Press Release
April 24, 2020

Signify reports first quarter sales of EUR 1.4 billion, operational profitability of 7.9% and a free
cash flow of EUR 112 million
First quarter 20201• Signify’s installed base of connected light points increased from 56 million in Q4 19 to 60 million in Q1 20• CSG growing profit engines -14.5%; CSG total Signify -15.3%• Adj. indirect costs down EUR 56 million, or -11.1%, excl. currency effects and changes in scope• Adj. EBITA margin improved by 10 bps to 7.9%, with a neutral effect from currencies• Adj. EBITA margin of the growing profit engines increased by 100 bps to 7.7%
• Net income of EUR 27 million (Q1 19: EUR 44 million)• Free cash flow doubled to EUR 112 million (Q1 19: EUR 55 million)• Acquisition of Cooper Lighting completed; integration is well underway and achievement of synergies on track
COVID-19 update Q1• Health & safety of employees was our highest priority• Supported local partners and communities: donations of UV-C lamps and (solar) luminaires• Our global manufacturing capacity was restored to more than 80%• Broad range of mitigating actions to preserve profitability and free cash flow in place from start of Q1• Liquidity remains strong, with a cash position of EUR 924 million at the end of Q1 20
Eindhoven, the Netherlands – Signify (Euronext: LIGHT), the world leader in lighting, today announced the company’s
first quarter 2020 results. “We were early to mobilize our teams worldwide and implement a broad range of actions
to face the unprecedented situation caused by the COVID-19 pandemic. I am particularly satisfied with the successful
measures we took to protect the health and safety of our employees and the people around us. We largely restored
the performance of our supply chain to minimize the impact on our customers. We rapidly implemented a set of
dedicated actions that enabled us to improve our operating margin and double our free cash flow despite a decline indemand,” said CEO Eric Rondolat. “We are building on these achievements to manage our performance in the second
quarter as we expect demand to be further impacted. In addition, we are taking extra measures to protect our
profitability and cash flow. We have also started to explore new business opportunities arising from the situationwhilst remaining very close to our customers. I believe that all these measures will help us to strengthen our market
positions.”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 2COVID-19 actions
From the start of the outbreak, we have been very agile and thorough in dealing with the challenges through global
and local crisis response teams. We have implemented a variety of policies including a ban on domestic andinternational travel, access restrictions to our sites, homeworking and very stringent hygiene and health measuresacross our plants, logistic hubs and R&D centers. We provided protective equipment, such as hand sanitizers, masks
and temperature measurement tools.
We also implemented a broad range of mitigating actions to preserve profitability. These measures include savings in,amongst others, selling expenses, travel costs and procurement costs. In addition, we have implemented a range ofmeasures to safeguard cash flow, including rigorous working capital management, a curtailment of uncommitted andnon-essential capital expenditure, and the withdrawal of the dividend proposal.
We are accelerating and extending mitigating measures, including:• Supervisory Board and Leadership Team took a 20% salary reduction for Q2• A significant part of our employees voluntarily supported a 20% worktime reduction and pro-rata pay adjustment
for a period of 3 months• A 6-month delay in merit increases, where possible• An external hiring freeze

OutlookConsidering the uncertainty about the future course of the pandemic, and the length and depth of the impact on the
global economy, Signify does not provide financial guidance at this point in time.

Successfully completed Cooper Lighting acquisition
On March 2, 2020, Signify completed the acquisition of Cooper Lighting Solutions from Eaton. Since the announcementof the transaction, Signify has worked intensively with the Cooper Lighting teams to finalize integration plans whichenabled us to start the implementation from day one. As a result, key business systems have been successfully
segregated from Eaton and Cooper Lighting is now operating as a business unit within Signify. The agents arecommitted to the go-to market approach and associated benefits of the acquisition. The integration teams are also
well on track to achieve the anticipated cost savings in procurement, supply chain and sourcing optimization.

