Press Release
May 3, 2023
Signify reports first quarter sales of EUR 1.7 billion, operational profitability of 8.9% and afree cash flow of EUR 51 million
First quarter 20231• Signify's installed base of connected light points increased from 114 million in Q4 22 to 117 million in Q1 23• On track to double the pace of the Paris Agreement• Sales of EUR 1,678 million; nominal sales decline of -6.1% and CSG of -9.1%• LED-based sales represented 82% of total sales (Q1 22: 84%)
• Adj. EBITA margin of 8.9% (Q1 22: 10.5%)• Net income of EUR 28 million (Q1 22: EUR 87 million)• Free cash flow of EUR 51 million (Q1 22: EUR -189 million)
Eindhoven, the Netherlands – Signify (Euronext: LIGHT), the world leader in lighting, today announced thecompany’s first quarter 2023 results.
“Largely in line with expectations, Q1 2023 saw persistent weakness in the consumer segment and in the indoor
professional business, as well as a slowdown in OEM sales. At the same time, we made progress with our 2023
priorities, such as continued price discipline and effective COGS management, which resulted in an improvementin our gross margin. The Adjusted EBITA margin performance of our Conventional Products division returned tohistorical levels. The company’s free cash flow further recovered, driven by working capital improvements.
While our adjusted EBITA margin was impacted by lower fixed cost absorption, we remain steadfastly focusedon applying our customary cost discipline,” said Eric Rondolat, CEO of Signify.
“While we expect the remainder of H1 2023 to remain challenging, we continue to see the potential for an
improved second half. Given the structural improvements in our gross margin and free cash flow generation, as
well as our intensified measures to reduce fixed costs, we confirm our guidance for the full year.”¹ This 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 notrecognized measures of financial performance or liquidity under IFRS. For a reconciliation of these non-IFRS financial measures to the most directly comparable IFRS financial measures, seeappendix B, Reconciliation of non-IFRS financial measures, of this press release.

Brighter Lives, Better World 2025
In the first quarter of the year, Signify was on track for all of its Brighter Lives, Better World 2025 sustainability
program commitments that contribute to doubling its positive impact on the environment and society.
••••Double the pace of the Paris Agreement:
Cumulative carbon reduction over the value chain is on track. This is mainly driven by energy-efficientand connected LED lighting, which drive emission reductions in the use phase.
Double our Circular revenues to 32%:
Circular revenues were 29%, stable versus the previous quarter, yet on track to reach the 2025 target.
Circular revenues continue to be driven by serviceable and circular luminaires.
Double our Brighter lives revenues to 32%:Brighter lives revenues were 27%, on track to reach the 2025 target. The main contribution continues
to be the consumer well-being and Safety & security portfolios.
Double the percentage of women in leadership positions to 34%:
The percentage of women in leadership positions was 29%, an increase versus the previous quarter andon track to reach the 2025 target. The improvement was mainly driven by new external hires and theinternal promotion of women.

OutlookSignify confirms its guidance for 2023. The company continues to focus its efforts on improving the Adjusted
EBITA margin and free cash flow. Signify expects for 2023:••

An Adjusted EBITA margin in the range of 10.5-11.5%
Free cash flow between 6-8% of sales

2Financial review
in millions of EUR, except percentages

2022

First quarter
2023

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

1,788
684
38.3%

1,678
659
39.3%

Adj. SG&A expenses
Adj. R&D expenses
Adj. indirect costs
Adj. indirect costs (as % of sales)

-456
-72
-528
29.5%

-461
-74
-535
31.9%

Adjusted EBITA
Adjusted EBITA margin
Adjusted items
EBITA

187
10.5%
-41
146

149
8.9%
-67
83

(20.2%)

