Record third quarter sales of €6.1 billion, up 7.1%

PR Newswire/Les Echos/ 
Financial Information 

         Record third quarter sales of EUR6.1 billion, up 7.1%

* North America and Rest of World continued to post positive growth
* Mixed business trends in Asia-Pacific while China stabilised sequentially
* Market conditions deteriorated in Western Europe, driven by France
* Group organic sales were down 1.9%
* Positive contribution from acquisitions and favourable currency effect
* Well on track to meet the full-year adjusted EBITA margin target

Rueil-Malmaison (France), October 25, 2012 - Schneider Electric reported today
third-quarter sales of EUR6,099 million, up 7.1% year-on-year on current
structure and exchange rate basis. Organic sales were down 1.9%, of which fewer
working days accounted for about 1% of decline.

Sales for the first nine months of 2012 reached EUR17,507 million, an increase
of 9.2% year-on-year. 

The breakdown of sales by business segment was as follows:

EUR million                  Q3 2012                       9M 2012
                     Sales   Organic   Reported    Sales   Organic   Reported
                             growth     growth             growth     growth

Power                2,233     -3.3%      +3.3%    6,511     +0.7%     +6.8%
Infrastructure       1,308     -1.9%     +11.4%    3,680     -1.1%    +14.9%
Industry             1,153     -2.7%      +5.8%    3,372     -5.1%     +1.7%
IT                     971     +2.8%     +10.1%    2,707     +4.2%    +18.0%
Buildings              434     -3.1%     +11.6%    1,237     -2.5%    +10.3%
Group                6,099     -1.9%      +7.1%   17,507     -0.6%     +9.2%

Jean-Pascal Tricoire, President and CEO, commented: "We generated more than EUR6
billion of sales in the third quarter and are on track to deliver record sales
this year, as we continue to integrate recent acquisitions, including Telvent,
Leader & Harvest and Luminous. Our third quarter organic growth reflects the
contrasted regional trends, marked particularly by a more pronounced
deterioration in some of our key markets in Western Europe, but our new
economies platform showed resilience and our China operations have stabilised.

In this environment, our key priorities are on pricing, cost discipline and the
continuous focus on supply chain efficiency. We can therefore con firm that we
are well on track to reach the adjusted EBITA margin target of 14% to 15% of
sales in 2012.

Going forward, we will continue to deploy the growth initiatives of our
three-year program "Connect". In parallel, we will keep using all our
operational levers to protect margins and cash generation."

Organic growth analysis by business segment

Power (37% of Q3 sales) sales were down 3.3% like-for-like, reflecting the
slowdown in both products and solutions. The product business saw solid demand
in the Rest of World region, driven by public and oil & gas investments, and
sustained momentum in North America. However, it was hit by the weak business
environment in France and Southern Europe, the slowing residential market in
Australia and still sluggish construction and industry markets in China. The
trend was amplified by some distributor destocking. The solution business was
impacted by the decline of the solar conversion and connection activity which
reported strong performance in the same period of 2011, particularly in Italy,
France and Thailand. Other Power solutions continued to grow on investment in
oil & gas, mining and infrastructure in the Middle East, South America and

Infrastructure (21% of Q3 sales) dropped 1.9% like-for-like. Product business
weakened as secondary distribution products and transformers declined,
reflecting primarily the reduced private investment in Southern Europe and
France, weaker utilities demand in China and financial constraints of customers
in India. The solution business was flat, benefiting from good growth in Russia
in infrastructure projects, and mining and oil & gas investment in South East
Asia, the Middle East and Australia. This was offset by the decline in
substation and equipment sales, impacted by subdued demand in Southern Europe
and North Africa, limited solar energy investment, higher project selectivity as
well as lower services sales.

Industry (19% of Q3 sales) decline was less than in the second quarter, at -2.7%
like-for-like. While the manufacturing contraction in key markets still weighed
on the performance of the Group's bestin-class products, the solution business
continued to expand at double-digit in this quarter. It was aided by the robust
trend of the mining and oil & gas segments, especially in Asia-Pacific, Brazil,
North America and Russia, and growing success of the OEM machine solutions in
the new economies. The growth of the still small services activity accelerated,
especially energy management services enabled by the launch of PlantStruxure
software suite. The product business remained negative across the board as
reduced capacity utilization in Western Europe, China and Japan impacted machine
builders and general manufacturing segments.

