Legrand SA

Franck, Ronan, and myself are happy to welcome you to the 2024 nine-month results conference call and webcast of Legrand. Please note, as usual, that this call is recorded. We have published today a press release, financial statements, and a slideshow to which we will refer. Those documents are available on the Legrand website. After a few opening remarks, we'll comment the results into more details. I begin on page five of the deck with the key takeaways of this release. First, in a building market that remains in decline in most of our geographies, Legrand reports stable sales in the first nine months of the year, including a plus 2.4% sales growth in the third quarter, driven by acquisitions and data centers. Over nine months, we deliver a solid margin and free cash flow. Second, we are sustaining a strong acquisition momentum. Third, we are specifying our margin full year target. And lastly, we recall our 2030 ambitions as presented during our last CMD. So moving to pages 7 to 8, I will start with an overview of sales. Over nine months, excluding FX and Russia, our sales increased by 0.3%, with an organic trend of minus 0.8%, and a positive scope from acquisitions of plus 1.1%. In the third quarter alone, sales grew plus 2.4%, excluding FX and Russia, driven by an organic growth of plus 1.7%, embedding a particularly sustained growth in data centers in the US. This is a good performance when considering the current building market environment that remains depressed in many geographies. Looking forward, based on acquisitions made and the likely date of consolidation, the impact from acquisitions, should be close to plus 2.5% full year. Regarding the two other elements on sales, the negative scope effect from Russia was minus 0.8% for the first nine months of the year and will be minus 0.6% for the full year 24. The FX effect was a negative minus 0.7% for the nine months of the year. And based on the average rates of October, it will be around minus 1% for the full year. You will read on page 8 the key takeaways per geographies on a like-for-like basis. In Europe, sales fell minus 3.4% over nine months in a persistently tough building market in most countries. These trends reflect a particularly deteriorated context in major countries during the quarter and do not point to recovery in the construction market in the very short term. In North and Central America, sales were up plus 2% over the period. We achieved a solid performance in the third quarter with a steep plus 6%, mostly driven by offers dedicated to the data center market segment in the U.S. Lastly, in the rest of the world, we recorded a decline of minus 0.9% in the first nine months, with a mixed picture depending on regions or countries. Sales grew notably in India, the Middle East, and South America, but this failed to offset a slight decline in Africa and the sharp fall in China, while the construction market continues experiencing a marked decrease.

These were the main comments I wanted to make on sales. I will now hand over to Franck for more color on the financial performance.

Thank you, Benoit, and good morning to all of you. I will start on page 9, commenting the adjusted operating margin. Before acquisition, we recorded a solid adjusted operating margin of 20.6% at September end. His resilience confirms the ability of the group to hold margins high in a difficult environment. The impact of acquisition was minus 0.1 points, meaning the adjusted operating margin all in stood at 20.5% at the end of the first nine months of this year. Going now to page 10 and 12 and highlighting two main points. First, the net profit stood at 834 million, representing 13.4% of our sales. And second, the free cash flow came to 749 million euros at 12% of sales. On page two, we can see the robustness of our balance sheet and a net debt to EBITDA ratio of 1.7 at the end of the period. This reflects both a solid pre-cash flow generation and a strong pack of acquisitions that Benoit will comment shortly. This concludes the key financial topics I wanted to share with you. Now, ending over back to Benoit.