Legrand : 2020 FIRST-QUARTER RESULTS

2020 FIRST-QUARTER RESULTS

MAY 7, 2020

1	HIGHLIGHTS	P.3
2	RESPONSIBLE MOBILIZATION TO TACKLE
	THE CONSEQUENCES OF THE HEALTH CRISIS	P.5
3	PERFORMANCE SHOWED GOOD RESISTANCE
	IN THE FIRST QUARTER OF 2020	P.8

4 ACTIVE PROTECTION OF LEGRAND'S MODEL

	IN A HIGHLY DETERIORATED CONTEXT	P.18
5	APPENDICES	P.23

2

HIGHLIGHTS

3

1

HIGHLIGHTS

• Responsible mobilization to tackle the consequences of the health crisis
• Performance showed good resistance in the first quarter of 2020

•	Organic change in sales:	-7.3%
•	Adjusted operating margin before acquisitions(1):	18.7%

• • Solid balance sheet and financial position
• Active protection of Legrand's model in a highly deteriorated context
• • 2020 outlook still uncertain
  • Determined measures to protect profitability and cash generation
  • Solid fundamentals for the future

4

1. At 2019 scope of consolidation.

RESPONSIBLE

MOBILIZATION TO TACKLE THE CONSEQUENCES OF THE HEALTH CRISIS

5

2

THE CONSEQUENCES OF THE HEALTH CRISIS

RESPONSIBLE MOBILIZATION TO TACKLE

Protecting employees

Immediate reaction to protect employees' health and safety

• Strict application of recommendations from officials and from the World Health Organization.
• Roll-outof Group-wide guidelines on best practices.

Supporting customers

Actively working on ensuring continued customer service

• On May 5, 2020, almost all of Legrand's logistics centers were open.
• Customer care operations (including both sales and service teams) were up and running in most of the geographical areas Legrand serves.

Honoring commitments

Honoring all commitments

towards stakeholders

• Payment deadlines met, notably for all suppliers.
• A dividend proposal for 2019 maintained for shareholders, returned at €1.34 per share (same level as the previous year and from €1.42 initially proposed).

1. For more details regarding Legrand's announcements relating to Covid-19, readers are invited to consult press releases published on April 11, April 9 and March 26, 2020.

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2

CONSEQUENCES OF THE HEALTH CRISIS

RESPONSIBLE MOBILIZATION TO TACKLE

Helping communities

Acting responsibly

Fast action to help communities	Supporting the most in need	Solidarity of Executive Management
in many countries		and Board of Directors

THE

• Europe: critical material for health facilities.
• United States: fast development of products for hospitals, manufacturing of masks, etc.
• India & Cambodia: distributing meals to populations in need, etc.

• Creation of a solidarity fund dedicated to nursing homes for the elderly.
• Help provided to both patients and staff of these institutions.

• For 2020: 25 % reduction in the target value of the CEO's total annual compensation, and a freeze in the fixed compensation of the Executive Committee, for whom the target value of the annual variable portion has also been significantly reduced.
• Freeze of compensation in respect of 2020 to the Board of Directors, who have forgone the increase initially planned.

1. For more details regarding Legrand's announcements relating to Covid-19, readers are invited to consult press releases published on April 11, April 9 and March 26, 2020.

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PERFORMANCE SHOWED GOOD RESISTANCE IN THE FIRST QUARTER

OF 2020

8

3

SHOWED GOOD RESISTANCE	THE FIRST QUARTER OF 2020
PERFORMANCE	IN

€ millions

1,5501,516

Organic:

-7.3%

Total:

External growth: +4.8%(1)	-2.2%

FX:

+0.7%(2)

Q1 2019

Q1 2020

1. Based on acquisitions completed in 2019 and 2020, and their likely date of consolidation, the impact of the change in scope of consolidation should be around +3% forfull-year 2020.
2. Applying average exchange rates for April 2020 to the last nine months of the year, the theoreticalfull-year 2020 impact on sales of changes in currency rates should be

about -0.5%.	9

3

SHOWED GOOD RESISTANCE	THE FIRST QUARTER OF 2020
PERFORMANCE	IN

o-5.1% organic change.

oIn Europe's mature countries, sales retreated organically by -7.4% in Q1 2020,

• recording a more marked decline in the month of March as lockdown measures took effect.
• Although warehouses for finished goods were kept open, this trend was observed in the main countries, including France, Italy, the United Kingdom and Spain.
• However, sales increased in a limited number of countries, including Germany and the Netherlands.

oIn Europe's new economies, despite a demanding basis for comparison, sales increased +9.4% from Q1 2019 at constant scope of consolidation and exchange rates,

• driven by ongoing projects started in 2019, as well as a still limited impact of the health crisis over the quarter,
• with good showings in Turkey, Hungary, Russia and Poland.

