Press Release
January 31, 2020

Signify reports full-year sales of EUR 6.2 billion, improvement in profitability by 30 bps to10.4% and a free cash flow of EUR 529 million
Full year 20191• Signify’s installed base of connected light points increased from 44 million at YE 18 to 56 million at YE 19• CSG growing profit engines -0.3%; CSG total Signify -4.6%• LED-based comparable sales grew by 1.4%, representing 78% of sales (FY 18: 71%)
• Adj. indirect costs down EUR 125 million, or -6.6%, excl. currency effects and change in scope• Adj. EBITA margin improved by 30 bps to 10.4%, despite a negative currency impact of 20 bps• Adj. EBITA margin of the growing profit engines increased by 180 bps with each of the three BGs improving• Net income increased to EUR 267 million (FY 18: EUR 261 million)• Free cash flow amounted to EUR 529 million (FY 18: EUR 306 million) or 8.5% of sales• Solid progress made on our sustainability goals for 2020; well on track to be carbon neutral in 2020
Fourth quarter 20191• Sales of EUR 1.8 billion; 1.4% nominal sales growth• CSG growing profit engines -0.7%; CSG total Signify -4.2%• LED-based sales represent 80% of total sales• Adj. indirect costs down EUR 25 million, or -5.4%, excl. currency effects and change in scope• Adj. EBITA margin improved by 80 bps to 13.2%, including a positive currency impact of 30 bps• Adj. EBITA margin of the growing profit engines increased by 180 bps• Net income decreased to EUR 98 million compared with EUR 119 million last year
• Strong free cash flow of EUR 308 million (Q4 18: EUR 279 million)
Shareholder returns• In 2019, EUR 164 million of capital was returned through the annual dividend payment• Propose to pay a cash dividend of EUR 1.35 per share over 2019, an increase of 3.8% and a pay-out ratio of 47%
Eindhoven, the Netherlands – Signify (Euronext: LIGHT), the world leader in lighting, today announced the company’s
fourth quarter and full-year 2019 results. “We are pleased that we’ve improved our Adjusted EBITA margin for thesixth consecutive year, which has led to a 400 basis points increase since 2013. During the same period, our LEDbased sales increased from 26% to 78%, reflecting our successful transformation from conventional lighting
technologies to LED lighting products, systems and services. Our free cash flow of EUR 529 million is at the highest
level since the IPO. The profit and cash contribution from the growing profit engines is now more than twice that ofLamps. This demonstrates that we have significantly strengthened the business and financial profile of the company.
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 mostdirectly comparable IFRS financial measures, see appendix B, Reconciliation of non-IFRS financial measures, of this press release.

Page 2We are also seeing positive traction from the acquisitions we completed in 2019 and look forward to welcoming
Cooper Lighting Solutions in 2020, which will strengthen our market position in North America and our overallbusiness mix,” said CEO Eric Rondolat. “We propose a dividend of EUR 1.35 per share which brings the total return toshareholders to more than EUR 1.2 billion since the IPO. While we continue to face challenging market conditions,
we are confident that our relentless focus on our growth initiatives will further strengthen our market leadership andprogressively improve our growth profile.”

Sustainability
Sustainability is central to Signify’s strategy. It is the company’s purpose to unlock the extraordinary potential of lightfor brighter lives and a better world. In 2019, 82.5% of the company’s revenues came from its portfolio of sustainableproducts, systems and services, exceeding its 2020 target of 80%. Signify sold 2.3 billion LED lamps and luminaires in
2015-2019, in line with its commitment to deliver more than 2 billion LED lamps and luminaires by the end of 2020.
The company also decreased its waste to landfill by 70% and is ahead of its targets related to a safe & healthy
workplace and a sustainable supply chain. The company reduced its carbon footprint by 10%, achieving carbon
neutrality in 15 out of its 19 markets, demonstrating it is well on track to become carbon neutral this year. In 2019,
Signify was named Industry Leader in the Dow Jones Sustainability Index for the third consecutive year and is includedin CDP’s prestigious ‘A List’ for climate change since the IPO.

OutlookFor 2020, Signify aims to achieve a further improvement in the Adjusted EBITA margin and to deliver a free cash flowof 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 Q1
2020, as previously indicated.

Capital allocation
Capital allocation
Signify intends to maintain a robust capital structure and continues to aim towards a financing structure that iscompatible with an investment grade profile. Following the announced acquisition of Cooper Lighting Solutions, thecompany will prioritize deleveraging with strong free cash flows expected to drive down Signify’s net leverage ratio
from around 2x at closing to below 1x net debt/EBITDA within three years. The company intends to use EUR 350
million to reduce its debt in 2020.
The company plans to continue to pay a stable to increased dividend per share. While Signify will prioritizedeleveraging, it will continue to invest in R&D and other organic growth opportunities. As Signify will focus on
integrating Cooper Lighting Solutions, M&A will have a lower priority.
Dividend
The company proposes to pay a dividend of EUR 1.35 per share in cash related to full year 2019, which represents
an increase of 3.8% compared with last year, and a pay-out ratio of 47%. The dividend payment is subject toapproval by the Annual General Meeting of Shareholders (AGM) to be held on May 19, 2020. Further details will be
provided in the agenda for the AGM.

