In a building market in retreat,
Sales: -5.6%, i.e. -3.7% excluding exchange rates and
Adjusted operating margin: 20.5% of sales
Net profit attributable to the Group: 13.6% of sales
3 acquisitions announced since the beginning of the year 2024 full-year targets unchanged
LIMOGES,
“Our first quarter results for 2024 are in line with our expectations in terms of both revenue and margins, as well as free cash flow. In Q1, the building market that represents approximately 80% of
In this context, we are continuing with our strategic investments in order to fully benefit from our markets’ recovery. Thus far this year, we have announced three acquisitions, and will keep up the strong pace of external growth in coming quarters. On the innovation side, we will be launching a large number of iconic product lines this year, including the Céliane range of wiring devices in
Moreover, the remarkable success of
2024 full-year targets unchanged1
In 2024, the Group is pursuing the profitable and responsible development laid out in its strategic roadmap.
Taking into account the world’s current macroeconomic outlook, with confidence in its model for creating integrated value,
- low single-digit sales growth (organic and through acquisitions2);
- an adjusted operating margin before acquisitions between 20.0% and 20.8%;
- at least 100% CSR achievement rate for the third year of the 2022-2024 roadmap.
Financial performance at
Key figures
Consolidated data (€ millions) (1) |
1st quarter 2023 |
1st quarter 2024 |
Change |
Sales |
2,149.6 |
2,028.2 |
-5.6% |
Adjusted operating profit |
477.2 |
415.9 |
-12.8% |
As % of sales |
22.2% |
20.5% |
|
|
|
20.6% before
|
|
Operating profit |
450.4 |
387.5 |
-14.0% |
As % of sales |
21.0% |
19.1% |
|
Net profit attributable to the Group |
330.5 |
275,9 |
-16,5% |
As % of sales |
15.4% |
13,6% |
|
Normalized free cash flow |
389.3 |
362.6 |
-6.9% |
As % of sales |
18.1% |
17.9% |
|
Free cash flow |
331.5 |
146.1 |
-55.9% |
As % of sales |
15.4% |
7.2% |
|
Net financial debt at |
2,305.0 |
2,270.3 |
-1.5% |
(1) See appendices to this press release for definitions and indicator reconciliation tables
(2) At 2023 scope of consolidation
Consolidated sales
In the first quarter of 2024, sales fell -5.6% from the same period of 2023 to reach €2,028.2 million.
In a building market in retreat, sales decreased organically by -5.4% for the quarter, including -5.0% in mature countries and -6.5% in new economies.
The impact of broader scope of consolidation was +0.7%, including +1.8% linked to acquisitions and -1.1% to the impact of the Group’s disengagement from
The exchange-rate effect on sales in the first quarter of 2024 was -1.0%. Based on average exchange rates in
Changes in sales by destination at constant scope of consolidation and exchange rates broke down as follows by region:
|
1st quarter 2024 / 1st quarter 2023 |
|
-4.7% |
North and |
-6.0% |
Rest of the world |
-5.8% |
Total |
-5.4%
|
These changes are analyzed below by geographical region:
-
Europe’s mature countries (37.8% of Group revenue) reported sales down -5.1% organically in the first quarter, with solid resilience in
Sales in Europe’s new economies were down -2.4% in the first quarter, with growth in
- North and
In
Sales rose in
- Rest of the world (18.9% of Group revenue): sales marked an organic decline of -5.8% in the first quarter of 2024.
In
In
In
Adjusted operating profit and margin
Adjusted operating profit for the first quarter of 2024 stood at €415.9 million, down -12.8% from the first three months of 2023. This corresponds to an adjusted operating margin equal to 20.5% of sales for the period.
Before acquisitions, adjusted operating margin for the first quarter of 2024 was equal to 20.6% of sales, down -1.6 points from the first quarter of 2023.
In the first quarter of 2024, the level of profitability of the Group once again demonstrates Legrand’s ability to protect its margins in a context of declining sales, thanks to its intact pricing power and solid cost control.
Value creation and solid balance sheet
Net profit attributable to the Group came to €275.9 million, down -16.5% from the first quarter of 2023 and equal to 13.6% of sales. This trend is due primarily to a decrease in operating profit, the negative impact of financial and exchange-rate results, and a corporate income tax rate of 26.0%, stable compared to the first quarter of 2023.
Net earnings per share stood at €1.05, for a decrease of -15.1% from the first quarter of 2023.
Free cash flow came to 7.2% of sales over the period at a total of €146.1 million.
The ratio of net debt to EBITDA3 stood at 1.2 on
Ongoing acquisitions strategy
The Group has today announced a minority stake acquisition in UIOT, one of the leading Chinese players in wireless IoT smart-home solutions with strong innovation capabilities, which will allow
These acquisitions in the promising areas of datacenters, assisted living and connected solutions further strengthen
SBTi Net Zero commitment for 2050
2024 marks an important milestone in the Group's decarbonization trajectory, with SBTi (Science Based Target initiative) validating Legrand’s Net Zero 2050 commitment.
