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ER - Signify reports third quarter sales of EUR 1.5 billion, operational profitability of 10.5% and a free cash flow of EUR 119 million

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# Press Release

October 25, 2024

### **Signify reports third quarter sales of EUR 1.5 billion, operational profitability of 10.5% and a free cash flow of EUR 119 million**

### **Third quarter 2024<sup>1</sup>**

- Signify's installed base of connected light points increased to 139 million in Q3 24
- On track for three Brighter Lives, Better World 2025 sustainability program commitments
- Sales of EUR 1,537 million; nominal sales decline of -6.8% and CSG of -5.2%
- LED-based sales represented 90% of total sales (Q3 23: 85%)
- Adj. EBITA margin of 10.5% (Q3 23: 10.7%)
- Net income of EUR 108 million (Q3 23: EUR 83 million)
- Free cash flow of EUR 119 million (Q3 23: EUR 152 million)

**Eindhoven, the Netherlands** – Signify (Euronext: LIGHT), the world leader in lighting, today announced the company's third quarter 2024 results.

Eric Rondolat, CEO of Signify, comments:

"As anticipated, our comparable sales growth continues to improve sequentially. Our teams are effectively managing the accelerated decline of our Conventional business and continued slowness in the Chinese market, without which the decline would be limited to -1.3% for the third quarter. 

In the Professional business, we saw a recovery in agricultural lighting and continued growth for connected, while our European distribution channel remained weak, particularly in Eastern and Southern Europe. Our Consumer business delivered comparable sales growth of 2.6% excluding China, reflecting the recovery of our business across all other regions. Our OEM business demonstrated two consecutive quarters of growth, driven by a stabilization of inventory levels at our customers. 

Despite the shrinking contribution of the Conventional business to EBITA, we have maintained a resilient bottom-line as our cost reduction program delivers the expected benefits. Additionally, we delivered strong free cash flow for the quarter, resulting from our ongoing focus on cash conversion. 

We are now very focused on our performance for the fourth quarter and confirm our guidance for an adjusted EBITA margin at the lower end of the 10.0-10.5% range and free cash flow generation of 6-7% of sales for 2024.

As we manage down our Conventional business, we are continuing to invest in connected and specialty lighting. These represent approximately 30% of our business and provide an attractive growth opportunities for our Professional, Consumer and OEM Businesses.

The progress we have driven in the past years uniquely positions us to continue to lead our industry as it enters each new phase of innovation. More than ever, the complementary drivers of innovation and sustainability sit at the heart of everything we do, driving growth opportunities that create long-term value for all our stakeholders."

## Brighter Lives, Better World 2025

In the third quarter of the year, Signify continued to progress on its [Brighter Lives, Better World 202](https://www.signify.com/global/sustainability/brighter-lives-better-world-2025)5 [sustainability program](https://www.signify.com/global/sustainability/brighter-lives-better-world-2025) commitments that contribute to doubling its positive impact on environment and society.

### **Double the pace of the Paris Agreement**

Signify is ahead of track to reduce emissions across the entire value chain by 40% against the 2019 baseline double the pace required by the Paris Agreement. This is driven by Signify's leadership in energy efficient and connected LED lighting solutions, which significantly reduce emissions during the use phase.

### **Double Circular revenues**

Circular revenues increased to 36.7%, up 1.7% over last quarter and surpassing the 2025 target of 32%. The main contribution was from Professional serviceable luminaires in the Americas.

### **Double Brighter lives revenues**

Brighter lives revenues at 31.1%, on track to reach the 2025 target of 32%. This includes a strong contribution from consumer products, mainly EyeComfort that support health and well-being. 

### **Double the percentage of women in leadership**

The percentage of women in leadership positions remained at 29.3%, behind the 2025 target of 34%. Signify continues its efforts to increase overall representation through focused hiring practices for diversity across all levels. Focus remains on building strong succession pipelines, and engagement actions to reduce attrition.

## Outlook

Signify continues to expect an Adjusted EBITA margin at the lower end of the 10.0-10.5% range and free cash flow generation of 6-7% of sales.

## Financial review

| Third	quarter |        |        |                                        | Nine	months |        |         |
|---------------|--------|--------|----------------------------------------|-------------|--------|---------|
| 2023          | 2024   | change | in	millions	of	EUR,	except	percentages | 2023        | 2024   | change  |
|               |        | -5.2	% | Comparable	sales	growth                |             |        | -7.9	%  |
|               |        | -1.5	% | Currency	effects                       |             |        | -1.9	%  |
|               |        | 0.0	%  | Consolidation	effects                  |             |        | 0.1	%   |
| 1,649         | 1,537  | -6.8	% | Sales                                  | 4,970       | 4,488  | -9.7	%  |
| 654           | 624    | -4.6	% | Adjusted	gross	margin                  | 1,953       | 1,828  | -6.4	%  |
| 39.7%         | 40.6%  |        | Adj.	gross	margin	(as	%	of	sales)      | 39.3%       | 40.7%  |         |
| -431          | -416   |        | Adj.	SG&A	expenses                     | -1,346      | -1,275 |         |
| -66           | -65    |        | Adj.	R&D	expenses                      | -209        | -204   |         |
| -498          | -481   | -3.4	% | Adj.	indirect	costs                    | -1,555      | -1,479 | -4.9	%  |
| 30.2%         | 31.3%  |        | Adj.	indirect	costs	(as	%	of	sales)    | 31.3%       | 33.0%  |         |
| 177           | 161    | -8.7	% | Adjusted	EBITA                         | 461         | 401    | -13.1	% |
| 10.7%         | 10.5%  |        | Adjusted	EBITA	margin                  | 9.3%        | 8.9%   |         |
| -26           | -8     |        | Adjusted	items                         | -121        | -51    |         |
| 151           | 153    | 1.8	%  | EBITA                                  | 341         | 350    | 2.6	%   |
| 131           | 137    | 4.3	%  | Income	from	operations	(EBIT)          | 280         | 299    | 6.5	%   |
| -22           | -22    |        | Net	financial	income/expense           | -84         | -59    |         |
| -26           | -6     |        | Income	tax	expense                     | -41         | -23    |         |
| 83            | 108    | 30.3	% | Net	income                             | 156         | 215    | 38.0	%  |
| 152           | 119    |        | Free	cash	flow                         | 291         | 249    |         |
| 0.64          | 0.84   |        | Basic	EPS	(€)                          | 1.17        | 1.68   |         |
| 32,214        | 30,159 |        | Employees	(FTE)                        | 32,214      | 30,159 |         |