Page 3Financial review
Fourth quarter
2018
2019

1,726
647
37.5%

1,750
661
37.8%

-398
-64
-463
26.8%

-389
-68
-457
26.1%

214
12.4%
-17
197

232
13.2%
-67
164

173
-7
-47
119

138
-11
-29
98

279
0.90
29,237308
0.74
32,005

Twelve months
2018
2019

changein millions of EUR, except percentages

-4.2%
2.0%
3.5%
1.4%
2.2%

Comparable sales growth
Effects of currency movements
Consolidation and other changes
Sales
Adjusted gross margin
Adj. gross margin (as % of sales)

6,358
2,433
38.3%

6,247
2,360
37.8%

Adj. SG&A expenses
Adj. R&D expenses
Adj. indirect costs
Adj. indirect costs (as % of sales)-1,609-288-1,89629.8%-1,544-270-1,81329.0%

Adjusted EBITA
Adjusted EBITA margin
Adjusted items
EBITA

640
10.1%
-136
504

648
10.4%
-148
500

Income from operations (EBIT)Net financial income/expense
Income tax expense
Net income

410
-41
-106
261

401
-43
-93
267

Free cash flow
Basic EPS (€)
Employees (FTE)

306
1.95
29,237529
2.08
32,005

1.1%

8.4%-16.7%-19.9%-17.3%

change
-4.6%
1.6%
1.3%
-1.8%
-3.0%

4.4%

1.3%

-0.7%
-2.0%

2.3%

Fourth quarter
Sales amounted to EUR 1,750 million, a nominal increase of 1.4%. Adjusted for 2.0% currency effects and 3.5%
consolidation and other changes, comparable sales declined by 4.2%. LED-based sales represent 80% of total sales.
The adjusted gross margin increased by 30 bps to 37.8%, including a positive currency effect of 30 bps. Adjusted
indirect costs decreased by EUR 5 million, or 70 bps as a percentage of sales. Excluding currency effects and change
in scope, indirect costs decreased by EUR 25 million. Adjusted EBITA amounted to EUR 232 million compared with
EUR 214 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, acquisition-related charges EUR 11
million and incidental items EUR 15 million. Net income decreased from EUR 119 million last year to EUR 98 million
in Q4 19, mainly due to higher restructuring costs and other incidentals. Free cash flow, which includes a positive
impact of EUR 18 million related to IFRS 16, amounted to EUR 308 million compared with EUR 279 million last year.
Full year
Sales amounted to EUR 6,247 million, a nominal decrease of 1.8%. Adjusted for 1.6% currency effects and 1.3%
consolidation and other changes, comparable sales decreased by 4.6%. LED-based sales grew by 1.4% on acomparable basis and represented 78% of sales compared with 71% in 2018. The adjusted gross margin declined by
50 bps to 37.8%, including a negative currency effect of 30 bps. Adjusted indirect costs decreased by EUR 83 million,
or 80 bps as a percentage of sales.

Page 4

Excluding currency effects and changes in scope, indirect costs decreased by EUR 125 million, as a result of continued
rigorous implementation of cost reduction initiatives. Adjusted EBITA amounted to EUR 648 million compared withEUR 640 million last year and was negatively impacted by EUR 4 million of currency effects. The Adjusted EBITA margin
improved by 30 bps to 10.4%, including an adverse currency effect of 20 bps. This improvement was driven by LED,
Professional and Home. Total restructuring costs were EUR 99 million, acquisition-related charges were EUR 13 million
and incidental items were EUR 36 million. Net income was EUR 267 million compared with EUR 261 million last year.
Free cash flow, which includes a positive impact of EUR 71 million related to IFRS 16, amounted to EUR 529 million
compared with EUR 306 million last year. Free cash flow was 8.5% of sales in 2019.

Growing profit engines
in millions of EUR, except percentages

CSG

Free cash flow*

Adj. EBITA margin

FY 18
0.4%
-0.4%
-3.8%

FY 19
-1.1%
-1.7%
11.3%

FY 18
11.7%
9.5%
-8.1%

FY 19
12.7%
10.0%
3.8%

FY 18

FY 19

LED
ProfessionalHome
Growing profit engines

-0.4%

-0.3%

8.6%

10.4%

370

559

* Excluding non-allocated free cash flow items (e.g. tax, interest) that are accounted for in Other. Please refer to page 8 for more information.

Full year
Comparable sales growth of the growing profit engines was -0.3%, reflecting a challenging macro environment
resulting in lower market activity in Europe, India and the United States. Our growth platforms, connected systems,
IoT platform services, horticulture, solar, LiFi and 3D printing, showed positive momentum in 2019. The Adjusted
EBITA margin of the growing profit engines improved by 180 bps to 10.4%, with each of the three business groups
improving profitability. The growing profit engines substantially increased free cash flow to EUR 559 million and eachof the three business groups generated positive free cash flow.

LED
2018

Fourth quarter
2019

changein millions of EUR, unless otherwise indicated-2.9%

Comparable sales growth

2018

Twelve months
2019change
-1.1%

481

541

12.3%

Sales

1,812

1,891

4.4%

69
14.4%
68
67

77
14.3%
69
67

11.3%

Adjusted EBITA
Adjusted EBITA margin
EBITA
Income from operations (EBIT)

212
11.7%
204
200

240
12.7%
217
212

13.2%

Fourth quarter
Sales amounted to EUR 541 million, a nominal increase of 12.3%, reflecting the consolidation of the Klite acquisition
as of October 1, 2019. On a comparable basis, sales declined by 2.9%. LED lamps delivered a solid performance whilesales in LED electronics were impacted by lower customer demand in most regions. The Adjusted EBITA margin
remained solid at 14.3%.

Page 5Full year
Sales amounted to EUR 1,891 million, a decrease of 1.1% on a comparable basis. LED lamps delivered a solid
performance while sales in LED electronics were impacted by lower customer demand in most regions. Adjusted
EBITA amounted to EUR 240 million. The Adjusted EBITA margin improved by 100 bps to 12.7%, benefiting fromongoing procurement savings and lower indirect costs.

