Ladies and gentlemen, good morning and welcome to the Nexans full year 2022 earnings conference call. As a reminder, this conference call is being recorded. You will have the opportunity to ask questions at the end of the call. This can be done by pressing star one on your telephone keypad to register your question. I would now like to turn the call over to your host for today's conference call, Mr. Christopher Guérin, Nexans CEO. Please go ahead, sir. Thank you. Good morning, ladies and gentlemen, and thank you for participating in Nexans conference call. Here is Chris Guérin, CEO of Nexans, with Jean-Christophe Juillard, Deputy CEO and CFO. We have as well Vincent Dessale, COO of Nexans, and Nino Cusimano, General Counsel. As well, Élodie Robbe-Mouillot, VP Investor Relations. I will turn over to Élodie that will go over conference call rules before we start. Thank you, Chris. I would like to remind participants that statements made during the conference call, which are not historical facts, are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Readers and listeners are strongly encouraged to refer to the disclaimers, which are an integral part of our URD, along with the audio replay of today's call that will be posted on our website, nexans.com. I will now turn over you over to Chris, who will go over the 2022 highlights. Thank you, Élodie. Let's go Page 5 regarding the highlights. Record year in recording since 2001, very strong profitable growth, all-time high EBITDA, normalized free cash flow on return capital employed performance. I think it's a pretty strong achievement when you look the last four years. Let me congratulate the team. As you know, we are really focused on growth driven by value more than volume on our transformation platform around SHIFT is of course generating fantastic on structural result. Our enhanced liquidity on solid balance sheet is maintained. We have as well very proud to announce this morning that S&P rating revised Nexans outlook to positive. That's confirming the evidence, the hard work of our team to strictly monitor working capital, which is a record low on shift to a cash generation mindset and enabling this robust balance sheet on liquidity. To give returns to our shareholders, we propose a dividend of EUR 2.10 per share, which is up 75% versus last year. You know already that has been announced. We have announced one new acquisition in the electrification market in Finland to reinforce our Nordic leadership position. We are preparing the divestment of our telecom system. This announcement we've done in parallel with Syntagma Capital. Record on FC backlog for Generation & Transmission, supported by the award of Celtic Interconnector business. As well, we keep amplifying our development into Industry 4.0. I'm very proud about this result. We are accelerating the decarbonization. The fact that we are extremely selective on the business side, that we are really focused on value growth more than volume growth, help us to exceed our SBTi target with a -28% of gas emission versus 2019. Of course, make the teams very, very proud. We have as well announced the photovoltaic power facility installed in Morocco. That's only the first step to a much bigger investment in that regards in other plants. Of course, our foundation is running very, very well. We are expanding our budget to keep improving the life of more than 2 million habitants. I will go straight to Page 7 because we're getting the highlight of Page 6. Everybody knows what have been announced in the last year. As you can see, EUR 599 million EBITDA, a record in Nexans history. What is important is the continuous progress with a 9% ratio on sales. Normalized free cash flow, supported as well by some down payment of the award that we've just mentioned, is reaching the record as well at EUR 393 million of free cash. Let me focus your attention on the cash conversion ratio, EBITDA to free cash flow of 66%. As well, the return capital employer, this one is not normalized, and so that this one includes the CapEx that we are putting in in G&T mainly. We reach a group level of 20.5%, which is I think one of the record in the sectors. For the electrification only, we are reaching a 29% return on capital employed coming from 9% in 2018. Pretty proud about this result. Page 8, we are working on the information of the agreement to acquire Reka Cables in the Nordics, one of the leaders in Nordic countries. What as well will help us a lot on the sustainability standpoint, because they are really the first cable neutral, carbon, sorry, first carbon neutral cable manufacturers in Europe. That's a fantastic news. It's about 270 people, three plants on EUR 160 million of revenue. We are entering an exclusive negotiation for the divestment of the telecom system business. It's about EUR 180 million revenue on 680 people. We found with Syntagma a good partner to keep growing this business on modernizing the units on keep investing in innovation. On Page 9, it's of course what create the singularity of Nexans versus others is our transformation platform around SHIFT. We have been able, over the last four years, supporting this great result to move many units from the red zone, means poor EBITDA and poor cash conversion, into the blue zone. Now the unit that are in the profit driver area, which is representing right now about 50% of our revenue, are working to go to the green area. Being in the green area means a 15% EBITDA on sales, on a minimum cash conversion of 70%, which is of course, outstanding to be there. But more importantly, the focus of 2023 will be about converting the unit that remain in the transformation candidate value burners area, so the pink and the red zone, which is about roughly 30% of our electrification revenue, which is rou ghly EUR 1 billion of sales running at 3%-4% in EBITDA, and our aim is to convert it to 8%-10%. That, that means a significant new potential leverage to improve our profitability on the structural minor without any growth factors or cost reduction factors on this. What you see in the structural result of the group with SHIFT program on the graph, you can see that at least the 20 units that are already in the blue zone have strongly improved over the years with limited growth on very significant improvement on both EBITDA on the working capital. Next page, that's the move from the profit driver to innovation driver, so from the blue zone to the green zone. This is what we are doing under SHIFT PRIME. We are ahead of our transformation, with seven innovation, significant innovation that have been launched over the last 24 months, bringing more than EUR 27 million additional profit. Those innovation have been launched in 17 countries overall. All the countries that have implemented those innovation have been able to generate an improvement of 200 basis points of their gross margin. Our revenue supported by our service revenue are up +14%, and we keep improving by 5 point our customer satisfaction. Starting from zero, two years ago, we have now more than 540,000 connected users on 37,000 connected object. Beyond these numbers, there is a subscription model improving our margin. The potentiality of connected object in our parameter will be about 4 million connected objects. You can see that we are only at the beginning of the journey, and we will keep improving this number, and that will of course help us to move from contractual factors to structural factors on medium and long term. On the Page 11, very proud about this result. The team make fantastic work. That's as well the result of our E3 model, which is aimed to really converge the economical factors with the environmental factors and the engagement factors. The fact that we put a lot of pressure on reducing the complexity, reducing the distance, focusing the units on the radius of 800 km distance from their base, and as well, all the action we are doing in decarbonizing upstream and downstream transportation have been