Signify reports full year sales of EUR 6.4 billion,

New Post Public Reply Private Reply Replies (0) Message Board
News Desk 2022
35
Signify reports full year sales of EUR 6.4 billion, improvement in operational profitability by 50 bps to 10.1% and free cash flow of EUR 306 million

Press Release

February 1, 2019

Signify reports full year sales of EUR 6.4 billion, improvement in operational profitability by 50 bps to 10.1% and free cash flow of EUR 306 million

Full year 2018 1

  • Signify's installed base of connected light points increased from 30 million at YE 17 to 44 million at YE 18
  • LED-based sales grew by 2.5% on a comparable basis to 71% of sales (FY 17: 65%); CSG total Signify -4.4%
  • Adj. indirect costs down EUR 224 million on a currency comparable basis, a reduction of 10%, or 180 bps of sales
  • Adj. EBITA margin improved by 50 bps to 10.1%, despite a negative currency impact of -50 bps
  • Net income of EUR 261 million (FY 17: EUR 281 million including net real estate gains of EUR 52 million)
  • Working capital improved by 20 bps to 8.4% of sales
  • Free cash flow of EUR 306 million (FY 17: EUR 403 million, which included EUR 56 million real estate proceeds and EUR 40 million lower restructuring cash-out)

Fourth quarter 2018 1

  • LED-based sales grew by 0.2% on a comparable basis; CSG total Signify -7.3% (Q4 17: 3.0%)
  • Adj. indirect costs down EUR 83 million on a currency comparable basis, a reduction of 15%, or 250 bps of sales
  • Adj. EBITA margin improved by 150 bps to 12.4%, despite a negative currency impact of -50 bps
  • Net income improved to EUR 119 million compared with EUR 38 million last year
  • Free cash flow of EUR 279 million (Q4 17: EUR 434 million)

         Shareholder returns

  • In 2018, EUR 462 million of capital was returned through share repurchases and ordinary dividends
  • Propose to pay a cash dividend of EUR 1.30 per share over 2018, an increase of 4% and a pay-out ratio of 46%
  • Signify will have returned EUR 1.1 billion to shareholders since IPO, including 2018 dividend

Eindhoven, the Netherlands - Signify (Euronext: LIGHT), the world leader in lighting, today announced the company's fourth quarter and full-year results 2018. "We continued to make solid progress with our simplification and cost reduction actions in 2018, resulting in a substantial increase in profitability and strong free cash flow delivery. In line with our strategy, our growing profit engines - LED, Professional and Home - have strongly contributed to these improvements and our LED-based sales have grown by 2.5%, now representing 71% of total revenues," said CEO Eric Rondolat. "While market conditions are challenging, we continue to focus on new growth platforms to strengthen our market leadership and progressively improve our growth profile. With our proposal to increase our dividend to EUR 1.30 per share, we will have returned more than EUR 1 billion to shareholders over the last three years. Looking forward, I'm confident we have built a solid foundation to deliver in 2019 on the mid-term targets set at the time of the IPO." Outlook

In 2019, our growing profit engines (LED, Professional and Home combined) are expected to deliver a comparable sales growth in the range of 2 to 5%. Our cash engine, Lamps, is expected to decline at a slower pace than the market, in the range of -21 to -24% on a comparable basis. For total Signify, we aim to reach an Adjusted EBITA margin in 2019 within the range of 11 to 13% set at the time of the IPO in May 2016. We expect free cash flow in 2019 to be above 5% of sales.    Financial review

Changes to financial reporting Since the first quarter of 2018, Signify reports and discusses its financial performance based on the portfolio changes that were announced in the first quarter of 2018. In March 2018, the company provided an update to show the effect of changes to the business portfolio as well as changes to the allocation methods of centrally-managed costs and to the threshold for other incidental items as adjusting items when presenting certain non-IFRS measures such as Adjusted EBITA. More details can be found on page 12 in the full and original version of the press release .

 

Fourth quarter   Twelve months
2017 2018 change in € million, unless otherwise indicated 2017 2018 change
    -7.3% Comparable sales growth     -4.4%
    -1.7% Effects of currency movements     -4.0%
    0.1% Consolidation and other changes     -0.3%
1,892 1,726 -8.8% Sales 6,965 6,358 -8.7%
732 647 -11.6% Adjusted gross margin 2,755 2,433 -11.7%
38.7% 37.5%   Adj. gross margin (as % of sales) 39.6% 38.3%  
             
-470 -398   Adj. SG&A expenses -1,852 -1,609  
-82 -64   Adj. R&D expenses -342 -288  
-552 -463 16.2% Adj. indirect costs -2,194 -1,896 13.6%
29.2% 26.8%   Adj. indirect costs (as % of sales) 31.5% 29.8%  
             