### **Third quarter**

Nominal sales decreased by 6.8% to EUR 1,537 million, including a negative currency effect of 1.5%, caused by a mix of currencies. Comparable sales declined by 5.2%, driven by continued weakness in China and Europe's professional business, which were partly compensated by stronger agriculture lighting sales.

The Adjusted gross margin increased by 90 bps to 40.6%, as continued COGS reductions and positive sales mix more than compensated lower pricing. Adjusted indirect costs as a percentage of sales increased by 110 bps to 31.3%, as indirect costs savings from the restructuring program were offset by the continued topline weakness.

Adjusted EBITA was EUR 161 million. The Adjusted EBITA margin decreased by 20 bps to 10.5%, as gross margin improvements and cost reductions were offset by an under-absorption of fixed costs.

Adjusted items were EUR -8 million, as restructuring costs of EUR -13 million were partly compensated by gains related to balances of prior acquisitions and other incidentals. 

Net income increased to EUR 108 million, reflecting a higher income from operations as well as a lower income tax expense, which included a sizeable one-off benefit related to the resolution of tax uncertainties. 

The number of employees (FTE) decreased from 32,214 at the end of Q3 23 to 30,159 at the end of Q3 24. The decrease is mostly related to a reduction of factory personnel due to lower production volumes as well as the recently implemented cost restructuring program. In general, the number of FTEs is affected by fluctuations in volume and seasonality.

## Professional

| Third	quarter |        |        |        |                                                | Nine	months |        |        |
|---------------|--------|--------|--------|------------------------------------------------|-------------|--------|--------|
|               | 2023   | 2024   | change | in	millions	of	EUR,	unless	otherwise	indicated | 2023        | 2024   | change |
|               | -4.2	% | -4.1	% |        | Comparable	sales	growth                        | -4.9	%      | -6.7	% |        |
|               | 1,055  | 995    | -5.6	% | Sales                                          | 3,159       | 2,897  | -8.3	% |
|               | 111    | 108    | -3.0	% | Adjusted	EBITA                                 | 284         | 256    | -9.9	% |
|               | 10.6	% | 10.8	% |        | Adjusted	EBITA	margin                          | 9.0	%       | 8.8	%  |        |

*Includes Intelligent Lighting Controls since March 1, 2023*

### **Third quarter**

Nominal sales decreased by 5.6% to EUR 995 million, including a negative currency effect of -1.5%. Comparable sales declined by 4.1% (Q3 23: -4.2%), as the continued softness in China and parts of Europe was partly compensated by the recovery in agricultural lighting. The Adjusted EBITA margin increased by 20 bps to 10.8%, mainly driven by gross margin management and cost reductions.

## Consumer

| Third	quarter |        |         |                                                | Nine	months |        |        |
|---------------|--------|---------|------------------------------------------------|-------------|--------|--------|
| 2023          | 2024   | change  | in	millions	of	EUR,	unless	otherwise	indicated | 2023        | 2024   | change |
| -6.0	%        | -1.8	% |         | Comparable	sales	growth                        | -10.9	%     | -3.3	% |        |
| 316           | 304    | -3.8	%  | Sales                                          | 956         | 900    | -5.8	% |
| 28            | 23     | -17.8	% | Adjusted	EBITA                                 | 65          | 75     | 16.1	% |
| 8.8	%         | 7.6	%  |         | Adjusted	EBITA	margin                          | 6.8	%       | 8.4	%  |        |

### **Third quarter**

Nominal sales decreased by -3.8% to EUR 304 million, including a negative currency effect of -2%. Comparable sales declined by 1.8% (Q3 23: -6.0%), as positive consumer sales in all regions were more than offset by a strong sales decline in China. The Adjusted EBITA margin decreased by 120 bps to 7.6%, as negative pricing and higher transportation costs were partly compensated by positive sales mix and bill-of-material savings.

## OEM

| Third	quarter |        |        |                                                | Nine	months |        |        |
|---------------|--------|--------|------------------------------------------------|-------------|--------|--------|
| 2023          | 2024   | change | in	millions	of	EUR,	unless	otherwise	indicated | 2023        | 2024   | change |
| -22.8	%       | 0.2	%  |        | Comparable	sales	growth                        | -22.8	%     | -2.3	% |        |
| 128           | 126    | -1.6	% | Sales                                          | 351         | 334    | -4.8	% |
| 16            | 19     | 22.1	% | Adjusted	EBITA                                 | 34          | 40     | 14.8	% |
| 12.2	%        | 15.2	% |        | Adjusted	EBITA	margin                          | 9.8	%       | 11.9	% |        |

### **Third quarter**

Nominal sales decreased by 1.6% to EUR 126 million, including a negative currency effect of -1.8%. Comparable sales increased by 0.2% (Q3 23: -22.8%), driven by the continued stabilization of distributor inventory levels. The Adjusted EBITA margin increased by 300 bps to 15.2%, mainly driven by one-off effects, gross margin expansion and cost reductions. 