an accelerator to our decarbonization, and this is why. We were supposed to be, versus 2019, at - 7% of gas emission, and we are very proud to announce that we are - 28%. That mean that our target that was supposed to be achieved in 2023 will be four to five years ahead. That's a good news for the company and a good news for the planet. We will reinforce our environmental stream and to help our manager to take decisions. This is what you can see on Page 12. We map all our units on the different, I will say, performance level. There is the y-axis, which is about the structural context of the units. What is the structural context is the country. You have country that already are very well advanced in terms of energy decarbonization, which is not the case of all the others. As well, the business model. Is it more aluminum and copper that have a pretty significant influence regarding their environmental performance? They can do a bit on that side, but with limited impact because they cannot change their location, for example. What we for them is to work on the operational GHG performance score, which is about everything on decarbonation, on logistic processes, low carbon content product on anything that they can do to reduce their carbon footprint. What you see on the histogram on the graph on the right is the electrification unique representation in terms of GHG emissions versus the gross margin output in 2021. You can see that at least on the red zone, on the orange zone, we are now implementing more and more carbon quota for our low environmental performers on making sure that you are not only bringing great margin, but as well, you do it in a very sustainable way. That's the aim of our, I would say, program on I will say performance that we will track in the coming two years. Let's now move to the business overview. On the Page 14, as you can see, the group is at +6%. I remind that our aim is to reduce our exposure, external exposure to metallurgy. When we do exclude metallurgy revenue, the organic growth is about 12%, 12.1%. The Electrification business only is about close to 13% on Non-Electrification business, close to 10%. As you can see, with the significant improvement on the EBITDA margin for electrification moving from 10.2 to 11.9. Regarding next page on the Generation & Transmission, a good organic growth, a slight reduction on the reddish EBITDA margin ratio, which is due to the changing mix of revenue in 2022. I'm sure you will have questions, so we'll come on through the questions. It's. We had more offshoring farm than interconnection, and this mix will evolve in the other side in the coming years. I remind that 90% of our business is subsea driven and all the announcement, further announcements that will be announced in terms of award will confirm our very strong position on the subsea part. Backlog is at +51%, but I think you know everything on that point. On Page 16, you know, we have spending a significant CapEx to increase our capacity both in Charleston, U.S., but as well in Halden, adding two new lines. Here is a photography that have been taken a few weeks ago. It's on progress. We are committed to be ready for early 2024. So far so good. Everything is on track regarding the deployment of this new CapEx, that will be ready for the project of Celtic and BorWin6. Let's move to Page 17. This is what I told you already in February 2021, that numbers are confirming our prediction. The world needs to modernize the power grids, the electrical grids, specifically in U.S., in Europe or in South America. The electrical grid in those region is more than 50 years old, you cannot cope with a big shift from fossil fuels to renewable energy on one hand on the electrification of our daily life with in the middle, a very obsolete electrical grid. All the DSO are putting a significant investment to accelerate the modernization, and we have difficulties to cope with their demand. Our factories are fully loaded. We're overloaded in 2022, and that's confirmed as well in 2023. You know, is what I told you every time, volume doesn't make profit on a systematically, it's important as well to be extremely selective on the project, on the customer, on the product that you want to manufacture, on the density of the production. This is all the effort that we run through SHIFT program on this distribution market that make us proud to announce that with a 13% organic growth, our EBITDA is up 51% and here is really structural change. Structural change. We keep improving the profitability of that business. In parallel, our backlog is up 33%. Within the backlog, you don't have the 100% of the demand because we have as well in parallel, frame agreement that keep rising every six months. This is why we have difficulties to cope with a very high demand. We remain extremely selective. Be sure that distribution sectors in the case of 2023, or I will say volatile environment is certainly 100% recession-proof. Regarding usage. Hello. Usage, very high level of selectivity, as you've seen as well, is 13% organic growth. There is some business that we have decided not to take for question of profitability, but you can see that the profitability is increasing up 76%. You have some conjuncture effect. We told you in full transparency, we told you that in the first semester of 2022. I will let JC coming back on those elements. I know that a lot of analysts are bidding on a very strong collapse on the usages in 2023. I'm sorry to say that we don't see that at all. The first semester remained extremely strong. We have a slight slowdown of demand in North America, but it's more a shift from residential market to commercial infrastructures on industrial infrastructure. A slight reduction in the residential that impact the backlog. Now we have a conversion of the demand to commercial infrastructure as well data center. We are pretty optimistic on the demand in North America, and with a very strong carryover of the pricing. Pricing remained the same than 2022. Very confident in that area in the first semester, and Europe is very strong. Europe, Middle East, Africa is very strong. What was, I will say, the big risk of 2023 in the case of recession, at least, let me comment for the first semester because commenting over first semester will be, but for the first semester, we have almost all the backlog that we need. At least backlog or confirmation of the projection from our key partners that confirm that usages will remain strong in both volume and in both pricing. Once again, we have as well in parallel launched a lot of actions to prevent any case of recession that will support the improvement of the margin in parallel of a strong demand for the first semester. On Page 19, very proud as well of the industry and solution result, they give us a pride to our automotive harnesses because in the context of a war in Ukraine, they have done a fantastic job to protect our 2,800 employees in Lviv in Ukraine, but as well to protect our relationships on business with our top customer, namely Porsche, BMW, Volkswagen, Daimler. Now the, the crisis management, the outstanding crisis management of the team, bring them more volume on, we have an astonishing result of automotive analysis in spite of the war in 2022 with an organic growth of more than 20%. Automation and mobility remains extremely strong in the industry business. 