euro 7 million at June 30, 2016)

Net financial position3: net debt of euro 631 million (net debt of euro 615 million at December 31, 2016). Most of the Group's debt is related to the financing of current assets associated with cruise ships construction. This figure includes certain short term debts which, though related to the financing of construction, are not, due to their technical specifications, construction loans

Construction loans, i.e. credit instruments used for the exclusive financing of orders to which they are referred, at euro 970 million at June 30, 2017 (euro 678 million at December 31, 2016), of which euro 584 million related to the subsidiary VARD (euro 578 million at December 31, 2016), while the remaining euro 386 million related to the Parent company (euro 100 million at December 31, 2016)

Net cash flows from operating activities: positive at euro 122 million in the first six months of 2017 (positive at euro 131 million at June 30, 2016); this includes construction loans, which generated euro 319 million of positive flows dedicated to financing the growth in cruise construction (while at June 30, 2016 they had adsorbed cash for euro 227 million)

Rome, July 25, 2017 – The Board of Directors of FINCANTIERI S.p.A. ("Fincantieri" or the "Company"), chaired by Giampiero Massolo, has examined and approved the Half year financial report at June 30, 2017, prepared in accordance with international financial reporting and accounting standards (IAS/IFRS).

During the Board meeting Giuseppe Bono, Fincantieri's Chief Executive Officer, said: “The operational and financial results of the first of half of 2017 confirms the company’s extraordinary execution capabilities and reinforce our position with respect to achieving all targets set out in our Business Plan.

Negotiations are still under way with the French government to define a satisfactory governance structure for STX France and we are confident that their closing will address the condition, non-renounceable for us, that the combination of the two companies be a value adding proposition.

Fincantieri’s commitment to pursuing its growth targets is visible also in the increase in personnel at our Italian shipyards, with the hiring of over 300 people in the course of the semester, for a total of 1200 in the past three years. Furthermore, we are continuing the process of internalizing the highest value adding activities, both through the creation, also with private entrepreneurs, of Fincantieri-controlled companies and by developing new forms of collaboration with our major suppliers. In doing so, we are creating a true “upstream yard” system around our industrial sites: a dedicated supply network, capable of innovating and creating value both for our company and for the territories in which we are based.

In the second half of the year, we are expecting a growth in revenues with respect to the first semester, also thanks to the ramp-up in the construction of higher value added ships, whose orders were acquired after the crisis, as well as of the military programs acquired in recent years.”

Bono concluded: “I’m also particularly happy to point out that, from the IPO we have delivered a Total Return to our shareholders of 34.6% versus a Total Return of 9.1% of the main Italian stock index, FTSE MIB”.

Communiqué de Fincantieri, 25/07/17