Nexans raises guidance as electrification demand grows

Nexans has raised its 2026 financial guidance after first half growth across its electrification businesses and the completion of its Republic Wire acquisition in the United States.

Standard sales reached €3.25 billion during the first half, an increase of 5%. The result included organic growth of 1.5% and a 3.8% contribution from acquisitions, while sales measured at current metal prices reached €4.74 billion.

The group’s electrification businesses produced organic growth of 4.5%. Adjusted EBITDA across those operations increased 5.2% to €376.5 million, with a margin of 13.2% of standard sales.

Group adjusted EBITDA rose 4.3% to €387.7 million, while the overall margin was 11.9%, compared with 12% during the equivalent period of 2025.

Nexans has increased its full year adjusted EBITDA guidance from a previous range of €730 million to €810 million to between €770 million and €840 million. Free cash flow guidance has moved from €210 million–€310 million to €235 million–€325 million.

The revised forecast includes Republic Wire from 1 June but excludes any future acquisitions. It does not assume execution of the Great Sea Interconnector during 2026, although it includes loading of the mass impregnated cable production line towards the end of the year.

Free cash flow reached €165.5 million, representing a cash conversion ratio of 42.7%. Net debt increased to €1.04 billion from €265.6 million at the end of 2025, reflecting acquisition funding and investment, while financial leverage remained at 1.4 times.

Group liquidity stood at €2.51 billion. Net income from continuing operations fell to €122.8 million from €143.3 million, while group net income was €105.9 million compared with €374 million a year earlier.

Grid and transmission demand support industrial visibility

PWR Transmission recorded standard sales of €776.8 million. Organic growth was broadly flat after two years of strong expansion and a demanding comparison period, but adjusted EBITDA increased 21.2% to €106.5 million.

The segment margin rose from 11.8% to 13.7%, while the adjusted backlog remained at €7.7 billion. That total includes €1.2 billion linked to the Great Sea Interconnector and remains dominated by subsea interconnection and offshore wind work.

The order book provides production visibility into 2028, although factory loading also increases the importance of project sequencing. Cable manufacturing must align with route preparation, landfalls, converter stations, substations, permits, vessel schedules, weather windows, jointing teams, and testing.

Nexans’ third cable laying vessel, Electra, entered operation during the second quarter. The vessel expands installation capacity for high voltage subsea work as cable production, transport, and marine deployment become increasingly constrained across European transmission programmes.

Manufacturing capacity alone cannot complete these projects, and a loaded production line increases the cost of disruption when customer schedules change. Project execution will therefore depend on coordination across factories, vessels, civil contractors, transmission operators, and equipment suppliers.

PWR Grid generated standard sales of €701.9 million, with organic growth of 4.9%. Adjusted EBITDA reached €108.1 million and the margin remained high at 15.4%, despite a modest year on year reduction.

Accessories performed strongly as utilities continued grid modernisation. Approximately two thirds of the segment operates through framework agreements, with the remainder linked to individual projects, leaving quarterly margins sensitive to delivery timing and business mix.

Joints, terminations, connectors, and monitoring systems occupy a critical part of network reliability because they must match cable construction, voltage class, installation conditions, and expected service life. Failure at an accessory can remove an otherwise sound circuit from operation.

PWR Connect recorded standard sales of €1.37 billion, up 15.4%. Organic growth reached 7.3%, while acquisitions contributed a further 10%.

Adjusted EBITDA was €161.8 million, with the margin declining from 13.6% to 11.8% as geographical and acquisition mix affected performance. Demand remained strong in Latin America and parts of Europe, while Nordic markets continued to face weaker conditions.

Acquisitions reshape regional cable supply

The acquisition of Republic Wire closed on 1 June, giving Nexans a larger manufacturing and distribution platform in the US low voltage market. The transaction values the business at approximately €680 million, with a potential additional payment of up to €43 million linked to performance through 2027.

Republic Wire operates a 32,500m² manufacturing facility and a recently completed 30,000m² warehouse and distribution centre in Cincinnati. Its current expansion is expected to increase production capacity by approximately 30% by the end of 2026.

The Republic Wire transaction gives Nexans greater access to electrical distribution, utilities, municipalities, commercial buildings, and data centre demand. Completion moves the business into integration, capacity expansion, and product development.

Nexans expects around €23 million of run rate synergies within three years. Those savings and revenue opportunities depend on purchasing, manufacturing, technology transfer, cross selling, and access to Republic Wire’s distributor network.

The acquisition increases debt but places production closer to one of the world’s largest cable markets. Regional manufacturing is becoming more valuable as utilities and infrastructure developers seek shorter supply chains, stronger delivery certainty, and products aligned with domestic standards and distribution practices.

Capital expenditure reached €191.3 million, or 5.9% of standard sales. Current investment includes Electra and the Charleroi plant extension, while a greater share of future spending is planned for PWR Grid and PWR Connect.

Material security forms part of the same strategy. A five year agreement will supply approximately 85,000 tonnes of low carbon aluminium wire rod for European distribution, overhead transmission, and subsea cable applications.

Cable demand is rising across transmission expansion, distribution reinforcement, renewable connections, electric transport, buildings, and digital infrastructure. Although those markets use different products and sales channels, they compete for metals, production equipment, test capacity, skilled labour, and capital.

Nexans’ raised guidance reflects profitable growth within that constrained market rather than uniform expansion across every segment. Transmission organic sales are normalising, grid margins remain sensitive to framework and project mix, and lower voltage profitability is absorbing acquisition and regional effects.

The group enters the second half with a large subsea backlog, stronger North American manufacturing, and higher expected earnings. Delivery will depend on maintaining project execution, integrating Republic Wire, controlling leverage, and expanding grid and connection capacity without weakening margins.