EINDHOVEN, The Netherlands – Signify published its 2023 Annual Report, containing the company’s financial and sustainability statements.
Eric Rondolat, Signify CEO stated:
Our new operating model will unleash talent across the company, bringing us closer to our customers and driving faster decision-making with greater autonomy and ownership.
As global conditions remained volatile and unpredictable throughout 2023, Signify’s financial profile was significantly strengthened. We have successfully expanded our gross margin by 180 bps to 38.2% and delivered a healthy free cash flow of EUR 586 million, representing 8.7% of sales. Despite adverse market conditions, our teams have worked particularly hard to achieve this result and put Signify in a strong financial position for the year ahead.
While the consumer connected segment continued to be squeezed by the double impact of inflation and reduced disposable incomes, business and public customers demonstrated readiness to invest in energy efficiency measures that lend protection from volatile energy markets and help them stay in step with emissions reduction targets. As a result, we are gaining ground in connected professional systems and services, with connected lighting and growth platforms reaching 30% of sales and LED now making up 85% of sales.
With challenging conditions set to continue through 2024, we announced in December that we will continue our transformation to enable us to execute our strategy at speed and work more closely in line with customers’ fast-changing needs. Our new operating model will be organized around four vertically integrated businesses. Three of these will focus on customers: Professional, OEM, and Consumer. The fourth will be dedicated to conventional lighting technologies. Aligned to this new verticalized, customer-centric structure, we will adjust the size of our central organization and further reduce our structural costs. Already started in Q4 2023, these changes will be implemented through 2024, with the majority achieved in Q2, and are expected to generate annualized savings in excess of EUR 200 million.
The full report is available here.
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