Legrand

Quarterly Report • May 7, 2014

LEGRAND UNAUDITED CONSOLIDATED FINANCIAL INFORMATION MARCH 31, 2014

CONTENTS

2
3
5
6

Consolidated Statement of Income

	Legrand
	3 months ended March 31,
(in € millions)	2014	2013
Revenue	1,084.3	1,092.9
Operating expenses
Cost of sales	(517.6)	(525.5)
Administrative and selling expenses	(294.1)	(297.9)
Research and development costs	(48.8)	(50.6)
Other operating income (expense)	(12.9)	(10.3)
Operating profit	210.9	208.6
Financial expense	(20.9)	(22.9)
Financial income	2.2	3.1
Exchange gains (losses)	(0.5)	(3.9)
Total net financial expense	(19.2)	(23.7)
Profit before tax	191.7	184.9
Income tax expense	(61.5)	(60.1)
Profit for the period	130.2	124.8
Attributable to:
– Legrand	129.5	124.5
– Minority interests	0.7	0.3
Basic earnings per share (euros)	0.488	0.471
Diluted earnings per share (euros)	0.480	0.463

Statement of Comprehensive Income

	3 months ended March 31,
(in € millions)	2014	2013
Profit for the period	130.2	124.8
Items that may be reclassified subsequently to profit or loss
Translation reserves	0.1	64.4
Income tax relating to components of other comprehensive
income	(0.3)	5.2
Actuarial gains and losses after deferred taxes	(0.1)	(0.1)
Comprehensive income for the period	129.9	194.3
Attributable to:
– Legrand	129.0	194.0
– Minority interests	0.9	0.3

• Consolidated Financial Information – March 31, 2014 - 2 -

Consolidated Balance Sheet

	Legrand
	March 31,	December 31,
(in € millions)	2014	2013
ASSETS
Current assets
Cash and cash equivalents	563.7	602.8
Marketable securities	3.0	3.0
Income tax receivables	43.7	45.9
Trade receivables (Note 3)	603.5	474.3
Other current assets	145.3	138.5
Inventories (Note 4)	641.3	620.9
Other current financial assets	0.0	0.0
Total current assets	2,000.5	1,885.4
Non-current assets
Intangible assets	1,819.6	1,821.1
Goodwill	2,505.6	2,411.7
Property, plant and equipment	549.4	560.6
Other investments	0.8	0.8
Deferred tax assets	94.9	94.5
Other non-current assets	2.4	2.5
Total non-current assets	4,972.7	4,891.2
Total Assets	6,973.2	6,776.6

	Legrand
	March 31,	December 31,
(in € millions)	2014	2013
LIABILITIES AND EQUITY
Current liabilities
Short-term borrowings (Note 5)	152.6	86.9
Income tax payable	46.2	24.5
Trade payables	471.3	468.8
Short-term provisions	92.6	99.9
Other current liabilities	441.0	441.8
Other current financial liabilities	0.1	0.1
Total current liabilities	1,203.8	1,122.0
Non-current liabilities
Deferred tax liabilities	658.2	661.8
Long-term provisions	104.3	100.4
Other non-current liabilities	0.4	0.4
Provisions for pensions and other post-employment benefits	157.1	156.7
Long-term borrowings (Note 5)	1,497.1	1,486.6
Total non-current liabilities	2,417.1	2,405.9
Equity
Share capital (Note 6)	1,066.0	1,062.4
Retained earnings	2,676.8	2,575.8
Translation reserves	(400.9)	(400.8)
Equity attributable to equity holders of Legrand	3,341.9	3,237.4
Minority interests	10.4	11.3
Total equity	3,352.3	3,248.7
Total Liabilities and Equity	6,973.2	6,776.6

