Legrand: Unaudited Consolidated Financial Statements as of September 30, 2022

03 Nov 2022 07:00 CET

Regulatory News:

Legrand (Paris:LR):

Consolidated statement of income

Consolidated statement of comprehensive income

Consolidated balance sheet

Consolidated statement of cash flows

Notes to the consolidated financial statements

Key figures 7

Note 1 - INTRODUCTION 8

Note 2 - Significant transactions and events for the period 8

Note 3 - Changes in the scope of consolidation 8

Note 4 - Inventories 9

Note 5 - Trade receivables 9

Note 6 - SHARE CAPITAL 10

Note 7 - LONG-TERM AND SHORT-TERM BORROWINGS 10

Note 8 - segment information 12

Note 9 - SUBSEQUENT EVENTS 13

Key figures

Adjusted operating profit is defined as operating profit adjusted for amortization and depreciation of revaluation of assets at the time of acquisitions and for other P&L impacts relating to acquisitions and, where applicable, for impairment of goodwill.

Normalized free cash flow is defined as the sum of net cash from 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 period considered - and net proceeds of sales from fixed and financial assets, less capital expenditure and capitalized development costs.

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

Net financial debt is defined as the sum of short-term borrowings and long-term borrowings, less cash and cash equivalents and marketable securities.

The reconciliation of consolidated key figures with the financial statements is available in the appendices to the first nine months 2022 results press release.

Note 1 - INTRODUCTION

This unaudited consolidated financial information is presented for the nine months ended

September 30, 2022. It should be read in conjunction with consolidated financial statements for the year ended December 31, 2021 such as established in the Registration Document deposited under visa no D.22-0245 with the French Financial Markets Authority (AMF) on April 06, 2022.

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 Interpretations Committee (IFRIC) interpretations adopted by the European Union and applicable or authorized for early adoption from January 1, 2022.

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

Note 2 - Significant transactions and events for the period

Legrand's activities in Russia and Ukraine accounted for around 2% of sales for full-year 2021.

As of December 31, 2021, the value of the Group’s assets in Russia excluding translation reserves, represented approximately 1% of the Group’s total assets.

Note 3 - Changes in the scope of consolidation

The contributions to the Group’s consolidated financial statements of companies acquired since the end of 2020 were as follows:

During the first nine months of 2022, the Group acquired:

• Emos, the leader in Central and Eastern Europe in electrical installation components. Based in the Czech Republic, Emos has annual sales of around €85 million;
• Usystems, a specialist in datacenter solutions. Usystems’ portfolio of cooling solutions and racks helps its clients reduce their datacenter energy bills and therefore their carbon footprint. Founded in 2003 and based in Bedford in the United Kingdom, the company has some 70 employees and recorded annual sales of around €11 million, including 50% stemming in the United States;
• A. & H. Meyer, Germany’s leading player in “power in furniture” connectivity solutions for commercial buildings. Based in Dörentrup (Germany), A. & H. Meyer has nearly 200 employees and annual sales of over €20 million;
• Power Control, a British specialist in UPS systems (equipment, services and maintenance). Based in Sheffield (United Kingdom), the company has annual sales of around €15 million and a workforce of over 70;
• Voltadis, a French player in datacenter services. From design to commissioning, including equipment supply and installation, Voltadis offers comprehensive support in defining tailored electrical power supply systems for datacenters’ grey rooms. Based in Cournon d’Auvergne, France, the company has some 20 employees and annual sales of around €13 million.

Note 4 - Inventories

Inventories are as follows:

Note 5 - Trade receivables

Trade receivables are as follows:

Note 6 - SHARE CAPITAL

Share capital as of September 30, 2022 amounted to €1,067,270,984 represented by 266,817,746 ordinary shares with a par value of €4 each, for 266,817,746 theoretical voting rights and 266,651,033 exercisable voting rights (after subtracting shares held in treasury by the Group as of this date).

Changes in share capital in the first nine months of 2022 were as follows:

As of September 30, 2022, the Group held 166,713 shares in treasury, versus 678,176 shares as of December 31,2021, i.e 511,463 fewer shares corresponding to:

• the net acquisition of 450,000 shares outside of the liquidity contract at a cost of €38.1 million ;
• the transfer of 426,945 shares to employees under performance share plans;
• the cancellation of 630,000 shares;
• the net purchase of 95,482 shares under the liquidity contract that led to a cash outflow of €7.8 million.

As of September 30, 2022, among the 166,713 shares held in treasury by the Group, 38,285 shares have been allocated for performance share plans, and 128,428 shares are held under the liquidity contract.

Note 7 - LONG-TERM AND SHORT-TERM BORROWINGS

7.1 LONG-TERM BORROWINGS

Long-term borrowings can be analyzed as follows:

7.2 SHORT-TERM BORROWINGS

Short-term borrowings can be analyzed as follows:

7.3 CHANGES IN LONG-TERM AND SHORT-TERM BORROWINGS

Changes in long-term and short-term borrowings can be analyzed as follows:

Note 8 - SEGMENT INFORMATION

In accordance with IFRS 8, operating segments are determined based on the reporting made available to the chief operating decision maker of the Group and to the Group's management.

Given that Legrand activities are carried out locally, the Group is organized for management purposes by countries or groups of countries which have been allocated for internal reporting purposes into three operating segments:

• Europe, including France, Italy and Rest of Europe (mainly including Benelux, Germany, Iberia (including Portugal and Spain), Poland, Russia, Turkey, and the United Kingdom);
• North and Central America, including Canada, Mexico, the United States, and Central American countries; and
• Rest of the world, mainly including Australia, China, India and South America (of which particularly Brazil, Chile and Colombia).

These three operating segments are under the responsibility of three segment managers who are directly accountable to the chief operating decision maker of the Group.

The economic models of subsidiaries within these segments are quite similar. Indeed, their sales are made up of electrical and digital building infrastructure products in particular to electrical installers, sold mainly through third-party distributors.

9 months ended September 30, 2022

9 months ended September 30, 2021

Note 9 - SUBSEQUENT EVENTS

As part of the investigation of the derogation mechanism on the French market, one of Legrand’s French entities has been indicted and ordered to provide security in the amount of €80.5 million.

Neither this indictment nor the ordering of this security mean that Legrand will ultimately be found guilty of any wrongdoing.

Legrand rejects that these proceedings have any merit and intends to vigorously demonstrate that its trade policy is in full compliance with the applicable law.

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