Page 3Financial review
in millions of EUR, except percentages

2019

First quarter
2020

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

1,478
557
37.7%

1,427
545
38.2%

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

-395
-69
-464
31.4%

-393
-67
-460
32.2%

Adjusted EBITA
Adjusted EBITA margin
Adjusted items
EBITA

115
7.8%
-22
93

112
7.9%
-42
70

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

69
-9
-16
44

43
-10
-6
27

55
0.35
28,689112
0.24
38,446

Free cash flow
Basic EPS (€)
Employees (FTE)change-15.3%
1.3%
10.6%
-3.5%
-2.1%

1.0%

-2.3%

-25.0%-37.6%-39.2%First quarter
Sales amounted to EUR 1,427 million, a nominal decrease of 3.5%. Adjusted for 1.3% currency effects and 10.6%
consolidation (mainly related to the acquisitions of Cooper Lighting and Klite) and other changes, comparable sales
declined by 15.3%. LED-based sales represent 78% of total sales. The adjusted gross margin increased by 50 bps to38.2%, including a negative currency effect of 10 bps. Adjusted indirect costs decreased by EUR 4 million. Excluding
currency effects and changes in scope, indirect costs decreased by EUR 56 million, or 11.1%. Adjusted EBITA amounted
to EUR 112 million compared with EUR 115 million in the same period last year. The Adjusted EBITA margin increasedby 10 bps to 7.9%, with a neutral effect from currencies. Total restructuring costs were EUR 13 million, acquisitionrelated charges EUR 18 million and incidental items EUR 11 million. Net income decreased from EUR 44 million lastyear to EUR 27 million in Q1 20, mainly due to higher acquisition-related charges and other incidentals. Free cash flow
doubled from EUR 55 million last year to EUR 112 million in Q1 20, mainly as a result of strong working capitalmanagement in the growing profit engines, and the consolidation of Cooper Lighting.

Page 4Growing profit engines

LED
Professional
Home

CSG
Q1 19
-0.2%
-1.5%
24.4%

Q1 20
-16.2%-14.2%-8.0%

Adj. EBITA margin
Q1 19
Q1 20
11.9%
10.9%
5.3%
6.7%
-6.1%
0.9%

Growing profit engines

1.1%-14.5%

6.7%

In percentages

7.7%

Despite the decline in top-line, the growing profit engines have improved the Adjusted EBITA margin by 100 bps to
7.7%, driven by Professional and Home.

LED
In millions of EUR, unless otherwise indicated2019

First quarter
2020

449

426

-5.2%

54
11.9%
52
51

46
10.9%
39
38

-13.8%

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

change-16.2%First quarter
Sales amounted to EUR 426 million, a nominal decrease of 5.2% and a decrease of 16.2% on a comparable basis. Both
LED lamps and LED electronics were impacted by the pandemic. Initially the impact was mainly on the supply side,which subsequently exacerbated due to a decline in demand as a result of the countermeasures taken by governments
and customers across the world. The Adjusted EBITA margin declined by 100 bps to 10.9%, mainly due to lower sales
volumes.

Professional
In millions of EUR, unless otherwise indicated2019

First quarter
2020

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

599
32
5.3%
23
1

639
43
6.7%
18
-7

change-14.2%
6.7%
33.9%

First quarter
Sales amounted to EUR 639 million, a nominal increase of 6.7% due to the consolidation of Cooper Lighting.
Comparable sales declined by 14.2%, largely as a consequence of the COVID-19 outbreak. Adjusted EBITA amounted
to EUR 43 million, resulting in an improvement in the Adjusted EBITA margin of 140 bps to 6.7%, mainly driven by an
improvement in gross margin and indirect cost savings.

Page 5Home
In millions of EUR, unless otherwise indicated2019

First quarter
2020

Comparable sales growth (%)
Sales
Adjusted EBITA

115
-7

103
1

Adjusted EBITA margin (%)

-6.1%

0.9%

EBITA

-7

-1

Income from operations (EBIT)-8-2change-8.0%-10.5%First quarter
Sales amounted to EUR 103 million, a decrease of 8.0% on a comparable basis. Supported by gross margin
improvements and the cost measures taken in 2019, Home increased Adjusted EBITA by EUR 8 million to EUR 1 million,
improving the Adjusted EBITA margin from -6.1% last year to 0.9% in Q1 20.

Cash engine - Lamps
In millions of EUR, unless otherwise indicatedComparable sales growth (%)
Sales
Adjusted EBITA
Adjusted EBITA margin (%)
EBITA
Income from operations (EBIT)

2019
309
63
20.5%
61
60

First quarter
2020
257
45
17.6%
39
39

change-17.8%-16.6%-28.3%First quarter
Sales amounted to EUR 257 million, a comparable decrease of 17.8%. Our cash engine continues to deliver on its‘last company standing’ strategy, which resulted in further market share gains and solid free cash flow generation.
The Adjusted EBITA margin remained robust at 17.6%.