## Conventional

| Third	quarter |         |         |                                                | Nine	months |         |         |
|---------------|---------|---------|------------------------------------------------|-------------|---------|---------|
| 2023          | 2024    | change  | in	millions	of	EUR,	unless	otherwise	indicated | 2023        | 2024    | change  |
| -21.0	%       | -29.4	% |         | Comparable	sales	growth                        | -14.7	%     | -30.5	% |         |
| 145           | 102     | -29.9	% | Sales                                          | 491         | 336     | -31.6	% |
| 30            | 20      | -35.4	% | Adjusted	EBITA                                 | 104         | 59      | -43.4	% |
| 20.9	%        | 19.3	%  |         | Adjusted	EBITA	margin                          | 21.1	%      | 17.5	%  |         |

### **Third quarter**

Nominal sales decreased by -29.9% to EUR 102 million, including a negative currency effect of -0.6%. Comparable sales decreased by 29.4% (Q3 23: -21.0%), as sales remained weak in Europe following the EU fluorescent bans. The Adjusted EBITA margin decreased by 160 bps to 19.3%.

## Other

### **Third quarter**

'Other' represents amounts not allocated to the businesses and mainly includes costs related to ventures, exploratory research and audits. Adjusted EBITA was EUR -8 million (Q3 23: EUR -9 million).

## Working capital

| in	millions	of	EUR,	unless	otherwise	indicated | Sep	30,	2023 | Jun	30,	2024 | Sep	30,	2024 |
|------------------------------------------------|--------------|--------------|--------------|
| Inventories                                    | 1,247        | 1,074        | 1,089        |
| Trade	and	other	receivables	1                  | 1,093        | 959          | 979          |
| Trade	and	other	payables                       | -1,672       | -1,500       | -1,548       |
| Other	working	capital	items2                   | -35          | -30          | -41          |
| Working	capital                                | 632          | 502          | 480          |
| As	%	of	LTM	sales	3                            | 9.1	%        | 7.9	%        | 7.7	%        |

1 As at September 30, 2024 and June 30 2024,Trade and other receivables exclude USD 50 million and USD 49 million, respectively, of insurance receivables for which a legal provision is recognized for the same amount.

2 As at June 30, 2024, Other working capital items exclude EUR 25 million of dividend-related payable. 3 LTM: Last Twelve Months

*6,614 6,336 6,275* 

### **Third quarter**

Compared to June 2024, working capital reduced to EUR 480 million, as higher payables and other working capital items were partly offset by slightly higher inventories and receivables. As a percentage of last twelvemonth sales, working capital decreased by 20 bps to 7.7%. 

Compared to September 2023, working capital reduced by EUR 152 million, mainly due a strong reduction in inventories and receivables, partly offset by lower payables. As a percentage of last twelve-month sales, working capital decreased by 140 bps.

| Third	quarter |      |                                                  | Nine	months |      |
|---------------|------|--------------------------------------------------|-------------|------|
| 2023          | 2024 | in	millions	of	EUR                               | 2023        | 2024 |
| 131           | 137  | Income	from	operations	(EBIT)                    | 280         | 299  |
| 66            | 60   | Depreciation	and	amortization                    | 205         | 192  |
| 46            | 31   | Additions	to	(releases	of)	provisions            | 159         | 101  |
| -53           | -61  | Utilizations	of	provisions                       | -145        | -191 |
| 28            | -15  | Changes	in	working	capital                       | -34         | -29  |
| -5            | -9   | Net	interest	and	financing	costs	received	(paid) | -40         | -40  |
| -21           | -5   | Income	taxes	paid                                | -59         | -38  |
| -31           | -17  | Net	capex                                        | -82         | -60  |
| -9            | -4   | Other                                            | 8           | 15   |
| 152           | 119  | Free	cash	flow                                   | 291         | 249  |

### Cash flow analysis

### **Third quarter**

Free cash flow decreased to EUR 119 million, mainly due to a higher cash outflow from working capital partly offset by lower income taxes paid. Free cash flow also included a restructuring payout of EUR 32 million (Q3 23: EUR 21 million).

## Net debt and total equity

| in	millions	of	EUR        | Sep	30,	2023 | Jun	30,	2024 | Sep	30,	2024 |
|---------------------------|--------------|--------------|--------------|
| Short-term	debt           | 759          | 574          | 567          |
| Long-term	debt            | 1,270        | 1,158        | 1,141        |
| Gross	debt                | 2,029        | 1,732        | 1,708        |
| Cash	and	cash	equivalents | 689          | 567          | 612          |
| Net	debt                  | 1,340        | 1,165        | 1,096        |
| Total	equity              | 3,084        | 2,965        | 2,903        |

### **Third quarter**

Compared with the end of June 2024, the cash position increased by EUR 45 million to EUR 612 million, mainly driven by free cash flow generation. Gross debt slightly decreased to EUR 1,708 million. As a result, net debt reduced to EUR 1,096 million. Total equity decreased to EUR 2,903 million (Q2 24: EUR 2,965 million), primarily due to currency translation results offset partly by net income.

Compared with the end of September 2023, the cash position decreased by EUR 77 million, while gross debt reduced by EUR 321 million. As a result, net debt reduced by EUR 244 million year on year. At the end of September 2024, the net debt/EBITDA ratio was 1.7x (Q3 23: 1.9x).

## 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 Željko Kosanović (CFO) will host a conference call for analysts and institutional investors at 9:00 a.m. CET to discuss the third quarter 2024 results. A live audio webcast of the conference call will be available via the [Investor Relations website](https://www.signify.com/global/our-company/investors).