12% organic growth, 14% improvement on EBITDA and backlog, + 41%. We are the record backlog on the industry and solution so far. Regarding Telecom & Data, two things. You know, we are divesting the land cable on the telecom infrastructures, a bit disappointing Q4. It was a bit more complex because some countries are reducing their investment, due to the fact that they are at the end of their, I would say, long-term plan of fiber optic investment. On the, a slight reduction of demand. We believe that the first semester are back on track. We are confident the backlog is strong. The reading of Special Telecom is a bit more complex now to read because Special Telecom divert a big part of its capacity to support our Generation & Transmission business because you know that in our high voltage subsea cable, we are inserting as well fiber optic. As the complexity of the project on the very high demand on G&T, we need this fiber optic capacity to support our business. This is why this business will not be divested because it is instrumental on our high contribution, technically speaking, to our development of our D&T business. That's overall the view of the business. Let me turn around the micro to JC for the financial. Thank you, Chris. If you turn over to the financials on Page 21, we look at the P&L of Nexans for the year 2022. You see that sales basically stand at EUR 8.3 billion in terms of sales at current metal price, EUR 6.7 billion standard metal price, which is an organic growth 6.3%. Chris explained basically the detail of that organic growth and the very strong performance of the Electrification business and an organic growth excluding me-metallurgy above 12%. EBITDA is a record high since the IPO of Nexans in 2001 at EUR 599 million on the top part of the range of the guidance that we raised in October, November, sorry, 2022 from EUR 580 million-EUR 600 million. You see the bridge here explaining basically the growth in EBITDA. You see that all businesses have contributed to the growth of EBITDA. We have also the impact here obviously on the acquisition of Centelsa that helped boost EBITDA in 2022. 2022, it's a 30% growth of EBITDA over the period versus last year. Operating margin also extremely high versus last year, 6.2%. I would just say that we had a correct negative impact this year due to the decrease of the copper price in the year 2022 by about EUR 500 per ton average, impacting the group EBITDA by EUR 30 million. A loss of EUR 30 million, where last year we had a gain of EUR 100 million, due to the increase of the price of copper. Overall, net income stands at EUR 248 million versus EUR 164 million last year, which is again, also a record high net income for the group. If I move to the next slide, we look a little bit specifically on the Electrification businesses, because you know that in our equity story of 2021, we committed to grow our EBITDA on electrification by 2024. to add EUR 150 million of EBITDA on electrification. You see here basically the progress we have been making in 2022 for the electrification segment, including the margin ratios of 10% to almost 13%, which is a 39% growth of EBITDA for electrification. We have and we have been very transparent of that conjuncture effect that we communicated in the first half, which basically with one-off basically represent EUR 60 million for, and for the year 2022. The growth of EBITDA if you impact would have been 20%. The main lever, the Amplify SHIFT, obviously, that you know well, that we explain every time, all the initiatives in moving into premierized product services, innovations and also, as I said, basically, the scope of Centelsa. If I move to the next slide, we look at our net debt. You see that we've had very strong cash generation from the businesses from operation. A record high EUR 451 million, driven obviously by the strong performance and the increased margin of the businesses. We had a very strong also change in working capital for the year 2022. This change of working capital of EUR 152 million positively impacted the cash flow. In terms of ratio, we moved from 3.9% in 2021 of operating working capital on sales to a low level of 2.9% in 2022. We've had significant CapEx also in the year. You know that we have two years of EV CapEx due to the investment we are making at then Charleston for the additional lines of. This basically represent about half, a little bit more than half, EUR 160 million of the EUR 300 million CapEx of the year. We have another big year in 2023, then after that, the strategic CapEx will go to zero and basically the CapEx will normalize. We also have the divestment of a land in Hannover that brought some positive cash, I mean, strong cash flow into the year. And then after that, you have basically the acquisition of Centelsa in Colombia, explaining why the leverage basically moved from 0.2 to 0.4 in terms of ratio. So a very strong balance sheet, I would say, with extremely low leverage, and we have already reduced leverage from June to December by about EUR 100 million thanks to the strong operating cash flow generation. If I move to the next slide on Page 24, and we have a quick look at the balance sheet of Nexans. Here only to say that fixed assets are growing mainly because of CapEx and the acquisition of Centelsa. Working capital, I discussed, are extremely low because of the very strong performance in monitoring basically our cash collection as well as our inventory during the year. Basically, equity improving, increasing in 52 because of the net result of the year. In terms of ratio, we continue to have very significant room in both of covenant, whether it's a gearing or leverage ratio. You might have seen this morning that we've got a good news from our rating S&P that move us from BB+ to a positive outlook for this morning. Basically, we are getting extremely close on the objective of becoming investment grade, hopefully at the next closing. Next slide. In terms of liquidity, when we look at the liquidity, it continued to improve. Basically, we have now liquidity at the end of December 2022 of close to EUR 2 billion. This is explained by two things. First of all, the strong cash generation of the year. We talked, I showed you that on the previous slide. Very strong working capital improvement. Lot of cash flow generation in the year 2022. Also the renewal and the increase of our revolving credit facility that was maturing this year in 2023, that we renewed for a period of five years, and that we upsized to EUR 800 million. We have this year, 2023, due in maturing in August, a bond for EUR 325 million that we will refinance. To ensure basically the liquidity of the company, we have signed in January of this year of 2023, a backup facility line with our core bank for EUR 325 million, which is just a, I would say, a backup line in case of the financial market being closing or being difficult, when we need to go to refinance our bond, we'll have the security of having a backup facility line, which is valid for 30 months and covering the amount of basically the refinancing of the bond. Which is strengthening again, our balance sheet. That's basically for the presentation of the financial result. I will now move to the outlook. If you move to Page 27 of the presentation, we are guiding on an EBITDA range from EUR 570 million-EUR 600 million, which is basically a midpoint of EUR 600 million, which is a stable EBITDA versus 2022. I will explain you the main rationale behind that, but the main rationale is that we are converting basically the EUR 60 million of conjuncture impact to structural actions. We are not betting in 2023 in any, I would say. Favorable ... favorable conjuncture impact on our top line. If it comes, and Chris just explained you that the first semester looked very good, this will be on top of any of our basically guidance. It will be very good news. Normalized free cash flow range from EUR 150 million-EUR 250 million, slightly below this last year of 2022, mainly due to the timing of the big down payment we received. I remind you, we grew our backlog on subsea by more than 50%, and most of the big down payment came up at the late December of 2022. Obviously explaining partially why the cash flow is extremely high in 2022 and obviously a little bit lower in 2023. We propose a dividend per share as explained by Chris of EUR 2.10 per share for 2022 paid in 2023, if approved by the General Assembly of May. On the next slide, just to give you a little bit of flavor when it comes to our EBITDA, because I think this is the key thing on how we are targeting to achieve