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3

SHOWED GOOD RESISTANCE	THE FIRST QUARTER OF 2020
PERFORMANCE	IN

o

o

o

-4.2% organic change, with the decline steepening for March alone.

In the United States, sales retreated -3.9%.

• Good performances in user interfaces and busways for datacenters, were not enough to offset the
• retreat in other ranges such as PDUs or control and lighting solutions.

Sales decreased slightly in Canada and more markedly in Mexico.

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3

SHOWED GOOD RESISTANCE	THE FIRST QUARTER OF 2020
PERFORMANCE	IN

o-17.2% organic change.

oIn Asia-Pacific, sales were down -20.6% in Q1 2020

• as business decreased by close to 50% in China over the whole period, and
• as sales marked a clear decline in India - a market where the increase in the first two months of the year was not enough to offset the strong retreat recorded in March alone.
• In Australia, sales increased over the period.

oIn South America, sales declined organically by -12.0% in Q1 2020, with

• many countries, including Brazil, reporting a sequential deterioration in business in March as the first lockdown measures were implemented.

oIn Africa and the Middle East, sales retreated -12.6%.

• Business was down in theMiddle-East, where the first impacts of the health crisis were combined with a persistently difficult geopolitical and economic environment.
• In Africa, where the 2019 basis for comparison was particularly demanding, sales also declined in a number of countries.

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3

SHOWED GOOD RESISTANCE	THE FIRST QUARTER OF 2020
PERFORMANCE	IN

€ millions

305

283

-7.4%

Q1 2019

Q1 2020

13

3

SHOWED GOOD RESISTANCE	THE FIRST QUARTER OF 2020
PERFORMANCE	IN

Q1 2019	Adjusted operating margin	19.7%
	•Against the backdrop of a sharp and sudden deterioration in the business
	environment	-1.0 pt
	•Good profitability resistance linked to the Group's (i) early adaptation
	measures and (ii) efficient management of pricing
	Adjusted operating margin before acquisitions(1)
Q1 2020	18.7%
	•Impact of acquisitions	-0.1 pts
Q1 2020	Adjusted operating margin	18.6%

1. At 2019 scope of consolidation.

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3

SHOWED GOOD RESISTANCE	THE FIRST QUARTER OF 2020
PERFORMANCE	IN

o

o

o

A fall in operating profit (-€26m)

An unfavorable trend (-€6m) in net financial expenses and the foreign-exchange result

A decrease in corporate income tax (+€8m)(1)

Net profit attributable to the

Group:

€167m

down

-12.2%

1. In absolute value, linked to the decline in profit before tax, and with the corporate tax rate almost unchanged at 28.5%.

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3

SHOWED GOOD RESISTANCE	THE FIRST QUARTER OF 2020
PERFORMANCE	IN

o

o

Cash flow from operations amounted to 14.7% of sales in Q1 2020, down by -2.9 points from Q1 2019

Working capital requirement came to 8.9% of sales(2)at March 31, 2020, -3.1 points lower than on March 31, 2019

Normalized free cash flow:

€230m

at

15.2%

of sales

1.	For more details on the reconciliation of free cash flow with normalized free cash flow, readers are invited to consult page 33.
2.	Based on sales in the last twelve months.	16

3

SHOWED GOOD RESISTANCE	THE FIRST QUARTER OF 2020
PERFORMANCE	IN

oSolid balance sheet structure at March 31, 2020, with key features including:

• Cash and cash equivalents of €1.8bn
• Net debt of €2.9bn, with an EBITDA(1)ratio of 1.9 and long-term debt maturity

oLegrand also has significant residual financing capacity

1. Based on EBITDA for the last twelve months.

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ACTIVE

PROTECTION OF

LEGRAND'S MODEL IN A HIGHLY

DETERIORATED CONTEXT

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4

PROTECTION OF LEGRAND'S MODEL	A HIGHLY DETERIORATED CONTEXT
ACTIVE	IN

oThe current health crisis is creating a rapid worsening in the global economic outlook for 2020, with a severe recession now anticipated. In this deteriorated and uncertain context, the Group announced on March 26(1)that it was suspending its 2020 targets(2).

oSales continued their organic fall in April 2020, with a retreat of -41% for the month alone that confirmed trends observed in the second half of March in several countries.

oOn this basis, Legrand anticipates a marked decline in sales in Q2 2020, reflecting the adoption of many lockdown measures. Compared to Q2 2020, and subject to a favorable trend in the global health situation, H2 2020 should see a sequential improvement.

