Financial Information

Strong start to 2021; Revenues up +13.5% organic in Q1 FY 2021 Target upgraded

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Q1 Group revenues of €6.5 billion, with growth in both business and all regions

Energy Management up +13.7% org.; up in all regions

Industrial Automation up +12.9% org.; Discrete automation continues strong growth trajectory, Process segments recovering more slowly Delivering on key strategic priorities:

  1. Continued strong growth in Product sales, up +17% org. driven by underlying demand and some stocking impact
  1. Good growth in Software & Services, up +6% org.
  1. 2021-2025Schneider Sustainability Impact program underway; Multiple customer wins linked to Sustainability

Future-ready portfolio enhanced with closing of OSIsoft transaction, acquired through AVEVA; disposal program progresses in Q1

Full year 2021 Target upgraded

Rueil-Malmaison(France), April 27, 2021 - Schneider Electric announced today its first quarter revenues for the period ending March 31, 2021.

Jean-PascalTricoire, Chairman and CEO commented: "We had a strong start to 2021, driven by continued and accelerating demand in both businesses and our four end-markets. We stay focused on executing our strategy, leveraging our unique portfolio to provide customers energy and automation digital solutions for efficiency and sustainability. In Q1 our majority-owned subsidiary AVEVA completes the acquisition of OSIsoft. We also kick- start our new 5-year Schneider Sustainability Impact program. The uncertainty surrounding the rest of 2021 remains, with recent uptick of COVID-19 contagion in specific countries, and potential global supply-chain pressures. However, given the strong underlying demand trends witnessed in Q1 and factoring the current uncertainties as of today, we upgrade our full-year target."

  1. FIRST QUARTER REVENUES WERE UP +13.5% ORGANIC

2021 Q1 revenues were €6,526 million, up +13.5% organic and up +11.9% on a reported basis.

Products (60% of Q1 revenues) grew +17% organic in Q1, benefitting from a strong recovery in short-cycle demand as the Group continues to leverage its multi-local approach and unrivaled partner network. Growth was supplemented by some customer stocking, and by the carryover of price actions from H2 2020, all against a low base of comparison. Growth was strong across the full product range, including the Group's offers for the

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Véronique Luneau (Roquet-

Michel Calzaroni

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Montégon)

Olivier Labesse

www.se.com

Tel : +33 (0)1 41 29 70 76

Tel : +33 (0)1 40 70 11 89

ISIN : FR0000121972

Financial Information

Buildings end-market, notably in Residential & Small buildings in both developed and emerging economies, and also in the Infrastructure and Industry end-markets.

Systems (22% of Q1 revenues) increased +10% organic in Q1. Overall, the growth of Systems revenues was stronger in Energy Management, benefitting from strong demand across the full suite of technologies, although by end-market there remained some weakness in non-residential buildings, as expected. In Industrial Automation, Systems revenues grew well, most notably through OEM sales, while demand in Process & Hybrid end-markets remained weak.

Software & Services (18% of Q1 revenues) grew +6% organic in Q1. Software and Digital Services grew mid- single digit organic in the quarter, with AVEVA impacted by a high base of comparison and the pull-forward of a contract renewal into Q4 2020. Excluding AVEVA, organic growth of Software and Digital Services was double-digit led by Energy Management software and the Group's EcoStruxure advisor offers. Field Services grew strongly, with contribution from both businesses. The Group's offers for Sustainability services continued to gain traction with customers and grew well.

Digital update: The Group continues to prioritize and track digital adoption with good progress in the growth of Assets under Management (AuM), reaching 4.5 million, up +47% year-on-year by the end of March 2021.

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Tel: +44 20 7592 8216

Montégon)

