Finance
Signify says CEO Rondolat to step down amid falling profits
Published by Global Banking and Finance Review
Posted on January 24, 2025
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Published by Global Banking and Finance Review
Posted on January 24, 2025
By Hugo Lhomedet and Leo Marchandon
(Reuters) -Signify, the world's biggest maker of lights, on Friday reported a nearly 10% drop in its 2024 core profit and said CEO Eric Rondolat would step down after the annual general meeting in April.
The abrupt leadership change and falling profits could shake investor confidence in the already underperforming company as it braces for the impact of U.S. President Donald Trump's tariffs. Signify has much of its production in China.
Rondolat, 58, who oversaw Signify's 2016 spin-off from Philips, had been appointed for a new four-year term last year. The company gave no reason for his decision to step down.
The Dutch group said the board would consider both internal and external candidates as it seeks a successor for him.
Signify's adjusted earnings before interest, taxes and amortisation (EBITA) fell 9.6% to 606 million euros ($633 million) in 2024, below analysts' average forecast of 611 million euros seen in a company-provided consensus.
It reported an adjusted EBITA margin of 9.9%, slightly lower than its forecast for the low end of a 10% to 10.5% range.
But the company said its gross margin was strong as price pressure in some markets was compensated by cost saving measures that included laying off 1,000 people by the end of last year.
Signify said it would increase its cash dividend to 1.56 euros per share for 2024, from 1.55 euros paid for the prior year.
It also unveiled a share repurchase programme of up to 150 million euros starting from the first quarter, and said it planned to buy back between 350 million and 450 million euros worth of shares by the end of 2027.
The company expects its comparable sales to grow in a low single-digit percentage in 2025, with a stable EBITA margin compared to last year's.
($1 = 0.9568 euros)
(Reporting by Leo Marchandon and Hugo Lhomedet in Gdansk, additional reporting from Toby Sterling in Amsterdam; Editing by Milla Nissi)