Professional
Fourth quarter
2018
2019
715
85
12.0%
79
56

720
92
12.7%
71
49

changein millions of EUR, unless otherwise indicated

-1.5%
0.7%
7.2%

Comparable sales growth
Sales
Adjusted EBITA
Adjusted EBITA margin
EBITA
Income from operations (EBIT)

Twelve months
2018
2019
2,635
251
9.5%
208
121

2,649
265
10.0%
222
133

change
-1.7%
0.5%
5.8%

Fourth quarter
Comparable sales decreased by 1.5% to EUR 720 million, mainly due to continued challenging market conditions,most notably in India and China, and lower market activity in the United States. Adjusted EBITA amounted to EUR 92
million, resulting in an improvement in the Adjusted EBITA margin of 70 bps to 12.7% which was mainly driven byindirect cost reductions.
Full year
Professional was impacted by weaker market conditions in 2019, most notably in certain markets in Europe and in
India. As a result, comparable sales declined by 1.7%. Adjusted EBITA increased by 5.8% to EUR 265 million, improving
the Adjusted EBITA margin by 50 bps to 10.0%, as procurement and indirect cost savings more than offset the negative
impact of price and mix.

Home
2018

Fourth quarter2019

Twelve months
2019changein millions of EUR, unless otherwise indicated

2018

9.5%
8.6%
140.5%

Comparable sales growth
Sales
Adjusted EBITA

467
-38

521
20

Adjusted EBITA margin

-8.1%

3.8%

176
16

191
38

8.9%

19.8%

16

35

EBITA

-43

5

15

34

Income from operations (EBIT)-44

3change11.3%
11.6%
151.7%

Fourth quarter
Home delivered a strong performance in Q4. Sales amounted to EUR 191 million, an increase of 9.5% on a comparable
basis. This reflects a particularly strong performance in Europe and the successful introduction of innovative offerings.
Adjusted EBITA more than doubled to EUR 38 million, improving the Adjusted EBITA margin from 8.9% to 19.8%.

Page 6

Full year
Sales amounted to EUR 521 million, an increase of 11.3% on a comparable basis. Adjusted EBITA increased by EUR 58
million to EUR 20 million. The Adjusted EBITA margin improved from -8.1% to 3.8%, driven by a higher top line, grossmargin improvement and cost optimization.

Cash engine - Lamps
2018
345
60
17.5%
50
50

Fourth quarter
2019
290
50
17.3%
17
17

2018

Twelve months
2019changein millions of EUR, unless otherwise indicated-18.3%-15.9%-16.5%

Comparable sales growth
Sales
Adjusted EBITA
Adjusted EBITA margin
EBITA
Income from operations (EBIT)

1,428
302
21.1%
270
269

1,159
222
19.2%
168
168

Free cash flow*

308

222

change-20.5%-18.8%-26.3%* Excluding non-allocated free cash flow items (e.g. tax, interest) that are accounted for in Other. Please refer to page 8 for more information.

Lamps continued to deliver on its ‘last man standing’ strategy, which resulted in further market share gains and solid
free cash flow generation of EUR 222 million in 2019. The Adjusted EBITA margin remained robust at 19.2% in 2019.

Other
Fourth quarter
Other represents amounts not allocated to the operating segments and includes certain costs related to central R&D
activities to drive innovation as well as group enabling functions. Adjusted EBITA amounted to EUR -26 million (Q418: EUR -17 million). EBITA amounted to EUR -28 million (Q4 18: EUR -15 million), including restructuring costs of EUR
2 million (Q4 18: EUR 9 million).
Full year
Adjusted EBITA amounted to EUR -100 million in 2019 (2018: EUR -87 million). EBITA amounted to EUR -112 million(2018: EUR -135 million), including restructuring costs of EUR 14 million (2018: EUR 39 million) and a net gain in
incidentals of EUR 1 million.

Sales by market
2018
662
485
483
95
1,726

Fourth quarter
Nominal2019change
652
-1.5%
452
-6.8%
500
3.5%
145
53.1%
1,750
1.4%

CSG

in millions of EUR, except
percentages

2018

-2.1%
-9.2%
-0.3%
-8.8%
-4.2%

EuropeAmericasRest of the World
Global businesses
Total

2,337
1,830
1,840
352
6,358

Twelve months
Nominal2019change
2,238
-4.3%
1,747
-4.5%
1,855
0.8%
406
15.5%
6,247
-1.8%

Horticulture is included in Market Groups Europe, Americas and Rest of the World (was previously part of Global businesses)

CSG
-4.4%
-7.5%
-2.0%
-4.4%
-4.6%

Page 7

Fourth quarter
Comparable sales in Europe decreased by 2.1%, mainly reflecting challenging market conditions in Germany and Italy.
Comparable sales in the Americas decreased by 9.2%, mainly driven by the ongoing decline of conventional and morechallenging market conditions in LED electronics and Professional. In the Rest of the World, comparable sales
decreased by 0.3%, with a solid performance in the Middle East largely offset by India.
Full year
Comparable sales in Europe decreased by 4.4%, mainly reflecting challenging market conditions in Germany, Italy andFrance. Comparable sales in the Americas decreased by 7.5%, mainly as a result of the ongoing decline of conventionaland more challenging market conditions in LED electronics. In the Rest of the World, comparable sales decreased by
2.0%, particularly due to India.

Changes in presentation of balance sheet and cash flow statement
The presentation of the balance sheet and cash flow statement has been amended to further improve transparency
and readability of these statements, in line with market practice. The changes in presentation are reclassifications ofamounts and do not impact total amounts. Refer to page 15 and 18 in the Appendix for an overview of the changes.

Working capitalin millions of EUR, unless otherwise indicatedInventories
Trade and other receivables
Trade and other payables
Other working capital items
Working capital
As a % of last-twelve-months sales

31 Dec '18

30 Sep '19

31 Dec '19

878
1,231
-1,507
-66
536
8.4%

1,030
1,213
-1,582
-74
588
9.4%

874
1,223
-1,684
-25
388
6.2%

A reconciliation of the changes in working capital can be found on page 16

Fourth quarterIn the fourth quarter, working capital decreased by EUR 200 million to EUR 388 million, representing 6.2% of sales,
mainly driven by lower inventories and higher payables compared with last quarter.
Full year
Working capital decreased year-on-year by EUR 148 million to EUR 388 million. As a percentage of sales, working
capital improved by 220 bps to 6.2% of sales, mainly driven by higher payables. This is the result of initiatives we
implemented during the year focused on optimizing receivables and payables policies.