115
-6
-22
87

61
-30
-3
28

(47.2%)-189
0.69
36,88451
0.20
34,408

Income from operations (EBIT)Net financial income/expense
Income tax expense
Net income
Free cash flow
Basic EPS (€)
Employees (FTE)change(9.1%)
0.9%
2.1%(6.1%)(3.6%)-1.4 %(43.4%)(67.9%)First quarter
Nominal sales decreased by 6.1% to EUR 1,678 million, including a positive currency effect of 0.9% and a positiveeffect of 2.1% from the consolidation of Fluence, Pierlite and Intelligent Lighting Controls. Comparable sales
declined by 9.1%, driven by continued weakness in the indoor professional business, the consumer segment andthe OEM channel. In China, the market was still impacted by COVID-related disruptions, but the company
started to see increased economic activity following the reopening.
The Adjusted gross margin increased by 100 bps to 39.3%, mainly driven by continued price discipline andeffective COGS management. Adjusted indirect costs as a percentage of sales increased by 240 bps to 31.9%, as
the reduction of indirect costs was not sufficient to compensate lower sales.
Adjusted EBITA decreased to EUR 149 million. The Adjusted EBITA margin decreased by 160 bps to 8.9%, mainly
due to under-absorption of fixed costs and an adverse currency effect from the weakening of emerging market
currencies, the strengthening of the US Dollar, and a one-off impact from the implementation of a new hedging
policy.
Restructuring costs were EUR 47 million and were mainly related to Conventional Products. These restructuringcosts were in line with the strategy to adjust Conventional Products' footprint to declining sales. Acquisitionrelated charges were EUR 3 million and incidental items were EUR 16 million, mainly related to additions toenvironmental provisions.
Net income decreased to EUR 28 million, mainly due to lower income from operations and higher financial
expenses, partly offset by lower income tax expense due to lower taxable income and a release of tax liabilities.
3

The higher financial expenses were mainly related to a non-cash fair value adjustment of the Virtual Power
Purchase Agreements due to lower energy prices, and higher interest costs.
The number of employees (FTE) decreased from 36,884 at the end of Q1 22 to 34,408 at the end of Q1 23. The
year-on-year decrease is mostly related to a reduction of factory personnel due to lower production volumes. In
general, the number of FTEs is affected by fluctuations in volume and seasonality.

Digital Solutions
in millions of EUR, unless otherwise indicated2022

First quarter
2023

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

981
95
9.7%
75
47

951
82
8.7%
70
50

change-8.7%-3.0%-13.1%-6.4%
8.0%

Includes Intelligent Lighting Controls since March 1, 2023, Fluence since May 2, 2022, and Pierlite since April 29, 2022.

First quarter
Nominal sales decreased by 3.0% to EUR 951 million, including a positive currency effect of 1.7% and a positiveeffect of 4.0% from the consolidation of Fluence, Pierlite and Intelligent Lighting Controls. Comparable sales
declined by 8.7% on the back of a high base of comparison (Q1 22: +16.9%), and weaker indoor professional andhorticulture sales. The Adjusted EBITA margin declined by 100 bps to 8.7%, as gross margin improvements weremore than offset by under-absorption of fixed costs and an adverse currency effect.

Digital Products
in millions of EUR, unless otherwise indicated2022

First quarter
2023

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

601
77
12.8%
65
63

537
44
8.3%
39
38

change-10.1%-10.6%-42.1%-40.2%-40.9%First quarter
Nominal sales decreased by 10.6% to EUR 537 million, including a negative currency effect of 0.4%. Comparable
sales declined by 10.1%, due to continued weakness in the consumer connected and OEM businesses, which waspartly compensated by higher sales of LED lamps and luminaires. The Adjusted EBITA margin declined by 450
bps to 8.3%, mainly reflecting under-absorption of fixed costs due to lower sales volumes, partly offset by apositive impact from price and sales mix.