1. Targets announced on February 13, 2020, which were set "excluding any major changes in the economic environment possibly linked to developments in the world health

outlook."
2. For more details regarding Legrand's announcements related to Covid-19, readers are invited to consult the press release published March 26, 2020.	19

4

PROTECTION OF LEGRAND'S MODEL	A HIGHLY DETERIORATED CONTEXT
ACTIVE	IN

oDrawing on its experienced and fully engaged teams, a structure that is as close as possible to its markets, and solid performance management processes, Legrand is focused on protecting both profitability and cash generation. Against a backdrop of sharply declining business volumes, initiatives taken to date by Legrand include:

• adapting its cost base (production as well as administrative and commercial costs);
• stepping up the pace of initiatives linked to its industrial footprint, in particular changes in the configuration and number of sites;
• postponingnon-priority investments;
• adapting and tightening careful management of working capital requirements and treasury.

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4

PROTECTION OF LEGRAND'S MODEL	A HIGHLY DETERIORATED CONTEXT
ACTIVE	IN

oLegrand is a worldwide playerpresent in:

• nearly 90 countries and a variety of markets - from residential to commercial and industrial buildings - and in both new construction and renovation;
• businesses driven by profound,long-term technological and societal megatrends (fight against climate change, digitization of buildings, new ways of working, and more).

oLegrand offers a host ofessential products that help keep the economy operating smoothly, by:

• ensuring business continuity and efficiency in data centers;
• protecting systems, goods and people;
• promoting assisted living, etc.

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4

PROTECTION OF LEGRAND'S MODEL	A HIGHLY DETERIORATED CONTEXT
ACTIVE	IN

oBacked by a global, balanced presence in critical business areas, plus the commitment of experienced and fully engaged teams, the Group is thus actively addressing the fundamentals that underpin its model of profitable and sustainable development, to prepare for the future. To this end, Legrand continues to:

• develop its leadership positions - which generate around 2/3 of total sales and have secured its place as an industrypace-setter - in particular through ongoing R&D efforts and a stream of new product launches;
• deploy initiatives to incorporate digital technologies into its product offering - through the development of connected products under the Eliot program - and into its processes;
• actively dock newly acquired companies within the Group, such as Focal Point(1);
• pursue a demanding, responsiblelong-term approach: despite the current economic and health crisis, the Group is thus prepared to achieve the 2019-2021 targets announced in its fourth CSR roadmap, focusing on its Business Ecosystem, People and Environment.

1. For more information on Focal Point, readers are invited to consult appendix page 25 of this presentation.

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APPENDICES

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5

APPENDICES

•	Adjusted operating profitis 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.
•Buswaysare electric power distribution systems based on metal busbars.
•Cash flow from operationsis defined as net cash from operating activities excluding changes in working capital requirement.
•CSRstands for Corporate Social Responsibility.
•	EBITDAis defined as operating profit plus depreciation and impairment of tangible and of right of use assets, amortization and impairment of intangible assets (including
	capitalized development costs), reversal of inventory step-up and impairment of goodwill.
•	Free cash flowis 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.
•	KVMstands for Keyboard, Video and Mouse.
•Net financial debtis defined as the sum of short-term borrowings and long-term borrowings, less cash and cash equivalents and marketable securities.
•	Normalized free cash flowis defined as the sum of net cash from operating activities-based on a normalized 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.
•Organic growthis defined as the change in sales at constant structure (scope of consolidation) and exchange rates.
•	Payoutis defined as the ratio between the proposed dividend per share for a given year, divided by the net profit attributable to the Group per share of the same year,
	calculated on the basis of the average number of ordinary shares at December 31 of that year, excluding shares held in treasury.
•	PDUstands for Power Distribution Unit.
•UPSstands for Uninterruptible Power Supply.
•	Working capital requirementis defined as the sum of trade receivables, inventories, other current assets, income tax receivables and short-term deferred tax assets, less	24
	the sum of trade payables, other current liabilities, income tax payables, short-term provisions and short-term deferred tax liabilities.

5

APPENDICES

• Front-runnerin the United States for specification-grade architectural lighting for non-residential buildings - including hospitals, schools and universities, offices and more
• Offering of customized solutions, in particular for renovation
• Annual sales of more than $200 million
• Over 750 employees
• Legrand thus strengthens its leading US positions in lighting controls and solutions, with a range ofspecification-grade architectural and mission-critical applications in commercial buildings, energy- efficient lighting management systems, and innovative connected solutions.

