Massimo Battaini: "Sustainability is a moral and ethical goal, but also a business driver"

This lack of uniqueness in defining common market rules or growth drivers makes Europe less competitive. Europe is much less protected than the United States, and it's not the tariffs that changed American protection; those only confused customers and investors. It's the fact that America lives on 'Made in the US' and Europe has always considered itself open to the global world. So I'll take the case of the fiber world. Fiber in Europe is produced only by us. The market is 60 million km and we produce 15. The rest is imported. If you do the analogy for North America, it's exactly the opposite. 85% is produced in the US and 15% is imported. Europe is open. This means that at some point, because those who compete in Europe, not Europeans but those coming from the Asian world, do not use exactly the same business logic or are not companies that live on their cash flow, but live on subsidies, Europe is open to this type of player.

Hi, thank you all. Good morning.

Well, 2025 is the best year ever, but it's not the last of the best years ever. We have a growth story that will allow, clearly, I can't say anything about '26 now, but the growth in '26 will beat the best year ever, '25, and we'll do the same in '27 and '28. The important growth drivers are that now all our business segments, from high-power energy transmission, so the transmission business, Power Grid, electrification, the last mile connecting residential and non-residential buildings, and especially Digital Solutions, are activated by equivalent secular market drivers. AI is certainly the latest of these and it gives us even more visibility of future growth.

I would say that this digital story is the most exciting of recent months. I remember in March I went to the US for the usual meeting with investors and unlike the past when they normally asked me about the trend in North America and the Transmission business, nine out of ten questions in those two days with investors were about fiber. And I wondered, why do they keep asking about fiber if we have capacity etc.? And I discovered the day after these meetings that I had a meeting with an American company, I won't name it, important in the Digital Solution world, but also new technologies, that pointed out a major change. Until then, fiber was used for fiber-to-the-home deployment, fiber connections to buildings for 5G mobile rollout, and for data centers. In those months, early 2026, a strong demand for fiber for military applications began. Many don't know, but drones that until 6 months ago were radio-guided, with radio frequency signals, which were clearly interceptable, so drones could be stopped or intercepted before reaching the target. Thanks to engineers, they were equipped with a fiber connection to the control point. So the drone takes off with 50 km of fiber attached underneath, which unspools as the drone flies to the target. Fiber is important for two reasons: it prevents the drone from being intercepted because it's a connecting cable, very thin, truly micron-sized. And it also allows transmitting visual images of what the drone sees to the pilot with great accuracy. 50 km. Imagine when you hear about Ukraine's attacks on Russia with 500 drones launched per day, the Middle East, other entities adopting this technology. This has meant that in the global fiber demand, estimated at 100 million km in 2026, 100 million come from drones. So 15% of this demand, which was zero in 2025, is now for military applications. Clearly, it's not an example to boast about, but this made fiber scarce. And as fiber became scarce because it was dedicated to military applications, it required further strong demand thanks to data center applications, traditional data centers and AI data centers. This caused all hyperscalers, aware that fiber is scarce, to seek solutions from all suppliers to have fiber availability for the next 5 years to sustain this demand. Here enters Prysmian, which has a great competitive advantage over many others because we have a dedicated asset for fiber production in the US. We are one, another competitor is Corning, and another is OFS. The Chinese do not participate in this market because geopolitical tension does not allow it. The Japanese neither, the Indians neither. So we found a unique opportunity that allowed us to become visible to the hyperscaler market. We were already visible for long-distance connections between campuses, but we became visible for the market inside the data center building, where racks and servers are connected by fiber. This is the real fiber market in data centers in terms of demand quantity. Thanks to this and our asset, which we intend to expand by doubling capacity in the United States, we have entered into various agreements, we still need one more.