Olivier Labesse

www.se.com

Tel : +33 (0)1 41 29 70 76

Tel : +33 (0)1 40 70 11 89

ISIN : FR0000121972

Financial Information

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

€ million

Q1 2021

Revenues

Organic Growth

Reported Growth

North America

1,492

+4.3%

-3.6%

Western Europe

1,341

+13.2%

+16.3%

Energy

Asia Pacific

1,437

+28.8%

+39.9%

Management

Rest of the World

679

+10.2%

+3.6%

Total Energy Management

4,949

+13.7%

+12.9%

North America

255

-8.6%

-18.0%

Western Europe

496

+4.1%

+5.5%

Industrial

Asia Pacific

591

+40.1%

+40.9%

Automation

Rest of the World

235

+6.1%

-4.6%

Total Industrial Automation

1,577

+12.9%

+9.0%

North America

1,747

+2.2%

-6.0%

Western Europe

1,837

+10.6%

+13.2%

Group

Asia Pacific

2,028

+32.1%

+40.2%

Rest of the World

914

+9.1%

+1.4%

Total Group

6,526

+13.5%

+11.9%

STRONG PERFORMANCE IN ENERGY MANAGEMENT UP +14% ORGANIC

Energy Management delivered a strong performance in the quarter, growing by +13.7% organic, and with growth in all regions. Growth was supported by strong demand through distribution channels and some customer stocking. Pricing actions also contributed to the organic sales growth. The main drivers of growth in the Group's four end-markets are detailed below. The Group sells its Energy Management offers in conjunction with Industrial Automation primarily in the Industry and Infrastructure end-markets.

  • Buildings - The Group saw strong demand overall in the Buildings end-market, supportive of the growth in the quarter. Residential construction continues to be the main contributor to organic growth in most regions. Non-Residential building demand remains good in Hospitals, Healthcare, Life Science and Warehouse/Distribution with some project delays and weakness in Hotels and Office buildings.
  • Data Center - The Group saw continued strong demand across the full range of Data Center & Network customers, from the large Hyperscale installations through to smaller Edge applications and offerings sold through the Group's distributed IT channels. Demand in the U.S. was strong, and this was complemented by accelerating levels of demand across a number of countries as customers require more localized Data Centers driven by the need to reduce latency, improve fidelity and increase data security & sovereignty. Demand is not limited to new Data Center construction, but also due to upgrade cycles within existing facilities and networks. The Group's global footprint and full spectrum of products (incorporating MV, LV

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Olivier Labesse

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ISIN : FR0000121972

Financial Information

and BMS offers), systems, software (including AVEVA's Unified Operations Center) and services is well aligned to the needs of larger customers (Hyperscale, Co-location, Telco and associated networks) as well as smaller Edge and multi-national industrial/commercial customers.

  • Infrastructure - Demand from the electric utility segment continued to grow in Q1 despite a high base of comparison from 2020. Demand was relatively stronger in the U.S. particularly given recent weather-related issues and government policy which have focused attention on improving grid stability, flexibility and resilience. Similar trends continue to support demand elsewhere in the world although with some COVID- 19 related delays still impacting in some emerging economies. The Group's build-out of Egypt's grid network contributed in the quarter and will be supportive of growth throughout the year. The Group continues to see good demand for Smart Grids, Microgrids and offers related to improved efficiency and sustainability. The transportation segment (rail, road, ports and airports) saw good demand, while Water and Wastewater (WWW) saw reduced demand in the quarter.
  • Industry - Sales into Discrete end-markets improved in most countries with good OEM demand, particularly from customers in the packaging, material handling and logistics segments. Field services grew as site access continued to return to normal notwithstanding new lockdowns seen towards the end of the quarter in certain countries. Sales into Process & Hybrid end-markets remained impacted by last year's oil price weakness, notably in the Oil & Gas (O&G) segment. Improved commodity prices supported demand in the Metal, Mining and Minerals (MMM) segment. Consumer Packaged Goods (CPG) which includes Food & Beverage saw stable demand having been an area of resilience through 2020.

Trends for Energy Management, by geography:

North America (30% of Q1 revenues) was up +4.3% organic. The U.S. saw good growth, while Canada grew double-digit, partly offset by Mexico which contracted low single-digit. Sequentially, all three countries saw an improvement on Q4 2020. February saw some impact from weather related issues particularly in southwestern states of the U.S. primarily offset by a strong recovery in March. Strong demand continued in Residential markets and Data Center performed well as did Infrastructure, including grid related investments and offers for enhanced efficiency and sustainability. Weakness in new Commercial buildings was partly offset by renovation and mixed-use modifications. In Canada performance was mainly attributable to Residential while Mexico was impacted by continued weakness in investment.