basically this midpoint of the range. As I said, we will transform here, you see on the waterfall on Page 28, we will transform a conjuncture and inflation impact that we have seen in 2022, with structural actions based again, like we have demonstrated in 2022, action on shift time, innovation, premiumization of our product, Amplify and SHIFT PERFORMANCE. SHIFT PERFORMANCE being, as Chris presented, all the units that are still below the average in terms of EBITDA and cash conversion, moving them from the red to the blue to the green. Just with those three actions here, we will offset basically any conjuncture that we've seen in 2022 and inflation. Anything, as I said, which is very important because first semester looks very good right now at the same level of 2022, that will be on top and will push us definitely to the high part of the guidance that I propose here. That basically concludes the financial presentation. Thank you. You see before opening for questions, just the last slide on Page 29. You have on the left part of the slide our organic vision, the growth vision of the sectors to 2023. We are revising this number up because the trends versus our February 21 forecast is much upwards, specifically on Generation & Transmission. The geopolitical context, plus as well the world decarbonation is amplifying the demand for interconnection subsea on offshore wind farm. The project pipeline is huge for the sectors. Nexans wants really to focus on the subsea only with higher margin yield. Of course, everything will be about mastering the project calendars, executions and installations on our plant ramp up. Regarding distribution, I think we have been certainly too conservative in two years ago regarding this growth ratio. All operators are waking up for the green modernization everywhere in the world. The demand will be extremely strong for the next five years, no doubt about it, and will be certainly 100% recession-proof. Nexans have signed already a platinum customer agreement for the next two years. I'm just back from Chile, meeting our copper mine producers and as well we review with our team all our aluminum source of supply, and we have secured the access to raw material for the next five years. Believe me, scarcity is coming up very soon. We are increasing as well our capacity output. Regarding the context of usages, organization, is still I would say aligned with the trend that we've foreseen two years ago, but there is an amplification of the demand for the fireproof solution within the building in the context of renovation. Our aim is really to move from community to premium, from conjuncture to structural result like JC mentioned, and from passive components to active components with very high potentiality of inserting Internet of Things in, within our offer. That's conclude our presentation. A record year in 2022. A very positive outlook for 2023. Let's open now for questions. Thank you very much. Thank you. Ladies and gentlemen, once again, if you would like to ask a question, please press star one on your telephone keypad. Thank you. We'll now take our first question from Sean McLoughlin at HSBC. Your line is open. Please go ahead. Good morning. Can you hear me? Yes, Sean. Good morning. Good morning. Thank you. Let me start with G&T, 'cause I guess the margins come in as a little bit of a disappointment. You say it's just down to mix. Can you confirm that there weren't any execution issues in the second half? It looks like in your 2023 guidance bridge, you're not factoring in better G&T profitability. Could you just talk around kind of what margin expectations you have in 2023 for G&T? Secondly, on buildings, you've mentioned how you that the conjuncture effect effectively continues into the first half. It's upside to that guidance range. I mean, how far forward is your visibility? Do you already have visibility to the end of June, or is it shorter than that? Thank you. Thank you. I will give the G&T question to Vincent because Vincent is with us on the line. I will take first the question regarding usages, your last question. Backlog-wise, we are fully loaded for Q1, so our visibility is at the end of March in terms of backlog. All the actions that we had with our distributors partners in last weeks confirmed that their vision for the first semester remained very strong. That's why we consider that at least the start of the year will be above our initial expectation. Of course is what we say, any conjuncture effect will come on top of the guidance. Regarding the G&T mix effect, Vincent, do you want to answer to Sean? Yeah, for sure. Hi, Sean. First to answer to your question, there has been no execution issue in H2 2022, so the business is running in term of execution as per the plan. Regarding indeed the margin, you have a mix effect. Maybe to re-give a little bit of perspective, as you know, we are working on, I will say three main segment, interconnections and offshore wind farm. We have a small part in what we call new energy, which is a certain number of links in the new activities regarding to hydrogen, hydrocarbon, and so on. Indeed, 2021 versus 2022, we had a decrease in our mix of the interconnection. As you know, interconnection are these long distance cables, very often in deep water, so much more technical, much more installation and consequently margin higher compared to, I would say traditional offshore wind farm. So it just, I will say, a phasing of project. The backlog as mentioned by Chris is still very sound, very balanced, very healthy. Because when we are doing our pipeline management, thanks to our SHIFT modeling program, we are balancing always of course, in the backlog, the interconnection and the offshore wind farm. So just a yearly effect, moving with lower interconnection in the mix of 2022 versus 2021. And regarding the- Yeah, just in terms of then the mix in 2023 and your margin expectations. In 2023, the interconnection will grow up again. We have more activity, we will be indeed in the same range, I will say, as 2022 in term of overall mix with a slight increase. It will depends really on the phasing of the project of this year. I will say no concern for the mix and the margin in 2023. What we can add, JC? No, I mean, obviously completely concur with what Vincent is saying. What we see for 2023 is probably be more on the line of 2022 and not yet in the line of 2021. We will see the improvement really when we start to execute the largest project on the interconnections that we just got into the backlog, meaning the Celtic, for instance, and then the EuroAsia. That will come beyond 2023 for the most part. This is where you will start to see really an improvement of the margin. I would say 2023 will be more in line with 2022 of what we see today. Yeah, we still awaiting the final award of EuroAsia. Maybe Vincent, you can comment because we will have the question later? Yeah, yeah. Well, in fact, as you all know, we have been chosen as a preferred supplier. We have signed the corresponding agreement. This project is partially funded by EU and then by the EuroAsia project company. Everything is ready. Now it's really the overall financing of the project, which is ongoing between EU, EuroAsia company and the technical company working within the project, which are IPTO in Greece and TERNA ENERGY, which is engineering firm. This I will say, and the Cyprus government, which is also a key partner in this project. I would say technically everything is ready. Now we just, I will say the process Of a different partner to be completed, normally I would say, in the end of Q1, in the course of Q2. That's basically our expectation right now. Thank you. Thank you, Sean. Next question? Thank you. Sure. We'll now take our next question from Akash Gupta at JP Morgan. Your line is open. Please go ahead. Yes. Hi, good morning, everybody. I have three questions, please, and I'll ask one at a time. The first one is on the bridge on page number 22. I'm wondering if you