Signify Reports 4Q19 and 2019 Financial Results with Growing LED Business

Signify published its fourth quarter and full-year 2019 financial results on January 31. The Dutch company reported full-year sales of EUR 6.2 billion (US$ 6.87 billion) which decreased by 4.6% YoY decrease but improved in profitability by 30bps to 10.4%. Its LED-based sales grew by 1.4%YoY, representing 78% of its sales.

For 4Q19, Signify, registered sales for EUR 1.75 billion (US$ 1.94 billion) which improved by 1.4% compared to 4Q18. The adjusted gross margin increased by 30 bps to 37.8%, including a positive currency effect of 30 bps. Adjusted EBITA amounted to EUR 232 million (US$ 257 million) compared with EUR 214 million (US$ 237 million) in the same period last year. The Adjusted EBITA margin increased by 80 bps to 13.2%, including a positive currency impact of 30 bps. Total restructuring costs were EUR 42 million (US$ 46.55 million), acquisition-related charges EUR 11 million (US$ 12.19 million).

In 2019, sales of Signify amounted to EUR 6.2 billion (US$ 6.87 billion), a nominal decrease of 1.8%. The adjusted gross margin declined by 50 bps to 37.8%, including a negative currency effect of 30 bps. LED-based sales grew by 1.4% on a comparable basis and represented 78% of sales compared with 71% in 2018. Adjusted EBITA amounted to EUR 648 million (US$ 718.17 million) compared with EUR 640 million (US$ 709 million) in 2018 and was negatively impacted by EUR 4 million of currency effects.

Eric Rondolat, CEO of Signify, said, “We are pleased that we’ve improved our Adjusted EBITA margin for the sixth consecutive year, which has led to a 400 basis points increase since 2013. During the same period, our LED-based sales increased from 26% to 78%, reflecting our successful transformation from conventional lighting technologies to LED lighting products, systems and services.”

Signify is also integrating its business with Cooper Lighting Solutions, which it acquired in 2019, to strengthen its market position in North America.

The company also highlighted its sustainability strategy and aims to unlock the extraordinary potential of light for brighter lives and a better world. In 2019, 82.5% of the company’s revenues came from its portfolio of sustainable products, systems and services, exceeding its 2020 target of 80%.

For 2020, Signify aims to achieve a further improvement in the Adjusted EBITA margin and to deliver a free cash flow of at least 6% of sales. This outlook excludes the announced acquisition of Cooper Lighting Solutions. An update on the outlook will be provided after the closing of the Cooper Lighting Solutions acquisition, which is expected in Q120.

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