### **Financial calendar 2025**

January 24, 2025 Fourth quarter and full-year results 2024 February 25, 2025 Annual Report 2024

**For further information, please contact: Signify Investor Relations** Thelke Gerdes Tel: +31 6 1801 7131 E-mail: [thelke.gerdes@signify.com](mailto:thelke.gerdes@signify.com)

### **Signify Corporate Communications**

Tom Lodge Tel: +31 6 5252 5416 E-mail: [tom.lodge@signify.com](mailto:tom.lodge@signify.com)

### **About Signify**

[Signify](https://www.signify.com/)  (Euronext: LIGHT) is the world leader in lighting for professionals and consumers and the Internet of Things. Our [Philips](https://www.lighting.philips.com/) products, [Interact](https://www.interact-lighting.com/en) systems and data-enabled services, deliver business value and transform life in homes, buildings and public spaces. In 2023, we had sales of EUR 6.7 billion, approximately 32,000 employees and a presence in over 70 countries. We unlock the extraordinary potential of light for brighter lives and a better world. We have been in the [Dow Jones Sustainability World Inde](https://www.spglobal.com/spdji/en/indices/esg/dow-jones-sustainability-world-index/#overview)x since our IPO for seven consecutive years and have achieved the [EcoVadis](https://ecovadis.com/) Platinum rating for four consecutive years, placing Signify in the [top one percent](https://www.instagram.com/signifycompany/) of companies assessed. News from Signify can be found in the [Newsroom,](https://www.signify.com/news) on [X,](https://twitter.com/SignifyCompany/) [LinkedIn](https://www.linkedin.com/company/signifycompany/mycompany/) and [Instagram.](https://www.instagram.com/signifycompany/) Information for investors is located on the [Investor Relations](https://www.signify.com/investors) page.

## 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 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 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, in particular the impacts of the Russia-Ukraine conflict, the conflict in the Middle East, the recovery trajectory of the Chinese economy, cost inflation, rapid technological change, competition in the general 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 date of 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 by applicable 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 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 gross margin, EBITA, adjusted EBITA, 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 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 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 19 Reconciliation of non-IFRS measures" in the Annual Report 2023.

### **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 the accounting policies as stated in the Annual Report 2023 and the Semi-Annual Report 2024.

### **Change in reportable segments**

Effective Q1 2024, Signify reports against four businesses with vertically integrated P&Ls, adapted from the previous three divisions as follows:

• The **Professional** business will offer LED lamps, luminaires, connected lighting systems and services to customers in the professional segment.

- The **Consumer** business will offer LED lamps, luminaires, and connected products, including Philips Hue and WiZ, to customers in the consumer segment.
- The **OEM** business will offer lighting components to the industry.
- The **Conventional** business will offer special lighting, digital projection, and lamp electronics.

### **Market Abuse Regulation**

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

## Appendix A – Financial statement information

### A. Condensed consolidated statement of income

*In millions of EUR unless otherwise stated*

|                                                                | Third	quarter |       | January	to	September |         |
|----------------------------------------------------------------|---------------|-------|----------------------|---------|
|                                                                | 2023          | 2024  | 2023                 | 2024    |
| Sales                                                          | 1,649         | 1,537 | 4,970                | 4,488   |
| Cost	of	sales                                                  | (1,014)       | (918) | (3,097)              | (2,699) |
| Gross	margin                                                   | 634           | 619   | 1,873                | 1,789   |
| Selling,	general	and	administrative	expenses                   | (443)         | (422) | (1,379)              | (1,298) |
| Research	and	development	expenses                              | (70)          | (66)  | (216)                | (205)   |
| Other	business	income                                          | 10            | 7     | 20                   | 16      |
| Other	business	expenses                                        | —             | (1)   | (19)                 | (3)     |
| Income	from	operations                                         | 131           | 137   | 280                  | 299     |
| Financial	income                                               | 7             | 7     | 18                   | 33      |
| Financial	expenses                                             | (29)          | (29)  | (102)                | (92)    |
| Results	relating	to	investments	in	associates                  | —             | (1)   | —                    | (1)     |
| Income	before	taxes                                            | 109           | 114   | 197                  | 239     |
| Income	tax	expense                                             | (26)          | (6)   | (41)                 | (23)    |
| Net	income                                                     | 83            | 108   | 156                  | 215     |
|                                                                |               |       |                      |         |
| Attribution	of	net	income	for	the	period:                      |               |       |                      |         |
| Net	income	(loss)	attributable	to	shareholders	of	Signify	N.V. | 81            | 106   | 147                  | 212     |
| Net	income	(loss)	attributable	to	non-controlling	interests    | 2             | 2     | 9                    | 3       |

