Legrand: 2024 first-half results
Good resilience in the first half, including sales growth in the second quarter and very firm margins
H1 sales trends: -2.0%, i.e. -0.7% excluding exchange rates and
Adjusted operating margin: 20.7%
Net profit attributable to the Group: 13.7% of sales
5 acquisitions announced since the beginning of the year,
including 3 in datacenters
More than €200 million additional revenue on an annual basis
Strong product innovation momentum
2024 full-year targets unchanged
LIMOGES,
“Our first-half results for 2024 show a limited retreat in sales and very firm margins and free cash flow.
In the second quarter alone, a moderate rebound in sales (+1.5% organic growth) stemmed notably from datacenter business, while the building market remained depressed. Margins and free cash flow hold steady at very good levels.
This performance highlights once again the relevance of our business model, and we stand by the annual targets announced in early February.
We are continuing to roll out our strategy, as illustrated by the very strong pace of external growth since the beginning of the year, with five acquisitions including three in the datacenter segment. This momentum will continue in the quarters to come. We are innovating relentlessly, with launches of a large number of new products including the new Céliane iconic range of wiring devices in France.”
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.
1 For more information, see
2 Excluding exchange-rate effect and impacts linked to the Group’s disengagement from
Financial performance at |
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Key figures |
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Consolidated data (€ millions)(1) |
1st half 2023 |
1st half 2024 |
Change |
Sales |
4,294.8 |
4,210.3 |
-2.0% |
Adjusted operating profit |
954.7 |
873.1 |
-8.5% |
As % of sales |
22.2% |
20.7% |
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20.8% before acquisitions (2) |
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Operating profit |
892.3 |
811.5 |
-9.1% |
As % of sales |
20.8% |
19.3% |
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Net profit attributable to the Group |
650.9 |
577.6 |
-11.3% |
As % of sales |
15.2% |
13.7% |
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Normalized free cash flow |
766.9 |
734.6 |
-4.2% |
As % of sales |
17.9% |
17.4% |
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Free cash flow |
813.8 |
468.1 |
-42.5 % |
As % of sales |
18.9% |
11.1% |
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Net financial debt at |
2,415.5 |
3,429.9 |
+42.0% |
(1) See appendices to this press release for definitions and indicator reconciliation tables |
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(2) At 2023 scope of consolidation |
Consolidated sales
In the first half of 2024, sales were down a total of -2.0% from the same period of 2023, reaching €4,210.3 million.
In a building market which remains depressed in many geographies, the organic decline in sales was -2.0% over the period, including -0.9% in mature countries and -5.1% in new economies.
The impact of broader scope of consolidation was +0.4%, including +1.3% linked to acquisitions and -0.9% to the impact of the Group’s disengagement from
The exchange-rate effect on sales in the first half of 2024 was -0.4%. 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 half 2024 / 1st half 2023 |
2nd quarter 2024 / 2nd quarter 2023 |
|
-3.2% |
-1.5% |
North and |
+0.0% |
+5.8% |
Rest of the world |
-3.1% |
-0.7% |
Total |
-2.0% |
+1.5% |
These changes are analyzed below by geographical region:
-
In Europe’s mature countries (36.3% of Group revenue), sales decreased organically by -3.1% in the first half of 2024, including -0.9% in the second quarter alone, with robust resilience in the first six months notably in
Sales in Europe’s new economies declined by -3.8% in the first half. In the second quarter alone, sales decreased -5.5%, including a marked decline in
- North and
In
Over the first half, sales declined in
- Rest of the world (19.6% of Group revenue): sales marked an organic decline of -3.1% in the first half of 2024.
In
In
In
Adjusted operating profit and margin
Adjusted operating profit for the first half of 2024 stood at €873.1 million, down -8.5% from the first half of 2023. This corresponds to an adjusted operating margin equal to 20.7% of sales for the period.
Before acquisitions, adjusted operating margin for the first half of 2024 stood at 20.8% of sales, down -1.4 points from the first half of 2023.
Over this period, Group profitability confirmed the ability of
Value creation and solid balance sheet
Net profit attributable to the Group came to €577.6 million, down -11.3% from the first half of 2023 and equal to 13.7% of sales. This trend was due primarily to a decline in operating profit, the negative impact of financial results and exchange-rate effects, and a corporate income tax rate of 27.0% for the first half of 2024.
Free cash flow came to 11.1% of sales over the period, to total €468.1 million.