207 214 3.2% Adjusted EBITA 669 640 -4.4%
10.9% 12.4%   Adjusted EBITA margin 9.6% 10.1%  
-88 -17   Adjusted items -98 -136  
119 197 65.0% EBITA 571 504 -11.9%
             
75 173 131.8% Income from operations (EBIT) 441 410 -7.2%
-12 -7   Net financial income/expense -43 -41  
-25 -47   Income tax expense -117 -106  
38 119 215.6% Net income 281 261 -7.2%
             
434 279   Free cash flow 403 306  
0.30 0.90   Basic EPS (€) 2.04 1.95  
32,130 29,237   Employees (FTE) 32,130 29,237  

¹This press release contains certain non-IFRS financial measures and ratios, such as comparable sales growth, EBITA, adjusted EBITA and free cash flow, and related ratios, which are not recognized measures of financial performance or liquidity under IFRS. For a reconciliation of these non-IFRS financial measures to the most directly comparable IFRS financial measures, see appendix B, Reconciliation of non-IFRS financial measures, of this press release.

For the full and original version of the press release click here . For the presentaton click here . Conference call and audio webcast Eric Rondolat (CEO) and Stéphane Rougeot (CFO) will host a conference call for analysts and institutional investors at 9:00 a.m. CET to discuss fourth quarter and full year results. A live audio webcast of the conference call will be available via the Signify Investor Relations website .

Financial calendar 26 February 2019                Annual report 2018 26 April 2019                       First quarter results 2019 14 May 2019                        Annual General Meeting of Shareholders 26 July 2019                        Second quarter and half year results 2019 25 October 2019                 Third quarter results 2019

For further information, please contact:

Signify Investor Relations Robin Jansen Tel: +31 6 1594 4569 E-mail: robin.j.jansen@signify.com

Signify Corporate Communications Elco van Groningen Tel: +31 6 1086 5519 E-mail: elco.van.groningen@signify.com

About Signify Signify (Euronext: LIGHT) is the world leader in lighting for professionals and consumers and lighting for the Internet of Things. Our Philips products, Interact connected lighting systems and data-enabled services, deliver business value and transform life in homes, buildings and public spaces. With 2018 sales of EUR 6.4 billion, we have approximately 29,000 employees and are present in over 70 countries. We unlock the extraordinary potential of light for brighter lives and a better world. We have been named Industry Leader in the Dow Jones Sustainability Index for two years in a row. News from Signify is located at the Newsroom , Twitter , LinkedIn and Instagram . Information for investors can be found on the Investor Relations page.

Important Information

Forward-Looking Statements and Risks & Uncertainties This document and the related oral presentation contain, and responses to questions following the presentation may contain, forward-looking statements that reflect the intentions, beliefs or current expectations and projections of Signify N.V. (the " Company ", and together with its subsidiaries, the " Group "), including statements regarding strategy, estimates of sales growth and future operational results.

By their nature, these statements involve risks and uncertainties facing the Company and its Group Companies and a number of important factors could cause actual results or outcomes to differ materially from those expressed in any forward-looking statement as a result of risks and uncertainties. Such risks, uncertainties and other important factors include but are not limited to: adverse economic and political developments, the impacts of rapid technological change, competition in the general lighting market, development of lighting systems and services, successful implementation of business transformation programs, impact of acquisitions and other transactions, impact of the Group's operation as a separate publicly listed company, pension liabilities and costs, establishment of corporate and brand identity, adverse tax consequences from the separation from Royal Philips and exposure to international tax laws. Please see "Risk Factors and Risk Management" in Chapter 12 of the Annual Report 2017 for discussion of material risks, uncertainties and other important factors which may have a material adverse effect on the business, results of operations, financial condition and prospects of the Group. Such risks, uncertainties and other important factors should be read in conjunction with the information included in the Company's Annual Report 2017 and the semi-annual report for 2018.

Looking ahead, the Group is primarily concerned about the challenging economic conditions, currency headwinds and political uncertainties in the global and domestic markets in which it operates. Additional risks currently not known to the Group or that the Group has not considered material as of the date of this document could also prove to be important and may have a material adverse effect on the business, results of operations, financial condition and prospects of the Group or could cause the forward-looking events discussed in this document not to occur. The Group undertakes no duty to and will not necessarily update any of the forward-looking statements in light of new information or future events, except to the extent required by applicable law.

