Schneider Electric : Half-Year Results / Release

Financial Information

H1 2021: Record performance in Revenues, Profitability and Cash flow Full Year 2021 Target upgraded

• Q2 2021 revenues of €7.2 billion, up +24% org. (c.+6% vs. Q2 2019) o Energy Management revenue up +26% org. (c.+6% vs. Q2
  2019), above pre-pandemic level in all regions
  o Industrial Automation revenue up +18% org. (c.+6% vs. Q2 2019), highest ever quarter in absolute value
  o Software & Services revenue up +14% org.; strong double-digit growth for Sustainability business
• H1 Group revenues of €13.8 billion, up +19% org. (c.+6% vs. H1 2019)
• Gross Profit at €5.7 billion, record high for H1, Gross Margin of 41.4%
• Adjusted EBITA at €2.4 billion, Adj. EBITA margin of 17.1%, expanding by +350 bps org.; both record highs for H1
• Adjusted Net Income of €1.6 billion, up +63%, all-time H1 high
• Record H1 FCF of €1.1 billion despite working capital requirements
• Existing share buyback program re-instated, to be completed by 2022
• New 2021-2025 Schneider Sustainability Impact program underway; Zero Carbon Project off to good start

Rueil-Malmaison(France), July 30, 2021 - Schneider Electric announced today its second quarter revenues and half year results for the period ending June 30, 2021.

Key figures (€ million)	2020 H1	2021 H1	Reported	Organic
Change	Change
Revenues	11,575	13,774	+19.0%	+18.7%
Adjusted EBITA	1,576	2,362	+49.9%	+51.7%
% of revenues	13.6%	17.1%	+350 bps	+350 bps
Net Income (Group share)	775	1,556	+101%
Free Cash Flow	965	1,079	+12%
Adjusted Earnings Per Share	1.80	2.92	+62%

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Investor Relations	Press Contact :	Press Contact :
Schneider Electric	Schneider Electric	DGM
Amit Bhalla	Véronique Luneau (Roquet-Montégon)	Michel Calzaroni
Tel: [phone]	Tel : [phone]	Olivier Labesse
www.se.com		Phone : [phone]
ISIN : FR0000121972

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Financial Information

Jean-Pascal Tricoire, Chairman and CEO, commented:

"In H1 2021, we are delivering record financial performance in revenues, profits and cash flow; resulting from the strong recovery and dynamics of our markets, the increased interest of our customers in our sustainability solutions based on digitization and low-carbon electrification, and new efficiencies in our way of working learned during the past 18 months. Our H1 exceeds pre-pandemic levels.

In a constrained supply chain environment, we are working closely with our suppliers to deliver to our customers and to support their growth and businesses, while also managing the increase of costs of materials, electronics and transportation. As always, we give the highest priority to the safety of our employees, partners and customers in a world which is still getting to grips with the pandemic.

In H1, we closed the acquisition of ETAP, and AVEVA closed the acquisition of OSIsoft. We are also progressing with the integration of ProLeiT and of RIB Software where we initiated the squeeze-out process. We have also announced our intention to launch a simplified tender offer for the remaining shares of IGE+XAO in order to accelerate the implementation of our strategy in Energy Management Software. We made strong steps in the integration of L&T E&A division, reinforcing our presence in India.

We have launched our new Schneider Sustainability Impact 2021-25 program, and we continue to grow our Sustainability business, delivering solutions to provide efficiency and sustainability to customers while also advising them on their ongoing sustainability journey.

 We continue to progress on our ongoing optimization program, refocusing our portfolio through the disposal of €0.8 billion of revenues since the start of the program, and delivering over €200 million of structural efficiency savings in H1.

Based on the strength of our cash flows, we are reopening our share buyback program in H2 2021.

As we move into H2, we shall continue to prioritize serving our customers, supporting their growth and their needs in sustainability, digitization and electrification. In H2, we will face the impact of rising costs of raw materials and other inputs, along with continued tightness in global supply chains as we look to satisfy strong and sustained levels of demand. Despite the increased cost pressures, we upgrade our full year target."

1. SECOND QUARTER REVENUES WERE UP +24% ORGANIC

2021 Q2 revenues were €7,248 million, up +23.9% organic and up +26.2% on a reported basis.

Products (60% of Q2 revenues) grew +30% organic in Q2 (+24% org. in H1, and c.+10% vs. H1'19), with the Group seeing a continued strong recovery linked to short-cycle demand. The Group benefitted from carryover and ongoing price actions, in addition to the low base of comparison. The growth in product revenues in Q2 was slightly higher in Energy Management as the Group's offers for residential and small buildings saw continued strong demand, while product revenues in Industrial Automation also grew strongly, led by OEM demand. The Group remained agile as it continued to deal with supply chain pressures in the quarter.

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Investor Relations	Press Contact :	Press Contact :
Schneider Electric	Schneider Electric	DGM
Amit Bhalla	Véronique Luneau (Roquet-Montégon)	Michel Calzaroni
Tel: [phone]	Tel : [phone]	Olivier Labesse
www.se.com		Phone : [phone]
ISIN : FR0000121972

Internal

Financial Information

Systems (22% of Q2 revenues) increased +15% organic in Q2 (+13% org. in H1, but down c.-4% vs. H1'19). Growth in Systems revenue continued to be stronger in Energy Management in Q2, with strong contribution coming from the Data Center and Infrastructure end-markets. In Industrial Automation, Systems revenue grew in the quarter notably through sales to OEM but continued to be held back by weaker growth in Process & Hybrid end-markets, meaning that overall Systems revenues remained below pre-pandemic levels. The early signs of a demand recovery in some regions for Process & Hybrid markets has begun to translate into sales growth.