We are the only ones who can offer both energy cables and telecom cables to the data center world. There are players dedicated to telecom, players dedicated to energy. The fact that we are the only ones who can offer a complete package makes us exclusive. Recently, we made an acquisition in the submarine telecom world, Extera, the name of the acquired company, they make repeaters for submarine telecom long-distance connections. So we can connect via the Atlantic the American data centers with Europe. We can provide green energy to data centers. You know how demanding they are for green energy because of their sense of responsibility given the high amount of energy they consume? We can offer optical cable solutions, outside building and inside building. The market is appreciating this. Certainly this is partially reflected in the share price growth you mentioned earlier, but it is not yet reflected in the full potential of this unique opportunity, which we do not see as a bubble. We see that perhaps growth rates will slow because they have been very rapid and accelerated. We see that there are other constraints, not just the lack of cables, but labor. In the US market, where data center expansion is strongest, there is a shortage of labor for installation, for working in factories, etc. There is another important shortage: water. Data centers require more power, they have more cooling and air conditioning that requires water to be cooled. So there are many constraints, but the industry is balancing in this supply chain where various constraints are aligned to the best possible output to ensure strong growth.

Yes, the fiber is quite simple. Among the various sophistications of fiber, it is the simplest because it doesn't need to transmit large amounts of data, it's not sophisticated. Only one characteristic: it must be flexible enough. Imagine a spool, since you made the analogy with fishing line, the fiber is smaller in thickness than fishing line. But the concept is the same: there is a spool with 50 km and this thing takes up so little space. It's so compact that it disappears inside the drone's size, and this fiber unspools as the drone reaches its destination. If you look at some images of Ukrainian or Russian fields, you see a network of fiber because each drone that arrives then loses it. Imagine 500 drones a day traveling on the same routes more or less, after 6 months what do they do? This technology has been available since July last year. So Ukraine started developing this solution, first using it with 20 km distance, then 30, then 50. 50 is currently the limit and it could go even further in the future. There are images of bird nests made of fiber, no longer twigs, so widespread it has become. And I repeat, it's not only warring countries adopting drones with this technology. We receive requests from various states to equip themselves with this solution for their arsenals that are not currently used in war, but become necessary for the future. I repeat, we are not supplying that fiber, we don't want to get into it for ethical reasons, we wouldn't want to be those who favor hostile activity between countries. But that demand, being so sizable, has completely disrupted the fiber market. And the factor to read in parallel is that it takes years to increase fiber capacity. The technology to produce fiber is complicated, investments are massive. A brownfield factory, an expansion of an existing factory, takes 3 years. A greenfield factory from scratch takes 5 years. So we will live the next 3 years where no one will have additional capacity, and everyone, us, Corning, and others, are making long-term contracts to allocate existing capacity to this data center application. Only from 2029 onwards will we have incremental capacity. This has made prices explosive. Chinese fiber arrived and destroyed the European market. In the last 3 years, Chinese fiber came to Europe at a price of $4 per km, lower than our costs. So low that in 2024 we closed an Italian factory that produced fiber because we couldn't sell it even to Italian customers. Today, fiber from China arrives at $20 because there isn't any, and fiber worldwide is priced at this level. So this fiber cost, this fiber price has inflated the price of the cable that uses fiber as raw material. But data centers have a fundamental need. Fiber is one of the components, and the share of optical cable cost within a data center building or campus is not that relevant, but it is a fundamental part. Without it, the building cannot proceed and the AI expansion cannot proceed.

The price of copper has an impact on all the energy cable part that goes into data centers. It's not as explosive as the price of fiber in optical cables. But this is another important point. You're right, copper is one of the two metals used for cable conductors, the other is aluminum. Copper has followed a constant growth curve over the last 3 years, very marked, because copper is also scarce, especially in the United States. Copper mines are expanding, but those processes are also long to implement. Copper becomes a scarce material, cable costs become higher. On top of this, there is also the issue of tariffs, which have not helped contain inflation in the US market, which is certainly the most demanding in terms of energy cables and optical fiber for digital applications.