### B. Condensed consolidated statement of comprehensive income

|                                                                  | Third	quarter |       | January	to	September |      |
|------------------------------------------------------------------|---------------|-------|----------------------|------|
|                                                                  | 2023          | 2024  | 2023                 | 2024 |
| Net	income	(loss)                                                | 83            | 108   | 156                  | 215  |
| Pensions	and	other	post-employment	plans:                        |               |       |                      |      |
| Remeasurements                                                   | (1)           | (1)   | (1)                  | 3    |
| Income	tax	effect	on	remeasurements                              | —             | —     | —                    | (1)  |
| Total	of	items	that	will	not	be	reclassified	to	profit	or	loss   | (1)           | (1)   | (1)                  | 2    |
| Currency	translation	differences:                                |               |       |                      |      |
| Net	current	period	change,	before	tax                            | 138           | (161) | 38                   | (55) |
| Income	tax	effect                                                | —             | —     | —                    | —    |
| Net	investment	hedge                                             |               |       |                      |      |
| Net	current	period	change,	before	tax                            | (4)           | —     | (4)                  | —    |
| Income	tax	effect                                                | —             | —     | —                    | —    |
| Cash	flow	hedges:                                                |               |       |                      |      |
| Net	current	period	change,	before	tax                            | 10            | —     | 21                   | 3    |
| Income	tax	effect                                                | (3)           | —     | (5)                  | (1)  |
| Total	of	items	that	are	or	may	be	reclassified	to	profit	or	loss | 141           | (161) | 50                   | (53) |
|                                                                  |               |       |                      |      |
| Other	comprehensive	income	(loss)                                | 140           | (162) | 49                   | (51) |
| Total	comprehensive	income	(loss)                                | 223           | (54)  | 205                  | 164  |
|                                                                  |               |       |                      |      |
| Total	comprehensive	income	(loss)	attributable	to:               |               |       |                      |      |
| Shareholders	of	Signify	N.V.                                     | 216           | (53)  | 197                  | 161  |
| Non-controlling	interests                                        | 7             | —     | 8                    | 3    |

*in millions of EUR*

### C. Condensed consolidated statement of financial position

| 2023<br>2024<br>Non-current	assets<br>Property,	plant	and	equipment<br>633<br>571<br>Goodwill<br>2,755<br>2,732<br>Intangible	assets,	other	than	goodwill<br>641<br>589<br>Investments	in	associates<br>12<br>11<br>Financial	assets<br>91<br>38<br>Deferred	tax	assets<br>402<br>385<br>Other	assets<br>32<br>26<br>Total	non-current	assets<br>4,566<br>4,352<br>Current	assets<br>Inventories<br>1,050<br>1,089<br>Other	assets<br>147<br>155<br>Derivative	financial	assets<br>14<br>Income	tax	receivable<br>54<br>69<br>Trade	and	other	receivables<br>1,012<br>1,024<br>Cash	and	cash	equivalents<br>1,158<br>612<br>Assets	classified	as	held	for	sale<br>—<br>Total	current	assets<br>3,438<br>2,957<br>Total	assets<br>8,004<br>7,310<br>Equity<br>Shareholders'	equity<br>2,817<br>2,798<br>Non-controlling	interests<br>129<br>105<br>Total	equity<br>2,947<br>2,903<br>Non-current	liabilities<br>Debt<br>1,192<br>1,141<br>Post-employment	benefits<br>322<br>300<br>Provisions<br>263<br>189<br>Deferred	tax	liabilities<br>20<br>18<br>Income	tax	payable<br>79<br>67<br>Other	liabilities<br>154<br>148<br>Total	non-current	liabilities<br>2,030<br>1,863<br>Current	liabilities<br>Debt,	including	bank	overdrafts<br>1,038<br>567<br>Derivative	financial	liabilities<br>17<br>Income	tax	payable<br>20<br>24<br>Trade	and	other	payables<br>1,539<br>1,548<br>Provisions<br>206<br>201<br>Other	liabilities<br>206<br>198<br>Total	current	liabilities<br>3,027<br>2,544<br>Total	liabilities	and	total	equity<br>8,004<br>7,310 | December	31, | September	30, |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------------|---------------|
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### D. Condensed consolidated statement of cash flows

*In millions of EUR*

|                                                                    | January	to    |      |           |       |
|--------------------------------------------------------------------|---------------|------|-----------|-------|
|                                                                    | Third	quarter |      | September |       |
|                                                                    | 2023          | 2024 | 2023      | 2024  |
| Cash	flows	from	operating	activities                               |               |      |           |       |
| Net	income	(loss)                                                  | 83            | 108  | 156       | 215   |
| Adjustments	to	reconcile	net	income	(loss)	to	net	cash	provided	by |               |      |           |       |
| operating	activities:                                              | 161           | 119  | 496       | 394   |
| •		Depreciation,	amortization	and	impairment	of	non-financial      |               |      |           |       |
| assets                                                             | 66            | 60   | 205       | 192   |
| •		Net	gain	on	sale	of	assets                                      | —             | (2)  | 8         | (2)   |
| •		Net	interest	expense	on	debt,	borrowings	and	other	liabilities  | 12            | 12   | 33        | 29    |
| •		Income	tax	expense                                              | 26            | 6    | 41        | 23    |
| •		Additions	to	(releases	of)	provisions                           | 39            | 26   | 142       | 89    |
| •		Additions	to	(releases	of)	post-employment	benefits             | 6             | 6    | 17        | 12    |
| •		Other	items                                                     | 11            | 12   | 51        | 50    |
| Changes	in	working	capital:                                        | 28            | (15) | (34)      | (29)  |
| •		Changes	in	trade	and	other	receivables                          | (73)          | (44) | (2)       | 17    |
| •		Changes	in	inventories                                          | 61            | (42) | 110       | (53)  |
| •		Changes	in	trade	and	other	payables                             | 29            | 78   | (161)     | 41    |
| •		Changes	in	other	current	assets	and	liabilities                 | 11            | (7)  | 20        | (33)  |
| Changes	in	other	non-current	assets	and	liabilities                | (10)          | (3)  | —         | (2)   |
| Utilizations	of	provisions                                         | (41)          | (54) | (116)     | (166) |
| Utilizations	of	post-employment	benefits                           | (13)          | (7)  | (30)      | (25)  |
| Net	interest	and	financing	costs	received	(paid)                   | (5)           | (9)  | (40)      | (40)  |
| Income	taxes	paid                                                  | (21)          | (5)  | (59)      | (38)  |
| Net	cash	provided	by	(used	for)	operating	activities               | 183           | 136  | 374       | 309   |
|                                                                    |               |      |           |       |
| Cash	flows	from	investing	activities                               |               |      |           |       |
| Net	capital	expenditures:                                          | (31)          | (17) | (82)      | (60)  |
| •		Additions	of	intangible	assets                                  | (17)          | (11) | (48)      | (33)  |
| •		Capital	expenditures	on	property,	plant	and	equipment           | (14)          | (13) | (40)      | (37)  |
| •		Proceeds	from	disposal	of	property,	plant	and	equipment         | —             | 7    | 6         | 10    |
| Net	proceeds	from	(cash	used	for)	derivatives	and	other	financial  |               |      |           |       |
| assets                                                             | (1)           | (9)  | 9         | (9)   |
| Purchases	of	businesses,	net	of	cash	acquired                      | (2)           | —    | (16)      | —     |
| Net	cash	provided	by	(used	for)	investing	activities               | (33)          | (26) | (89)      | (68)  |
|                                                                    |               |      |           |       |
| Cash	flows	from	financing	activities                               |               |      |           |       |
| Dividend	paid                                                      | (30)          | (37) | (198)     | (203) |
| Proceeds	from	issuance	of	debt                                     | 2             | 6    | 11        | 185   |
| Repayment	of	debt                                                  | (18)          | (17) | (64)      | (730) |
| Capital	reduction	to	minority	shareholders                         | —             | —    | —         | (12)  |
| Purchase	of	treasury	shares                                        | (7)           | —    | (7)       | (14)  |
| Net	cash	provided	by	(used	for)	financing	activities               | (53)          | (47) | (259)     | (774) |
| Net	cash	flows                                                     | 97            | 62   | 26        | (534) |
| Effect	of	changes	in	exchange	rates	on	cash	and	cash	equivalents   |               |      |           |       |
| and	bank	overdrafts                                                | 8             | (16) | (13)      | (13)  |
| Cash	and	cash	equivalents	and	bank	overdrafts	at	the	beginning	of  |               |      |           |       |
| the	period	1                                                       | 583           | 566  | 676       | 1,158 |
| Cash	and	cash	equivalents	and	bank	overdrafts	at	the	end	of	the    |               |      |           |       |
| period	2                                                           | 688           | 612  | 688       | 612   |

