65 / 278
PRYSMIAN GROUP | DIRECTORS’ REPORT
65
The Industrial market reported stable or growing demand in some segments, like certain OEM sectors (such
as Nuclear, Crane and Railway) and Elevators, and a general growth in renewables market demand in China
and North America. In Europe, however, renewables demand remained weak, like in the previous year, in
the wake of restrictive financial policies adopted by the main governments which had either cut special
incentives or made it more difficult to access credit for onshore wind projects. Other market segments of the
Industrial market, however, saw volumes contract due to delays in investment projects, like the low-end
mining and infrastructure OEM ranges, where demand depends on specific geographical factors. In
particular, within the mining sector, demand was persistently weak, primarily due to falling commodity prices,
significant production overcapacity and the reduction in investments.
The Oil & Gas segment experienced a highly negative trend: in fact, the market for international projects
deteriorated sharply, reporting many instances of oil companies cancelling or postponing investments in new
fields pending more favourable market conditions. In addition, even the drilling sector was heavily impacted
by lower oil prices, with a consequent reduction in operations worldwide.
The Automotive market recorded a general growth in Europe, the United States and China, while the
negative trend continued in Brazil, heightened by the ongoing economic crisis.
FINANCIAL PERFORMANCE
Sales to third parties by the Industrial & Network Components business area amounted to Euro 1,749 million
in 2015, compared with Euro 1,708 million in 2014, posting a positive change of Euro 41 million (+2.4%) due
to the combined effect of the following main factors:
negative organic growth in sales of Euro 39 million (-2.3%);
increase of Euro 114 million (+6.7%) for exchange rate fluctuations;
sales price reduction of Euro 34 million (-2.0%) for metal price fluctuations.
Overall performance in 2015 by the industrial applications business was partially affected by the instability of
investment demand in some sectors, while nonetheless maintaining geographical and application
differentiation in view of the wide range of specially developed products and the highly customised nature of
the solutions offered by the Group.
In the OEM market, the sales trend recorded by the Prysmian Group was generally positive in the European
market and in Argentina, but stable in North America and Asia. As for the different sectors, good
performance by Railway, Crane and Nuclear applications, with a growth in the higher value-added order
book, was partly offset by weak demand for Marine and Rolling Stock cables.
In the renewables business, the positive trend in demand in the solar segment in North America was entirely
offset by the slowdown in the onshore wind segment in North Europe and China, where the Group has
generally reduced its exposure for strategic reasons linked to the competitive environment.
The Oil & Gas sector witnessed a growth in sales by the onshore projects business, thanks to the solid order
book at the start of the year, particularly in Asia, the Middle East and Caspian region. However, this was not
sufficient to make up for the steep decline in activities in the markets for submersible pumps, MRO