can provide a high level breakdown of the EUR 61 million and conjectural and one-off into how much of that is U.S. versus Canada, and within U.S. and Canada, how much of that is resi versus non-resi, just for us to understand what is going on there. On the same slide where you have - EUR 22 million net cost, how do you see this number moving in 2023 given the high inflation? That's question number one. I will take the question, Akash. Just on the conjectural, we reported basically EUR 40 million the first half, about EUR 40 million of conjectural impact. We have about EUR 20 in the second half of conjectural and one-off. I would say about 60% of that is coming from additional volume than above the norm. I would say the rest is pricing. It's not U.S. because we don't have any low voltage activity in the U.S., so it's only and mainly but only Canada for us that is impacting. The reason the second half is a little bit lower than the first half is because we get to the end of the year and distributors basically have been destocking for the end of the year. Also last year in 2021, the year before, we started to have also a positive conjectural mixed impact in Canada. We started to see that at the end of 2021, therefore obviously when you bridge the two years, the impact on the second half is a little bit less than the first half. Again, the trend in terms of volume and pricing, as Chris mentioned, remain quite robust, especially on the pricing side. When it comes to the -22 of the bridge, yes, definitely, this is a net of the total inflation that impacted Nexans. We're talking about roughly EUR 90 million of inflation impact in the year 2022. Most of that is pass-through, because we have the mechanism of pass-through that we, that you know, whether a pass-through through the contract or pass-through through updating our price list. We have, I would say a small basically impact mainly on our fixed cost that is not, that is not offset, I would say, by all the prices and the mechanism, and it's 2022. The way we see it in 2023 is that this number will not increase. We have strong action. We have covered already, so we have pass-through for most of the situation. We have also, for the one where we were impacted in 2022, like for example, energy cost, we have hedged that in 2023. I would say the level of exposure we had is even lesser in 2023 than in 2022. I'm not foreseeing this number to worsen in 2023. We have reached, I would say, we believe also we have reached a plateau in terms of inflation in most of our cost categories. We are not worried, and we have actions to that. A big part also of the EUR 22 million was coming to specific countries like Turkey, that has been very strongly impacted, and Lebanon. Turkey and Lebanon strongly impacted by two-digit inflation rate in 2022. Again, we have mitigated that through action for 2023. Thank you. The second question is on medium voltage or distribution segment. I mean, here demand is very strong. You said you are fully saturated on capacity, and we hear the same comments from your competitors. When we look at the capacity situation and strong demand that you flagged in your long-term outlook on the last slide, is there any need for strategic CapEx in this part of the business that you may foresee in the coming years? Yes, potentially, Akash. I think some further announcement to come in the course of 2023. We are working on it. Thank you. My final one is on European equivalent of IRA. There were some details out earlier. Do you see cable companies could be potential beneficiary? Do you see that you might get subsidies to fund some of the capacity expansion that might be needed in the medium term on both medium voltage and low voltage side? Thank you. I think it's a good question. It may be too early to say, but what we hear is that for the energy transition, you have two factors that are a big major risk of bottleneck is first the access to natural resources, because Europe has a very strong ambition, but don't have the natural resources compared to U.S. and China, at least. First point on that cable, sector starts to be as well a bottleneck. I'm sure that we are working on it, but I'm sure that in the context on Inflation Act, cable could be part of potential subsidies. Thank you. On at least Nexans is working on it because. Sorry, to add up. Nexans is working on it because we are the unique cable manufacturers being in this vertical integration that give us an advantage to increase our output for recycling copper in the future. On that can give us extra benefit versus our peers. Sorry. Thank you. Thank you. We'll now take our next question from Miguel Borrega at BNP Paribas. Your line is open. Please go ahead. Hi. Good morning, everyone. two questions from me. The first one, I want to understand a little bit better the market environment in usages. I know you mentioned you're not counting on any conjunctural effects, but so far you've seen those continuing in 2023. Then how do you square that with slide 2028? Because the way I understand this bridge is you're basically expecting those tailwinds from 2022 to reverse in their entirety in 2023. Correct? Am I misunderstanding the chart? Thank you. No, you're not, Miguel, misunderstanding these charts. Right now, with basic assumption, one would say that with the news we're having about having a continuous, I would say, healthy H1, definitely make the chart here a little bit conservative, because what we're assuming is obviously a total disappearance of the conjunctural inflation replaced by the structural level, as I mentioned, and that would put us at EUR 600 million. Obviously, with what we seeing today, but who knows what will be H2. I mean, the only question is that we're talking about H1, we don't know H2, we don't have a crystal ball for H2. With what we've seen H1 in if H2 is basically not a disaster, then definitely we are already, quite, I mean, positioned to say that we will be on the top part of the guidance. Miguel, it's more a question of processes that our team are fully incentivized only for structural effect, not for conjunctural effect. On the time of the budget that bring the guidance, it was between September and December, and everybody was talking about the coming up of the recession. We have launched recession-proof actions. We are very enforce our structural actions in parallel, and we say to our team, "You do not bet at all on any contractual factors." That's why that this guidance can bring some further upside if there is no recession and demand remains strong. Okay. That is understood. Thank you. My second question on high voltage. You achieved your goal of a backlog of close to EUR 4 billion. Can you give us an update on what to expect for 2023? Is this gonna be a year of backlog execution, or do you see backlog expanding a little bit further, and where to compare to 2022? How do you think 2023 will fare in terms of awards? Thank you. Yes, it's a good question. First of all, it's not yet finished because EuroAsia has not been, they have not closed their financing like Vincent mentioned, so it's not yet awarded. We have the preferred supplier, we have the letter of intent, we hope this being concluded in coming weeks, months. Start to be a very long story, it's a fantastic project. There is some awards to come in U.S. in coming weeks before the end of Q1 and after a significant award on the before July. No, the backlog will keep expanding in the course of 2023, Miguel. On significantly. Next question. Thank you. We'll now move on to our next question from Jean-François Granjon at ODDO BHF. Your line is open. Please go ahead. Thank you. Jean-François Granjon speaking from ODDO BHF. I would just come back on the guidance. I understood that you're very confident running the usages businesses for 2023. I just wondering why we have a so huge magnitude for the guidance for the EBITDA between the low and the high end range. This is my first questions. My second question concern the