1 For Q3 2024 and Q3 2023, included bank overdrafts of EUR 1 million and EUR 0 million, respectively. For January to September of 2024 and 2023, included bank overdrafts of EUR 0 million and EUR 1 million, respectively.

2 Included bank overdrafts of EUR 0 million and EUR 1 million as at September 30, 2024 and 2023, respectively.

## Appendix B - Reconciliation of non-IFRS financial measures

### **Sales growth composition per business in %**

|              | Third	quarter        |                  |                |        |  |
|--------------|----------------------|------------------|----------------|--------|--|
|              | Comparable<br>growth | Currency	effects | Nominal	growth |        |  |
| 2024	vs	2023 |                      |                  |                |        |  |
| Professional | (4.1)                | (1.5)            | —              | (5.6)  |  |
| Consumer     | (1.8)                | (2.0)            | —              | (3.8)  |  |
| OEM          | 0.2                  | (1.8)            | —              | (1.6)  |  |
| Conventional | (29.4)               | (0.6)            | —              | (29.9) |  |
| Signify      | (5.2)                | (1.5)            | —              | (6.8)  |  |

|              |                      | Third	quarter    |                          |                |  |  |
|--------------|----------------------|------------------|--------------------------|----------------|--|--|
|              | Comparable<br>growth | Currency	effects | Consolidation<br>effects | Nominal	growth |  |  |
| 2023	vs	2022 |                      |                  |                          |                |  |  |
| Professional | (4.2)                | (6.2)            | 0.4                      | (10.0)         |  |  |
| Consumer     | (6.0)                | (7.0)            | —                        | (13.0)         |  |  |
| OEM          | (22.8)               | (5.4)            | —                        | (28.1)         |  |  |
| Conventional | (21.0)               | (4.7)            | —                        | (25.7)         |  |  |
| Signify      | (7.8)                | (6.2)            | 0.2                      | (13.8)         |  |  |

|              | January	to	September |                                              |     |                |  |
|--------------|----------------------|----------------------------------------------|-----|----------------|--|
|              | Comparable<br>growth | Consolidation<br>Currency	effects<br>effects |     | Nominal	growth |  |
| 2024	vs	2023 |                      |                                              |     |                |  |
| Professional | (6.7)                | (1.7)                                        | 0.1 | (8.3)          |  |
| Consumer     | (3.3)                | (2.5)                                        | —   | (5.8)          |  |
| OEM          | (2.3)                | (2.5)                                        | —   | (4.8)          |  |
| Conventional | (30.5)               | (1.1)                                        | —   | (31.6)         |  |
| Signify      | (7.9)                | (1.9)                                        | 0.1 | (9.7)          |  |

|              | January	to	September |                  |                          |                |  |
|--------------|----------------------|------------------|--------------------------|----------------|--|
|              | Comparable<br>growth | Currency	effects | Consolidation<br>effects | Nominal	growth |  |
| 2023	vs	2022 |                      |                  |                          |                |  |
| Professional | (4.9)                | (2.4)            | 1.8                      | (5.5)          |  |
| Consumer     | (10.9)               | (3.7)            | —                        | (14.5)         |  |
| OEM          | (22.8)               | (3.3)            | 0.1                      | (26.0)         |  |
| Conventional | (14.7)               | (2.1)            | —                        | (16.8)         |  |
| Signify      | (8.5)                | (2.7)            | 1.1                      | (10.2)         |  |