Ah, absolutely. The fiber for the world is a high-tech fiber. We have been involved for the last 10 years with hyperscalers for the most complicated fiber for interconnections between campuses. Why is it the most complicated? Because inside the building, to connect one rack to another, the amount of fiber is small. Cables with 10, 12, 24 fibers per cable. When you connect one data center to another, you need thousands of kilometers of fiber in the same cable. For example, there is a cable that Amazon needs with 6912 fibers inside the same cable. The difficulty is not putting 6912, but putting them in the smallest possible space, because the cable cannot be huge. Cables go into plastic conduits that are standard, defined, and to make installation cost-effective, you can't install a huge thing. So imagine 6912 fibers in a cable that must be so small. Technological innovation is fundamental, and the know-how of this fiber technological innovation is in Italy, in Milan. The production we have in France, Amsterdam, Brazil, North America, but the know-how is in Milan. What about the know-how for this new solution, which is hollow core fiber? That means the fiber is a glass conductor, but the new one has a void inside this conductor, so the data signal is not transmitted through glass but through air, so it is much faster and goes much farther, with lower latency. And this is one of the latest acquisitions you made. Actually, it's a startup, not an acquisition, it's a technology we incorporated. Now we are moving it from the startup lab world to the industrial world, and we have infinite demand for this technology. I won't say the price because it's outrageous, and clearly the quantities are marginal. Today we are the bottleneck, we cannot produce industrially as much as needed.

Listen, I want to paraphrase a book by a friend of ours, 'The Geopolitics of Artificial Intelligence'. When there was this agreement among all Western countries not to export advanced technology to China, practically, but no one ever talked about Prysmian. In Europe, only ASML was talked about, not Prysmian. You partially answered before, in the sense that there is a structural advantage for the Western world on fiber, but are you part of this agreement? No, we are not part of this agreement, but we are a fundamental part of the supply chain, I repeat. And the geopolitical situation makes the presence of fiber and optical cable assets in the United States priceless. We have a competitive position linked to the fact that we have always invested in the US in local capacity. Today we have a factory that produces 20 million km of fiber in the US, which we are doubling, actually more than doubling, and we have four factories that produce optical cables starting from fiber in the US. This presence is fundamental for data center deployment, which, as you know, is substantially in the US, little in Europe, and little in the rest of the world. And it's not true that after the North America wave, the Europe and rest of the world wave will come. It will always be a tenth of the North American market, what we will see of data centers in the rest of the world and in Europe, because electricity costs, space availability, and proximity to hyperscalers are not there in Europe, and there are fundamental constraints to this deployment.

I always took the value of Pirelli. At that time it was about the same value as now, over 5 billion market cap. Prysmian was sold. I remember I managed a fund then, a hedge fund. It was sold for a billion something, a billion and two I think, something like 1.3 billion.

Yes. And the feelings then were conflicting. I had been transferred from Pirelli tires, a world I loved, because tires and cars are always of greater interest to the public, so I was young, had this interest, and in 2002 I go to cables, I say okay, I go to cables, they offer me a career opportunity etc. In 2004, after 2 years in cables, they tell me, the CEO at that time was Giovanni Ferrario, we are selling, and I said, what the heck, what bad luck, excuse the term. So I faced that path with some anguish, disappointment, and frustration. The reality is that in those months of the sale, between September '04 when it was announced and July '05 when it happened, I was in management presentations to present the company to funds. And in those months, the cable market began to recover. The cost of copper metal rose. With the cost rising, prices increased. We managed to pass on more than the cost to the market, demand grew, and it was a machine that didn't stop. I think if it had stopped, it would have been better for the seller. It didn't stop, it was a great deal for the buyer.

