Signify Nv · EURONEXT:LIGHT
Signify Nv — Signify Nv Ord — Q4 2024 Earnings Presentation
28 slides from Signify Nv's earnings presentation, Jan 24, 2025
Slide 1: Q4 2024 results
Q4 2024 results January 24, 2025 NatureConnect Pittarello Office
Slide 2: Important information
Important information Forward-looking statements This release contains forward-looking statements that reflect the intentions, beliefs or current expectations and projections of Signify, including statements regarding strategy, estimates of sales growth and future operational results. By their natur
Slide 3: Content
Content Full Year 24 performance - Eric Rondolat Q4 24 Financial performance - Željko Kosanović Capital Allocation and Outlook - Eric Rondolat Q&A 3 NatureConnect Stirixis Office
Slide 4: 2024 was a year of successful transition for Signify
2024 was a year of successful transition for Signify Implemented new organizational structure in April 2024, consisting of four verticalized businesses with full profit and loss responsibility Launched cost reduction program with 2/3 of savings realized in 2024, as committed Successfully manag
Slide 5: Signify delivers a robust 2024 profitability despite continued headwinds
Signify delivers a robust 2024 profitability despite continued headwinds Connected light points: 144 million • Strong connected sales in Professional and Consumer businesses • Progressively improving topline Comparable Sales Growth (CSG): - 6.6% • Signify CSG excluding Conventional at -4.2% • Profes
Slide 6: Professional, Consumer and OEM further increased their contribution to Signify
The Professional, Consumer and OEM businesses further increased their contribution to overall Signify FCF contribution Sales contribution Adj. EBITA contribution 92% 91% 93% 82% 88% 2024 2023 2024 2023 2024 Conventional Signify ex. Conventional and Others 6
Slide 7: Decline of Conventional business drag on CSG and Adj. EBITA
The decline of the Conventional business has led to a drag effect on Signify’s CSG and Adj. EBITA performance Impact of Conventional business on FY 24 CSG Impact of Conventional business on FY 24 Adj. EBITA margin Signify excl. Conventional 2024 Conventional impact 2024 30 bps 10.0% 9.9% -40 bps -4.
Slide 8: OEM and Consumer stabilized; Professional faced headwinds in Europe
OEM and Consumer stabilized and delivered margin expansion; Professional continued to face headwinds in Europe Professional Consumer OEM CSG% -1.2% -2.0% -4.4% -5.8% -9.3% -23.0% 2023 2024 2023 2024 2023 2024 -40bps +220bps +170bps Adj. EBITA% 9.7% 11.1% 9.3% 8.9% 9.4% 11.1% 2023 2024 2023 2024 2023
Slide 9: Cost reduction program delivered gross savings of EUR 131 million
The cost reduction program was successfully implemented and delivered gross savings of EUR 131 million, in line with commitment €M 21 2,075 1,965 -131 Adj. Indirect Adj. Indirect costs 2023 Investments, Investments, Inflation & FX Savings Savings Adj. Indirect Adj. Indirect costs 2024 costs 2023 Inf
Slide 10: Brighter Lives, Better World 2025
Brighter Lives, Better World 2025 – FY 2024 results 2019 FY 2024 2025 Doubling our positive impact on the environment and society Baseline Result Target Climate action Carbon reduction over value chain Ahead of Better World 0 324 MT against Paris Agreement track Circular economy Circular revenues 16
Slide 11: Content
Content Full Year 24 performance - Eric Rondolat Q4 24 Financial performance - Željko Kosanović Capital Allocation and Outlook - Eric Rondolat Q&A NatureConnect Stirixis Office
Slide 12: Sequential sales improvement in Q4 2024, adj. EBITA margin expansion
Signify delivers sequential sales improvement in Q4 2024, adj. EBITA margin expansion and solid free cash flow generation Sales (in EURm) & comparable sales growth (in %) Q4 key developments CSG -7.7% -2.8% -10.1% -8.4% -5.2% • Comparable sales decline of 2.8% • Sequential sales improvement • Strong
Slide 13: Professional Business: CSG of -3.4%, adj. EBITA margin of 10.8%
The Professional Business reported a CSG of -3.4% and an adj. EBITA margin of 10.8% Sales (in EURm) & comparable sales growth (in %) Key developments CSG -3.0% -3.4% -7.6% -8.3% -4.1% • Comparable sales decline of 3.4% • Sequential sales improvement with strong agriculture lighting and connected sys
Slide 14: Consumer Business: CSG of 4.0%, adj. EBITA margin 17.4%