4

Conventional Products
in millions of EUR, unless otherwise indicated2022

First quarter
2023

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

201
32
16.0%
23
23

186
42
22.5%
-5
-5

change
-8.5%
-7.6%
30.1%
-121.8%-121.8%First quarter
Nominal sales decreased by 7.6% to EUR 186 million, including a positive currency effect of 0.9%. Comparable
sales declined by 8.5%, as lower volumes were partially compensated by price increases. The Adjusted EBITA
margin increased by 650 bps to 22.5%, mainly reflecting strong price discipline and a benefit from one offs.
EBITA included EUR 47 million of adjusted items, mainly related to restructuring charges and additions toenvironmental provisions.

OtherFirst quarter'Other' represents amounts not allocated to operating segments and includes costs related both to central R&D
activities to drive innovation, and to Group enabling functions. Adjusted EBITA was EUR -19 million (Q1 22: EUR-17 million) and EBITA was EUR -22 million (Q1 22: EUR -18 million). Restructuring costs increased to EUR 3
million (Q1 22: EUR 1 million) and incidental items were a net benefit of EUR 1 million.
Update US legal caseIn reference to the legal case disclosed in its Q3 2022 press release, Signify received a decision from the trial
judge on April 26th, reducing the jury’s award from USD 100 million to approximately USD 46 million and
Signify’s allocated share to approximately USD 42 million. Both the legal provision and the insurance cover asset
have been updated in the balance sheet of the company as per 31 March 2023 without any net P&L impact.
Signify has a comprehensive global liability insurance and has confirmation that the case is fully covered without
reservation of rights, including interest and other costs. Signify will continue to exercise all its rights to appeal
this verdict.

Sales by market
in millions of EUR, except percentages

EuropeAmericasRest of the world
Global businesses
Total

2022
557
703
394
135
1,788

First quarter2023
Change
524
-5.9%
653
-7.1%
369
-6.2%
132
-1.8%
1,678
-6.1%

CSG
-6.2%
-10.9%-6.8%-16.4%-9.1%

Americas includes Intelligent Lighting Controls since March 1, 2023. Global businesses include Fluence since May 2, 2022. Rest of the world includes Pierlite sinceApril 29, 2022.

First quarterIn the first quarter, most markets saw continued weakness in the consumer segment and softness in the indoor
professional segment, in addition to a high base of comparison. In Europe, comparable sales declined by 6.2%,
mainly due to Germany, the Benelux and the UK. In the Americas, comparable sales declined by 10.9%, mainly
due to the US and Canada. In the Rest of the World, comparable sales declined by 6.8%, as most markets
5declined. China was still impacted by COVID-related disruptions. Global businesses' comparable sales declinedby 16.4%, mainly due to Klite.

Working capitalin millions of EUR, unless otherwise indicatedInventories
Trade and other receivables
Trade and other payables
Other working capital items
Working capital
As % of LTM* sales

Mar 31, 2022
1,535
1,128
-2,073
-30
559
7.9%

Dec 31, 2022
1,361
1,102
-1,859
-41
564
7.5%

Mar 31, 2023
1,337
1,032
-1,710
-42
617
8.3%

* LTM: Last Twelve Months

First quarter
Working capital slightly increased from a recurring seasonal low of EUR 564 million at the end of December 2022
to EUR 617 million at the end of March 2023. The higher working capital is driven by a reduction in payables,
only partly offset by lower receivables and lower inventories. As a percentage of last twelve-month sales,
working capital increased by 80 bps to 8.3%. Including last twelve-month sales pro forma for Fluence andPierlite, working capital increased by 90 bps to 8.3%.
Compared with March 2022, working capital increased by EUR 58 million. This increase is mainly related to lower
payables and other working capital items, partly offset by lower inventories and receivables. As a percentage oflast twelve-month sales, working capital increased by 40 bps to 8.3%. Including last twelve-month sales pro
forma for Fluence and Pierlite, working capital also increased by 40 bps.

