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Signify CEO Sees Better Year Ahead After Supply Chain Woes


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(Bloomberg) — Signify NV sees the light at the end of the tunnel in the second half of the year after inflation and supply-chain challenges impacted the Dutch company’s margins in 2022.

The lighting maker is counting on an improvement in China’s economy and cost reductions to ride out a volatile first half. Signify refrained from providing sales guidance for the year but predicts its margin of adjusted earnings before interest, tax and amortization, or EBITA, will be between 10.5% and 11.5% for 2023. 

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The company’s shares rose as much as 6% after its earnings report early Friday, the biggest jump since November. They were trading up 3% at €33.98 apiece as of 1:09 p.m. local time.

Extended supply chains and increases in energy and logistic costs weighed heavily on the firm’s profitability in 2022, Chief Executive Officer Eric Rondolat said in an interview. 

“What was negatively impacting us in 2022 should gradually improve in 2023,” he said, adding that the company raised its prices on a full-year basis in 2022 by about 2% to 3% of sales to cover the structural impact of inflation. 

The company doesn’t expect to have to raise prices further this year.

Rondolat said the firm is not in any “rush” for acquisitions but it does consider potential deals that could help boost development of its lighting as a service business. China, India, the US and big European markets are among the geographies where Signify sees potential for future investments.

The company reported adjusted EBITA in the fourth quarter of €202 million ($220 million), missing the average analyst estimate of €218.8 million. The firm saw a decline of 8.8% in comparable sales in the fourth quarter, which also missed the average analyst estimate of 6.77%.

—With assistance from Cagan Koc.


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