Other
First 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 -23 million (Q1 19:
EUR -27 million). EBITA amounted to EUR -25 million (Q1 19: EUR -35 million), including restructuring costs of EUR 2
million (Q1 19: EUR 7 million).

Page 6

Sales by market
First quarter
In millions of EUR, unless otherwise indicated

2019

2020*

Europe

533

502

-5.8%

-6.1%

Americas

430

484

12.6%

-15.2%

Rest of the World

432

325

-24.8%-26.1%

Global businesses

84

117

38.3%

-16.3%

1,478

1,427

-3.5%

-15.3%

Total

changeCSG*Americas include Cooper Lighting and Global businesses include Klite

First quarter
Overall, sales in Q1 20 were impacted by the COVID-19 pandemic. Comparable sales in Europe decreased by 6.1%,
with a particularly soft performance in Italy, Spain, France, and the UK. Comparable sales in the Americas decreased
by 15.2%, due to the ongoing decline in conventional and more challenging market conditions in the US, Canada andLatin America. In the Rest of the World, comparable sales declined by 26.1%, mainly due to weak market activity in
China, India and Southeast Asia.

Working capital
In millions of EUR, unless otherwise indicated31 Mar '19*

31 Dec '19

31 Mar '20

Inventories
Trade and other receivables
Trade and other payables
Other working capital items
Working capital
As a % of last-twelve-months sales

943
1,231
-1,522
-65
587
9.3%

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

1,019
1,173
-1,673
-49
470
7.6%

* Trade and other payables include accrued liabilities which was previously on a separate line, other working capital items inc lude deferred income which waspreviously in trade and other payables.

First quarter
Working capital improved by EUR 117 million to EUR 470 million year-on-year, mainly driven by lower receivables andhigher payables, notwithstanding the addition of Cooper Lighting’s working capital. Working capital represents 7.6%of sales, compared with 9.3% at the end of March 2019. Working capital improved by 320 bps to 6.1% of sales when
including pro-forma last-twelve-months sales for both Cooper Lighting and Klite.

Cash flow analysis
First quarter
In millions of EUR

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

2019

2020

69
70
41
-57
-29
-4
-19
-10
-5
55

43
78
33
-52
52
-10
-28
-17
12
112

Page 7First quarter
Free cash flow doubled from EUR 55 million last year to EUR 112 million in Q1 20, mainly as a result of strong working
capital management in our growing profit engines, and the consolidation of Cooper Lighting. Free cash flow included
a restructuring payout of EUR 18 million (Q1 19: EUR 25 million).

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 Mar '19

31 Dec '19

31 Mar '20

151
1,370
1,521
733
789
2,208

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

95
2,639
2,734
924
1,810
2,334

First quarter
Signify’s cash position has increased by EUR 77 million to EUR 924 million compared with the end of 2019. Net debt
amounted to EUR 1,810 million, an increase of EUR 1,192 million compared with the end of 2019. The increase in longterm debt can be explained by the USD 1.4 billion bridge loan facility to finance the acquisition of Cooper Lighting.
Total equity increased to EUR 2,334 million at the end of Q1 (Q4 19: EUR 2,324 million), primarily due to net income
and unrealized gains on cash flow hedges, offset by currency translation.
Despite the challenges the COVID-19 pandemic is causing, Signify is confident in the underlying resilience of its
businesses and operating model, and that its liquidity needs are well covered by the financial framework it has in place.
Signify’s focus remains on maintaining a robust capital structure and on its policy to prioritize future deleveraging tosupport its commitment to an investment grade credit rating.

Page 8Other 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 René van Schooten (CFO) will host a conference call for analysts and institutional investors at
9:00 a.m. CET to discuss first quarter 2020 results. A live and on-demand audio webcast of the conference call will beavailable via the Investor Relations website.
Financial calendar 2020
May 19Annual General Meeting of Shareholders
July 24
Second quarter and half year results 2020
October 23
Third quarter results 2020

For further information, please contact:
Signify Investor Relations
Rogier Dierckx
Tel: +31 6 1138 4609
E-mail: rogier.dierckx@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
38,000 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 9

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 COVID-19, rapid technological change, competition in the generallighting 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, andexposure to international tax laws. Please see “Risk Factors and Risk Management” in Chapter 12 of the Annual Report 2019 fordiscussion 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 and other important factors should
be read in conjunction with the information included in the Company’s 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 and ratios
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 2019.

