NKT A/S Annual Report 2021: Significantly improved operating and financial results

Company Announcement

23 February 2022
Announcement No. 2

NKT A/S Annual Report 2021: Significantly improved operating and financial results

NKT CEO Alexander Kara says:
- Our businesses emerged from 2021 with financial performance better than originally expected, and are in an attractive position for further growth. In 2021, NKT again played a central part in creating the infrastructure needed for the transition to renewable energy by providing the required power cable solutions. NKT Photonics returned to growth in 2021 and the strong commercial position resulted in all-time high revenues.

Financial highlights

* Std. metal prices

2022 financial outlook
In NKT, revenue (in std. metal prices) is expected to be approx. EUR 1.35–1.45bn and the operational EBITDA is expected to be approx. EUR 130–155m.
        
In NKT Photonics, the organic revenue growth is expected to be approx. 12-17%, and the EBITDA margin is expected to be approx. 11-14%.

Medium-term ambitions
In its Q3 2020 Interim Report, NKT introduced medium-term ambitions which are to grow revenue (in std. metal prices) organically from 2019 (EUR 945m) in the medium-term by a CAGR above 10% and to increase the operational EBITDA margin (in std. metal prices) to approx. 10-14%. The underlying assumptions and the ambitions remain unchanged and the financial performance in 2021 was well-aligned with these ambitions.

NKT Photonics is introducing financial medium-term ambitions which are to grow revenue organically from 2021 (EUR 80m) in the medium-term by a CAGR of approx. 12-17% and to increase the EBITDA margin to approx. 20-25%.

NKT: Operational EBITDA more than doubled
NKT’s revenue developed positively in 2021, driven by increased activity in all three business lines. This resulted in organic growth of 15%. The increased revenue also drove up earnings and the operational EBITDA more than doubled from EUR 56.7m in 2020 to EUR 131.1m in 2021.

NKT’s high-voltage order backlog was maintained at a high level of EUR 2.87bn (EUR 2.43bn in std. metal prices) at end-2021 compared to EUR 3.07bn (EUR 2.59bn in std. metal prices) at end-2020. Driven by the ongoing transition towards renewable energy, NKT was awarded a number of new projects in 2021 with a total order intake of approx. EUR 500m.

As planned, NKT continued the investment programme to upgrade and expand the high-voltage production sites in Cologne and Karlskrona during 2021.

NKT Photonics: Record-high revenue
NKT Photonics returned to positive growth momentum in 2021 after financial performance was adversely impacted by the COVID-19 pandemic in 2020. Revenues in NKT Photonics reached EUR 80.1m in 2021 which was 10.2m above 2020, equal to 15% organic growth. The main growth contributors were the Industrial and Quantum & Nano Technology segments. NKT Photonics’ EBITDA almost tripled from EUR 2.6m in 2020 to EUR 7.5m in 2021.

In 2021, the Board of Directors decided to resume the review of strategic alternatives for NKT Photonics, with the objective of maximizing value creation for the shareholders. The review is ongoing and J.P. Morgan Securities plc was retained as lead financial advisor.

Teleconference
NKT A/S hosts a teleconference for investors and financial analysts at 10:00 am CET on 23 February 2022. It can be accessed at investors.nkt.com. The presentation for the call will be available before the teleconference. To attend, please dial in from (confirmation code: 4297398):

DK +45 32 72 04 17
UK +44 207 192 8338     
US +1 646 741 3167

Contacts
Investor Relations: Michael Nass Nielsen, Head of Investor Relations, tel: +45 2494 1654
Media Relations:    Louise Westh Naldal, Head of Group Communications, tel: +45 2982 0022