Cash flow analysis
in millions of EUR

Income from operations (EBIT)
Depreciation and amortization
Additions to (releases of) provisions
Utilizations of provisions
Changes in working capital
Net interest and financing costs received (paid)
Income taxes paid
Net capex
Other
Free cash flow

First quarter
2022
115
76
19
-43
-315
—
-24
-27
9
-189

2023
61
71
77
-52
-53
-4
-23
-30
4
51

First quarter
Free cash flow was EUR 51 million, mainly due to a lower cash outflow from working capital, which benefited
from improved demand planning reliability and stricter inventory discipline. The increase in additions toprovisions was mostly related to restructuring provisions in Conventional Products. Free cash flow included a
restructuring payout of EUR 21 million (Q1 22: EUR 14 million).

6

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

Mar 31, 2022
72
1,932
2,004
626
1,378
2,716

Dec 31, 2022
83
1,950
2,033
677
1,356
3,065

Mar 31, 2023
83
1,942
2,025
694
1,331
3,053

First quarter
Compared with the end of December 2022, both the cash and gross debt positions remained relatively stable.
The cash position increased by EUR 17 million to EUR 694 million, while gross debt declined by EUR 8 million to
EUR 2,025 million. As a result, net debt decreased by EUR 25 million to EUR 1,331 million. Total equity slightly
reduced to EUR 3,053 million at the end of March 2023 (Q4 22: EUR 3,065 million), primarily due to currencytranslation results, partly offset by net income.
Compared with the end of March 2022, the cash position increased by EUR 68 million, while gross debt
increased by EUR 21 million. As a result, the net debt decreased by EUR 47 million year on year. At the end of
March 2023, the net debt/EBITDA ratio was 1.4x (Q1 22: 1.6x).

7Other information
Appendix A – Selection of financial statements
Appendix B – Reconciliation of non-IFRS financial measures
Appendix C – Financial glossary
Conference call and audio webcast
Eric Rondolat (CEO) and Javier van Engelen (CFO) will host a conference call for analysts and institutional
investors at 9:00 a.m. CET to discuss the first quarter 2023 results. A live audio webcast of the conference callwill be available via the Investor Relations website.
Financial calendar
May 16, 2023
May 18, 2023
May 19, 2023
June 5, 2023
July 28, 2023
October 27, 2023

Annual General Meeting
Ex-dividend date
Dividend record date
Dividend payment date
Second quarter and half-year results 2023
Third quarter results 2023

For further information, please contact:
Signify Investor Relations
Thelke Gerdes
Tel: +31 6 1801 7131
E-mail: thelke.gerdes@signify.com
Signify Corporate Communications
Leanne Carmody
Tel: +31 6 3928 0201
E-mail: leanne.carmody@signify.com
Abigail Levene
Tel: +31 6 2939 3895
E-mail: abigail.levene@signify.com
About Signify
Signify (Euronext: LIGHT) is the world leader in lighting for professionals and consumers and lighting for theInternet of Things. Our Philips products, Interact connected lighting systems and data-enabled services, deliver
business value and transform life in homes, buildings and public spaces. In 2022, we had sales of EUR 7.5 billion,
approximately 35,000 employees and a presence in over 70 countries. We unlock the extraordinary potential oflight for brighter lives and a better world. We achieved carbon neutrality in our operations in 2020, have been in
the Dow Jones Sustainability World Index since our IPO for six consecutive years and were named Industry
Leader in 2017, 2018 and 2019. News from Signify is located at the Newsroom, Twitter, LinkedIn and Instagram.
Information for investors can be found on the Investor Relations page.