After the acquisition, the market became even more solid. It had 2005, 2006-2007, strong years of growth, and Pirelli Cables, which in the meantime had become Prysmian from July 2005, had grown in revenue and size. Then a sequence of important events happened. A first acquisition with the acquisition of Draka in 2011, which gave us a stronger European presence, but especially a presence in telecom, which now becomes an important growth lever. Think of the coincidence: the factory we have in the US was bought from Draka in 2011, so the purchase of Draka brought us those US assets. Then another important crossroads in 2017-18. We were working in 2017 on the acquisition of a large French global player, and we were close until at the last moment the management of the player changed their mind, so we were left with nothing after months of negotiation. But a stroke of luck was that 6 months later the option to acquire General Cable in the United States opened up. If we had done the big European acquisition, we would not have had the financial strength to do the General Cable acquisition. The two acquisitions were similar, but a fundamental difference is that the General Cable one opened us to the American market. Before that acquisition, we were a company doing $1 billion in revenue in the US. We went from $1 billion to, thanks to that acquisition and leveraging integration, assets, synergies, and other acquisitions made in the last 24 months, today we have $10 billion in revenue in the US, which is half, a little less than half of our turnover. But it's not so much the revenue that makes the difference, but the fact of being exposed to a single market. It's a great region. Europe is also a great region, but America is a great region with a concentrated, very consolidated portfolio of customers and suppliers, so price discipline, discipline. In Europe there is great market fragmentation. It's a large single market that moves in one direction, while each European state goes in its own direction. So the profitability of US revenue is double that of Europe. This would not have happened if we had not been unlucky with the European player acquisition. So at that moment it was a negative point for us to have lost an opportunity. It turned into a great opportunity. Today we have a very strong American exposure to the electrification world, we are leaders in that segment, the digital solution we commented on before, and above all we have great balance. Europe has different growth drivers than North America. Not always are these drivers in sync, but that's the strength of Prysmian: portfolio differentiation and geographic differentiation. I return to the point of Milan. The know-how is in Milan. We have the R&D structure that governs the R&D of all other 25 R&D centers in Milan, and this is a strength because we do not compete with regional players with local forces; we compete with regional players with the globality of R&D vision, but also the globality of supply chain, the globality of operations. We have gained market share in data centers in the US and North America because we activated productions outside North America to respond quickly to the surge in demand for energy cables in North America or the surge in digital solution cables in North America. So we are a global player that has its strength in the center. If we were disconnected from the center and competed with local American realities, we would not be able to win in leadership as we are winning today. So this heart, this head in Milan is fundamental.

What a question. In these difficult times when everything is moving to America, especially given that if you are listed in America, the multiples are different. You're touching a raw nerve. Well, clearly what I said before applies. We feel Italian because it's an Italian multinational, we grew up in Milan for 100-140 years, we are Milan by birth and we remain proud to be Italian. Clearly we are not satisfied with the support Italy gives us, both from the government side, but we don't need it, it doesn't concern us, and also from the customer side. I repeat, we closed a factory that made optical cables that we would have gladly kept open because in these moments we would benefit, but Italian customers didn't buy fiber from us, they bought from China, so we have never been strongly supported by the customer side. I say this without malice, as an objective fact, and I won't name other customers. But that said, we are Italian at heart and mind, but we are global and we like this geographic differentiation. Clearly, North America, having grown so much in our perimeter, has opened in us the ambition to say why don't we also list in the US, not removing Italy, but a dual listing that would certainly allow us to capture what you said earlier, the opportunity for rerating, improvement in the growth of company value. There are US-based funds and investors that cannot buy shares in stocks not listed in New York, so there is capital we cannot reach. There is also the intangible but valuable advantage. It's a path that we said last year at the Capital Market Day in '25 was not feasible simultaneously with all the other things we had to do: the acquisition of Anchor, the acquisition of Channel, the Capital Market Day, the integrations of these companies. In the end, we have strengthened ourselves this year, we are working on new acquisitions. It's likely that the new acquisitions will be American because for every dollar I put in, I get twice the return compared to the same dollar in a European acquisition. This will make it even more inevitable, fortunately. Maybe there won't be simultaneity between the US listing and the M&A operation, but it becomes even more evident that we are becoming more American, so it becomes a no-brainer to take that step.

I would say that I want to distinguish, perhaps to address your question, different periods of our history. Between 2005 and 2022, certainly M&A growth was fundamental. The acquisition of the global perimeter of Draka Holding and that of General Cable made us take important steps of leadership and growth in various markets. From 2022 onwards, the market changed. While before the market was substantially stable and we were a company with a super focus on costs.