The ratio of net debt to EBITDA1 stood at 1.8 on
Following a €600 million bond issue in
Accelerating acquisitions strategy
In the first half of 2024,
- in the buoyant datacenters segment, the acquisition of Netrack (Indian specialist in racks),
- in the assisted living segment, Enovation, theDutch leader in connected health software;
- lastly, in the cable management segment,
Strong product innovation momentum
As announced at the beginning of the year, the launch of numerous new products during the first half demonstrates the Group's continued robust capacity for innovation, with, for example:
- Core infrastructure products including new wiring device ranges: Céliane (in
- In faster expanding segments, Linkeo DC and NX1 PDUs (datacenters, energy efficiency and connected products), DPX3 et DMX3 connected power breakers, KNX Mallia Senses lighting and temperature touch screens control panels (energy efficiency and connected products), Cable Bus cable management solutions, and M70 critical power monitors (datacenters and connected products), new LCS3 accIAIM and OM5 fibre digital infrastructure solutions and Cablobend cable management offer (datacenters), Green’Up metering cabinets for electric vehicle infrastructure (energy efficiency), renewal of the NMR dynamization IOT connected wiring range in
1 Based on EBITDA for the past 12 months
The consolidated financial statements for the first half of 2024 were subject to a limited review by the Group’s auditors and were adopted by the Board of Directors at its meeting on
KEY FINANCIAL DATES |
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: November 7, 2024
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About
The Group harnesses technological and societal trends with lasting impacts on buildings with the purpose of improving life by transforming the spaces where people live, work and meet with electrical, digital infrastructures and connected solutions that are simple, innovative and sustainable.
Drawing on an approach that involves all teams and stakeholders,
https://www.legrandgroup.com
1 Period of time when all communication is suspended in the run-up to publication of results
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/ impacts related to disengagement from
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 |
H1 2023 |
H1 2024 |
Trade receivables |
1,074.1 |
1,160.0 |
Inventories |
1,331.3 |
1,332.2 |
Other current assets |
310.3 |
322.4 |
Income tax receivables |
142.7 |
226.6 |
Short-term deferred taxes assets/(liabilities) |
103.0 |
109.9 |
Trade payables |
(944.8) |
(967.2) |
Other current liabilities |
(840.9) |
(897.4) |
Income tax payables |
(68.0) |
(118.4) |
Short-term provisions |
(147.0) |
(173.3) |
Working capital required |
960.7 |
994.8 |
Calculation of net financial debt
In € millions |
H1 2023 |
H1 2024 |
Short-term borrowings |
639.0 |
929.7 |
Long-term borrowings |
4,630.9 |
4,622.1 |
Cash and cash equivalents |
(2,854.4) |
(2,121.9) |
Net financial debt |
2,415.5 |
3,429.9 |
Reconciliation of adjusted operating profit with profit for the period
In € millions |
H1 2023 |
H1 2024 |
Profit for the period |
651.0 |
577.7 |
Share of profits (losses) of equity-accounted entities |
0.0 |
0.0 |
Income tax expense |
229.2 |
213.4 |
Exchange (gains) / losses |
3.2 |
8.7 |
Financial income |
(31.9) |
(60.1) |
Financial expense |
40.8 |
71.8 |
Operating profit |
892.3 |
811.5 |
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 |
62.4 |
61.6 |
Impairment of goodwill |
0.0 |
0.0 |
Adjusted operating profit |
954.7 |
873.1 |
Reconciliation of EBITDA with profit for the period
In € millions |
H1 2023 |
H1 2024 |
Profit for the period |
651.0 |
577.7 |
Share of profits (losses) of equity-accounted entities |
0.0 |
0.0 |
Income tax expense |
229.2 |
213.4 |
Exchange (gains) / losses |
3.2 |
8.7 |
Financial income |
(31.9) |
(60.1) |
Financial expense |
40.8 |
71.8 |
Operating profit |
892.3 |
811.5 |
Depreciation and impairment of tangible assets (including right-of-use assets) |
98.8 |
109.0 |
Amortization and impairment of intangible assets (including capitalized development costs) |
75.0 |
67.8 |
Impairment of goodwill |
0.0 |
0.0 |
EBITDA |
1,066.1 |
988.3 |
Reconciliation of cash flow from operations, free cash flow and normalized free cash flow with profit for the period
In € millions |
H1 2023 |
H1 2024 |
Profit for the period |
651.0 |
577.7 |
Adjustments for non-cash movements in assets and liabilities: |
|
|
Depreciation, amortization and impairment |
175.5 |
179.2 |
Changes in other non-current assets and liabilities and long-term deferred Taxes |
26.2 |
38.8 |
Unrealized exchange (gains)/losses |
9.4 |
0.3 |
(Gains)/losses on sales of assets, net |
1.1 |
2.7 |
Other adjustments |
0.1 |
5.7 |
Cash flow from operations |
863.3 |
804.4 |
Decrease (Increase) in working capital requirement |
29.4 |
(258.1) |
Net cash provided from operating activities |
892.7 |
546.3 |
Capital expenditure (including capitalized development costs) |
(79.6) |
(78.6) |
Net proceeds from sales of fixed and financial assets |
0.7 |
0.4 |
Free cash flow |
813.8 |
468.1 |
Increase (Decrease) in working capital requirement |
(29.4) |
258.1 |
(Increase) Decrease in normalized working capital requirement |
(17.5) |
8.4 |
Normalized free cash flow |
766.9 |
734.6 |
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 |
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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 |
6 months |
9 months |
12 months |
ZPE Systems |
Balance sheet only |
Balance sheet only |
To be determined |
To be determined |
Enovation |
|
Balance sheet only |
To be determined |
To be determined |
Netrack |
|
Balance sheet only |
To be determined |
To be determined |
|
|
Balance sheet only |
To be determined |
To be determined |
Vass |
|
Balance sheet only |
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
View source version on businesswire.com: https://www.businesswire.com/news/home/20240730194227/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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