8

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 andprojections of Signify N.V. (the “Company”, and together with its subsidiaries, the “Group”), including
statements regarding strategy, estimates of sales growth and future operational results.
By their nature, these statements involve risks and uncertainties facing the Company and its Group companies,
and a number of important factors could cause actual results or outcomes to differ materially from thoseexpressed in any forward-looking statement as a result of risks and uncertainties. Such risks, uncertainties andother important factors include but are not limited to: adverse economic and political developments, inparticular the impacts of the Russia-Ukraine conflict, the energy crisis in Europe, the impacts of COVID-19,
supply chain constraints, component shortages, cost inflation, rapid technological change, competition in thegeneral lighting market, development of lighting systems and services, successful implementation of business
transformation programs, impact of acquisitions 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, adverse currency effects, pension liabilities, and exposure to international tax laws.
Additional risks currently not known to the Group or that the Group has not considered material as of the dateof this document could also prove to be important and may have a material adverse effect on the business,
results of operations, financial condition and 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 byapplicable law.
Market and Industry Information
All references to market share, market data, industry statistics and industry forecasts in this document consist of
estimates compiled 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 unlessotherwise stated.
Non-IFRS Financial Measures
Certain parts of this document contain non-IFRS financial measures and ratios, such as comparable sales growth,
adjusted gross margin, EBITA, adjusted EBITA, and free cash flow, and other related ratios, which are notrecognized measures of financial performance or liquidity under IFRS. The non-IFRS financial measurespresented are measures used by management to monitor the underlying performance of the Group’s businessand operations and, accordingly, they have not been audited nor reviewed. Not all companies calculate non-IFRS
financial measures in the same manner or on a consistent basis and these measures and ratios may not becomparable 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 thisdocument. For further information on non-IFRS financial measures, see “Chapter 18 Reconciliation of non-IFRS
measures” in the Annual Report 2022.
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 preparedin accordance with the accounting policies as stated in the Annual Report 2022.
Market Abuse Regulation
This press release contains information within the meaning of Article 7(1) of the EU Market Abuse Regulation.

9

Appendix A – Financial statement information
A. Condensed consolidated statement of income
In millions of EUR unless otherwise stated

Sales
Cost of sales
Gross margin
Selling, general and administrative expenses
Research and development expenses
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

First quarter
2022
1,788
(1,124)
664
(477)
(71)
1
(1)
115
10
(15)
—
109
(22)
87
86
1

2023
1,678
(1,073)
605
(472)
(76)
6
(3)
61
6
(35)
—
31
(3)
28
25
3

Amounts may not add up due to rounding.

10B. Condensed consolidated statement of comprehensive income
In millions of EUR
First quarter
2022
87

2023
28

(6)
—
(6)

—
—
—

71
—

(59)
—

(3)
—

—
—

(6)
1
64

18
(4)
(46)

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

59
146

(46)
(18)

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

142
3

(19)
1

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 effect
Net investment hedge
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.

11C. Condensed consolidated statement of financial position
In millions of EUR
December 31, 2022

March 31, 2023

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

699
2,861
700
12
165
418
40
4,895

687
2,830
677
12
108
428
34
4,775

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

1,361
—
161
34
56
1,102
677
1
3,391
8,286

1,337
—
168
32
44
1,032
694
1
3,308
8,084

EquityShareholders’ equity
Non-controlling interests
Total equity

2,920
145
3,065

2,907
146
3,053

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

1,950
327
283
25
111
160
2,855

1,942
321
247
24
92
171
2,798

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

83
42
21
1,859
168
194
—
2,367
8,286

83
38
27
1,710
171
204
—
2,233
8,084

Amounts may not add up due to rounding.

12

D. Condensed consolidated statement of cash flows
In millions of EUR
First quarter
2022
Cash flows from operating activities
Net income (loss)
Adjustments to reconcile net income (loss) to net cash provided by operating
activities:

87

28

129

176

76

71

—
—
7

—
(5)
10

22
15
4
5

3
72
5
19

Changes in working capital:• Changes in trade and other receivables• Changes in inventories• Changes in trade and other payables• Changes in other current assets and liabilities
Changes in other non-current assets and liabilities
Utilizations of provisions
Utilizations of post-employment benefits
Net interest and financing costs received (paid)
Income taxes paid
Net cash provided by (used for) operating activities