I remember the previous CEO, I was part of the structure, the analysis of factory scrap, efficiencies, headcount, fixed costs, it was our daily bread, and the lesson from Goldman Sachs was free cash flow, meaning we managed working capital as if it were our own money, so it's a company very focused on itself that created the foundations to be a global champion. From 2022 onwards the market changed. The Energy Transition was born, which requires creating renewable sources and connecting these renewable sources, which are notoriously far from consumption, with long-distance cables. So the world of transmission, submarine cables, nobody knows about it, but we have 11 ships, we are a cable producer with 11 ships, and one says 'What are the ships for?' We install all the cables we produce, and it's unique, you won't find it. So the Energy Transition brought demand for renewable electricity, transmission of this electricity, but the grid between the consumer and the transmitted electricity is not strong, it needs reinforcement, so you also need the Power Grid to reinforce national grids, etc. Then the connection with buildings requires the last mile of electrification.

This demand has grown strongly in recent years. North America does not invest in offshore renewable, but invests in electrification. North America is electrifying new buildings in New York, above seven floors are mandatory without gas. So heating of homes and residential and non-residential buildings is replaced by heat pumps. So electrification is the true growth driver in the United States, while transmission is the true growth driver in Europe. So this demand that has grown in these geographical areas has meant that from 2022 onwards our focus had to stay, or rather had to remain, on costs because we are not a company that makes 50% EBITDA margin or anything like that. Here we have to be careful about costs, but at the same time we had to turn the company's mission 180 degrees towards growth, and in the last 3 years I would say we have made an excellent combination of the two: investments for organic capacity and growth, especially in the US and M&A. M&A we do not announce until we do it, unlike other players who say they will do it and then maybe find themselves in difficulty.

But M&A is our growth driver not only in terms of revenue or EBITDA or assets or portfolio that we get from the acquisitions we make, but from the point of view of talent. That is, M&A is what brought us that know-how for which Milan is central in the world. It's not that we acquire companies in Milan, but we have in Milan the control of all this know-how. Today with 34,000 people, we have 2/3 of these people who are not original Prysmian, because when we make an acquisition, for the various positions we choose between two, the legacy Prysmian or the legacy of the company we buy, and we take the best. This has meant that we have enriched our know-how, which is the winning factor. You cannot develop know-how organically as quickly as you can by having access to a pool of people that M&A allows you to access.

Well, first of all, 4 billion is to say that a year and a half after the last acquisition we have restored significant firepower. Actually, we are able to spend much more than four, given the strong deleverage that has come in the last 2 years, given that we have a pre-agreed, pre-approved by shareholders, possibility to increase capital by 10% and as you said before, 42 billion market cap allows us to raise 4.5 billion of new capital. So we have power up to 10 billion dollars if we want to do it, but it's hard to find the company. We are highly selective in M&A because we cannot make mistakes. The business fit is important, the cultural fit is even more so. We are looking, unlike the past, not for opportunities that give us an increase in leadership, because with the last two acquisitions of Encore and Channel we have closed those leadership gaps that we were missing in various markets. So we are looking for acquisitions that are still in the cable space, but can also be in the adjacencies of cables, maybe components that help, are used for cable installation. So we are also looking a bit more laterally in the value chain. The important thing is that there is synergistic value. We do not buy to add, leave it standalone, we buy to integrate. Integrating meant in the past cost synergies, today they are commercial synergies, so finding something that enriches my portfolio, allows cross-selling, so selling more of one and the other and adding. Thanks to this, it is increasingly difficult because we also have market share positions that do not allow us to go exactly on the cable itself because we would trigger various European or American antitrust. America remains a priority, but we are looking at 360 degrees, and anyway I always have to, these are the most frequent questions from investors to which I can really answer in a very soft way because if they knew what the real target is, imagine how much more it would cost us to buy it.

Exactly. We are deliberately misleading a bit.

