(AOF) – Legrand, specialist in electrical and digital building infrastructures, announces its intention to launch its first international employee shareholding plan. From March 18 to April 2, employees will have the opportunity to acquire Legrand shares, the subscription price of which has been set at 74.13 euros. This takes into account a 20% discount. The operation is deployed in France and internationally (including China in particular). The shares will be subscribed to through a company mutual fund (FCPE) or, in certain countries, directly by employees.
The shares will be subject to a lock-up period of 5 years, except in exceptional cases of authorized early release.
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Key points
– World leader in electrical and digital building infrastructure, with 6% share of a very fragmented market;
– Complete portfolio, organized into four divisions, control and command, cable management, energy distribution and VDI/Dataco, 2/3 of sales coming from products number 1 or 2 in their markets;
– Global presence balanced between Europe (41%) and North and Central America (40.5%)
– Business model with 2 engines, organic growth driven by innovation and commercial initiatives and external growth;
– High float (96.1% of the capital including 10% for the American investment fund MFS), Angeles Garcia-Poveda chairing the board of directors of 14 members, Benoît Coquart being general manager;
– Healthy balance sheet with debt leverage of 1.2 at the end of June 2022 and free self-financing of €1 billion.
Challenges
– Medium-term strategy:
– annual growth of 5 to 10% in sales, operating margin around 20%,
– 50% of sales in data centers, connected offers from the Eliot program and energy efficiency;
– Innovation strategy supported by R&D funding at 5% of sales:
– operational excellence via the Legrand Way program and deployment of industry 4.0 on 80% of sites;
– 15% of teams dedicated to software and firmware,
– offering digital connectivity and infrastructure (voice, data, images, PDU and KVM),
– partnerships with laboratories, manufacturers and support for start-ups;
– Environmental strategy supported by the 5th CSR roadmap 2022-24 and execution ahead of objectives:
– 3 priority commitments: 30% reduction in carbon emissions in 2030 and total neutrality in 2050, /10th of sales with products that are sustainable by their design or use in 2030, circular economy in the production cycle,
– reduction of CO2 emissions by customers via energy efficiency solutions for buildings and the use of renewable energies (15% in 2023),
– green loan, indexed to the carbon neutrality trajectory and syndicated loan indexed to the achievement of CSR objectives;
– Continuation of acquisitions (2 in mid-February, 7 in 2022), at least half of the free self-financing being intended for investments in growth sectors – IoT, data centers, infrastructure and energy efficiency;
– Strong dominant positions – No. 1 or 2 worldwide for 2/3 of turnover.
Challenges
– Lack of visibility in a business without an order book;
– Inflation on raw materials and components and on energy and transport, not fully offset by the increase in sales prices and still persistent difficulties in electronic components, and in the logistics chain from China to North America;
– Towards a total exit from Russia (1.5% of sales);
– Dispute with the French Competition Authority over sales price practices;
– 2023 objectives: growth of 2 to 6% in revenue, operating margin around 20%;
– 2022 dividend of €1.9, up 15%, and share buybacks.
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Rail investment plan
The French railway industry is in second place in Europe and third place worldwide. This industry displays a trade surplus, which generates more than 100,000 jobs in France. The announcement of the future plan for French rail transport provides in particular for the regeneration and modernization of the network, the average age of which is 30 years in our territory. This age is much higher than that of countries like Germany (17 years) and Switzerland (15 years). An annual investment increasing from 2.8 billion euros to nearly 4 billion euros should make it possible to maintain the entire network in good condition.