Market and Industry Information All references to market share, market data, industry statistics and industry forecasts in this document consist of estimates compiled by industry professionals, competitors, organizations or analysts, of publicly available information or of the Group's own assessment of its sales and markets. Rankings are based on sales unless otherwise stated.

Non-IFRS Financial Measures Certain parts of this document contain non-IFRS financial measures and ratios, such as comparable sales growth, adjusted gross margin, EBITA, adjusted EBITA, and free cash flow, and other related ratios, which are not recognized measures of financial performance or liquidity under IFRS. The non-IFRS financial measures presented are measures used by management to monitor the underlying performance of the Group's business and operations and, accordingly, they have not been audited or reviewed. Not all companies calculate non-IFRS financial measures in the same manner or on a consistent basis and these measures and ratios may not be comparable to measures used by other companies under the same or similar names. A reconciliation of these non-IFRS financial measures to the most directly comparable IFRS financial measures is contained in this document. For further information on non-IFRS financial measures, see "Chapter 18 Reconciliation of non-IFRS measures" in the Annual Report 2017.

Presentation All amounts are in millions of euros unless otherwise stated. Due to rounding, amounts may not add up to totals provided. All reported data are unaudited. Unless otherwise indicated, financial information has been prepared in accordance with the accounting policies as stated in the Annual Report 2017 and semi-annual report 2018.

Changes to financial reporting following organizational changes to further align the organizational structure with the strategy As the market trend of both professionals and consumers switching from buying lamps and luminaires to integrated LED luminaires is accelerating, the company has decided to modify the current portfolios of its business groups. As of January 1, 2018, Signify has implemented the following changes to the following portfolios:

  • Consumer and professional trade downlights, the recessed spots portfolio and the LED Light strips moved from Home and Professional to LED;
  • Consumer LED functional ceiling products moved from Home to LED;
  • LED battens moved from Home to Professional; and
  • Consumer and professional trade LED panels moved from Home and LED to Professional.
  • Next to this, the financial performance of the Ventures activities is reported in Other instead of in Professional and in Home, as these activities are managed outside of the aforementioned business groups. In addition, the switches business within Lamps has been moved to LED.

Therefore, with effect from the first quarter of 2018, Signify reports and discusses its financial performance based on the above portfolio changes. In March 2018, the company provided an update to show the effect of changes to the business portfolio as well as changes to the allocation methods of centrally-managed costs and expenses and threshold for other incidental items as adjusting items when presenting certain non-IFRS measures such as Adjusted EBITA.

In addition, the cash flow presentation has been amended to better correspond to the balance sheet and to further improve transparency on cash flow movements.

Market Abuse Regulation This press release contains information within the meaning of Article 7(1) of the EU Market Abuse Regulation.

Scroll down for more posts ▼

Top 10 Most Recent News Articles

Veho's Role in Redefining Beauty E-Commerce Delivery

Updated Category News Views 2

Veho Grabs Headlines with BeautyMatter Awards Nod Here's something a bit off the beaten path: Veho's been tapping into new wells of opportunity in the e-commerce sector, and their latest accolade demonstrates just that. Named a finalist in the 2026 BeautyMatter Awards under the Logistics category, they're making noise in all the right circles. Beyond Boxes: Transforming...

Continue Reading
Woodpack Global Unveils Crate Design System: A New Era Begins

Updated Category News Views 2

Innovating the Wooden Crate Landscape An old industry got a much-needed facelift today, folks. Woodpack Global has rolled out Crate Design System™ (CDS)—a snazzy new tool that's shaking up the wooden crate design landscape. It blows the dust off outdated design methods that have been collecting cobwebs since the '60s. That's right, we’re talking about a significant...

Continue Reading
Sandbox VR Expands to Melbourne, Betting on Immersive Fun

Updated Category News Views 3

Sandbox VR Ventures into Melbourne's Heart Every now and then, a venture takes its ambitions and rolls the dice on a prime location. Sandbox VR is swaggering into Melbourne's bustling Central Business District, fresh out of its success on the Gold Coast. Opening this Melbourne venue on September 14 marks a significant leap in the company's Aussie expansion—a bold nod to...

Continue Reading
ZEEKR's Shooting Brakes Dominate: Over 400K Sold

Updated Category News Views 4

ZEEKR's Stellar Performance in a Crowded Market Another month, another bumper crop for ZEEKR's shooting brakes. These beauties aren't just hanging in there; they're leading the pack. In August alone, global deliveries marched past the 10,000 mark for the third month running—a feat not easily achieved in today's saturated automotive landscape. It's no wonder the...