Well, I can say that you can already see a lot of what is happening in Europe. This lack of unity in defining common market rules or growth drivers makes Europe less competitive. Europe is much less protected than the United States, and it's not the tariffs that changed American protection, those only confused customers, investors, etc., it's the fact that America lives on made in the US, and Europe has always considered itself open to the global world. So I take the case of the fiber world. Fiber in Europe is produced only by us. The market is 60 million km and we produce 15. The rest is imported. If you do the analogy in North America, it's exactly the opposite. 85% is produced in the US and 15% is imported. And Europe is open. This means that at a certain point, since those who compete in Europe, not Europeans who come from the Asian world, do not use exactly the same business logic or are not companies that live on their cash flow, but live on state subsidies, etc., Europe is open to this type of player, and you see it from the restructuring that Volkswagen has launched, 100,000 jobs, 15% of its workforce. Why? Because BYD has taken a share of the European market that 5 years ago no one even imagined it would take. So what can I say? Europe is creating a problem for itself, because protectionism is not about protecting local companies, but guaranteeing fair competition. And we have been active several times with the European Commission to make them understand these dumping logics that exist in the market.

First time in 2021 and we won this case against the dumping of optical cables brought from China to Europe, for which European duties were imposed on these imports. We proposed another case for fiber that is brought into Europe, as I said before, at $4. Our production cost in Italy was €5 and we have been waiting for a positive solution for 3 years, it doesn't happen. That is, if Europe does not decide to do something, not for absolute defense logic, but for fair competition logic, more and more European companies will find themselves losing market share. You lose market share, you lose volume, you lose volume, you are more inefficient, the so-called negative spiral enters from which you don't come out, you come out with innovation, so innovation is for us the true defense against competitors that arrive from outside. And we always try, for example, in the transmission world, which is the most complicated cable, the one that goes submarine or high-power terrestrial, to create distance factors, so that we keep them always one step behind. If we were to fight on costs we would have lost, because they arrive with conditions that we cannot afford. So innovation remains the only true anchor for European companies or global companies like ours. We believe our internal slogan that we can defend market leadership only through technological leadership, which means being innovators at 360 degrees, and it's not just the cable that is innovated with more power, etc., or digital solutions, but also service. For example, in the US we have a service where a customer order that arrives today is delivered in 24 hours. Fantastic, because the customer, American distributors no longer keep stock, we have it, there is no need for stock. So sustainability...

Sustainability for us has been a two-faced initiative. One, we wanted, as enablers of energy transformation, to set a good example on sustainability. So we set a target of net zero scope 1, 2, and 3, so for our factories scope 1 and 2, and for the cables that are in operation and have CO2 emissions not from production, but because they have energy losses that determine CO2 emissions, net zero by 2035 on all three scopes 1, 2, 3. There is no one who has achieved, has shown commitment of this type. And if you consider that in 2020 it was an investor, a series of investors IRG, who told us guys you have to wake up because the world is going in that direction, even more we are proud to have made this growth in 5 years and to have given these certified targets for 2035. Second, sustainability is no longer just net zero, it is for us a way to offer new innovative solutions where R&D works hard to put recycled materials in cables, copper itself. We recycle copper to put PVC and other recycled compounds, sell sustainable solutions for our customers who also have scope 2, scope 1 targets to zero. So in some scenarios we gain share of wallet thanks to a cable that has superior sustainability qualities. In other cases, also a price. For example, we have a large submarine transmission connection in the UK between Scotland and England that will be made entirely with conductor with entirely recycled copper. The cost is borne by the customer, it is a sustainability factor for us. We gave them the technological solution that allows this. So sustainability is an ethical, moral goal important for us, but it is a business factor. We do it because it makes us grow organically in price or volume.