Software & Services (18% of Q2 revenues) grew +14% organic in Q2 (+10% org. in H1, and c.+9% vs. H1'19). Software and Digital Services grew double-digit organic in the quarter, led by strong performance from the Group's portfolio of digital offers, including those for EcoStruxure Advisors and cybersecurity services. AVEVA was impacted by the timing of some renewals, though continuing to see a good level of underlying demand. Recently closed acquisition OSIsoft performed strongly in its first quarter as part of the Group (included in scope effects for Q2 2021). The Group's offers for Sustainability services continued to gather attention from customers and suppliers alike, with this business showing strong double-digit growth in the quarter. Field Services also grew double-digit, against a low base of comparison with restricted site access in Q2'20.

Digital update: The Group continues to prioritize and track digital adoption with good progress in the growth of Assets under Management (AuM), reaching 5.1 million, up +48% year-on-year by the end of June 2021.

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Investor Relations	Press Contact :	Press Contact :
Schneider Electric	Schneider Electric	DGM
Amit Bhalla	Véronique Luneau (Roquet-Montégon)	Michel Calzaroni
Tel: [phone]	Tel : [phone]	Olivier Labesse
www.se.com		Phone : [phone]
ISIN : FR0000121972

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Financial Information

The breakdown of revenue by business and geography was as follows:

	€ million		Q2 2021
	Revenues	Organic Growth	Reported Growth
	North America	1,694	+32.3%	+23.8%
	Western Europe	1,363	+25.6%	+30.5%
Energy
Asia Pacific	1,714	+17.0%	+24.8%
Management
Rest of the World	767	+32.5%	+31.1%

	Total Energy Management	5,538	+25.7%	+26.7%
	North America	437	+39.8%	+71.3%
	Western Europe	470	+24.0%	+27.0%
Industrial
Asia Pacific	554	+2.7%	+4.6%
Automation
Rest of the World	249	+21.6%	+14.1%

	Total Industrial Automation	1,710	+18.0%	+24.5%
	North America	2,131	+33.4%	+31.2%
	Western Europe	1,833	+25.2%	+29.6%
Group	Asia Pacific	2,268	+13.0%	+19.1%
	Rest of the World	1,016	+29.6%	+26.5%
	Total Group	7,248	+23.9%	+26.2%

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Investor Relations	Press Contact :	Press Contact :
Schneider Electric	Schneider Electric	DGM
Amit Bhalla	Véronique Luneau (Roquet-Montégon)	Michel Calzaroni
Tel: [phone]	Tel : [phone]	Olivier Labesse
www.se.com		Phone : [phone]
ISIN : FR0000121972

Internal

Financial Information

	€ million		H1 2021
	Revenues	Organic Growth	Reported Growth
	North America	3,186	+17.6%	+9.3%
	Western Europe	2,704	+19.1%	+23.0%
Energy
Asia Pacific	3,151	+22.0%	+31.2%
Management
Rest of the World	1,446	+21.0%	+16.6%

	Total Energy Management	10,487	+19.8%	+19.8%
	North America	692	+13.5%	+22.2%
	Western Europe	966	+12.9%	+15.0%
Industrial
Asia Pacific	1,145	+19.2%	+20.6%
Automation
Rest of the World	484	+13.5%	+4.2%
	Total Industrial Automation	3,287	+15.4%	+16.5%
	North America	3,878	+16.9%	+11.4%
	Western Europe	3,670	+17.4%	+20.8%
Group	Asia Pacific	4,296	+21.2%	+28.2%
	Rest of the World	1,930	+19.0%	+13.2%
	Total Group	13,774	+18.7%	+19.0%

STRONG PERFORMANCE IN ENERGY MANAGEMENT UP +26% ORGANIC IN Q2

Energy Management delivered a strong sales performance in the quarter, growing by +25.7% organic, with double-digit growth in all regions. This reflected the low base of comparison due to COVID-19 but revenue growth was also up c.+6% versus Q2 2019. The strong pace of underlying demand in Q1 continued into and across Q2 and was the main contributor to organic sales growth in the quarter. Price increases also contributed during the quarter. There was double-digit growth in Energy Management Field Services as access to sites improved in several countries.

• Buildings - Residential demand continued to lead growth in part due to the low base of comparison, but also reflecting multi-year strength due to a combination of factors including low-mortgage rates, consumer spending habits and government support in some countries. Non-residential also grew in the quarter. Non- Residential building demand remains good in Hospitals, Healthcare, Life Science and Warehouse/Distribution with some project delays and weakness in Hotels and new Office buildings.
• Data Center - Strong sales growth in Data Center & Networks continued in the quarter, including Distributed IT, Data Center and non-IT applications. The Group's unrivalled offering incorporating MV, LV, Secure Power, BMS, services and software (including AVEVA's Unified Operations Center) coupled with its global presence is relevant for both large and small installations. Localized Data Centers are becoming more relevant due to the need for reduced latency, improved fidelity, and increased data security and sovereignty requirements.

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Investor Relations	Press Contact :	Press Contact :
Schneider Electric	Schneider Electric	DGM
Amit Bhalla	Véronique Luneau (Roquet-Montégon)	Michel Calzaroni
Tel: [phone]	Tel : [phone]	Olivier Labesse
www.se.com		Phone : [phone]
ISIN : FR0000121972

Internal