Signify announced its 2023+Q1 results, achieving sales of 1.678 billion euros

On May 3, Signify announced its financial report for the first quarter of 2023. Affected by factors such as indoor professional business, consumer market segmentation business, OEM channel business, and weak market demand in various regions, Signify's performance declined during the reporting period.

In the first quarter of 2023, Signify achieved sales of 1.678 billion euros (approximately RMB 12.836 billion), a nominal decrease of 6.1%, and comparable sales decreased 9.1%. Among them, LED product sales accounted for 82% of total sales (84% in the same period last year); net profit was 28 million euros (approximately RMB 214 million), a nominal decrease of 67.9%. The adjusted gross profit margin was 39.3%, a year-on-year increase of 1 percentage point; the adjusted profit margin before interest, taxes, and amortization was 8.9%, a year-on-year decrease of 1.6 percentage points.

Signify said that during the reporting period, monetary policy and the acquisition of Fluence, Pierlite, and Intelligent Lighting Controls had a positive impact on the company's sales. However, the company's indoor professional business, consumer market segment business, and OEM channel business demand were weak; Chinese market demand is recovering.

During the reporting period, the performance of Signify’s Digital Solutions, Digital Products, and Conventional Products all declined to varying degrees.

Specifically, sales of the Digital Solution business were 951 million euros, a nominal decrease of 3.0%; due to a higher comparable base in the same period last year and declining demand for indoor professional and plant lighting businesses, comparable sales decreased by 8.7%.

Digital Products sales were 537 million euros, a nominal decrease of 10.6%, and comparable sales decreased by 10.1%. Affected by the consumer market and OEM business, demand for digital products has declined. On the other hand, Signify’s sales of LED lights and lighting fixtures have increased.

Traditional business (Conventional Products) sales were 186 million euros, a nominal decline of 7.6%, and comparable sales fell 8.5%. Signify said that the company made up for the impact of declining demand for traditional products by increasing product prices.

In terms of regional markets, during the reporting period, Signify's sales in various parts of the world declined compared with the same period last year. Among them, comparable sales in the two major markets of Europe and the United States fell by 6.2% and 10.9% respectively.

Looking forward to 2023, Signify said that the company will continue to increase its adjusted EBITDA profit margin and free cash flow. It is expected that the adjusted EBITDA profit margin in 2023 will be 10.5%~11.5%; free cash flow will account for 6%~8% of sales.