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5

APPENDICES

Breakdown of change in Q1 2020 net sales by destination (€m)

	North	Rest of
Europe	& Central
the World
	America
		+0.7%	+4.8%(1)
	-7.3%	FX	Scope of
Q1 2019	Organic growth		consolidation	Q1 2020

1. Due to the consolidation of Debflex, Netatmo, Trical, Universal Electric Corporation and Connectrac.

-2.2%

Total

26

5

APPENDICES

In € millions	Q1 2019	Q1 2020	Total	Scope of	Like-for-Like	Currency Effect
Change	Consolidation	Growth
Europe	652.3	642.3	-1.5%	3.9%	-5.1%	-0.2%
North and Central America	567.1	602.7	6.3%	7.9%	-4.2%	2.9%
Rest of the World	330.6	270.7	-18.1%	1.1%	-17.2%	-2.1%
Total	1,550.0	1,515.7	-2.2%	4.8%	-7.3%	0.7%

27

1. Market where sales are recorded.

5

APPENDICES

In € millions	Q1 2019	Q1 2020	Total	Scope of	Like-for-Like	Currency Effect
Change	Consolidation	Growth
Europe	677.0	663.2	-2.0%	3.8%	-5.4%	-0.2%
North and Central America	578.0	613.7	6.2%	7.9%	-4.4%	2.9%
Rest of the World	295.0	238.8	-19.1%	0.7%	-17.6%	-2.5%
Total	1,550.0	1,515.7	-2.2%	4.8%	-7.3%	0.7%

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1. Zone of origin of the product sold.

5

APPENDICES

In € millionsQ1 2019Q1 2020% change

Net sales	1,550.0	1,515.7	-2.2%
Gross profit	804.3	801.6	-0.3%
as % of sales	51.9%	52.9%
Adjusted(1)operating profit	305.2	282.6	-7.4%
as % of sales	19.7%	18.6%(2)
Amortization & depreciation of revaluation of assets at the time	(19.3)	(22.6)
of acquisitions and other P&L impacts relating to acquisitions
Operating profit	285.9	260.0	-9.1%
as % of sales	18.4%	17.2%
Financial income (costs)	(18.8)	(20.0)
Exchange gains (losses)	(0.8)	(5.5)
Income tax expense	(75.2)	(66.8)
Share of profits (losses) of equity-accounted entities	(0.3)	(0.6)
Profit	190.8	167.1	-12.4%
Net profit attributable to the Group	190.4	167.1	-12.2%

1.	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 (€19.3 million in
	Q1 2019 and €22.6 million in Q1 2020) and, where applicable, for impairment of goodwill (€0 in Q1 2019 and Q1 2020).	29
2.	18.7% excluding acquisitions (at 2019 scope of consolidation).

5

APPENDICES

Q1 2020		North and	Rest of
Europe	Central	Total
(in € millions)	the World
	America
Net sales	663.2	613.7	238.8	1,515.7
Cost of sales	(288.6)	(295.3)	(130.2)	(714.1)
Administrative and selling expenses, R&D costs	(233.9)	(216.0)	(71.9)	(521.8)
Reversal of acquisition-related amortization, depreciation, expense and	(5.3)	(17.6)	(2.4)	(25.3)
income accounted for in administrative, selling expenses and R&D costs
Adjusted operating profit before other	146.0	120.0	39.1	305.1
operating income (expense)
as % of sales	22.0%	19.6%	16.4%	20.1%
Other operating income (expense)	(11.9)	(20.4)	12.5	(19.8)	(1)
Reversal of acquisition-related amortization, depreciation, expense and	0.0	2.7	0.0	2.7
income accounted for in other operating income (expense)
Adjusted operating profit	134.1	96.9	51.6	282.6
as % of sales	20.2%	15.8%	21.6%	18.6%

30

1. Restructuring (€1.2m) and other miscellaneous items (€18.6m).

5

APPENDICES

Q1 2019		North and	Rest of
Europe	Central	Total
(in € millions)	the World
	America
Net sales	677.0	578.0	295.0	1,550.0
Cost of sales	(299.8)	(278.7)	(167.2)	(745.7)
Administrative and selling expenses, R&D costs	(220.7)	(199.1)	(77.3)	(497.1)
Reversal of acquisition-related amortization, depreciation, expense and	(2.0)	(15.0)	(2.3)	(19.3)
income accounted for in administrative, selling expenses and R&D costs
Adjusted operating profit before other	158.5	115.2	52.8	326.5
operating income (expense)
as % of sales	23.4%	19.9%	17.9%	21.1%
Other operating income (expense)	(7.5)	(11.0)	(2.8)	(21.3)	(1)
Reversal of acquisition-related amortization, depreciation, expense and	0.0	0.0	0.0	0.0
income accounted for in other operating income (expense)
Adjusted operating profit	151.0	104.2	50.0	305.2
as % of sales	22.3%	18.0%	16.9%	19.7%

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1. Restructuring (€3.3m) and other miscellaneous items (€18.0m).