CapEx. What do you expect for 2023 for the normative CapEx and the strategic CapEx? My third question concerned the normative margin expected for the usages division after the exceptional level reached at 12% last year. My last question concerned the target expected for 2024. When we see the performance, last year for the Electrification, sorry, businesses, we have reached nearly 13.3% EBITDA margin. This is the top of the range expected for 2024, if I well remember. Do you expect the same level, or do you expect more than that in 2024? You have already reached, in fact, what we expected for 2024. I will start with the range, Jean-François. I will start with your question of the range. Indeed, we increased versus what we're doing, we've done in the past. The range is a little bit wider. We're talking range of EUR 60 million. + 30, - 30 around the midpoint. I mean, there was a lot of discussion with Chris and our board about basically where to set the range. There was obviously there are still a lot of discussion and question mark about the year 2023 when it comes to when it comes to recession and no recession. Yes, you're right. We start to have a very good visibility on the first quarter for sure, even on the first half. We don't know about the second half. With what we're seeing and the things that can move one way or the other very quickly, and it is very volatile, we decided to slightly increase. The idea again is to come back in the middle of the year in July when we present our first half numbers and come back with a much more, I mean, reduced range and potentially improved range, when if we confirm that H1 is as strong as we start to see it, and we don't see sign for H2. We preferred maybe to be a little bit more. Conservative. I don't like the word conservative, but a little bit more, yeah. Okay. A little bit more, cautious. Cautious about ups and downs. Yeah. Then come back in July and come, you know, reduce the range by EUR 20 million or even more. Okay. Upwards. That's basically. The case last year, it was the same case last year, well, some cautious at the beginning of 2022, and you improved. Exactly. Exactly. It's exactly the same similar approach. I would say we came up with a large, EUR 40 million range. Then we came in July and we narrowed the range. We in fact increased the range. Basically the same approach we're looking for 2023 because we know that we are in times which are extremely unpredictable and I mean, Yeah. We need as well the signature of the EuroAsia contract that will go and contribute as well to the result of 2023 partly. Yeah. Basically we are very confident the EuroAsia contract will sign. The question is when the EuroAsia contract will sign. If it delay, will it be delayed by one month, two months, three months? Definitely that could have a little bit of an impact as well in our range. Yes. Okay. Regarding the CapEx. Can you remind the questions on the CapEx? No, I got the question. The question on the CapEx was how much of strategic CapEx for 2023. Basically slightly less than 2022. In 2022, we really had a split of 50% of strategic and 50% of maintenance CapEx. We have less strategic CapEx, about EUR 130 million of strategic CapEx in 2023, this year. And about EUR 160 million, EUR 70 million of maintenance CapEx. Next year, in 2024, there will only be the maintenance CapEx. Okay. The net CapEx were a little bit lower in 2022 because we had the proceeds of the divestment of the land that basically net the CapEx to a lower level. In terms of growth CapEx, we don't have any sell of disposals of assets in 2023. The third question was about the normative EBITDA ratio of the usage. Of, within 2022 there is some control flow effect that we will offset future. The potentiality of improving this ratio is still very high because on twofold. The first is because we still have a big part of our unit that are value burners, or I would say in the red zone needs to be converted in profit driver. SHIFT program is playing fully right now on those unit. I remind you that they're representing EUR 1 billion at 3%-4% EBITDA. They should be at least they need to reach the minimum ratio of 2021, means 8% within 12 months. That's the first improvement lever. On the second, I'm very happy and very satisfied on all development we see on the innovation customers. Our partners are asking for more. Of course, this is structurally contributing to the improvement on the margin. Very positive on the evolution on the ratio on the usages. Regarding the last questions were on the fact that we are in the electrification reaching more or less the 2024 objective, [Foreign language] mon JC. What do you say is 2024? No. That's a tough question, but you're right. I mean, you're right that thanks to the conjuncture positive impact in 2022, basically we have already achieved the target of 2024. I think we feel very comfortable with structural actions without betting on any conjuncture role. We are very comfortable in achieving the target by 2024. On beyond- Jean-François. Yeah. Normally what you have already reached this level, but if I understood you are very confident for, to improve the margin for the G&T generation businesses, with between 18%-24%. Probably, or you should be able to be above this level in 2024 or after that. Yeah, sure. I would say let's make 2023. Let's see how the world is evolving. You know, every year has this lot of crisis. After the call of last year in February, Ukraine have been invited, so we are in a permanent crisis mode now. They are all piling up, so I'm not able to predict what is the crisis. I will say, right, we remain prudent. We do our work 2023. What is important, Jean-François, I think, and that's for all the message, is keep working on the rotation of asset. We had a lot of remark last time. You say, "Yes, but we don't see any divestment." It's on the way. For telecom, we hope to have some other divestment announcement in 2023. At least we're working hardly on it. As well, some working on acquisition for 2024. The rotation of assets beyond the pure ratio is as well a big objective of Nexans. Okay. Perfect. Thank you very much. Thank you, Jean-François. Next question. Thank you. We'll now take next question from Rajesh Singla at Société Générale. Your line is open. Please go ahead. Yeah, hi. Good morning. Thanks for taking my question. I just have one question regarding the normalized FCF guidance. If you can talk about a bit of a bridge between around EUR 600 million of OIBDA and around EUR 150 million-EUR 250 million of normalized free cash flow, like any things which is having a negative impact on the free cash flow conversion in 2023 for you? Yes, it's a very good question. You've seen that in 2022, as I presented, we have EUR 152 million of working capital improvement. We are not seeing any working capital improvement in 2023, number one, mainly because the ratio we have reached in terms of working capital on sales is extremely low, and I don't see it basically getting further down. That's one thing. It's probably going to be stabilizing or going back to 3%-4%. Probably, we will see, I would say a little bit of a reversal in the working capital. We've got the down payment, the big down payment that explains the high normative free cash flow, normalized free cash flow in 2022. At the same time we will be consuming those down payments in 2023. There is also another impact that explains the high level of cash flow, normalized cash flow in 2022. It's because we acquired Centelsa, and we had a one-off cash gain of EUR 60 million when we acquired the asset just to normalize the working capital on the asset. That's obviously now it's normalized, it will not repeat itself. I would say there is a conjunction of elements that basically makes the working capital improvement and the cash flow generation in 2022 quite high. That will not repeat themselves in 2023. This is why you see this difference between the two. In fact, the good way to look at it would be