Q3 2024 Legrand SA Earnings Call Transcript
Key Points
- Legrand SA (LGRDY) reported stable sales for the first 9 months of 2024, with a 2.4% sales growth in the third quarter driven by acquisitions and datacenters.
- The company maintained a solid adjusted operating margin of 20.6% before acquisitions, demonstrating resilience in a challenging market environment.
- Legrand SA (LGRDY) sustained a strong acquisition momentum with seven acquisitions announced, adding around EUR350 million in annual sales.
- The datacenter segment in the US showed significant growth, with sales increasing by approximately 20% in the third quarter.
- The company's free cash flow generation remained robust at EUR749 million, representing 12% of sales, reflecting strong financial management.
- Sales in Europe fell by 3.4% over 9 months due to a persistently tough market, with no immediate recovery expected in the construction sector.
- The company's sales in the Rest of the World declined by 0.9%, with significant challenges in China due to a sharp fall in the construction market.
- The adjusted operating margin was slightly diluted by acquisitions, standing at 20.5% after acquisitions.
- The European margin declined in the third quarter, attributed to lower sales volumes and increased restructuring costs.
- Free cash flow has been below market expectations for several quarters, partly due to higher working capital requirements.
Good morning, ladies and gentlemen, and welcome to today's Legrand's 2024 9 Months Results Conference Call. For your information, this conference is being recorded.
(Operator Instructions)
At this time, I would like to hand the call over to CEO, Mr. Benoît Coquart; and CFO, Mr. Franck Lemery. Please go ahead, sir.
Thank you very much. Good morning, everybody. Franck, Ronan and myself are happy to welcome you to the 2024 9 months results conference call and webcast of Legrand. Please note, as usual, that this call is recorded. We have published today our press release, financial statements and a slide show to which we will refer.
Those documents are available on the Legrand website. . After a few opening remarks, we'll comment the results into more details. I begin on Page 5 of the deck with the key takeaways of this release. First, in a building market that remains in decline in most of our geographies, Legrand reports stable sales in
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