Landis+Gyr update on current market conditions and COVID-19
Zug –March 27, 2020 – Landis+Gyr (LAND.SW) today provided the following comments on current market conditions and COVID-19.
On January 27, 2020, Landis+Gyr announced that, with the continuing regulatory delays in the U.S., it expected the results for the financial year 2019 (ending 31 March 2020) to be around the lower end of the guidance range provided for net revenue (1-4% revenue growth in constant currency), adjusted EBITDA (USD 240 255 million) and free cash flow (excluding M&A) (USD 120-135 million).
Landis+Gyr has started to experience some impacts related to COVID-19 and some further weakness in demand in North America. Based on this and the increased uncertainty from the COVID-19 impact, Landis+Gyr now expects net revenue for the financial year 2019 to show a slight decline of around 2% in constant currency compared to financial year 2018 and expects Adjusted EBITDA and free cash flow (excl. M&A) for the financial year 2019 to be around or somewhat below the lower end of the guidance ranges. Free cash flow (excluding M&A) is subject to the usual uncertainties on the timing of receipts from customers, which is exacerbated by COVID-19 uncertainties.
The Company has recently been informed by a number of major customers that they are reducing or suspending meter installations due to government restrictions and in order to safeguard their installers and consumers during the ongoing COVID-19 pandemic. Landis+Gyr expects that these actions will delay revenue until the currently widespread government restrictions are lifted, and customers are able to ramp up their installation programs. At the moment, the Company is unable to estimate the net revenue impact, but it could have a material effect on net revenue in FY 2020. Overall, no major project cancellations have occurred, software and service contracts remain on track.
Landis+Gyr has consistently maintained low net debt and continues to monitor its liquidityposition closely. As a precautionary measure to reflect current uncertainties, the Company will suspend its share buyback program with immediate effect.
As communicated previously, the unaudited results for the financial year 2019 will be published on May 6, 2020. Landis+Gyr will then also provide an update on market conditions.
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Release of Results for Financial Year 2019 – May 6, 2020
Publication of Annual Report 2019 and invitation to AGM 2020 – May 28, 2020
Annual General Meeting 2020 – June 30, 2020
Release of Half Year Results 2020 – October 28, 2020
Landis+Gyr is the leading global provider of integrated energy management solutions for the utility sector. Offering one of the broadest portfolios, we deliver innovative and flexible solutions to help utilities solve their complex challenges in smart metering, grid edge intelligence and smart infrastructure. With sales of USD 1.8 billion, Landis+Gyr employs approximately 6,000 people in over 30 countries across five continents, with the sole mission of helping the world manage energy better. More information is available at www.landisgyr.com.
Important notice about forward-looking information
This release contains specific forward-looking statements that include terms like “believe”, “assume”, “expect”, “guidance”, “target” or similar expressions. Such forward-looking statements represent Lands+Gyr’s judgments and expectations and are subject to known and unknown risks, uncertainties and other factors that may result in a substantial divergence between the actual results, the financial situation, and/or the development or performance of the company and those explicitly or implicitly presumed in these statements. Against the background of these uncertainties, readers should not rely on forward-looking statements. Landis+Gyr Group is not under any obligation to (and expressly disclaims any such obligation to) update or alter its forward-looking statements, whether as a result of new information, future events or otherwise, except as required by applicable law or regulation.
Alternative performance measures.
This release contains information regarding alternative performance measures. Definitions of these measures and reconciliations between such measures and their US GAAP counterparts may be found on pages 36 to 40 of the Landis+Gyr Half Year Report 2019 on our website at www.landisgyr.com/investors.