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

|      |         |                            |          |     | Other                    |
|------|---------|----------------------------|----------|-----|--------------------------|
|      |         |                            |          |     |                          |
|      | 108     | 23                         |          | 20  | (8)                      |
| (13) |         |                            |          |     |                          |
| 4    |         |                            |          |     |                          |
| 1    |         |                            |          |     |                          |
| 153  |         |                            |          |     |                          |
| (16) |         |                            |          |     |                          |
| 137  |         |                            |          |     |                          |
|      |         |                            |          |     |                          |
|      |         |                            |          |     |                          |
|      | 111     | 28                         |          | 30  | (9)                      |
| (27) |         |                            |          |     |                          |
| (3)  |         |                            |          |     |                          |
| 4    |         |                            |          |     |                          |
| 151  |         |                            |          |     |                          |
| (19) |         |                            |          |     |                          |
| 131  |         |                            |          |     |                          |
|      | Signify | Professional<br>161<br>177 | Consumer | OEM | Conventional<br>19<br>16 |

1 Amortization and impairments of acquisition related intangible assets and goodwill. 

|                                  | Signify | Professional | Consumer | OEM | Conventional | Other |
|----------------------------------|---------|--------------|----------|-----|--------------|-------|
| January	to	September	2024        |         |              |          |     |              |       |
| Adjusted	EBITA                   | 401     | 256          | 75       | 40  | 59           | (28)  |
| Restructuring                    | (44)    |              |          |     |              |       |
| Acquisition-related	charges      | —       |              |          |     |              |       |
| Incidental	items                 | (6)     |              |          |     |              |       |
| EBITA                            | 350     |              |          |     |              |       |
| Amortization	1                   | (51)    |              |          |     |              |       |
| Income	from	operations	(or	EBIT) | 299     |              |          |     |              |       |
|                                  |         |              |          |     |              |       |
| January	to	September	2023        |         |              |          |     |              |       |
| Adjusted	EBITA                   | 461     | 284          | 65       | 34  | 104          | (25)  |
| Restructuring                    | (84)    |              |          |     |              |       |
| Acquisition-related	charges      | (9)     |              |          |     |              |       |
| Incidental	items                 | (27)    |              |          |     |              |       |
| EBITA                            | 341     |              |          |     |              |       |
| Amortization	1                   | (61)    |              |          |     |              |       |
| Income	from	operations	(or	EBIT) | 280     |              |          |     |              |       |
|                                  |         |              |          |     |              |       |

1 Amortization and impairments of acquisition related intangible assets and goodwill.

| Acquisition<br>related<br>Incidental<br>items	1<br>Reported<br>Restructuring<br>charges<br>Adjusted<br>Third	quarter	2024<br>Sales<br>1,537<br>—<br>—<br>—<br>1,537<br>Cost	of	sales<br>(918)<br>5<br>(1)<br>1<br>Gross	margin<br>619<br>5<br>(1)<br>1<br>624<br>Selling,	general	and	administrative	expenses<br>(422)<br>7<br>—<br>(1)<br>Research	and	development	expenses<br>(66)<br>1<br>—<br>—<br>Indirect	costs<br>(488)<br>8<br>—<br>(1)<br>Other	business	income<br>7<br>—<br>(3)<br>(1)<br>Other	business	expenses<br>(1)<br>—<br>—<br>—<br>Income	from	operations<br>137<br>13<br>(4)<br>(1)<br>145<br>Amortization<br>(16)<br>—<br>—<br>—<br>Income	from	operations	excluding<br>amortization	(EBITA)<br>153<br>13<br>(4)<br>(1)<br>161<br>Third	quarter	2023<br>Sales<br>1,649<br>—<br>—<br>—<br>1,649<br>Cost	of	sales<br>(1,014)<br>13<br>1<br>6<br>Gross	margin<br>634<br>13<br>1<br>6<br>654<br>Selling,	general	and	administrative	expenses<br>(443)<br>10<br>2<br>(1)<br>Research	and	development	expenses<br>(70)<br>4<br>—<br>—<br>Indirect	costs<br>(514)<br>14<br>2<br>(1)<br>Other	business	income<br>10<br>—<br>—<br>(10)<br>—<br>Other	business	expenses<br>—<br>—<br>—<br>—<br>—<br>Income	from	operations<br>131<br>27<br>3<br>(4)<br>157<br>Amortization<br>(19)<br>—<br>—<br>—<br>Income	from	operations	excluding |                      |     |    |   |     |     |
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| (913)<br>(416)<br>(65)<br>(481)<br>3<br>(1)<br>(16)<br>(994)<br>(431)<br>(66)<br>(498)<br>(19)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |                      |     |    |   |     |     |
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|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | amortization	(EBITA) | 151 | 27 | 3 | (4) | 177 |

#### **Third quarter 2024 Income from operations to Adjusted EBITA in millions of EUR**

<sup>1</sup> Q3 2024: Incidental items are non-recurring by nature and relate to other items with an effect of EUR 1 million gain.

Q3 2023: Incidental items are non-recurring by nature and relate to the incidental warranty costs (EUR 5 million, in 'Professional'), gain from the movements in the indemnification positions with Koninklijke Philips N.V. originating from the separation (EUR 10 million, in 'Other') and other items with en effect of EUR 1 million loss. 