to look at the average between the two years, to get a better visibility on the cash conversion. Thank you, everyone. Thank you. Thank you. Thank you. We'll now move on to our next question from Massimiliano Suveri at Credit Suisse. Your line is open. Please go ahead. Yeah. Hi. Thank you for taking my questions. I had two. The first one would be on the Amplify and SHIFT programs. Basically, you have now achieved in advance the data targets that you had set in the 2021 Capital Markets Day, which were around EUR 90 million from both. I was wondering how much of the value burners and transformation candidates do you think you can move to profit drivers in 2023, and maybe also what do you think for the next years? Is it everything or do you expect that there are some niches that you will need to exit or keep it as a, as a lower margin business than the overall group? Yes, Massimiliano. Organic Amplify and SHIFT PRIME is really the... those two programs are mainly focused on moving the profit driver into innovation driver, or means business that are already in the range of 8%-12% EBITDA, and the objective is to move them from 12%-15% EBITDA. That's the aim of the program. Regarding value burners, it's all the techniques that we use under SHIFT PERFORMANCE, which is about complexity reduction, making sure that you have the good sat of your customers on product portfolio, on reducing the cost overall. Here the aim is to at... The aim is to achieve their move from value burners to profit driver in Q4 2023, so to have a full run rate of improvement in 2024. Can we expect to be able to move everything that you have, or do you expect that part of it will need to be exited or not emphasized anymore? Yeah. 100% confident that everything will be back to profit driver. I think, what I mean, Massimiliano, is that there is no exogenous factor that make them value burner today. Just a question of management decisions on how we manage these businesses. We have recently changed some managers running this unit, and we have our transformation team working with them. 100% confident. We don't need to divest. just to give you a little bit of numbers, what we're expecting to generate from that transformation in 2023 is about EUR 60 million additional EBITDA. Okay. Okay. Thank you very much. My second question would be, again, on Generation & Transmission. I appreciate the issue of the mix between offshore wind and interconnection. I was wondering, would you be able to give some more granularity on the difference between offshore wind and large subsea interconnection. If I think about your 24% upper end of the target for 2025, even in 2025, most of the orders from the U.S. will be offshore wind. Yes, you will have EuroAsia, Celtic Interconnector, and other large subsea interconnections, but offshore wind will still be part of the mix. I was wondering, can you maybe give some additional clarity on this margin differential between offshore wind and the subsea interconnections? Yeah. I will not give you a precise number, but you have four stream in the high voltage. That explain the mix effect. You have the lone high voltage, which is a lower margin in general versus all the high voltage business. After you have short distance wind offshore on AC technology, which is medium-sized margin, because the competition intensity is much higher. After you have long distance offshore wind farm, which are shifting to DC technology on year, margin now significantly upward. After you have the most complex part of the high voltage, we see the subsea interconnection. From land interconnection to subsea interconnection, you can be in a range from 0% EBITDA up to 25%-26% EBITDA. That's why the mix effect is playing fully. The only thing that we can re-mention again is that we have limited exposure to the land, high voltage, but we still have in the mix short distance offshore wind farm, and in the future, we'll shift to long distance offshore wind farm. To give maybe some additional color to understand the dynamic. As you know, we are investing currently in the extension of our factory in Norway and also the same in U.S. As you properly said, the U.S. expansion capability capacity will be able to answer to the dynamic of the U.S. market. Chris has mentioned before that we are indeed expecting some award this year on this market. The extension of Halden is from capability perspective, is an extension which would be ready by early next year, which can answer both to interconnection and offshore wind farm. Which means that we'll be again starting 2024 in a capacity to increase the mix towards the interconnection thanks to this extension. For example, the mentioned Celtic award will run on this, which is an interconnection, will run on this extension in our factory in Halden. That's why the 2024, 2025 as mentioned by JC, we are confident in this evolution of mix having again the right balance between interconnection and offshore wind farm. I think, also to answer your question on how we ramp up on margin, what is important is the extension that Vincent just mentioned. I had stable fixed cost. Basically the mixed impact of adding this revenue will increase the overall margin of the business because again we adding two new lines that will generate in 2025 more than EUR 300 million of revenue, but has a much more attractive EBITDA margin because the fixed cost will not move of the plant. In fact it will have a mixed effect, very positive. [Foreign language] Voilà. Next. You have another question? Very clear. Yeah. No? No. That was it. Thank you. Very clear. Perfect. Thank you. Next question. Sure. Next question from Eric Lemarié at CIC. Your line is open. Please go ahead. Yes. Hi, good morning. Thanks a lot to my question. I got two actually. First one about this Sunrise Wind project in the U.S. I understand that Ørsted has announced some impairment due to the cost inflation of the project, and I understand Nexans is involved in this project, and we'd like to know what could be the consequences for Nexans? This is my first question. I got on a second one on copper. You mentioned, you got visibility on the supplies for copper for the next five years, but I understand it was for Chile, and I would like to know if you got this five years visibility as well for the rest of the world? Thank you. Vincent, you want to take the question regarding the Sunrise? Yeah. Yeah. I think quite easy. Sunrise is currently ongoing and no impact for us. As you know, we have a long-term agreement with Ørsted in U.S. This agreement is organized with indexes and so on. No impact for us. Project running as planned and on time. Okay. Thank you. Regarding the copper, the copper is 60% of the copper supply in the world is coming from China, Chile, and Peru. When I mention Chile, it's not about for our Chilean need. It's for our worldwide need. We are our key suppliers namely Codelco, is supplying copper for Nexans everywhere in the world. We have signed long-term contract on privileged access for the at least we'll say for the next five years in case of a world scarcity for copper, make sure that we are able to keep producing our cables and secure the supply for our key customers too. It's Chile for the world. You have may seen, this last week that we have announced also a similar agreement with KGHM, which is another mining company. We are extending this long-term agreement to our key strategic supplier in term of copper worldwide. That's right, because on this would be the same for aluminum. Either there is a two fold, whether it's the access securitization or as well, anything we can do on the, I would say, raw material, decarbonations. Having low carbon aluminum, low carbon copper, we're working hardly on it. What conclusion is that the demand is secular, is very strong. We are entering in a hyper cycle of electrification. Everybody, all nations are waking up for climate change, and every company wants or each nations want everything at the same time. One day on