With war, supply chain, energy prices.. Signify still profits

Added on 01 May 2022

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With war, supply chain, energy prices.. Signify still profits

Price increases and surcharges have helped. But the situation remains volatile. Meanwhile, the company confirms it has halted all new activity in Russia.

Surging energy costs, ongoing supply chain difficulties, new COVID-19 lockdowns in China, and Russia's invasion of Ukraine all chipped away at Signify's first-quarter performance, yet the company managed to increase sales and profits.

Although margins slipped compared to a year ago, price increases, transportation surcharges, and other measures helped the company through the quarter ending March 31. Comparable sales rose 6.4% (11.8% on a nominal basis) to 1.79 billion and net income jumped 44.7% to 87 million. The revenue rise was driven largely by the company's Digital Solutions division, which sells lighting and IoT systems to the commercial and government markets.

"As you know, operating conditions in the quarter became more challenging," CEO Eric Rondolat said on a web call with analysts this morning. "Our main priority in the first quarter was to safeguard and support our Ukrainian employees and their families to the best extent possible. We are happy to report that all of our people are safe, and we were proud to see the very strong engagement from our colleagues and the Signify Foundation in supporting the people and communities so desperately affected by the war. Investments in Russia were stopped and all new business was paused since Feb. 25."

Russia invaded Ukraine on Feb. 24.

The company had previously not commented on its business in Russia, as it worked to provide lighting needs to Ukraine's displaced people.