The Consumer Business delivered a CSG of 4.0% and a strong adj. EBITA margin expansion to 17.4% Sales (in EURm) & comparable sales growth (in %) Q4 key developments CSG -5.3% 4.0% -5.7% -2.4% -1.8% • Comparable sales growth of 4.0% • Consumer business growing in all regions except China • Strong con
Slide 15: OEM Business: CSG of -1.2%, adj. EBITA margin 8.5%
The OEM Business reported a CSG of -1.2% and Adj. EBITA margin expansion of 40 bps to 8.5% Sales (in EURm) & comparable sales growth (in %) Key developments CSG -23.7% -1.2% -7.4% 0.1% 0.2% • Comparable sales decline of -1.2% • Stable performance in most markets • Softness in APAC region 107 103 103
Slide 16: Conventional Business maintained solid profitability despite topline decline
The Conventional Business maintained a solid profitability despite the continued topline decline Sales (in EURm) & comparable sales growth (in %) Key developments CSG -29.6% -24.5% -34.1% -27.6% -29.4% • Comparable sales decline of 24.5% • Strong decline of general lighting sales in most geographies
Slide 17: Business highlights
Business highlights Signify Professional Consumer Earning Platinum medal Optimizing PSV’s stadium Improving patients' Elevating experiences at from EcoVadis for the 5th pitch maintenance with comfort at Sightour Mercedes-AMG PETRONAS consecutive year innovative lighting ophthalmic Hospital, China F1
Slide 18: Adj. EBITA increases to 12.4% on productivity gains and cost savings
Adj. EBITA increases to 12.4% driven by productivity gains and indirect cost savings; price stable vs. Q3 2024 while mix slightly deteriorated As % of sales 12.1% +30bps 12.4% 0.0% 0.1% -50bps -0.5% 1.3% -2.7% 2.2% Q4 23 Volume Price/Mix COGS Indirect Costs Currency Other Q4 24 18
Slide 19: Working capital reduced by EUR 39 million
Working capital reduced by EUR 39 million driven by higher payables and lower inventories In EURm / as % of sales 6.9% 6.9% 461 6 422 -15 19 -49 Q4 23 Inventories Trade & other receivables Trade & other payables Other working Q4 24 19 capital items
Slide 20: Year-end leverage ratio reduced to 1.3x
The 2024 year-end leverage ratio significantly reduced to 1.3x through strong cash flow generation, allowing for successful deleveraging In EURm €M 1,096 FCF: EUR 188m -920 14 12 1 -241 41 59 -77 17 Net 1.7x 1.3x leverage Net debt EBITDA Change in Net capex Change in Interest & Tax Other FCF items O
Slide 21: Content
Content Full Year 24 performance - Eric Rondolat Q4 24 Financial performance - Željko Kosanović Capital Allocation and Outlook - Eric Rondolat Q&A NatureConnect Stirixis Office
Slide 22: Dividend of EUR 1.56 per share; share repurchase program up to EUR 150m
Signify announces dividend per share of EUR 1.56; launches share repurchase program of up to EUR 150m for 2025 Capital allocation policy Key developments 1. Continue to maintain a robust capital structure 2024 to support our commitment to an investment • Signify strengthened its balance sheet: grade
Slide 23: Outlook FY 2025: Stable CSG and Adj. EBITA margin, strong free cash flow
Outlook FY 2025: Stable CSG and Adj. EBITA margin, strong free cash flow generation enabling share buybacks CSG: Adj. EBITA margin: Free Cash Flow: Low single digit growth (ex Conventional) Stable vs. 2024 7.0% - 8.0% of sales Signify expects low single digit comparable Signify expects a stable adj.
Slide 24: Q&A
Q&A Need to update photo NatureConnect NatureConnect Pittarello Office
Slide 25: Net income increased to EUR 119m on lower restructuring costs
Net income increased to EUR 119m achieved through lower restructuring costs From Adjusted EBITA to net income (in EURm) Key developments Q4 23 Q4 24 1 Incidental items are mainly related to a one-off gain Adjusted EBITA 209 205 in a real estate transaction of EUR 15m - Restructuring -83 -30 - Acquis
Slide 26: Free cash flow decreased to EUR 188m
Free cash flow decreased to EUR 188m, explained by a lower inflow from working capital Free cash flow (in EURm) Key developments Q4 23 Q4 24 • Free cash flow of EUR 188m Income from operations 89 179 Depreciation and amortization 69 63 • Cash outflow from US pensions de-risking of EUR Additions to (
Slide 27: Currency movements impact on sales and Adjusted EBITA margin
Currency movements had a negative impact on sales and no impact on the Adjusted EBITA margin Q4 24 Sales FX Footprint (% of total) Key developments • Overall currency impact on sales of -1.8% coming from a mix of currencies. • No impact on the Adjusted EBITA margin %. 27
Slide 28: Stony
Stony