Page 8Cash flow analysis
Fourth quarter
2018
2019
173
58
28
-73
147
-7
-22
-14
-11
279

138
77
65
-69
152
-4
-26
-26
1
308

Twelve months
2018
2019

in millions of EUR

Income from operations (EBIT)
Depreciation and amortization
Additions to (releases of) provisions
Utilizations of provisions
Change in working capitalInterest paid
Income taxes paid
Net capex
Other
Free cash flow

410
231
170
-286
8
-23
-123
-75
-6
306

401
288
178
-246
110
-17
-90
-70
-26
529

Fourth quarter
Free cash flow amounted to EUR 308 million, an increase of EUR 29 million compared with last year, including a
positive impact of EUR 18 million related to IFRS 16. Free cash flow included a restructuring payout of EUR 25 million(Q4 2018: EUR 36 million).
Full year
Free cash flow amounted to EUR 529 million, or 8.5% of sales, an increase of EUR 223 million compared with 2018,
including a EUR 71 million positive impact from IFRS 16. The free cash flow improved largely as a result of a betterworking capital position, and also benefited from a lower restructuring payout and income taxes paid.
in millions of EUR

Growing profit engines
Cash engine - Lamps
Other*
Signify total

FY 17
353
438
-388
403

Free cash flow
FY 18
370
308
-372
306

FY 19
559
222
-252
529

* Non-allocated free cash flow items (e.g. tax, interest)

In 2019, the free cash flow of the growing profit engines LED, Professional and Home combined amounted to EUR
559 million, a EUR 189 million increase compared with 2018, including a EUR 53 million positive impact from IFRS 16.
The free cash flow of Lamps amounted to EUR 222 million, or 19.2% of sales, which is a decrease of EUR 86 million
and includes a EUR 9 million positive impact from IFRS 16. For the first time, the free cash flow of the growing profit
engines was more than twice the level of the free cash flow of Lamps.

Net debt and total equity
in millions of EUR

Short-term debt
Long-term debt
Gross debt
Cash and cash equivalents
Net debt
Total equity

31 Dec '18

30 Sep '19

31 Dec '19

78
1,187
1,265
676
589
2,119

117
1,379
1,496
639
857
2,200

96
1,369
1,465
847
618
2,324

Page 9Fourth quarter
Net debt amounted to EUR 618 million, a decrease of EUR 239 million compared with the end of the third quarter,
mainly driven by strong free cash flow. The cash position increased to EUR 847 million. Total equity increased to EUR
2,324 million at the end of the fourth quarter (Q3 19: EUR 2,200 million), primarily due to net income and noncontrolling interest in Klite, offset by currency effects.
Full year
Net debt increased by EUR 29 million to EUR 618 million compared with the end of 2018, due to a EUR 200 million
increase in gross debt mainly related to IFRS 16. This was partly offset by an increase in the cash position. Total
equity increased by EUR 205 million to EUR 2,324 million, primarily driven by net income, non-controlling interest in
Klite and currency effects, partly offset by the dividend distribution.

Page 10

Other information
Appendix A – Financial statements information
Appendix B – Reconciliation of non-IFRS financial measures
Appendix C – Financial Glossary
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 2019 results. A live and on-demand audio webcast of theconference call will be available via the Investor Relations website.
Financial calendar 2020
February 25
Annual report 2019
April 24First quarter results 2020
May 19Annual General Meeting of Shareholders
May 21
Ex-dividend date
May 22
Dividend record dateJune 2
Dividend payment dateJune 18
Capital Markets Day
July 24
Second quarter and half year results 2020
October 23
Third quarter results 2020

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 GroningenTel: +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 Internetof 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 2019 sales of EUR 6.2 billion, we have approximately
32,000 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 three 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.

Page 11

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 growthand future operational results.
By their nature, these statements involve risks and uncertainties facing the Company and its Group Companies and a number ofimportant 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 ofacquisitions and other transactions, reputational and adverse effects on business due to activities in Environment, Health & Safety,
compliance risks, ability to attract and retain talented personnel, establishment of corporate and brand identity, adverse currency
effects, pension liabilities, and exposure to international tax laws. Please see “Risk Factors and Risk Management” in Chapter 12of the Annual Report 2018 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 andother important factors should be read in conjunction with the information included in the Company’s Annual Report 2018 andsemi-annual report 2019.
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 conditionand 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 estimatescompiled 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 grossmargin, 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 andratios 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 2018.

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 theaccounting policies as stated in the Annual Report 2018 and semi-annual report 2019.

Changes to financial reporting following announced organizational changes
On January 20, 2020, Signify announced its intent to adapt its business structure to enable a stronger customer focus and enhanced
specialization to further increase execution speed. To this end, the company intends to move from its current four business groups(BG) to three divisions: Digital Solutions, formerly known as BG Professional, Digital Products, which combines BG LED and BG
Home, and Conventional Products, which is the current BG Lamps. As a consequence, Signify intends to adapt its segment reporting
accordingly.