It is clear that having a majority shareholder simplifies life for management, but it is equally clear, and I am happy to say it, that having a widespread shareholding gives much more stimulus and much more positive and constructive pressure than a majority shareholder. So for us it is not a constraint, it is a great opportunity. Contrary to what is happening especially in America, we have these iconic dominant figures. As I said before, the sustainability case came from investors, but as the fiber theme came in March 2026 from, for me I spend a lot of time outside with investors because you have to communicate the strategy, you have to communicate our things, understand not so much the results achieved, but above all the vision of the future. And every time I find it boring, it's true, many questions, because when you do a roadshow that lasts two days you meet dozens and dozens and many questions are repeated, but I find fantastic the opportunity I have to know their perspective which often makes me reflect. It gives me inputs to say maybe we could do this thing differently, maybe what one sees I haven't seen yet is an opportunity. So for me it is a great upside to have such a differentiated shareholder base and the possibility of normally doing 1000-1200 meetings with investors per year. This is total wealth.

And I see it as a great risk of vulnerability because for example in R&D, innovation that can be greatly accelerated with AI can give competitors the ease to close that gap that I said before I want to maintain, because if you use traditional technologies for material development, cable design development, etc., you are decidedly slower. So, if I have to recognize that we have not been capable, we have done several use cases, there is quite a bit of implementation, but not at a level that I consider indispensable or appropriate for a market leader like Prysmian must be, so we are working on it, we will close the gap, but while on sustainability I am highly proud of what we have done and are doing, on AI not yet, but I hope soon, the next time we see each other or...

Well, a lot, and especially on two fronts. The cable itself has become, only in the last 5 years, a cable that thanks to technological innovation transmits, at the same cost, double the power. So imagine...

Absolutely, the sustainability of the energy transition from a financial point of view. Certainly. The projects in Germany that connect the North Sea offshore platforms to consumption in southern Germany are about 1000-1200 km of terrestrial connection. The previous technology until 2020 was 320 kV, which meant 1 GW of power transmitted. With the 525 kV solution, that GW became 2, so the cost per MW transmitted halved. Not only the cost of the cable, the installation cost. To do the same transmission of 2 GW with the previous technology you had to put four cables, now you put two. 3 months ago we made a further step. This 525 kV solution today can operate at a higher operating temperature, so it transmits an additional 20% of power capacity. So today we go to 2.4 GW when until 3 months ago it was 2 GW with the same cable, changing components, etc. So this is a strong innovation that allows the energy transition to happen with lower costs. So I gladly take your comment of deflation of the system.

Our cycle, however, is a part with more materiality, more physical. Innovation is this, you have to make the use of the cable more sustainable in the energy transition. On the side of ships and installation, which is the other important aspect of innovation, today we can install cables up to 3000 m depth, and one says what do you do with that? You do that many connections between North Africa and Italy, sorry, were not feasible because you had to cross depth zones where you couldn't lay the cable. So you open new routes, which means new business for Prysmian, certainly, but above all the possibility of taking solar production, for example, in North Africa at low cost and bringing it to Italy. So innovation makes this market more interesting, but it really makes the Energy Transformation an important growth driver. I cite an example. The war in the Middle East, what is it bringing? It is bringing that already with Ukraine and Russia, Europe realized that it had a great vulnerability on gas imported from Russia, ok? They found a way to close that channel, to activate with others, but there remains a great source of energy produced in the Middle East and used in Europe. The goal of Europe and all regions is to disconnect, to become autonomous. The way to become autonomous does not exist other than renewable. So Prysmian strongly pushes and will strongly exploit this opportunity that the goal of every region, many are already self-sufficient in North America, Europe has no independent energy resources, fossil fuel must create them, and nuclear is certainly a solution, but it is very long. Further renewable is the best answer to make Europe geopolitically stronger and autonomous from an energy point of view.

They have become, it has happened some examples, they have finally become considered by Europe as strategic assets. Nice name, but then they don't do much to consider them as such. What Prysmian does to make this network, which is immense of submarine cables, telecom, going back to the theme of innovation, to have increasingly sophisticated means to allow submarine burial at greater depths. Submarine cables are normally laid on the seabed, but in the distance between beach, coast and 600 m depth they are buried, not because of fear of cyber security attack, but because of fear that ship anchors or fishing equipment could damage them. So the technology of burying cables has always been present. But recently, clients, given the capability of Prysmian's new naval assets, ask us for greater depth to make it mechanically or physically more protected.