This commitment involves reducing the Group's GHG emissions by 90% across its entire value chain by 2050, and neutralizing emissions that cannot be avoided.
The Group's 2030 objectives have thus been revised, more demanding, with now:
- a 42% reduction in Scopes 1&2 emissions in current data based on 2022,
- a 25% reduction in Scope 3 emissions in current data based on 2022, incorporating emissions related to purchased goods and services and the use phase of Group's products.
Combined General Meeting of Shareholders on
Board of Directors6
Jean-Marc Chéry's term of office as director expires this year. He will be proposed for re-election at the next General Meeting of shareholders.
In addition, upon recommendation of the
Following these appointments the Board of Directors, with 75% independent Directors, 42% women and seven nationalities represented, would continue to reflect the industry’s best practices.
Proposed changes to the composition of Board Committees are set out in chapter 6.1.3.1 of the universal registration document - Legrand_URD_2023_ENGLISH (legrandgroup.com).
Proposed dividend
As announced on
The ex-dividend date is
Success of the first international share ownership plan for employees
To recognize and promote employee engagement at all levels in rolling out the Group’s strategy,
This plan, which is non-dilutive since it is funded through share buybacks, was over 36% subscribed, reflecting the full confidence of
---------
The Board adopted consolidated financial statements for first-quarter 2024 at its meeting on
Key financial dates
-
General Meeting of Shareholders:
May 29, 2024 -
Ex-dividend date:
May 31, 2024 -
Dividend payment:
June 4, 2024 -
2024 first-half results:
July 31, 2024
“Quiet period8” startJuly 1, 2024 -
2024 Capital Markets Day:
September 24, 2024 –London (UK )
About
https://www.legrandgroup.com
Appendices
Glossary
Adjusted operating profit: Adjusted operating profit is defined as operating profit adjusted for (i) amortization and depreciation of revaluation of assets at the time of acquisitions and for other P&L impacts relating to acquisitions, (ii) assets impairment in
Cash flow from operations: Cash flow from operations is defined as net cash from operating activities excluding changes in working capital requirement.
CSR: Corporate Social Responsibility.
EBITDA: EBITDA is defined as operating profit plus depreciation and impairment of tangible and right of use assets, amortization and impairment of intangible assets (including capitalized development costs), reversal of inventory step-up and impairment of goodwill.
ESG: Environmental, Societal and Governance.
Free cash flow: Free cash flow is defined as the sum of net cash from operating activities and net proceeds from sales of fixed and financial assets, less capital expenditure and capitalized development costs.
KVM: Keyboard, Video and Mouse.
Net financial debt: Net financial debt is defined as the sum of short-term borrowings and long-term borrowings, less cash and cash equivalents and marketable securities.
Normalized free cash flow: Normalized free cash flow is defined as the sum of net cash from operating activities—based on a normalized working capital requirement representing 10% of the last 12 months’ sales and whose change at constant scope of consolidation and exchange rates is adjusted for the period considered—and net proceeds of sales from fixed and financial assets, less capital expenditure and capitalized development costs.
Organic growth: Organic growth is defined as the change in sales at constant structure (scope of consolidation) and exchange rates.
Payout: Payout is defined as the ratio between the proposed dividend per share for a given year, divided by the net profit attributable to the Group per share of the same year, calculated on the basis of the average number of ordinary shares at
PDU: Power Distribution Units.
Working capital requirement: Working capital requirement is defined as the sum of trade receivables, inventories, other current assets, income tax receivables and short-term deferred tax assets, less the sum of trade payables, other current liabilities, income tax payables, short-term provisions and short-term deferred tax liabilities.