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 2019 but does not represent a formal IAS 34 interim financial reporting report.

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 10

Appendix A – Financial statements information
A. CONSOLIDATED STATEMENTS OF INCOME
In millions of EUR unless otherwise statedFirst 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
Amounts may not add up due to rounding

2019

2020

1,478
(927)
552
(409)
(72)
2
(4)
69
5
(14)
1
61
(16)
44

1,427
(895)
533
(422)
(68)
2
(1)
43
5
(15)
(0)
33
(6)
27

44
(0)

30
(3)

Page 11

B. CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME
in millions of EUR
First quarter
2019
44

2020
27

(2)
(2)

0
0

45
(2)

(31)
-

17
(3)
57

14
(3)
(20)

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

55
99

(20)
6

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

97
1

9
(3)

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 12

C. CONSOLIDATED STATEMENT OF FINANCIAL POSITION
In millions of EUR

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
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

EquityShareholders’ equity
Non-controlling interests
Total equity
Non-current liabilities
Debt
Post-employment benefits
Provisions
Deferred tax liabilities
Income tax payable
Other liabilities
Total non-current liabilities
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
The accompanying notes are an integral part of these consolidated financial statements.

December 31,
2019

March 31,
2020

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

796
2,445
916
14
43
374
59
4,646

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

1,019
173
24
54
1,173
924
10
3,377
8,023

December 31,
2019

March 31,
2020

2,181
142
2,324

2,193
141
2,334

1,369
437
216
28
52
135
2,236

2,639
430
237
23
49
135
3,513

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

95
32
14
1,673
146
215
2
2,177
8,023

Page 13

D. CONSOLIDATED STATEMENTS OF CASH FLOWSIn millions of EUR
First quarter2019 1
2020
Cash 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 and inv. 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
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
Net interest and financing costs paid
Income taxes paid
Net cash provided by (used for) operating activities

44
131
70
(0)
(0)
4
16
35
6
1
(29)
21
(52)
(10)
12
(1)
(49)
(8)
(4)
(19)
65

27
133
78
0
7
6
28
5
8
52
220
(9)
(185)
26
7
(43)
(9)
(10)
(28)
129

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

(10)
(4)
(7)
1
5
(0)
(5)

(17)
(5)
(12)
0
10
(1,270)0(1,277)

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 2)
Cash and cash equivalents and bank overdrafts at the end of the period 3)

1
(27)
(27)
33
15
664
712

2,455
(1,218)
(6)
1,231
84
(5)
840
919

Amounts may not add up due to rounding
1 Certain reclassifications have been made to prior year figures to conform with current year presentation. Refer to our Annual Report 2019 for further details of thereclassifications. These reclassifications did not impact net cash flows, or total cash flows from operating, investing and financing activities; 2 For Q1 2020 and 2019,
included bank overdrafts of EUR 7 million and EUR 12 million, respectively; 3 Included bank overdrafts of EUR 5 million and EUR 20 million as at March 31, 2020 and
2019, respectively.

Page 14

Appendix B – Reconciliation of non-IFRS Financial Measures
Sales growth composition in %comparable
growth2020 vs 2019
LED
Professional
Home
Lamps
Total

-16.2
-14.2
-8.0
-17.8
-15.3

First quarter
currency
consolidation
effects
and otherchanges
1.1
1.5
0.8
1.3
1.3

nominalgrowth

9.9
19.4
-3.4
-0.1
10.6

-5.2
6.7
-10.5
-16.6
-3.5

First quarter
currency
consolidation
effects
and otherchangesnominalgrowthSales growth composition in %comparable
growth2020 vs 2019
EuropeAmericasRest of the World
Global businesses
Total

-6.1
-15.2
-26.1
-16.3
-15.3

0.3
2.1
1.5
0.2
1.3

0.0
25.8
-0.2
54.4
10.6

-5.8
12.6
-24.8
38.3
-3.5

Page 15

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

LED

Professional

Home

Lamps

Other

First quarter 2020
Adjusted EBITA
Restructuring
Acquisition-related charges
Incidental items
EBITA
Amortization 1)
Income from operations (or EBIT)

112
(13)
(18)
(11)
70
(27)
43

46
(2)
(2)
(3)
39
(1)
38

43
(4)
(16)
(4)
18
(25)
(7)

1
(1)
(1)
(1)
(1)
(2)

45
(3)
(3)
39
(0)
39

(23)
(2)
(0)
(25)
(0)
(25)