(315)
65
(107)
(284)
10
4
(34)
(8)
—
(24)
(162)

(53)
55
9
(136)
19
9
(42)
(9)
(4)
(23)
82

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

(27)
(14)
(14)
1
14
—
—
(12)

(30)
(14)
(16)
—
13
(14)
—
(31)

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 bank overdrafts
Cash and cash equivalents and bank overdrafts at the beginning of the period 1
Cash and cash equivalents and bank overdrafts at the end of the period 2

—
3
(23)
(36)
(55)
(230)
8
847
625

—
1
(23)
—
(22)
29
(12)
676
693

• 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• 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

1
2

2023

For Q1 2023 and Q1 2022, included bank overdrafts of EUR 1 million and EUR 4 million, respectively.
Included bank overdrafts of EUR 1 million and EUR 0 million as at March 31, 2023 and 2022, respectively.

Amounts may not add up due to rounding.

13

Appendix B - Reconciliation of non-IFRS financial measures
Sales growth composition per business in %Comparable
growth2023 vs 2022
Digital Solutions
Digital Products
Conventional Products
Total

(8.7)
(10.1)(8.5)(9.1)

First quarter
Currency effects
Consolidation andother changes
1.7
(0.4)
0.9
0.9

Nominal growth

4.0
—
—
2.1

(3.0)
(10.6)(7.6)(6.1)

First quarter
Currency effects
Consolidation andother changes

Nominal growth

Sales growth composition per market in %Comparable
growth2023 vs 2022
EuropeAmericasRest of the world
Global businesses
Total

(6.2)
(10.9)(6.8)(16.4)
(9.1)

0.1
3.6
(3.6)
1.6
0.9

0.2
0.2
4.2
13.0
2.1

(5.9)
(7.1)
(6.2)
(1.8)
(6.1)

14

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

1

Signify

DigitalSolutions

Digital Conventional
Products
Products

First quarter 2023
Adjusted EBITA
Restructuring
Acquisition-related charges
Incidental items
EBITA
Amortization1
Income from operations (or EBIT)

149
(47)
(3)
(16)
83
(22)
61

82
(6)
(3)
(3)
70
(20)
50

44
(4)
—
(1)
39
(1)
38

42
(34)
—
(12)
(5)
—
(5)

(19)
(3)
—
1
(22)
—
(22)

First quarter 2022
Adjusted EBITA
Restructuring
Acquisition-related charges
Incidental items
EBITA
Amortization1
Income from operations (or EBIT)

187
(4)
(7)
(29)
146
(31)
115

95
(1)
(7)
(11)
75
(29)
47

77
—
—
(11)
65
(2)
63

32
(2)
—
(7)
23
—
23

(17)
(1)
—
—
(18)
—
(18)

Other

Amortization and impairments of acquisition related intangible assets and goodwill.

Amounts may not add up due to rounding.

15

First quarter 2023 Income from operations to Adjusted EBITA in millions of EUR

Reported Restructuring
First quarter 2023
Sales
Cost of sales
Gross margin
Selling, general and administrative expenses
Research and development expenses
Indirect costs
Impairment of goodwill
Other business income
Other business expenses
Income from operations
Amortization
Income from operations excluding
amortization (EBITA)First quarter 2022
Sales
Cost of sales
Gross margin
Selling, general and administrative expenses
Research and development expenses
Indirect costs
Impairment of goodwill
Other business income
Other business expenses
Income from operations
Amortization
Income from operations excluding
amortization (EBITA)
1

Acquisitionrelated
charges

Incidental
items1

Adjusted

1,678(1,073)
605

—
37
37

—
1
1

—
16
16

1,678
(1,019)
659

(472)
(76)
(548)
—
6
(3)
61
(22)