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

Page 12

Appendix A – Financial statement information
A. CONSOLIDATED STATEMENTS OF INCOME
in millions of EUR unless otherwise stated

Fourth quarter

Sales
Cost of sales
Gross margin
Selling, general and administrative expenses
Research and development expenses
Impairment of goodwill
Other business income
Other business expenses
Income from operations
Financial income
Financial expenses
Results relating to investments in associates
Income before taxes
Income tax expense
Net income
Attribution of net income for the period:
Net income (loss) attributable to shareholders of Signify N.V.
Net income (loss) attributable to non-controlling interests
Earnings per ordinary share attributable to shareholders
Weighted average number of ordinary shares outstanding used for
calculation (in thousands):
Basic
Diluted
Net income attributable to shareholders per ordinary share in EUR:
Basic
DilutedAmounts may not add up due to rounding

January to December

2018

2019

2018

2019

1,726
(1,092)
634
(415)
(67)
23
(2)
173
5
(11)
(1)
165
(47)
119

1,750
(1,121)
629
(418)
(76)
5
(1)
138
5
(16)
(0)
127
(29)
98

6,358
(3,976)
2,382(1,675)
(312)
32
(17)
410
20
(61)
(2)
367
(106)
261

6,247
(3,940)2,307(1,637)
(283)
22
(8)
401
17
(60)
1
360
(93)
267

115
4

93
5

263
(2)

262
5

128,163
128,482

125,937
127,594

134,306
134,672

126,028
127,626

0.90
0.90

0.74
0.73

1.95
1.95

2.08
2.06

Page 13

B. CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
in millions of EUR

Fourth quarter

January to December

2018
119

2019
98

2018
261

2019
267

(4)
1
(4)

9
(3)
6

(10)
1
(9)

6
(3)
4

53

(53)

61

38
(1)

18
(4)
67

7
(1)
(47)

(11)
1
51

1
1
39

Other comprehensive income (loss)
Total comprehensive income (loss)

64
182

(41)
57

42
303

42
309

Total comprehensive income (loss) attributable to:Shareholders of Signify N.V.
Non-controlling interests

177
5

55
3

301
2

304
6

Net income (loss)
Pensions and other post-employment plans:Remeasurements
Income tax effect on remeasurements
Total of items that will not be reclassified to profit or loss
Currency translation differences:
Net current period change, before tax
Income tax effectCash flow hedges:
Net current period change, before tax
Income tax effectTotal of items that are or may be reclassified to profit or loss

Amounts may not add up due to rounding

Page 14

C. CONSOLIDATED STATEMENT OF FINANCIAL POSITION
in millions of EUR

December31, 20181

December31, 2019

Non-current assets
Property, plant and equipment
Goodwill
Intangible assets, other than goodwill
Investments in associates
Financial assets
Deferred tax assets
Other assets
Total non-current assets

431
1,771
493
11
49
399
58
3,211

644
1,943
443
14
49
384
64
3,541

Current assets
Inventories
Financial assets
Other assets
Derivative financial assets
Income tax receivable
Trade and other receivables
Cash and cash equivalents
Assets classified as held for sale
Total current assets
Total assets

878
4
107
28
35
1,231
676
9
2,969
6,181

874
0
161
16
48
1,223
847
4
3,174
6,715

EquityShareholders’ equity
Non-controlling interests
Total equity

2,041
78
2,119

2,181
142
2,324

Non-current liabilities
Debt
Post-employment benefits
Provisions
Deferred tax liabilities
Income tax payable
Other liabilities
Total non-current liabilities

1,187
475
237
19
48
125
2,091

1,369
437
216
28
52
135
2,236

Current liabilities
Debt, including bank overdrafts
Derivative financial liabilities
Income tax payable
Trade and other payables
Provisions
Other liabilities
Liabilities from assets classified as held for sale
Total current liabilities
Total liabilities and total equity

78
22
15
1,507
168
179
0
1,970
6,181

96
20
22
1,684
149
183
2
2,155
6,715

Amounts may not add up due to rounding;1 This consolidated statement of financial position was updated for certain reclassification changes made

Page 15

C. CONSOLIDATED STATEMENT OF FINANCIAL POSITION – RECLASSIFICATIONS 2018
in millions of EUR

2018 beforechanges

Changes2018 after
changes

399
49
3,211

(38)
(20)
49
8
-

431
1,771
493
11
49
399
58
3,211

Current assets
Inventories
Current financial assets
Other assets
Derivative financial assets
Income tax receivable
Trade and other receivables
Cash and cash equivalents
Assets classified as held for sale
Total current assets
Total assets

878
4
107
28
35
1,231
676
9
2,969
6,181

-

878
4
107
28
35
1,231
676
9
2,969
6,181

EquityShareholders’ equity
Non-controlling interests
Total equity

2,041
78
2,119

-

2,041
78
2,119

1,187

475
(475)
48
(48)
-

1,187
475
237
19
48
125
2,091

(953)
(444)
1,507
(109)
-

78
22
15
1,507
168
179
1,970
6,181

Non-current assets
Property, plant and equipment
Goodwill
Intangible assets, excluding goodwill
Investments in associates
Non-current receivables
Other non-current financial assets
Financial assets1
Deferred tax assets
Other assets2
Total non-current assets

Non-current liabilities
Debt
Post-employment benefits3
Provisions
Deferred tax liabilities
Income tax payable4
Other liabilities
Total non-current liabilities
Current liabilities
Debt, including bank overdrafts
Derivative financial liabilities
Income tax payable
Accounts and notes payable5
Accrued liabilities5
Trade and other payables
Provisions
Other liabilities6,7
Liabilities directly associated with assets classified held for sale
Total current liabilities
Total liabilities and total equity

431
1,771
493
11
38
20

712
19
173
2,091

78
22
15
953
444
168
288
0
1,970
6,181

Amounts may not add up due to rounding;
1 Non-current receivables and other non-current financial assets were merged into the line “Financial assets”; 2 Non-current income tax receivable was moved from “Non-current
receivables” to “Other assets” within “Non-current assets”; 3 Post-employment benefits were separated from Provisions; 4 Income tax payable was separated from otherliabilities;
5 Accounts and notes payable and Accrued liabilities were merged into the line “Trade and other payables”; 6 Rebates payable EUR 163 million were moved from “Otherliabilities” into “Trade and other payables”; 7 Contract liabilities EUR 54 million were moved from “Accrued liabilities” to “Other liabilities”.

