Schneider Electric (SU) Q4 2024 earnings summary

Executive summary

• Achieved record 2024 revenues of €38.2bn, up 8.4% organically, with Q4 growth accelerating to 12.5% and strong performance in Energy Management and Data Centers.

• Recognized as the world's most sustainable company by Corporate Knights and received multiple external sustainability awards.

• Maintained balanced exposure across end-markets, with Data Centers, Buildings, Industry, and Infrastructure as key growth drivers.

• Continued transformation towards digital and recurring revenue streams, with AVEVA ARR up 15% and strong innovation in R&D.

• Proposed 15th consecutive progressive dividend, up 11% to €3.90/share for 2024.

Financial highlights

• Adjusted EBITA/EBITDA reached €7.1bn, up 14% organically, with margin at 18.6% (+90bps); gross margin improved to 42.6% (+80bps).

• Net income was €4.3bn (+7%), adjusted net income €4.7bn (+15%), and adjusted EPS up 18.2% to €8.32.

• Free cash flow totaled €4.2bn, with a 99% cash conversion ratio for the second year.

• ROCE improved to 14.8%, nearing the long-term target.

• Net debt reduced to €8.1bn, maintaining strong investment grade rating.

Outlook and guidance

• 2025 targets: organic revenue growth of 7%-10%, adjusted EBITA/EBITDA growth of 10%-15%, and margin expansion of 50-80bps.

• All regions expected to contribute, led by U.S., India, and Middle East & Africa.

• Continued investment in capacity, especially in North America, India, and Middle East.

• FX impact on 2025 revenues estimated at +€600m to +€700m; effective tax rate expected at 23%-25%.