• Consolidated Financial Information – March 31, 2014 - 4 -

Consolidated Statement of Cash Flows

	Legrand
	3 months ended March 31,
(in € millions)	2014	2013
Profit for the period	130.2	124.8
Reconciliation of profit for the period to net cash provided by/(used in)
operating activities:
– Depreciation expense	23.4	24.9
– Amortization expense	9.1	9.6
– Amortization of development costs	6.1	5.6
– Amortization of finance expense	0.5	0.5
– Impairment of goodwill	0.0	0.0
– Changes in deferred taxes	(3.5)	(2.9)
– Changes in other non-current assets and liabilities	10.3	8.7
– Exchange (gains)/losses, net	1.3	(0.2)
– Other adjustments	0.2	0.1
– (Gains)/losses on sales of assets, net	0.5	(0.3)
Changes in operating assets and liabilities:
– Inventories	(21.6)	(16.6)
– Trade receivables	(128.0)	(101.2)
– Trade payables	2.2	34.8
– Other operating assets and liabilities	3.4	(41.5)
Net cash provided by/(used in) operating activities	34.1	46.3
– Net proceeds from sales of fixed and financial assets	0.2	0.7
– Capital expenditure	(15.9)	(17.6)
– Capitalized development costs	(7.2)	(7.4)
– Changes in non-current financial assets and liabilities	0.0	(0.3)
– Acquisitions of subsidiaries, net of cash acquired	(93.1)	(66.2)
Net cash provided by/ (used in) investing activities	(116.0)	(90.8)
– Proceeds from issues of share capital and premium (Note 6)	19.3	9.2
– Net sales (buybacks) of treasury shares and transactions under the
liquidity contract (Note 6)	(31.6)	(30.4)
– Dividends paid to equity holders of Legrand	0.0	0.0
– Dividends paid by Legrand subsidiaries	0.0	0.0
– Proceeds from new borrowings and drawdowns	0.1	1.5
– Repayment of borrowings	(1.8)	(1.7)
– Debt issuance costs	0.0	0.0
– Increase (reduction) in bank overdrafts	65.4	(3.5)
– Acquisitions of ownership interests with no gain of control	(7.0)	(0.1)
Net cash provided by/(used in) financing activities	44.4	(25.0)
Effect of exchange rate changes on cash and cash equivalents	(1.6)	7.6
Increase (decrease) in cash and cash equivalents	(39.1)	(61.9)
Cash and cash equivalents at the beginning of the period	602.8	494.3
Cash and cash equivalents at the end of the period	563.7	432.4
Items included in cash flows :
– Free cash flow* (Note 7)	11.2	22.0
– Interest paid during the period	25.5	42.9
– Income taxes paid during the period	34.7	36.8

*Normalized free cash flow is presented in Note 7.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

Note 1 - Introduction

This unaudited consolidated financial information of Legrand is presented for a three-month period ending March 31, 2014. This unaudited consolidated financial information should be read in accordance with consolidated financial statements for the year ended December 31, 2013 such as established in the Registration document (Document de référence) deposited under visa no D.14-0274 with the French security regulator (Autorité des Marchés Financiers) on April 2, 2014.

All the amounts are presented in millions of euros unless otherwise indicated. Some totals may include rounding differences.

The consolidated financial statements have been prepared in accordance with the International Financial Reporting Standards (IFRS) and International Financial Reporting Interpretation Committee (IFRIC) interpretations adopted by the European Union and applicable or authorized for early adoption from January 1, 2014.

None of the IFRSs issued by the International Accounting Standards Board (IASB) that have not been adopted for use in the European Union are applicable to the Group.

Therefore Interpretation IFRIC 21 – Levies, that has not yet been approved by European Union, has not been applied. It should be noted that such application should only have a timing impact between quarters in the recognition of certain levies but should be neutral on a full year basis.