Western Europe (27% of Q1 revenues) was up +13.2% organic, with growth accelerating toward the end of the quarter, due to both market demand and an easier base of comparison in most countries due to the effect of lockdowns in March 2020. The five major economies of the region each grew double-digit, with the largest impact coming from France, followed by the U.K., Italy, Germany and Spain. France saw increased momentum through the quarter, including through distribution channels where growth was strong, but largely reflective of the external demand. Growth was further supported by project execution in the Data Center end-market. The U.K. continued to see good demand in Residential buildings and in Data Center, while specific areas of the Non-residential buildings market performed well. Italy delivered strong growth showing a sequential improvement against Q4 2020 recovering across end-markets. Germany continued to benefit from good traction in Residential building and Data Center markets, despite a high base of comparison from Q1 2020 due to project execution. Spain continued to benefit from project execution in the Infrastructure end-market, while there was good growth from offers for Residential buildings. There was good growth across the rest of the region, in particular in Denmark which grew strongly benefiting from good demand and project execution.

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Olivier Labesse

www.se.com

Tel : +33 (0)1 41 29 70 76

Tel : +33 (0)1 40 70 11 89

ISIN : FR0000121972

Financial Information

Asia-Pacific (29% of Q1 revenues) was up +28.8% organic. China showed strong double-digit growth, against a low base of comparison associated with the COVID-19 pandemic in Q1 2020. Underlying market demand continued to be very strong and was complemented by several customers continuing operations during the Lunar new year. Performance was strong across end-markets, with public buildings and utilities showing strong demand supported by increasing investment, while the Residential buildings market rebounded against the low base of comparison though impacted by tighter credit policy measures. Demand in the Data Center end-market remains strong, with growth impacted by a high base of comparison, while the transportation sector remains an area of good growth. The Group's non-consolidated subsidiary Delixi also benefitted from these market dynamics and delivered strong double-digit growth in Q1. India also delivered strong double-digit growth in the quarter, led by demand across the Group's Residential and small buildings offers. Recent acquisition L&T Electrical & Automation division also posted a strong quarter, although not included in the organic growth for Q1. There was good growth in Australia, where demand for Energy Management products in residential buildings continued, however systems demand remained soft with projects delayed. There was strong growth in South Korea and much of South East Asia, although as expected Indonesia remained challenged and was down in the quarter, as was Singapore due to project execution in Q1 2020. Field Services performed well across the region, delivering strong growth.

Rest of the World (14% of Q1 revenues) was up +10.2% organic. Africa, Central & Eastern Europe and the CIS all grew double-digit. In Africa, the performance was led by Egypt as the Group continued to execute on a large infrastructure project, while in CIS, Russia grew strongly as a result of demand from the Infrastructure and Residential buildings markets. The Middle East saw strong growth as Turkey continued to perform well, while there was a return to growth in Saudi Arabia helped in part by execution on a smart metering project alongside good demand for products. South America delivered solid growth against a high base of comparison, with good performance in Brazil and Argentina.

STRONG PERFORMANCE IN INDUSTRIAL AUTOMATION UP +13% ORGANIC

The Group delivered +12.9% organic growth in Industrial Automation in Q1, contrasted between strong growth in sales made into Discrete automation end-markets, and a more moderate performance in Process end- markets, which continued to recover more slowly. There was good traction in Field Services.

  • Sales into Discrete end-markets were up double-digit with broad-based growth across geographies. China remained the outstanding area of growth with strength in OEM demand, including in hoisting, material handling and packaging. The U.S. showed sequential improvement on last quarter, with good demand in targeted segments of OEM, such as packaging and conveying equipment.
  • Process and Hybrid end-markets remain challenged in the first quarter, with North America and Rest of the World still impacted by the weaker oil price in 2020. The Group continues to see delayed investment decisions by customers and longer lead-times on projects, particularly impacting the O&G segment. Other segments including CPG, Utilities and MMM saw good demand in Q1, although demand from WWW remained soft. The Group's industrial software offer through AVEVA was impacted by a high base of comparison in the quarter, and also the effect of the pull-forward of a contract renewal into Q4 2020.

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Investor Relations

Press Contact :

Press Contact :

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Schneider Electric

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Amit Bhalla

Véronique Luneau (Roquet-

Michel Calzaroni

Tel: +44 20 7592 8216

Montégon)

Olivier Labesse

www.se.com

Tel : +33 (0)1 41 29 70 76

Tel : +33 (0)1 40 70 11 89

ISIN : FR0000121972

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Schneider Electric SE published this content on 27 April 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 27 April 2021 05:46:05 UTC.