First quarter 2019
Adjusted EBITA
Restructuring
Acquisition-related charges
Incidental items
EBITA
Amortization 1)
Income from operations (or EBIT)

115
(20)
(0)
(2)
93
(24)
69

54
(2)
52
(1)
51

32
(8)
(0)
23
(22)
1

(7)
(0)
(7)
(0)
(8)

63
(3)
61
(0)
60

(27)
(7)
(2)
(35)
(1)
(36)

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

Page 16

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

Reported

Restructuring

Acquisition
relatedcharges

Sales
Cost of sales
Gross margin

1,427
(895)
533

-

-

-

4
4

7
7

2
2

1,427
(882)
545

Selling, general and administrative expenses
Research and development expenses
Indirect costs 1

(422)
(68)
(490)

8
1
9

12
0
12

10
10

(393)
(67)
(460)

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

2
(1)
43
(27)

13
-

18
-

(0)
0
11
-

2
(1)
85
(27)

70

13

18

11

112

First quarter 2019
Sales
Cost of sales
Gross margin

1,478
(927)
552

5
5

-

-

1,478
(922)
557

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

(409)
(72)
(481)

12
3
15

0
0

2
2

(395)
(69)
(464)

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

2
(4)
69
(24)

20
-

0
-

2
-

2
(4)
91
(24)

93

20

0

2

115

First quarter 2020

Incidental
items 2Adjusted

Amounts may not add up due to rounding
1 Adj. indirect costs included a negative currency impact of EUR 5 million and changes in scope of EUR 46 million in Q1 20. Adjusting for the currency and changes in scope,indirect costs reduced by EUR 56 million on a comparable basis; 2 Incidental items are non-recurring by nature and relate to the separation, company name change,transformation and real estate gains

Page 17

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

Changes in scope
Comparable sales growth (CSG)

EBIT
EBITA
EBITDA
Effects of changes in consolidation andother changes

Effects of currency movements

Employees
Free cash flow

Gross margin
Incidental charges

Costs that are directly triggered by theacquisition of a company, such as transaction costs, purchaseaccounting related costs and integration-related expenses
EBITA excluding restructuring costs, acquisition-related charges
and other incidental charges
Adjusted EBITA divided by sales to third parties (excludingintersegment)
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 restructuringcosts, acquisition-related charges and other incidental items
attributable to research and development expenses
Selling, general and administrative expenses, excluding
restructuring costs, acquisition-related charges and otherincidental items attributable to selling, general and administrative
expenses
Consolidation effects related to acquisitions (Cooper Lighting andKlite)The period-on-period growth in sales excluding the effects ofcurrency movements and changes in consolidation and otherchanges
Income from operations
Income from operations excluding amortization and impairment ofacquisition related intangible assets and goodwill
Income from operations excluding depreciation, amortization andimpairment of non-financial assets
In the event a business is acquired (or divested), the impact of theconsolidation (or de-consolidation) on the Group’s figures is
included (or excluded) in the calculation of the comparable sales
growth figures. Other changes include regulatory changes andchanges originating from new accounting standards
Calculated by translating the foreign currency financials of theprevious period and the current period into euros at the same
average exchange rates.
Employees of Signify at period end expressed on a full-time
equivalent (FTE) basis
Net cash provided by operating activities minus net capital
expenditures. Free cash flow includes interest paid and income
taxes paid
Sales minus cost of sales
Any item with an income statement impact (loss or gain) that isdeemed to be both significant and not part of normal businessactivity. Other incidental items may extend over several quarters
within the same financial year

Page 18

Indirect costs
Net capital expenditures

Net debt
Net leverage ratio

R&D expenses
Restructuring costs

SG&A expenses
Working capital

The sum of selling, general and administrative expenses and R&D
expenses
Additions of intangible assets, capital expenditures on property,
plant and equipment and proceeds from disposal of property, plantand equipment
Short-term debt, long-term debt minus cash and cash equivalents
The ratio of consolidated reported net debt to consolidated
reported EBITDA for the purpose of calculating the financial
covenant
Research and development expenses
The estimated costs of initiated reorganizations, the mostsignificant of which have been approved by the group, and which
generally involve the realignment of certain parts of the industrial
and commercial organization
Selling, general and administrative expenses
The sum of inventories, trade and other receivables, other current
assets, derivative financial assets minus the sum of trade and otherpayables, derivative financial liabilities and other current liabilities.