Page 16

WORKING CAPITAL BRIDGE FOR THE FOURTH QUARTER 2018
in millions of EUR

Inventories
Trade and other receivables
Accounts and notes payable
Accrued liabilities
Other working capital items
Working capital

Beforechanges
878
1,231
(953)
(444)
(176)
536

Accruedliabilities

(444)
444
0

Customer
rebates

Contract
liabilities

(163)

54

163
0

(54)
0

After
changes878
1,231(1,507)0(66)
536Inventories
Trade and other receivables
Trade and other payables
Other working capital items
Working capitalPage 17

D. CONSOLIDATED STATEMENTS OF CASH FLOWS
in millions of EUR

Fourth quarter
January to December
20181
2019
20181
2019
Cash flows from operating activities
Net income (loss)
Adj. to reconcile net income (loss) to net cash provided by operating activities:• Depreciation, amortization and impairment of non-financial assets• Impairment (reversal) of goodwill, other non-current fin. assets and inv. in assoc.
• Net gain on sale of assets• Net interest expense on debt, borrowings and other liabilities• Income tax expense• Additions to (releases of) provisions• Additions to (releases of) post-employment benefits• Other items
Decrease (increase) in working capital:• Decrease (increase) in trade and other receivables• Decrease (increase) in inventories• Increase (decrease) in trade and other payables• Increase (decrease) in other current assets and liabilities
Increase (decrease) in other non-current assets and liabilities
Utilizations of provisions
Utilizations of post-employment benefits
Interest paid, net
Income taxes paid
Net cash provided by (used for) operating activities

119
140
58
1
(5)
5
47
27
1
6
147
47
136
(26)
(10)
(11)
(63)
(10)
(7)
(22)
294

98
182
77
(3)
4
29
59
6
10
152
42
170
(17)
(44)
1
(56)
(13)
(4)
(26)
334

261
547
231
2
(8)
15
106
151
19
31
8
113
43
(92)
(56)
(3)
(223)
(63)
(23)
(123)
381

267
586
288
(0)
(13)
15
93
154
24
25
110
83
35
21
(30)
(11)
(189)
(57)
(17)
(90)
599

Cash flows from investing activities
Net capital expenditures:• Additions of intangible assets• Capital expenditures on property, plant and equipment• Proceeds from disposal of property, plant and equipment
Net proceeds from (cash used for) derivatives and other financial assets
Purchases of businesses, net of cash acquired
Proceeds from sale of businesses, net of cash disposed of
Net cash provided by (used for) investing activities

(14)
(7)
(13)
6
(4)
(2)
4
(16)

(26)
(7)
(22)
4
6
(71)
10
(81)

(75)
(26)
(57)
8
(13)
(7)
5
(90)

(70)
(29)
(58)
16
5
(95)
15
(145)

(1)
3
(29)
(125)
(152)
126
9

(0)
(0)
(31)
(0)
(31)
223
(14)

(171)
28
(87)
(324)
(554)
(263)
2

(165)
12
(127)
(6)
(286)
168
7

529
664

631
840

925
664

664
840

Cash flows from financing activities
Dividend paid
Proceeds from issuance of debt
Repayment of debt
Purchase of treasury shares
Net cash provided by (used for) financing activities
Net cash flows
Effect of changes in exchange rates on cash and cash equivalents and bankoverdrafts
Cash and cash equivalents and bank overdrafts at the beginning of the period2
Cash and cash equivalents and bank overdrafts at the end of the period3

Amounts may not add up due to rounding; 1 This consolidated cash flow was updated for certain reclassification changes made. 2For Q4 2019 and 2018, included bankoverdrafts of EUR 7 million and EUR 5 million, respectively. For January to December of 2019 and 2018, included bank overdrafts of EUR 12 million and EUR 17 million,
respectively. 3 Included bank overdrafts of EUR 7 million and EUR 12 million as of December 31, 2019 and 2018, respectively.

Page 18

D. CONSOLIDATED STATEMENTS OF CASH FLOWS - RECLASSIFICATIONS 2018
in millions of EUR
2018 beforechangesCash flows from operating activities
Net income (loss)
Adjustments to reconcile net income (loss) to net cash provided by operating
activities:• Depreciation, amortization and impairment of non-financial assets• Impairment (reversal) of goodwill, other non-current financial assets andinvestments in associates• Net gain on sale of assets• Interest income 1)• Net interest expense on debt, borrowings and other liabilities1• Income tax expense• Additions to (releases of) provisions2• Additions to (releases of) post-employment benefits2• Other items
Decrease (increase) in working capital:• Decrease (increase) in trade and other receivables• Decrease (increase) in inventories• Increase (decrease) in trade and other payables3• Increase (decrease) in other current assets and liabilities3
Increase (decrease) in other non-current assets and liabilities
Utilizations of provisions4
Utilizations of post-employment benefits4
Interest paid, net
Income taxes paid
Net cash provided by (used for) operating activities
Cash flows from investing activities
Net capital expenditures:• Additions of intangible assets• Capital expenditures on property, plant and equipment• Proceeds from disposal of property, plant and equipment
Net proceeds from (cash used for) derivatives and other financial assets5
Proceeds from other non-current financial assets5
Purchases of other non-current financial assets5
Purchases of businesses, net of cash acquired
Proceeds from sale of businesses, net of cash disposed of
Net cash provided by (used for) investing activities
Cash flows from financing activities
Dividend paid
Proceeds from issuance of debt6
Repayment of debt6
Purchase of treasury shares
Net cash provided by (used for) financing activities
Net cash flows
Effect of changes in exchange rates on cash and cash equivalents and bank overdrafts
Cash and cash equivalents and bank overdrafts at the beginning of the period
Cash and cash equivalents and bank overdrafts at the end of the period