the certainly, 2024, 2025, specifically when China will be fully boost for its energy transition in parallel to India and U.S. Just the three country together can consume the full copper worldwide. There will be a massive bottleneck coming up, that's for sure. Thanks for that. Maybe a follow-up. You're not afraid that this scarcity will mean, well, some price increase for copper and maybe some negative impact on some projects because, well, like Sunrise Wind has an issue with the cost of some large project due to copper inflation. You don't see that? Of course. Scarcity means inflation, and this is what we say to our customers, there will be a structural inflation on the natural resources that will be a carryover for the next year. There is no doubt about it. Of course, you can say that can put some pressure on the margin of the project and can delay the project. The pipeline is so huge. On each nation going on the same direction of shifting from fossil fuels to renewable energy, you will always find a customers or project or countries that will be able to absorb this inflation or to make their project happen. No, we are confident on the fact that most of the project will be confirmed. Of course, it will be at a different cost. Once again, in the sectors, the metal effect is 100% pass-through. That give us, I would say, a very high shield or protection against inflation. Thank you. That's great. Thank you. Are we finished with the question? Thank you, Eric. You'll have a last question. One last question, yes, from George Featherstone at Bank of America. Your line is open. Please go ahead. Morning, everyone, thanks for squeezing me in at the end. A few questions from me. First one, just a clarification on the free cash flow guidance. Obviously you mentioned that the strategic CapEx level was gonna be slightly lower than 2022. Does that imply that, sort of if I took more traditional view on free cash flow, that the low end of your guidance would be zero? Is there some other missing pieces that I'd have to consider? No. The normalized does not include the strategic CapEx, but you're talking about free cash flow, all free cash flow. No, we are basically, we have a wide range, as you see, on the guidance, huh? Because we are talking obviously, EUR 150 million-EUR 250 million. We are not targeting to be at the lower part of the guidance. We are more targeting to be midpoint or above part of the guidance. Definitely free cash flow all together, including strategic CapEx, will be lower than it was in 2022, but it will not be zero. Okay, great. Thanks, thanks for clarifying that. Just maybe following on from the prior question just gone about the sort of content per gigawatt of cable in the high voltage segment. I think you've given a range in the past of EUR 250 million-EUR 400 million. I just wondered how that's evolved in the current cost inflation environment and given the price increases you've probably put through in that too. It's a good question. I'm not sure that I have the answer. Vincent, do you have the answer regarding the value of cable per gigawatt evolution? No. To be honest, I think. As you know, in a turnkey, you have around usually a traditional turnkey will be for offshore wind farm, around 50% to 60% of cables, and the rest is installation. Inside the cable, the big part is the copper or the aluminum. I would say it's difficult to answer the question because the aluminum and the copper, we don't sell this metal already, moving ups and downs, as mentioned by Chris. On the rest, if I can say this, the plastic, the steel, and so on, the inflation last year has been in the range of depending on the material, between 10% and 10% to 15%. It's 10%-15% on probably 10%-15% of overall components. It's not massive. Of course, the copper and aluminum can make big impact, but this one are more related, so. The rise, the price rising is mainly coming from the distance to shore. We are more much longer distance to shore on that have a significant effect. As well, we are shifting to more and more supply only to turnkey mode. That's affect as well the to the full value of the project. Okay. Understood. Just trying to understand the sort of how we square that with your comments on maybe a structural shortage of supply of copper here and the pass-through mechanism you have in your contracts. Does that ultimately mean that we need to sort of change the way we think about the EUR 250 element of that range? Perhaps it's not ever gonna be that low again. I didn't get the question. Can you rephrase your question so I didn't get it. Sure. Sure. Yeah, understood. I mean, basically, if you get multi-supply only, and therefore most of that range is dictated by the underlying price of the metals that you're passing through, and they are structurally in short supply, per your prior comments. Do we need to think then that EUR 250 million-EUR 400 million needs to just structurally shift higher in terms of the sort of the cable revenue per gigawatt that we're seeing in some of these projects? Sure. Maybe Vincent, you have a comment? I think you have two view on your question. You have a market view, if I can say this, that's for sure, that if you have scarcity, as we plan in term of non-ferrous metals, so typically aluminum and copper, you will have most certainly an increase in term of actual. As you know, we are reporting all our sales in standard. Which means that in term of performance for Nexans, it's a different part. The end user will see for sure, an increase of value per kilometer, because you have an inflation. For Nexans, I will say in term of performance, in term of margin, it's a different story because we are doing this pass-through. I think the last element that you. Which is maybe where I will not enter too much in technical details, but what you have to know also is that over the last 10 or 15 years, we have worked a lot also with our customers in order to reduce step by step, the cost of the cable. We are working, for example, some years back, a cable for a offshore wind farm where mainly copper. Now we are doing aluminum. We are able to do some part of the section in copper, some part of the section in aluminum. We are trying to find always new solutions, technicals. We have launched some years back a new type of armoring. You have the evolution of inflation by itself, and after you have all the technical solution that we are finding. Just again, to give an example, the new vessel, Aurora, is able to lay two cable at the same time. Of course this is an advantage in term of timing, in term of cost for our customers. Yes, you have the inflation on one hand, but on the other hand, you have the technical evolution of the solution on the turnkey, which is helping somehow to counterbalance this inflation trend. Okay. Thank you very much for that extra color. Final question for me then would be on the distributed de-stocking commentary you mentioned. I just wondered when you speak to them whether you think they've got the right level of inventory now for the forward-looking demand? We asked them the questions. I think you will be some presentation of like selling coming days. We call as with Sonepar, we call our North American partners. Yes, they consider that from all the feedback that we receive from seven distributors, that the level of inventory is normal. I would add normal, normative right now. There is no not foreseen any de-stocking effect coming up in coming months. I think there was some de-stocking effect in Q4, and now they are restocking because the demand is at least foreseen for the moment, higher than expected on the recession, apparently delayed or more, I would say, soft than what was planned originally. George. Okay. Thank you very much. Thank you. Thank you. Thank you, everyone. Thank you. Thanks for your attendance. Thanks a lot. Have a good day. Thank you. Ladies and gentlemen, this concludes today's call. Thank you for your participation. Stay safe. You may now disconnect.