Signify Nv · EURONEXT:LIGHT
Signify Nv — Shareholder Meeting (May 2022)
50 slides from Signify Nv's shareholder meeting presentation, May 17, 2022
Slide 1: Annual General Meeting of Shareholders 2022
Annual General Meeting of Shareholders 2022
Slide 2: Presentation by CEO Eric Rondolat
1. Presentation by CEO Eric Rondolat 2
Slide 3: Full year 2021
Full year 2021 Strengthening Signify's growth profile in a challenging external environment • LED-based sales increased to 83% (FY 20: 80%) • Connected light points rose to 96m (FY 20: 77m) • Comparable sales grew by 3.8% • Adjusted indirect costs reduced to 29.6% of sales • Operational profitabilit
Slide 4: Brighter Lives, Better World 2025 - 2021 results
Brighter Lives, Better World 2025 - 2021 results Doubling our positive impact on the environment and society 2019 2021 2025 Baseline Result Target Better World Climate action Carbon reduction over value 0 On track 324 MT chain against Paris Agreement Circular economy Circular revenues 16% 21% - 25%
Slide 5: Signify's Frontiers strategy
Signify’s 5 Frontiers strategy 5
Slide 6: Build a customer-centric organization
Signify’s 5 Frontiers strategy Build a customer-centric organization • Customer Net Promoter Score improved by 3 points to 44 • Net Promoter Score grew by 10 points in the Americas 6 6
Slide 7: Deliver differentiated lighting offers
Signify’s 5 Frontiers strategy Deliver differentiated lighting offers • Invested 4.1% of our sales in R&D • Launched B-Brands to cover the various segments of the market • Launched the ultra-efficient LED lamp 7 7
Slide 8: Drive growth for sustainability
Signify’s 5 Frontiers strategy Drive growth for sustainability • Connected lighting sales grew by 21% to EUR 1.4 billion • Growth platforms grew by 19% to EUR 326 million 8 8
Slide 9: Digitalize and transform for the future
Signify’s 5 Frontiers strategy Digitalize and transform for the future • Digital sales via our B2C channels increased by 53.6% • Digital Academy for employees launched 9 9
Slide 10: Be a great place to work
Signify’s 5 Frontiers strategy Be a great place to work • Employee Net Promoter Score of 32 • Over 80% of leadership positions staffed internally • Installed UV-C disinfection lighting in 138 Signify locations 10 10
Slide 11: Signify is the world leader in lighting
Signify is the world leader in lighting We provide high-quality energy efficient lighting products, systems and services Light sources Luminaires Systems and Services No. 1 €6.9bn 37,000 people in 74 countries 100% Conventional, LED sales in 2021, Carbon neutral and Connected ~ 75% professional oper
Slide 12: Transitioned to an LED-based company with nine years of margin improvement
Transitioned successfully to an LED-based company with nine years of consecutive operating margin improvement Transition from conventional to Development of Adj. EBITA margin LED-based sales (in % of total sales) 11.6% 10.7% 10.1% 10.4% 9.6% 8.9% Conventional 17% 7.3% 6.8% 6.4% 78% 83% 4.7% LED 22%
Slide 13: First quarter 2022
First quarter 2022 • Sales increased to EUR 1.8 billion • Comparable sales grew by 6.4% • Operational profitability was 10.5% • Connected light points rose to 100 million • LED-based sales increased to 84% of total sales • Safeguarding Ukrainian employees the top priority • Investments in Russia sto
Slide 14: Outlook 2022
Outlook 2022 Based on current visibility, Signify confirms guidance for 2022: • Comparable sales growth in the range of 3-6% • Continued adjusted EBITA margin improvement of up to 50 bps • Free cash flow in excess of 8% of sales 14 Herzogenaurach, Germany
Slide 15: Connected Lighting Systems & Growth platforms
Connected Lighting Systems & Growth platforms Connected lighting & Growth platforms +21% +19% 25% Connected lighting Growth platforms Total sales 15
Slide 16: Connected Lighting Systems & Growth platforms
Connected Lighting Systems & Growth platforms 16
Slide 17: Climate action and Safety & security: Herzogenaurach
Connected Lighting Systems & Growth platforms Climate action and Safety & security LED lighting and Interact City for the city of Herzogenaurach, Germany 17
Slide 18: Climate action and Safety & security: Veneto
Connected Lighting Systems & Growth platforms Climate action and Safety & security Solar and hybrid street lighting for 10 municipalities in Veneto, Italy 18
Slide 19: Circular economy
Connected Lighting Systems & Growth platforms Circular economy 3D-printed downlights and LEDs at El Dorado International Airport, Colombia 19
Slide 20: Food availability
Connected Lighting Systems & Growth platforms Food availability Philips GreenPower LED and Philips GrowWise control system at Ljusgårda, Sweden 20
Slide 21: Health & well-being: Philips Hue
Connected Lighting Systems & Growth platforms Health & well-being Philips Hue Enrave Pendant 21
Slide 22: Health & well-being: UV-C disinfection lighting
Connected Lighting Systems & Growth platforms Health & well-being UV-C disinfection lighting at TTFB restaurants, Taiwan 22
Slide 23: Corporate Social Responsibility through the Foundation
Corporate Social Responsibility through the Foundation Enabling access to benefits of sustainable lighting solutions for underserved communities Lighting lives • 7.2 million lives lit; on track to light 10 million lives by end-2025 Supporting entrepreneurs • 11,000 local lighting entrepreneurs suppo