Note 2 - Changes in the scope of consolidation

The contributions to the Group's consolidated financial statements of companies acquired since January 1, 2013 were as follows:

2013	March 31	June 30	September 30	December 31
NuVo Technologies	3 months' profit	6 months' profit	9 months' profit	12 months' profit
Daneva	Balance sheet only	6 months' profit	9 months' profit	12 months' profit
Seico	Balance sheet only	5 months' profit	8 months' profit	11 months' profit
S2S		Balance sheet only	Balance sheet only	8 months' profit
Adlec Power			Balance sheet only	5 months' profit
Tynetec			Balance sheet only	5 months' profit

2014	March 31
Daneva	3 months' profit
Seico	3 months' profit
S2S	3 months' profit
Adlec Power	3 months' profit
Tynetec	3 months' profit
Lastar Inc.	Balance sheet only
Neat	Balance sheet only

• Consolidated Financial Information – March 31, 2014 - 6 -

The acquisitions announced in the first three-months of 2014 were as follows:

• The Group acquired Lastar Inc., a frontunner in pre-terminated solutions for Voice-Data-Image (VDI) and audio-video (A/V) networks in the United States. With facilities based primarily in the United States and in China, Lastar Inc. has annual sales of around \$130 million.
• The Group acquired a majority stake in Neat, Spain's leader in assisted living and a major player in this market Europe-wide. It acquired 51% of the shares with an option to take full control from 2018. Based in Madrid, Neat has annual revenues of over €15 million.

In all, acquisitions of subsidiaries (net of cash acquired), and acquisitions of ownership interests with no gain control came to a total of €100.1 million in the first three-months of 2014, versus €66.3 million in the first three-months of 2013. Of this, acquisitions of subsidiaries (net of cash acquired) accounted for €93.1 million in the first three-months of 2014, compared with €66.2 million in the first three-months of 2013.

Note 3 - Trade receivables

Trade receivables are as follows:

	March 31,	December 31,
(in € millions)	2014	2013
Trade accounts and notes receivable	668.4	538.7
Less impairment	(64.9)	(64.4)
	603.5	474.3

Note 4 - Inventories

Inventories are as follows:

	March 31,	December 31,
(in € millions)	2014	2013
Purchased raw materials and components	239.1	231.7
Sub-assemblies, work in progress	93.7	90.8
Finished products	412.3	403.4
	745.1	725.9
Less impairment	(103.8)	(105.0)
	641.3	620.9

• Consolidated Financial Information – March 31, 2014 - 7 -

5.1 Long-term borrowings

Long-term borrowings can be analyzed as follows:

	March 31,	December 31,
(in € millions)	2014	2013
8 ½% debentures	280.0	279.5
Bonds	1,100.0	1,100.8
Other borrowings*	125.1	114.8
	1,505.1	1,495.1
Debt issuance costs	(8.0)	(8.5)
	1,497.1	1,486.6

*Including €54.3 million corresponding to private placement notes held by employees through the "Legrand Obligations Privées" corporate mutual fund (€55.2 million at December 31, 2013).

5.2 Short-term borrowings

Short-term borrowings can be analyzed as follows:

	March 31,
(in € millions)	2014	2013
Commercial paper	55.0	0.0
Other borrowings	97.6	86.9
	152.6	86.9

Note 6 - Share capital

Share capital as of March 31, 2014 amounted to €1,065,970,696 represented by 266,492,674 ordinary shares with a par value of €4 each, for 278,337,200 voting rights.

6.1 Changes in share capital

	Number of	Par value	Share capital	Premiums
	shares		(euros)	(euros)
As of December 31, 2013	265,590,517	4	1,062,362,068	1,108,075,425
Exercise of options under the 2007 plan	50,869	4	203,476	1,078,423
Exercise of options under the 2008 plan	79,227	4	316,908	1,313,584
Exercise of options under the 2009 plan	46,448	4	185,792	423,606
Exercise of options under the 2010 plan	725,613	4	2,902,452	12,930,424
As of March 31, 2014	266,492,674	4	1,065,970,696	1,123,821,462

• Consolidated Financial Information – March 31, 2014 - 8 -

Share capital consists exclusively of ordinary shares, each with a par value of €4.

Fully paid-up shares held in registered form in the name of the same shareholder for at least two years carry double voting rights.

In the first three-months of 2014, 902,157 shares were issued under the 2007 to 2010 stock option plans, resulting in a €3.6 million capital increase with a €15.7 million premium.