5

APPENDICES

In € millions

Q1 2019

Q1 2020

Profit	190.8	167.1
Depreciation, amortization and impairment	69.1	78.6
Changes in other non-current assets and liabilities and long-term deferred taxes	8.8	15.4
Unrealized exchange (gains)/losses	3.4	(19.3)
(Gains)/losses on sales of assets, net	1.1	(16.5)
Other adjustments	0.2	(1.8)
Cash flow from operations	273.4	223.5

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5

APPENDICES

In € millionsQ1 2019 Q1 2020% change

Cash flow from operations	273.4	223.5	-18.3%
as % of sales	17.6%	14.7%
Decrease (Increase) in working capital requirement	(184.0)	(84.9)
Net cash provided from operating activities	89.4	138.6	+55.0%
as % of sales	5.8%	9.1%
Capital expenditure (including capitalized development costs)	(29.3)	(23.5)
Net proceeds from sales of fixed and financial assets	0.3	18.7
Free cash flow	60.4	133.8	+121.5%
as % of sales	3.9%	8.8%
Increase (Decrease) in working capital requirement	184.0	84.9
(Increase) Decrease in normalized working capital requirement	(4.2)	11.7
Normalized free cash flow	240.2	230.4	-4.1%
as % of sales	15.5%	15.2%

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5

APPENDICES

2019

Full consolidation method

Debflex

Netatmo

Trical

Universal Electric Corporation

Connectrac

Jobo Smartech

Q1	H1	9M	FY
Balance sheet only	6 months	9 months	12 months
Balance sheet only	6 months	9 months	12 months
Balance sheet only	6 months	9 months	12 months
	Balance sheet only	6 months	9 months
			Balance sheet only
			Balance sheet only

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5

APPENDICES

2020

Full consolidation method

Debflex

Netatmo

Trical

Universal Electric Corporation

Connectrac

Jobo Smartech

Focal Point

Q1	H1	9M	FY
3 months	6 months	9 months	12 months
3 months	6 months	9 months	12 months
3 months	6 months	9 months	12 months
3 months	6 months	9 months	12 months
3 months	6 months	9 months	12 months
Balance sheet only	To be determined	To be determined	To be determined
Balance sheet only	To be determined	To be determined	To be determined

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5

APPENDICES

INVESTOR RELATIONS

LEGRAND

Ronan MARC

Tel: [phone] [e-mail]

PRESS RELATIONS

PUBLICIS CONSULTANTS

Vilizara LAZAROVA

Tel: [phone]

Mob: [phone] [e-mail]

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The information contained in this presentation has not been independently verified and no representation or warranty expressed or implied is made as to, and no reliance should be placed on, the fairness, accuracy, completeness or correctness of the information or opinions contained herein.

This presentation contains information about Legrand's markets and its competitive position therein. Legrand is not aware of any authoritative industry or market reports that cover or address its market. Legrand assembles information on its markets through its subsidiaries, which in turn compile information on its local markets annually from formal and informal contacts with industry professionals, electrical-product distributors, building statistics, and macroeconomic data. Legrand estimates its position in its markets based on market data referred to above and on its actual sales in the relevant market for the same period.

This document may contain estimates and/or forward-looking statements. Such statements do not constitute forecasts regarding Legrand's results or any other performance indicator, but rather trends or targets, as the case may be. These statements are by their nature subject to risks and uncertainties, many of which are outside Legrand's control, including, but not limited to the risks described in Legrand's reference document available on its Internet website (www.legrandgroup.com). These statements do not reflect future performance of Legrand, which may materially differ. Legrand does not undertake to provide updates of these statements to reflect events that occur or circumstances that arise after the date of this document.

This document does not constitute an offer to sell, or a solicitation of an offer to buy Legrand shares in any jurisdiction.

Unsponsored ADRs

Legrand does not sponsor an American Depositary Receipt (ADR) facility in respect of its shares. Any ADR facility currently in existence is "unsponsored" and has no ties whatsoever to Legrand. Legrand disclaims any liability in respect of any such facility.

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