Schneider Sustainability Report 2017 – 2018

06 Company Performance Year in Review

Recognitions and awards

Included in CDP’s Climate A List of companies leading the fight against carbon emissions for the 7th year in a row, 2017

1 of 104

companies

Featured in the first-ever Bloomberg Gender-Equality Index, January 2018

Received the Environmental Leader Product and Project Award for Shedd Aquarium, 2017

Received the Global Power Correction New Product Innovation Award from Frost & Sullivan, 2017

Ranked 2nd in our industry in the Dow Jones Sustainability Index, 2017 – 2018

Recognized as one of the world’s most ethical companies according to Ethisphere® for the 8th consecutive year, 2018

Named as one of the World’s Most Admired Companies by Fortune® Magazine, 2018

Winner in the Health and Wellbeing category of 2017 the HR Distinction Awards, 2017

Ranked 3rd on Corporate Knights Carbon Clean 200™ list, 2017

Recognized among LinkedIn Top Companies for the second year in a row, 2017

Ranked as a Market Leader in Magic Quadrant for Advanced Distribution Management Systems by Gartner Research, 2017

Voted Best Place to Work in France in the Glassdoor Employees’ Choice Awards, 2018

Honored with the Sustainability Award Gold Class from RobecoSAM, 2017

2017 key figures

€24.7 billion

in revenue

€3.65 billion

adjusted EBITA

5%

of revenue devoted to R&D

76%

of revenue in energy management

24%

of revenue in industrial automation

142,000

employees in 100 countries

2017 revenue by geography, products, and solutions

Revenue distribution to our stakeholders

References
  • *Borrowings, share issues, and sale of treasury stock
  • 1 Including €314 million in R&D
  • 2 Including €160 million for long-term pension plans

Company Program: 2017 performance

2017 was the third and final year of our most recent company program focused on one simple idea: customer centricity. Each element of the program gave us opportunities to fulfill our customers’ needs and exceed their expectations.

Do More

  • More Products: Product revenues up +4.3% organic in FY17, with 100+ launches in 2017
  • More Software: Industrial software sales about flat with Q4 slightly up — transaction with AVEVA announced, providing unique software portfolio across asset life cycle for continuous and hybrid processes — good development in apps, analytics, and digital services powered by EcoStruxure
  • More Services: High single-digit growth in FY17 orders; +6% org. growth in Q4 revenues

Simplify

  • €650M Gross savings (Support Function Cost reduction and industrial productivity) in 2017 (c.€1.9B since 2015)
  • System margin improved by c.1 pts in 2017

Digitize

  • The number of connected assets increased +25% vs. 2016
  • Unique connected customers +36% vs. 2016

Innovate

  • Numerous key launches of products, advisors, and software within EcoStruxure
  • 2015 – 2017 Planet & Society barometer reached 9.58/10

Step Up

  • Launch of Global Family Leave policy
  • Strong traction of the Gender Pay Equity program

Digital growth

Connectivity

  • 1.6 million of assets under management — up 25% year over year

Experience

  • New web experience with traffic up 15% year over year
  • New digital catalog rollout with traffic up 70%
  • 650,000+ channel partners on our digital portal

Scale

  • New EcoStruxure cloud platform scaling up: ~2,500 events per second

Ecosystem

  • 20,000+ system integrators and developers
  • x2 in connected customers vs. end of 2016

100+ products launched

In 2017, product revenue went up 4.3 percent as we launched over 100 new innovations. This included the world’s first air circuit breaker with a built-in Class 1 power meter — the Masterpact™ MTZ circuit breaker — and the Galaxy™ VX UPS, Compact NSXm circuit breaker, and the SM6 Connected medium-voltage switchgear.

Masterpact MTZ

Galaxy VX

Compact NSXm

SM6

2017 Mergers and Acquisitions

Our merger and acquisition strategy is focused on strengthening our position as the global specialist in energy management and automation. In 2017, we focused on growing our software portfolio and adding to our low-voltage expertise.

IGE+XAO Group

IGE+XAO is a leader in design software for electrical installations through its CAD, PLM, and simulation software. This acquisition reinforces Schneider Electric’s software offer in a field complementary to electrical distribution products and solutions.

AVEVA

AVEVA is a leading provider of engineering, design, and information management software to the process, plant, and marine industries. The Schneider Electric industrial software business and AVEVA have merged to trade as AVEVA Group plc, a UK listed company.

ASCO Power Technologies

Since 1888, ASCO Power Technologies has been an innovator in automatic transfer switches, creating world-class technology for reliable power transfer. With this acquisition, Schneider enhances its position as a leader in low-voltage innovation.