Changes2018 after
changes

261
547

261
547

231
2

231
2

(8)
(16)
31
106
170
31
8
113
43
(54)
(95)
(3)
(286)
(23)
(123)
381

(75)
(26)
(57)
8
(4)
2
(11)
(7)
5
(90)

(171)
(59)
(324)
(554)
(263)
2
925
664

16
(16)
(19)
19

(38)
38
63
(63)

-

(9)
(2)
11

-

87
(87)
-

(8)
15
106
151
19
31
8
113
43
(92)
(56)
(3)
(223)
(63)
(23)
(123)
381

(75)
(26)
(57)
8
(13)
(7)
5
(90)

(171)
28
(87)
(324)
(554)
(263)
2
925
664

1 Interest income and expense are presented at net. These items were presented at gross previously.
2 Additions to (releases of) post-employment benefits are presented separately. They were presented in "Additions to (releases of) provisions” previously.
3 "Increase (decrease) in trade and other payables" now includes movements for customer rebates and accrued liabilities other than contract liabilities. They were presented in"Increase (decrease) in other current asset and liabilities" previously.
4 Utilizations of post-employment benefits are presented separately. They were presented in "Utilizations of provisions" previously.
5 "Net proceeds from (cash used for) derivatives and other financial assets" includes purchases and proceeds from non-current financial assets. They were presented in "Proceedsfrom other non-current financial assets" and "Purchases of other non-current financial assets" previously.
6 Proceeds and repayment of debt are presented separately. These items were presented at net previously.

Page 19

Appendix B – Reconciliation of non-IFRS Financial Measures
Sales growth composition in %Fourth quartercomparable
growthcurrency
effects

consolidationand otherchangesnominalgrowth

-2.9
-1.5
9.5
-18.3
-4.2

2.4
1.6
1.3
2.5
2.0

12.8
0.5
-2.2
0.0
3.5

12.3
0.7
8.6
-15.9
1.4

January to December
currency
consolidation
effects
and otherchangesnominalgrowth2019 vs 2018
LED
Professional
Home
Lamps
Total

comparable
growth2019 vs 2018
LED
Professional
Home
Lamps
Total

-1.1
-1.7
11.3
-20.5
-4.6

1.9
1.3
1.1
1.7
1.6

3.5
1.0
-0.8
0.0
1.3

4.4
0.5
11.6
-18.8
-1.8

Fourth quarter
currency
consolidation
effects
and otherchangesnominalgrowthSales growth composition in %comparable
growth2019 vs 2018
EuropeAmericasRest of the World
Global businesses
Total

-2.1
-9.2
-0.3
-8.8
-4.2

comparable
growth2019 vs 2018
EuropeAmericasRest of the World
Global businesses
Total
Amounts may not add up due to rounding

-4.4
-7.5
-2.0
-4.4
-4.6

0.3
2.4
4.1
1.2
2.0

0.3
-0.1
-0.3
60.7
3.5

-1.5
-6.8
3.5
53.1
1.4

January to December
currency
consolidation
effects
and otherchangesnominalgrowth

-0.1
3.0
2.2
1.0
1.6

0.2
0.0
0.6
18.9
1.3

-4.3
-4.5
0.8
15.5
-1.8

Page 20

Adjusted EBITA to Income from operations (or EBIT) (in millions of EUR)
Signify

LED

Professional

Home

Lamps

Other

Adjusted EBITA

232

77

92

38

50

(26)

Restructuring

(42)

(1)

(6)

(2)

(31)

(2)

Acquisition-related charges

(11)

(3)

(8)

-

-

-

Incidental items

(15)

(4)

(6)

(1)

(3)

(0)

EBITA

164

69

71

35

17

(28)

Amortization1

(26)

(2)

(23)

(1)

(0)

(0)

Income from operations (or EBIT)

138

67

49

34

17

(28)

Adjusted EBITA

214

69

85

16

60

(17)

Restructuring

(27)

(2)

(6)

(0)

(10)

(9)

Acquisition-related charges

(1)

-

(1)

-

-

(0)

Incidental items

11

(0)

-

(0)

(0)

11

EBITA

197

68

79

16

50

(15)

Amortization1

(24)

(1)

(22)

(0)

(0)

(0)

Income from operations (or EBIT)

173

67

56

15

50

(15)

Fourth quarter 2019

Fourth quarter 2018

Signify

LED

Professional

Home

Lamps

Other

Adjusted EBITA
Restructuring

648
(99)

240
(8)

265
(22)

20
(11)

222
(44)

(100)
(14)

Acquisition-related charges
Incidental items

(13)
(36)

(3)
(12)

(9)
(11)

(4)

(10)

(0)
1

EBITA

500

217

222

5

168

(112)

Amortization1

(99)

(5)

(90)

(2)

(0)

(2)

Income from operations (or EBIT)

401

212

133

3

168

(114)

Adjusted EBITA
Restructuring
Acquisition-related charges
Incidental items

640
(118)
(1)
(17)

212
(8)
(0)

251
(34)
(1)
(8)

(38)
(5)
(0)

302
(32)
(0)
(0)

(87)
(39)
(0)
(9)

EBITA

504

204

208

(43)

270

(135)

Amortization1

(94)

(4)

(86)

(1)

(1)

(2)

Income from operations (or EBIT)

410

200

121

(44)

269

(137)

January to December 2019

January to December 2018

Amounts may not add up due to rounding
1 Amortization and impairments of acquisition related intangibles and goodwill

Page 21

Income from operations to Adjusted EBITA (in millions of EUR)

Fourth quarter 2019

Acquisition
related Incidental
Reported Restructuring
charges
items2Adjusted

1,750(1,121)
629

-

-

-

31
31

2
2

(1)
(1)