### **January to September 2024 Income from operations to Adjusted EBITA in millions of EUR**

|                                              |          |               | Acquisition |            |          |
|----------------------------------------------|----------|---------------|-------------|------------|----------|
|                                              |          |               | related     | Incidental |          |
|                                              | Reported | Restructuring | charges     | items	1    | Adjusted |
| January	to	September	2024                    |          |               |             |            |          |
| Sales                                        | 4,488    | —             | —           | —          | 4,488    |
| Cost	of	sales                                | (2,699)  | 27            | —           | 11         | (2,660)  |
| Gross	margin                                 | 1,789    | 27            | —           | 11         | 1,828    |
| Selling,	general	and	administrative	expenses | (1,298)  | 15            | 3           | 4          | (1,275)  |
| Research	and	development	expenses            | (205)    | 2             | —           | —          | (204)    |
| Indirect	costs                               | (1,503)  | 17            | 3           | 4          | (1,479)  |
| Impairment	of	goodwill                       | —        | —             | —           | —          | —        |
| Other	business	income                        | 16       | —             | (3)         | (9)        | 4        |
| Other	business	expenses                      | (3)      | —             | —           | —          | (3)      |
| Income	from	operations                       | 299      | 44            | —           | 6          | 350      |
| Amortization                                 | (51)     | —             | —           | —          | (51)     |
| Income	from	operations	excluding             |          |               |             |            |          |
| amortization	(EBITA)                         | 350      | 44            | —           | 6          | 401      |
|                                              |          |               |             |            |          |
| January	to	September	2023                    |          |               |             |            |          |
| Sales                                        | 4,970    | —             | —           | —          | 4,970    |
| Cost	of	sales                                | (3,097)  | 53            | 3           | 24         | (3,018)  |
| Gross	margin                                 | 1,873    | 53            | 3           | 24         | 1,953    |
| Selling,	general	and	administrative	expenses | (1,379)  | 24            | 8           | 1          | (1,346)  |
| Research	and	development	expenses            | (216)    | 7             | —           | —          | (209)    |
| Indirect	costs                               | (1,595)  | 31            | 8           | 1          | (1,555)  |
| Impairment	of	goodwill                       | —        | —             | —           | —          | —        |
| Other	business	income                        | 20       | —             | (2)         | (11)       | 7        |
| Other	business	expenses                      | (19)     | —             | 1           | 14         | (3)      |
| Income	from	operations                       | 280      | 84            | 9           | 27         | 401      |
| Amortization                                 | (61)     | —             | —           | —          | (61)     |
| Income	from	operations	excluding             |          |               |             |            |          |
| amortization	(EBITA)                         | 341      | 84            | 9           | 27         | 461      |

<sup>1</sup> Q1 2024 - Q3 2024: Incidental items are non-recurring by nature and relate to the one - day FX loss from the devaluation of the Egyptian Pound by the Egyptian government (EUR 10 million, mainly in 'Professional'), environmental provision for inactive sites and the discounting effect of long-term provisions (EUR 6 million, mainly in 'Other'), gain from the movements in the indemnification positions with Koninklijke Philips N.V. originating from separation (EUR 9 million, in 'Other') and other items with an effect of EUR 1 million gain. Q1 2023 - Q3 2023: Incidental items are non-recurring by nature and relate to results on real estate transactions (EUR 13 million, in 'Other'), environmental provision for inactive sites and discounting effect of long-term provisions (EUR 15 million, mainly in Conventional), operations in Russia and Ukraine (EUR 3 million loss, in Professional and Conventional), incidental warranty costs (EUR 5 million, in 'Professional'), gains from the movements in the indemnification positions with Koninklijke Philips N.V. originating from the separation (EUR 10 million, in "Other") and other items with an effect of EUR 1 million loss.

## Appendix C – Financial glossary

### **Acquisition-related charges**

Costs that are directly triggered by the acquisition of a company, such as transaction costs, purchase accounting related costs and integration-related expenses.

### **Adjusted EBITA**

EBITA excluding restructuring costs, acquisitionrelated charges, and other incidental items.

### **Adjusted EBITA margin**

Adjusted EBITA divided by sales to third parties (excluding intersegment). 'Operational profitability' also refers to this metric.

### **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, and other incidental items attributable to research and development expenses.

### **Adjusted SG&A expenses**

Selling, general and administrative expenses, excluding restructuring costs, acquisition-related charges, and other incidental items attributable to selling, general and administrative expenses.

### **Brighter lives revenues**

Percentage of total revenues coming from all products, systems and services contributing to Food availability, Safety & security, or Health & well-being.

### **Circular revenues**

Percentage of total revenues coming from products, systems and services designed for a circular economy, categorized as serviceable luminaires (incl. 3Dprinting), circular components, intelligent systems, or circular services.

### **Comparable sales growth (CSG)**

The period-on-period growth in sales excluding the effects of currency movements and changes in consolidation.

### **EBIT**

Income from operations.

### **EBITA**

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

### **EBITDA**

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

### **Consolidation effects**

In the event a business is acquired (or divested), the impact of the consolidation (or de-consolidation) on the Group's figures is included (or excluded) in the calculation of the comparable sales growth figures.

### **Currency effects**

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 items**

Any item with an income statement impact (loss or gain) that is deemed to be both significant and not part of normal business activity. Other incidental items may extend over several quarters within the same financial year.

### **Indirect costs**

The sum of selling, general and administrative expenses and R&D expenses.

### **Net capital expenditures**

Additions of intangible assets, capital expenditures on property, plant and equipment and proceeds from disposal of property, plant and equipment.

### **Net debt**

Short-term debt, long-term debt minus cash and cash equivalents.

### **Net leverage ratio**

The ratio of consolidated reported net debt to consolidated 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, and generally 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 and inventories.

### **SG&A expenses**

Selling, general and administrative expenses.

### **Working capital**

The sum of inventories, trade and other receivables (excluding insurance receivables for which a legal provision is recognized for the same amount), other current assets, derivative financial assets minus the sum of trade and other payables, derivative financial liabilities and other current liabilities (excluding dividend-related payables).