Slide 24: Thank you
Thank you
Slide 25: Remuneration report 2021
2. Remuneration report 2021 25
Slide 26: Remuneration Board of Management 2021
Remuneration Board of Management 2021 Board of Base Salary Annual (Cash) Incentive Long-term Equity-based Management Jan 1, 2021 (% of Base Salary) Incentive at target (+2%) (% of Base Salary) Min. Target Max. E.H.E. Rondolat € 919,737 0 80 160 100 F.J. van Engelen € 601,800 0 60 120 80 M.L. Mariani
Slide 27: Annual Incentive 2021
Annual Incentive 2021 The Annual Incentive 2021 consists of two major components: 1 Financial • Growth measure – Comparable Sales Growth Component (ext. reported) Three • Profit measure – Adj. EBITA - Adjusted Earnings Before Interest, Tax and performance Amortization (ext. reported) measures • Cash
Slide 28: Long-term Incentive 2021
Long-term Incentive 2021 Long-term Incentive 2021 performance measures: Performance measures 25% 25% Relative TSR Free Cash Flow Sustainability 25% 25% ROCE 28
Slide 29: Annual Incentive Realization 2021
Annual Incentive Realization 2021 Performance measures Weighting Realized Realized % Multiple achieved Comparable sales growth 30% 3.8% 80.0% 24.0% Adjusted EBITA 30% 11.6% 160.0% 48.0% Free Cash Flow 20% 8.9% 107.1% 21.4% Team and individual performance measures 20% ― 90.0% 18.0% Multiple achieved
Slide 30: 2019 Long-Term Incentive Grant Performance Achievement and Vesting Levels
2019 Long-Term Incentive Grant Performance Achievement and Vesting Levels Achievement Weighting Vesting level TSR 160% 40% 64.0% Free Cash Flow 200% 40% 80.0% Sustainability 183% 20% 36.6% Total 180.6% 30
Slide 31: Remuneration Supervisory Board 2021
Remuneration Supervisory Board 2021 Other Supervisory Board Membership Committees Total compensation1 A.P.M. van der Poel € 110,000 € 25,000 € - € 135,000 G. van der Aast € 85,000 € 28,000 € - € 113,000 E. Blok € 75,000 € 26,000 € - € 101,000 P. Knapp € 75,000 € 32,500 € 7,500 € 115,000 R.S. Lane €
Slide 32: Remuneration Board of Management - Outlook 2022
Remuneration Board of Management - Outlook 2022 32
Slide 33: Overview of Total Direct Compensation for the Board of Management
Overview of Total Direct Compensation for the Board of Management Outlook 2022 total direct compensation for members of the Board of Management Base Salary Short-Term Long-term Total Direct In EUR Jan 1, 2022 Incentive 1 Incentive 1 Compensation 1 (+3%) (% of Base Salary) (% of Base Salary) E.H.E. R
Slide 34: Explanation of the policy on additions to reserves and dividends
3. Explanation of the policy on additions to reserves and dividends 34
Slide 35: Proposed 2021 dividend of EUR 1.45
Signify, as part of its overall capital allocation policy, proposes a 2021 dividend of EUR 1.45 to be paid in cash in 2022 Capital allocation policy Dividend per share since IPO (in EUR) • Signify’s focus remains on maintaining a robust • Proposed dividend of EUR 1.45 per share (EUR capital structur
Slide 36: Net leverage reduced to 1.4x
Signify’s net leverage reduced to 1.4x, in line with our deleverage commitments Characteristics at the end of 2021 Net debt development in 2021 (in EUR million) 1,275 614 • Total cash of EUR 851 million with Free Cash 49 1,156 Flow generation of EUR 614 million in 2021 354 92 • Total gross debt of E
Slide 37: Financial statements 2021, Dividend, Discharge
4. Financial statements 2021 5. Dividend 6. Discharge members of the Board of Management and Supervisory Board 37
Slide 38: Presentation audit of 2021 Annual Report by Ernst & Young
AGM Signify N.V. Presentation audit of 2021 Annual Report and non-financial information by Ernst & Young Accountants LLP May 17, 2022
Slide 39: Agenda
Agenda 1. Audit approach & focus areas 2. Summary audit results 3. Communication and interaction 39
Slide 40: Audit approach & focus areas
1. Audit approach & focus areas Scope Strategy Execution Company only and Responsibility Approach consolidated financial Risk analysis Cyber statements Teaming Estimates Core team ESG Experts Sustainability statements, Component teams Fraud including non-financial Compliance laws and regulation Goin
Slide 41: Summary audit results
2. Summary audit results Annual report Conclusion Level of Key audit matters assurance Financial statements 2021 (consolidated Unqualified opinion Reasonable • Revenue recognition and company-only assurance • Uncertain tax positions Non-financial information Unqualified assurance- Reasonable • Brigh
Slide 42: Communication and interaction
3. Communication and interaction • Our reports • Meetings with Board of Management and Audit Committee • Interaction with these bodies 42
Slide 43: Annual General Meeting Signify N.V.
Annual General Meeting Signify N.V. 43
Slide 44: Q&A
Q&A Marc Anthony’s Pa’lla Voy Tour Vari-Lite VL10 ©Todd Kaplan
Slide 45: Composition of the Supervisory Board
7. Composition of the Supervisory Board 45
Slide 46: Authorizations to issue shares and restrict pre-emptive rights
8. Authorizations of the Board of Management to (a) issue shares or grant rights to acquire shares, and (b) restrict or exclude pre-emptive rights 46
Slide 47: Authorization to acquire shares in the company
9. Authorization of the Board of Management to acquire shares in the company 47
Slide 48: Cancellation of shares
10. Cancellation of shares 48
Slide 49: Any other business
49 Il. Any other business @®ignify
Slide 50: Siontty
Siontty