1,750
(1,089)661

Selling, general and administrative expenses
Research and development expenses
Indirect costs1

(418)
(76)
(494)

4
8
11

9
0
9

17
0
17

(389)
(68)
(457)

Impairment of goodwill
Other business income
Other business expenses
Income from operations
Amortization
Income from operations excl. amortization (EBITA)

5
(1)
138
(26)
164

42
42

11
11

(1)
(0)
15
15

3
(1)
206
(26)
232

1,726
(1,092)
634

13
13

-

-

1,726
(1,079)647

Selling, general and administrative expenses
Research and development expenses
Indirect costs1

(415)
(67)
(482)

11
3
14

1
1

5
5

(398)
(64)
(463)

Impairment of goodwill
Other business income
Other business expenses
Income from operations
Amortization
Income from operations excl. amortization (EBITA)

23
(2)
173
(24)
197

27
27

1
1

(17)
1
(11)
(11)

6
(1)
189
(24)
214

Sales
Cost of sales
Gross margin

Fourth quarter 2018
Sales
Cost of sales
Gross margin

Amounts may not add up due to rounding
1 Adj. indirect costs included a negative currency impact of EUR 7 million and scope effect of EUR 12 million in Q4 19. Adjusting for the currency and scope impact, indirect costs
reduced by EUR 25 million on a comparable basis. 2Incidental items are non-recurring by nature and relate to the separation, company name change, transformation and realestate gains.

Page 22January to December 2019

Acquisition
related Incidental
charges
items22
1
2
1

Adjusted
6,247(3,887)2,360

Reported
6,247(3,940)2,307

Restructuring
50
50(1,637)(283)(1,920)

36
13
50

11
0
11

47
0
47

(1,544)(270)(1,813)

22
(8)
401
(99)
500

99
99

13
13

(13)
1
36
36

9
(7)
549
(99)
648

Sales
Cost of sales
Gross margin

6,358(3,976)
2,382

50
50

0
0

0
0

6,358
(3,926)
2,433

Selling, general and administrative expenses
Research and development expenses
Indirect costs 1)(1,675)(312)(1,988)

43
25
68

1
1

23
23

(1,609)(288)(1,896)

32
(17)
410
(94)
504

118
118

1
1

(17)
11
17
17

14
(5)
545
(94)
640

Sales
Cost of sales
Gross margin
Selling, general and administrative expenses
Research and development expenses
Indirect costs1
Impairment of goodwill
Other business income
Other business expenses
Income from operations
Amortization
Income from operations excluding amortization (EBITA)

January to December 2018

Impairment of goodwill
Other business income
Other business expenses
Income from operations
Amortization
Income from operations excluding amortization (EBITA)
Amounts may not add up due to rounding

1 Adj. indirect costs included a negative currency impact of EUR 7 million and scope effect of EUR 12 million in Q4 19. Adjusting for the currency and scope impact, indirect costs

reduced by EUR 25 million on a comparable basis. 2Incidental items are non-recurring by nature and relate to the separation, company name change, transformation and realestate gains.

Page 23

Appendix C – Financial glossary
Acquisition-related charges

Adjusted EBITA
Adjusted EBITA margin
Adjusted gross margin

Adjusted indirect costs

Adjusted R&D expenses

Adjusted SG&A expenses

Comparable sales growth (CSG)

EBIT
EBITA

Costs that are directly triggered by theacquisition of a company, such as transaction costs,
purchase accounting related costs and integrationrelated expenses
EBITA excluding restructuring costs, acquisitionrelated charges and other incidental charges
Adjusted EBITA divided by sales to third parties(excluding intersegment)
Gross margin, excluding restructuring costs,
acquisition-related charges and other incidental
items attributable to cost of sales
Indirect costs, excluding restructuring costs,
acquisition-related charges and other incidental
items attributable to indirect costs
Research and development expenses, excluding
restructuring costs, acquisition-related charges andother incidental items attributable to research anddevelopment expenses
Selling, general and administrative expenses,
excluding restructuring costs, acquisition-related
charges and other incidental items attributable toselling, general and administrative expenses
The period-on-period growth in sales excluding theeffects of currency movements and changes in
consolidation and other changes
Income from operations

Income from operations excluding amortization andimpairment of acquisition related intangible assets
and goodwill
Effects of changes in consolidation and other In the event a business is acquired (or divested), thechanges
impact of the consolidation (or de-consolidation) on
the Group’s figures is included (or excluded) in thecalculation of the comparable sales growth figures.
Other changes include regulatory changes andchanges originating from new accounting standards
Effects of currency movements
Calculated by translating the foreign currency
financials of the previous period and the current
period into euros at the same average exchange
rates.
Employees
Employees of Signify at period end expressed on afull-time equivalent (FTE) basis
Free cash flow
Net cash provided by operating activities minus net
capital expenditures. Free cash flow includes interest
paid and income taxes paid
Gross margin
Sales minus cost of sales

Page 24

Incidental charges

Indirect costs
Net capital expenditures

Net debt
R&D expenses
Restructuring costs

SG&A expenses
Working capital

Any item with an income statement impact (loss orgain) that is deemed to be both significant and notpart of normal business activity. Other incidental
items may extend over several quarters within thesame financial year
The sum of selling, general and administrative
expenses and R&D expenses
Additions of intangible assets, capital expenditureson property, plant and equipment and proceedsfrom disposal of property, plant and equipment
Short-term debt, long-term debt minus cash andcash equivalents
Research and development expenses
The estimated costs of initiated reorganizations, themost significant of which have been approved by theGroup, and which generally involve the realignmentof certain parts of the industrial and commercialorganization
Selling, general and administrative expenses
The sum of Inventories, Receivables, Other current
assets, Derivative financial assets, minus the sum of
Accounts and notes payable, Accrued liabilities,
Derivative financial liabilities, and Other current
liabilities.