Calculation of working capital requirement
In € millions |
Q1 2023 |
Q1 2024 |
Trade receivables |
1,105.0 |
1,125.2 |
Inventories |
1,349.9 |
1,288.1 |
Other current assets |
293.2 |
297.7 |
Income tax receivables |
122.1 |
187.8 |
Short-term deferred taxes assets/(liabilities) |
110.0 |
111.9 |
Trade payables |
(891.5) |
(921.9) |
Other current liabilities |
(815.6) |
(856.7) |
Income tax payables |
(111.4) |
(107.3) |
Short-term provisions |
(150.7) |
(155.1) |
Working capital required |
1,011.0 |
969.7 |
Calculation of net financial debt
In € millions |
Q1 2023 |
Q1 2024 |
Short-term borrowings |
806.0 |
1,005.0 |
Long-term borrowings |
3,997.6 |
3,974.6 |
Cash and cash equivalents |
(2,498.6) |
(2,709.3) |
Net financial debt |
2,305.0 |
2,270.3 |
Reconciliation of adjusted operating profit with profit for the period
In € millions |
Q1 2023 |
Q1 2024 |
Profit for the period |
330.4 |
276.1 |
Share of profits (losses) of equity-accounted entities |
0.0 |
0.0 |
Income tax expense |
115.8 |
97.0 |
Exchange (gains) / losses |
0.2 |
9.0 |
Financial income |
(22.2) |
(29.0) |
Financial expense |
26.2 |
34.4 |
Operating profit |
450.4 |
387.5 |
i) Amortization & depreciation of revaluation of assets at the time of acquisitions, other P&L impacts relating to acquisitions and ii) impacts related to disengagement from |
26.8 |
28.4 |
Impairment of goodwill |
0.0 |
0.0 |
Adjusted operating profit |
477.2 |
415.9 |
Reconciliation of EBITDA with profit for the period
In € millions |
Q1 2023 |
Q1 2024 |
Profit for the period |
330.4 |
276.1 |
Share of profits (losses) of equity-accounted entities |
0.0 |
0.0 |
Income tax expense |
115.8 |
97.0 |
Exchange (gains) / losses |
0.2 |
9.0 |
Financial income |
(22.2) |
(29.0) |
Financial expense |
26.2 |
34.4 |
Operating profit |
450.4 |
387.5 |
Depreciation and impairment of tangible assets (including right-of-use assets) |
48.3 |
51.7 |
Amortization and impairment of intangible assets (including capitalized development costs) |
33.9 |
31.9 |
Impairment of goodwill |
0.0 |
0.0 |
EBITDA |
532.6 |
471.1 |
Reconciliation of cash flow from operations, free cash flow and normalized free cash flow with profit for the period
In € millions |
Q1 2023 |
Q1 2024 |
Profit for the period |
330.4 |
276.1 |
Adjustments for non-cash movements in assets and liabilities: |
|
|
Depreciation, amortization and impairment |
83.0 |
84.7 |
Changes in other non-current assets and liabilities and long-term deferred Taxes |
19.5 |
11.3 |
Unrealized exchange (gains)/losses |
3.2 |
2.9 |
(Gains)/losses on sales of assets, net |
(0.2) |
2.4 |
Other adjustments |
(1.3) |
6.4 |
Cash flow from operations |
434.6 |
383.8 |
Decrease (Increase) in working capital requirement |
(71.5) |
(205.0) |
Net cash provided from operating activities |
363.1 |
178.8 |
Capital expenditure (including capitalized development costs) |
(31.8) |
(32.9) |
Net proceeds from sales of fixed and financial assets |
0.2 |
0.2 |
Free cash flow |
331.5 |
146.1 |
Increase (Decrease) in working capital requirement |
71.5 |
205.0 |
(Increase) Decrease in normalized working capital requirement |
(13.7) |
11.5 |
Normalized free cash flow |
389.3 |
362.6 |
Scope of consolidation
2023 |
Q1 |
H1 |
9M |
Full-year |
Full consolidation method |
||||
Geiger |
3 months |
6 months |
9 months |
12 months |
Emos |
3 months |
6 months |
9 months |
12 months |
Usystems |
3 months |
6 months |
9 months |
12 months |
Voltadis |
Balance sheet only |
6 months |
9 months |
12 months |
A. & |
Balance sheet only |
6 months |
9 months |
12 months |
Power Control |
Balance sheet only |
Balance sheet only |
9 months |
12 months |
Encelium |
Balance sheet only |
6 months |
9 months |
12 months |
Clamper |
Balance sheet only |
Balance sheet only |
Balance sheet only |
11 months |
Teknica |
|
|
Balance sheet only |
4 months |
MSS |
|
|
|
Balance sheet only |
2024 |
Q1 |
H1 |
9M |
Full-year |
Full consolidation method |
||||
Voltadis |
3 months |
6 months |
9 months |
12 months |
A. & |
3 months |
6 months |
9 months |
12 months |
Power Control |
3 months |
6 months |
9 months |
12 months |
Encelium |
3 months |
6 months |
9 months |
12 months |
Clamper |
3 months |
6 months |
9 months |
12 months |
Teknica |
3 months |
6 months |
9 months |
12 months |
MSS |
Balance sheet only |
To be determined |
To be determined |
To be determined |
ZPE Systems |
Balance sheet only |
To be determined |
To be determined |
To be determined
|
Disclaimer
This press release may contain forward-looking statements which are not historical data. Although
Details on risks are provided in the most recent version of Legrand Universal Registration Document filed with the Autorité des marchés financiers (
Investors and holders of
Subject to applicable regulations,
This press release does not constitute an offer to sell, or a solicitation of an offer to buy
Readers are invited to verify the authenticity of
_________________________
1 For more information, see
2 Excluding exchange-rate effect and impacts linked to the Group’s disengagement from
3 Based on EBITDA for the past 12 months.
4 For more information, see
5 For more information, see
6 Subject to the approval of the General Meeting of shareholders to be held on
7 This distribution will be made in full out of distributable income
8 Period of time when all communication is suspended in the run-up to publication of results
View source version on businesswire.com: https://www.businesswire.com/news/home/20240502429504/en/
Investor relations & financial communication
+33 1 49 72 53 53
ronan.marc@legrand.com
Press relations
Tiphaine RAFFRAY (TBWA)
+33 6 58 27 78 98.
tiphaine.raffray@tbwa-corporate.com
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