6.2 Share buyback program and transactions under the liquidity contract

Share buyback program

As of December 31, 2013, the Group held 63,027 shares in treasury. During the first three-months of 2014, it acquired a further 820,000 shares, at a cost of €35,580,154 and has allocated 817,240 shares to employees under performance share plans.

As of March 31, 2014, the Group held 65,787 shares, acquired at a total cost of €1,692,253. These shares are being held for the following purposes:

• For allocation upon exercise of performance share plans (60,866 shares purchased at a cost of €1,569,622).
• For allocation upon sale to employees who choose to re-invest their profit-shares in Legrand stock through a corporate mutual fund (4,921 shares purchased at a cost of €122,631).

Liquidity contract

On May 29, 2007, the Group appointed a financial institution to maintain a liquid market for its ordinary shares on the NYSE Euronext™ Paris market under a liquidity contract complying with the Code of Conduct issued by the AMAFI (French Financial Markets Association) approved by the AMF on March 22, 2005.

Cash used to purchase shares under the liquidity contract is capped at €15.0 million.

As of March 31, 2014, the Group held 16,192 shares under this contract, purchased at a total cost of €706,220.

Transactions in the first three-months of 2014, under the liquidity contract, led to a net cash inflow of €3,961,707 and correspond to a net disposal of 91,308 shares.

• Consolidated Financial Information – March 31, 2014 - 9 -

Note 7 - Information by geographical segment

The information by geographical segment presented below corresponds to the information used by the Group management to allocate resources to the various segments and to assess each segment's performance. It is extracted from the Group's consolidated reporting system.

			Geographical segments			Items not
3 months ended March 31, 2014		Europe		USA/	Rest of	allocated to	Total
(in € millions)	France	Italy	Others	Canada	the world	segments
Revenue to third parties	270.7	143.4	199.1	181.9	289.2		1,084.3
Cost of sales	(96.8)	(50.4)	(111.9)	(92.1)	(166.4)		(517.6)
Administrative and selling expenses, R&D costs	(106.8)	(42.1)	(48.9)	(64.5)	(80.6)		(342.9)
Other operating income (expense)	(5.0)	0.5	(2.3)	(0.9)	(5.2)		(12.9)
Operating profit	62.1	51.4	36.0	24.4	37.0		210.9
- of which acquisition-related amortization , expense and income*
 accounted for in administrative and selling
expenses, R&D costs	(1.7)	0.0	(0.6)	(2.6)	(3.1)		(8.0)
 accounted for in other operating income (expense)							0.0
- of which goodwill impairment							0.0
Adjusted operating profit	63.8	51.4	36.6	27.0	40.1		218.9
- of which depreciation expense	(6.9)	(5.1)	(3.7)	(2.2)	(5.4)		(23.3)
- of which amortization expense	(0.6)	(0.9)	(0.3)	(0.5)	(0.3)		(2.6)
- of which amortization of development costs	(4.3)	(1.6)	0.0	(0.1)	(0.1)		(6.1)
- of which restructuring costs	(2.1)	(0.2)	(0.2)	0.0	(1.5)		(4.0)
Net cash provided by operating activities						34.1	34.1
Net proceeds from sales of fixed and financial assets						0.2	0.2
Capital expenditure	(4.0)	(2.8)	(3.2)	(1.5)	(4.4)		(15.9)
Capitalized development costs	(5.3)	(1.8)	0.0	(0.1)	(0.0)		(7.2)
Free cash flow**						11.2	11.2
Normalized free cash flow***						153.0	153.0
Normalized free cash flow as % of sales							14.1%
Segment assets from operations excluding taxes	269.2	159.3	279.3	167.2	515.1		1,390.1
Net tangible assets	178.5	121.9	85.1	42.6	121.3		549.4
Segment liabilities from operations excluding taxes	370.5	181.3	112.2	87.5	253.4		1,004.9

* Amortization of intangible assets remeasured as part of the purchase price allocation process, plus any acquisitionrelated expense and income.