Continue Reading
MCatalysis Secures $5M to Disrupt Fuel Cost Dynamics

Updated Category News Views 3

Funding Fuels Innovation MCatalysis has just secured a hefty $5 million in seed funding to throw down with the big dogs in energy production. This isn't your regular backyard science project; this company is serious about changing the game with a tech-driven approach that could undercut current fuel prices. HL Energy Ventures and Oxford Science Enterprises are backing...

Continue Reading
Midlife ADHD in Women: New Challenges and Solutions

Updated Category News Views 5

ADHD Evolution in Women's Midlife They say change is the only constant, and boy, does that ring true for women navigating the turbulent seas of ADHD as they hit 40 and beyond. According to Germaine Swanson, the ADHD landscape changes dramatically in midlife, especially for women. We're talking about a mix of hormonal shifts, increasing life demands, and changes in brain...

Continue Reading
Law Firm Gains Strength with Strategic New Hires

Updated Category News Views 1

Catching the latest twist in the legal scene, veteran criminal defense attorney John T. Floyd is stiffening the backbone of his Houston-based firm. Snagging both Christopher Choate and Mia Floyd, he's set to fortify his team representing folks caught in the snarl of Texas and federal criminal courts. New Faces, Massive Expertise Let's dig into Choate's credentials first....

Continue Reading
Fresh Thyme Empowers Local Brands in Michigan Debut

Updated Category News Views 2

A Community-Driven Retail Innovation The grocery game just got a little more personal in Michigan, and we're not talking about run-of-the-mill retail pitches. Fresh Thyme Market, known for its commitment to local and natural products, is shaking things up with their Pitch Thyme Competition. This ain’t your usual product presentation. It’s a whole new ball game where...

Continue Reading
WNET's 25th Anniversary 9/11 Tribute: Stories and Lessons

Updated Category News Views 3

Reflecting on a Dark Day with WNET's Programming Nothing quite hits you like the anniversary of a colossal tragedy. The memories of September 11, 2001, remain etched in the urban landscape of New York City, and this year marks 25 years since that heart-wrenching day. The WNET Group steps up to the plate with a comprehensive slate of programming aimed at honoring the...

Continue Reading
RARE Foundation Rebrands, Focus Still Strong

Updated Category News Views 3

Unveiling the RARE Foundation's New Identity In the stock market, you ride waves of change, and let me tell you, it ain't just stocks and bonds that change names and faces. Case in point: The EveryLife Foundation for Rare Diseases has spiffed up as the RARE Foundation. New name, new logo, the whole enchilada. This isn't just a cosmetic touch-up, though. It's about...

Continue Reading

Top 5 Most Recently Viewed Articles

BrainTap Achieves Milestone Engagement with New Wellness Series

Updated Category News Views 97

BrainTap Experiences Tremendous Growth in 2025 BrainTap, the leading provider of audio-guided brainwave entrainment technology, achieved remarkable milestones in its 2025 data report. With over 2.2 million sessions completed and an astounding 46.6 million minutes listened, the platform has established itself as an essential tool for individuals focused on improving sleep...

Continue Reading
METABORA GAMES Boosts BORA with Innovative Kaia CL Integration

Updated Category News Views 351

METABORA GAMES Enhances BORA Ecosystem METABORA GAMES, a prominent player in the blockchain gaming sector, is setting new standards by enhancing the BORA ecosystem. Their recent integration of the Consensus Liquidity (CL) Protocol from the Kaia blockchain marks a significant milestone in improving the functionality and broader reach of BORA. Establishment of a Joint...

Continue Reading
Measurabl Strengthens Its Leadership with Key Promotions

Updated Category News Views 100

Measurabl Expands Leadership Team Measurabl, a frontrunner in ESG technology for real estate, is expanding its leadership team. A key highlight is the promotion of Maureen Waters to President. She previously held the role of Chief Growth Officer, and this promotion underscores Measurabl's dedication to promoting sustainability within the real estate industry. Major...

Continue Reading
Recursion and Exscientia's Shareholders Embrace New Merger

Updated Category News Views 91

Recursion and Exscientia's Merger Gains Major Shareholder Approval Recursion and Exscientia plc have recently announced that they have received significant backing from their shareholders regarding their proposed merger. This monumental step signifies a critical turning point for both companies in their mission to enhance drug discovery and improve patient outcomes....

Continue Reading
ThriveDX Expands University Partnerships in Cybersecurity Training

Updated Category News Views 164

ThriveDX Expands University Partnerships for Cybersecurity Training ThriveDX, a leading name in cybersecurity education, is excited to announce significant changes aimed at enhancing their partnerships with universities by providing transformative cybersecurity bootcamp and training programs. As the technology landscape evolves, many educational institutions face...

Continue Reading