There is another important element that is added, the Prysmian power cable is always combined with an optical cable, that is, an optical cable that travels on the bundle of the submarine cable and serves to monitor the quality of the energy, the power transmitted, and gives an additional benefit when the cable is interrupted due to intentional damage or sabotage or unintentional damage, sabotage. Because the interruption of the optical cable gives us an immediate way to understand where the point of interruption is. So, when once it happened that the connection no longer worked, we went to look for where it broke. Imagine the complexity of finding where a cable broke, especially when it is buried. That optical cable allows us to know with certainty of 1-2 meters, so knowing exactly where the point is.

The third fundamental element of this equation is to put together an asset that we keep available. An asset means a ship with splicers, with special equipment, always on standby, waiting for the client's call. The cable broke, we know where it broke, we intervene and repair in 40 days, thus restoring in 40 days a data line or a power line when normally it took 3 or 4 months. So this is what Prysmian can do as burial depth to guarantee more security and as rapid intervention with the signaling of the optical cable and the available ship to make these episodes, if they were to occur, more manageable and affordable.

It works that there are crews, parts of the crew that are related to the installation know-how that are all Prysmian personnel. The crew that drives the ship can be a crew that we buy from the market. However, the man, when the ship maneuvers in installation and therefore must proceed at a certain speed depending on a certain wheel, etc., it is all Prysmian personnel that controls the positioning of the ship, the descent of the cable to sea, etc. These are highly sophisticated ships. Think of a fact, when you lay in a calm sea nothing happens, but when you find wind, currents and storms, the ship must stay there. It may have 50 km of cable being laid, it has 2 km of cable hanging from the stern, going to the seabed, a storm arrives, the ship stays still and cannot move, so you need engines and equipment that allow the so-called dynamic positioning, that is, the ship stays in that position even with waves of 5 m and wind at 120 km/h and sea currents of 5 knots, because it has happened in the past that with events of this type the only way to save the ship and crew was to cut the cable and take shelter, events that have happened clearly moments that the client does not appreciate because you cut a cable and then have to create a new joint, so an additional weakness in the system. The last three ships taken allow us to overcome any atmospheric condition without having to resort to this emergency exit.

Sensitive question. No, look, certainly in monitoring of underwater activities. Clearly a great differentiation, diversification for Fincantieri compared to pure production. I understand that it becomes a new important revenue driver for Fincantieri. We are already on our part of the buried network or installation equipped with our solutions, but I do not exclude that there could be partnership opportunities. In particular, one of the four M&A that Fincantieri is carrying out is related to a seabed survey activity that we have already equipped ourselves with an acquisition made just 6 months ago in the same space, in the same logic.

Well, two intense years, certainly a complicated challenge. That of, when I said before, turning the company's direction 180 degrees is a strong challenge, because having 34,000 people who were used to doing certain things, telling them do that still but do others, was not easy. Often there have been moments of discouragement because sometimes the mindsets of the past still come, no, I can't hire people because I increase costs and who cares, then you give me more revenue. So there are still some nuclei, some pockets of the company not aligned, so important challenging.

But at the same time excitement because it's nice to say that a company that did this and you are taking it in another direction. Then the numbers help us to be proud of what we have done. So there is the excitement of saying 'Damn, this thing is working? The company is understanding, the market sees us differently.'

I heard a colleague who told me that his son had his high school diploma and he wanted to give him a car for turning 18, going to university, etc. And this son said 'No, look, I don't need the car, but I would like you to give me Prysmian.' And this is a fundamental point of pride. It means, when an 18-year-old who probably aspires to that moment normally wants a car, says 'No, I prefer Prysmian'. It means that this transformation is happening and that there is a sense of pride of this son, of an employee who recognizes that Prysmian is a value for the family, a value for his friends, etc. So a lot of pressure because the market, as you know, sets expectations, the more you do the more it raises them, but a beautiful pressure, positive, to do better, to do faster, to do more, and so a positive balance. Effort, yes, challenge is a lot, pressure also, important risk orientation, but gratification and so we are fine.

Thank you.