9
2
11
—
—
—
47
—

3
—
3
—
(1)
—
3
—

(1)
—
(1)
—
—
16
—

(461)
(74)
(535)
—
5
(2)
127
(22)

83

47

3

16

149

1,788
(1,124)
664

—
2
2

—
3
3

—
15
15

1,788
(1,104)
684

(477)
(71)
(548)
—
1
(1)
115
(31)

2
—
2
—
—
—
4
—

5
—
5
—
—
—
7
—

14
—
14
—
—
—
29
—

(456)
(72)
(528)
—
1
(1)
156
(31)

146

4

7

29

187

Incidental items are non-recurring by nature and relate to impairment and other non-cash charges related to operations in Russia and Ukraine, separation,transformation, environmental provision for inactive sites and discounting effect of long-term provisions.

Amounts may not add up due to rounding.

16

Appendix C – Financial glossary

EBIT
Income from operations.

Acquisition-related charges
Costs that are directly triggered by the acquisitionof a company, such as transaction costs, purchaseaccounting related costs and integration-related
expenses.

EBITA
Income from operations excluding amortizationand impairment of acquisition-related intangible
assets and goodwill.

Adjusted EBITAEBITA excluding restructuring costs, acquisitionrelated charges, and other incidental charges.

EBITDA
Income from operations excluding depreciation,amortization, and impairment of non-financial
assets.

Adjusted EBITA margin
Adjusted EBITA divided by sales to third parties(excluding intersegment).
Adjusted gross margin
Gross margin, excluding restructuring costs,
acquisition-related charges, and other incidental
items attributable to cost of sales.
Adjusted indirect costs
Indirect costs, excluding restructuring costs,
acquisition-related charges, and other incidental
items attributable to indirect costs.
Adjusted R&D expenses
Research and development expenses, excluding
restructuring costs, acquisition-related charges, andother incidental items attributable to research anddevelopment expenses.
Adjusted SG&A expenses
Selling, general and administrative expenses,
excluding restructuring costs, acquisition-related
charges, and other incidental items attributable toselling, general and administrative expenses.
Brighter lives revenues
Percentage of total revenues coming from all
products, systems and services contributing toFood availability, Safety & security, or Health &well-being.
Changes in scope
Consolidation effects related to acquisitions.
Circular revenues
Percentage of total revenues coming fromproducts, systems and services designed for acircular economy, categorized as serviceable
luminaires (incl. 3D-printing), circular components,
intelligent systems, or circular services.
Comparable sales growth (CSG)
The period-on-period growth in sales excluding theeffects of currency movements and changes in
consolidation and other changes.

Effects of changes in consolidation and otherchangesIn the event a business is acquired (or divested),
the impact of the consolidation (or deconsolidation) on the Group’s figures is included (orexcluded) in the calculation of the comparable sales
growth figures. Other changes include regulatorychanges and changes 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 the end of the period,
expressed on a full-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.
Incidental charges
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.
Indirect costs
The sum of selling, general and administrative
expenses and R&D expenses.
Net capital expenditures
Additions of intangible assets, capital expenditureson property, plant and equipment and proceedsfrom disposal of property, plant and equipment.
Net debt
Short-term debt, long-term debt minus cash andcash equivalents.
17

Net leverage ratio
The ratio of consolidated reported net debt toconsolidated reported EBITDA for the purpose of
calculating the financial covenant.
R&D expenses
Research and development expenses.
Restructuring costs
The estimated costs of initiated reorganizations
which have been approved by the company, andgenerally involve the realignment of certain parts of
the organization. Restructuring costs include costs
for employee termination benefits for affected
employees and other costs directly attributable to
the restructuring, such as impairment of assets andinventories.
SG&A expenses
Selling, general and administrative expenses.
Working capital
The sum of inventories, trade and otherreceivables, other current assets, derivative
financial assets minus the sum of trade and otherpayables, derivative financial liabilities and othercurrent liabilities (excluding dividend-related
payables).

18