** Free cash flow is defined as the sum of net cash provided by operating activities and net proceeds from sales of fixed and financial assets minus capital expenditure and capitalized development costs.

*** Normalized free cash flow is defined as the sum of (i) net cash provided by operating activities, based on a working capital requirement representing 10% of the last 12 months' sales, and whose change at constant scope of consolidation and exchange rates is adjusted for the quarter and (ii) the net proceeds from sales of non-current assets minus (iii) capital expenditure and capitalized development costs.

• Consolidated Financial Information – March 31, 2014 - 10 -

	Geographical segments				Items not
3 months ended March 31, 2013		Europe		USA/	Rest of	allocated to	Total
(in € millions)	France	Italy	Others	Canada	the world	segments
Revenue to third parties	268.7	151.7	187.5	185.0	300.0		1,092.9
Cost of sales	(97.8)	(54.3)	(108.9)	(93.3)	(171.2)		(525.5)
Administrative and selling expenses, R&D costs	(104.4)	(44.6)	(50.7)	(65.6)	(83.2)		(348.5)
Other operating income (expense)	(4.5)	0.2	(1.6)	(0.4)	(4.0)		(10.3)
Operating profit	62.0	53.0	26.3	25.7	41.6		208.6
- of which acquisition-related amortization , expense and income*
 accounted for in administrative and selling expenses, R&D costs	(0.9)	0.0	(0.9)	(2.4)	(3.3)		(7.5)
 accounted for in other operating income (expense)							0.0
- of which goodwill impairment							0.0
Adjusted operating profit	62.9	53.0	27.2	28.1	44.9		216.1
- of which depreciation expense	(7.8)	(5.5)	(3.3)	(2.3)	(5.8)		(24.7)
- of which amortization expense	(0.9)	(0.9)	(0.3)	(0.5)	(0.3)		(2.9)
- of which amortization of development costs	(3.8)	(1.5)	0.0	(0.2)	(0.1)		(5.6)
- of which restructuring costs	(1.8)	0.0	(1.0)	(0.2)	(0.9)		(3.9)
Net cash provided by operating activities						46.3	46.3
Net proceeds from sales of fixed and financial assets						0.7	0.7
Capital expenditure	(4.9)	(3.7)	(2.5)	(2.3)	(4.2)		(17.6)
Capitalized development costs	(5.5)	(1.7)	0.0	(0.1)	(0.1)		(7.4)
Free cash flow**						22.0	22.0
Normalized free cash flow***						147.2	147.2
Normalized free cash flow as % of sales							13.5%
Current operating assets excluding taxes	282.3	187.1	266.0	168.9	477.9		1,382.2
Net tangible assets	189.9	132.5	76.6	48.7	125.9		573.6
Current operating liabilities excluding taxes	362.5	191.4	116.0	93.4	256.3		1,019.6

* Amortization of intangible assets remeasured as part of the purchase price allocation process, plus any acquisitionrelated expense and income.

** Free cash flow is defined as the sum of net cash provided by operating activities and net proceeds from sales of fixed and financial assets minus capital expenditure and capitalized development costs.

*** Normalized free cash flow is defined as the sum of (i) net cash provided by operating activities, based on a working capital requirement representing 10% of the last 12 months' sales, and whose change at constant scope of consolidation and exchange rates is adjusted for the quarter and (ii) the net proceeds from sales of non-current assets minus (iii) capital expenditure and capitalized development costs (Q1 reported figures unadjusted for the quarter: €149.2 million and 13.7%).

Note 8 - Quarterly data – non-audited

8.1 Quarterly revenue by geographical segment (billing region)

(in € millions)	st quarter 1 2014	st quarter 1 2013
France	270.7	268.7
Italy	143.4	151.7
Rest of Europe	199.1	187.5
USA/Canada	181.9	185.0
Rest of the world	289.2	300.0
Total	1,084.3	1,092.9

Note 9 - Subsequent events

No significant events occurred between March 31, 2014 and the date when the consolidated financial statements were prepared.

• Consolidated Financial Information – March 31, 2014 - 12 -