Signify beats profit expectations helped by US tariff refund

Signify Exceeds Q3 Profit Estimates Thanks to US Tariff Refund and Cost Reductions

Signify’s Third-Quarter Financial Performance and Strategic Updates

Q3 Profit Results Surpass Expectations

Oct 23 (Reuters) - The world's largest lighting maker Signify beat third-quarter core profits expectations on Friday, helped by an extraordinary US tariff refund and reduced costs of sales.

Impact of US Tariff Refund

Following the tariff refund, the company now expects to reach the top end of its annual guidance for adjusted EBITA margin range of 7.5% to 8.5%.

Key Financial Highlights

• Signify posted quarterly adjusted earnings before interest, taxes and amortisation (EBITA) of €145 million ($163 million), above the €113 million average analysts' forecast seen in a company-compiled poll.

• The US tariff refund resulted in a benefit of €28 million.

Sales Performance and Market Conditions

• The group reported quarterly sales falling to €1.37 billion, in line with expectations, and said it still expects persistent challenging market conditions in its European and US businesses.

Strategic Initiatives and Turnaround Efforts

• Signify, which spun off from Philips in 2016, had earlier in the year announced a new dividend policy and medium-term targets, which failed to convince investors of an imminent turnaround.

• The turnaround story included a portfolio review, which would reduce Signify's in-house manufacturing of standard lighting products as it struggled with Chinese overcapacity.

Currency Exchange Rate

($1 = 0.8921 euros)

Reporting Credits

(Reporting by Mateusz Rabiega; editing by Izabela Niemiec)