IT (16% of Q3 sales) posted another positive quarter, up 2.8% like-for-like,
driven by solid growth of the product business. The success of the Luminous
offer in India and demand for secured power products in North America and Russia
offset the challenging trading conditions in Western Europe and distributor
destocking in Japan. The solution business growth paused in this quarter,
reflecting customer cautiousness towards new datacenter investment, especially
in the Middle East, South America and to a lesser extent the US, but also fewer
opportunities in the UK and France. Within solutions, services continued on
solid trend, supported by growth in advanced services for datacenters design and
operation in North America and installed-base services in Asia-Pacific.

Buildings (7% of Q3 sales) was down 3.1% organically. Solution business was in
slight decline. The good performance of security systems and energy efficiency
solutions provided to airports, educational buildings and hospitals in North
America and the UK largely offset declining services, in particular advanced
energy management services which were impacted by government spending cuts in
the UK, the US and the Nordic countries. Products sales declined due to tough
market conditions for security products while demand for building management
products remained positive.

Solutions business was flat organically at 0% in the third quarter and
represented 38% of sales.

Organic growth analysis by geography

EUR million                  Q3 2012                       9M 2012
                     Sales   Organic   Reported    Sales   Organic   Reported
                             growth     growth             growth     growth

Western Europe       1,711       -8%        -3%    5,192       -6%       -1%
Asia-Pacific         1,707       -2%        +8%    4,751       -2%      +12%
North America        1,574       +1%       +16%    4,441       +3%      +19%
Rest of the World    1,107       +4%        +9%    3,123       +5%      +11%
Group                6,099     -1.9%      +7.1%   17,507     -0.6%     +9.2%

Western Europe (28% of Q3 sales) dropped 8% year-on-year in the third quarter.
Spain and Italy declined at a pace similar to the previous quarters but France
experienced broad based deterioration since summer due to erosion in business
confidence impacting investment decisions in all end markets. The UK also turned
negative. Germany was stable. Nordic countries continued to post positive

Asia Pacific (28% of Q3 sales) was down 2% like-for-like. The trend in China
remained negative at mid single-digit year-on-year but stabilization was
confirmed. South East Asia and India continued to grow in the region, supported
by investment in natural resources and demand for data-centers and power
reliability, offsetting the slowdown in construction market in Australia and
overall weak business conditions in Japan.

North America (26% of Q3 sales) reported 1% growth like-for-like. The region
benefited from improving trend of the residential construction market in the US,
continued investment in secured power, oil & gas and industrial segments,
offsetting weakness in utilities and some non-residential construction segments,
in particular those that depend on government spending.

Rest of the World (18% of Q3 sales) grew 4% like-for-like. Russia and Saudi
Arabia posted solid double-digit growth with continued investment in oil & gas
and infrastructure projects. Central Europe and South America reported small
growth whereas Africa was in decline.

Sales in new economies were up 2% organically and represented 41% of total
reported sales in the third quarter.

Consolidation and foreign exchange impacts

Net acquisitions contributed EUR146 million or +2.6%. This includes mainly
Telvent (in Infrastructure) and Leader & Harvest (in Industry).

The impact of foreign exchange fluctuations was positive at EUR372 million,
primarily the result of the appreciation of the US dollar, Chinese yuan and
Australian dollar against the euro over the period.

Potential one-time charge related to the Buildings business segment

The Buildings business segment faced challenging trading environment in the past
few years following the construction downturn in its key mature markets,
affecting its financial performance. When conducting the annual impairment tests
at year-end, the Group may have to book a one-time non-cash charge on the assets
of Buildings. The amount of this charge remains to be confirmed but could fall
in the range of EUR100 million and EUR200 million.

The Group's dividend policy is based on 50% payout of the net income. However,
the 2012 dividend to be proposed for approval in the next annual shareholders
meeting would be adjusted to neutralise the impact of this potential charge on
the net income.

2012 Outlook

Despite the global economic uncertainties, the Group's topline development was
overall in line with the scenarios contemplated in early 2012 with the exception
of a more pronounced slowdown in part of Western Europe and a later than
expected rebound in China. Therefore, Schneider Electric now expects its organic
sales growth for the full year 2012 to be flat to slightly negative.

However, the Group reaffirms its full year adjusted EBITA margin target of 14%
to 15% of sales reflecting the positive price actions and continued focus on
productivity and cost discipline.

The Q3 2012 sales presentation is available at 

2012 full year results will be released on February 21, 2013.

About Schneider Electric 
As a global specialist in energy management with operations in more than 100
countries, Schneider Electric offers integrated solutions across multiple market
segments, including leadership positions in energy and infrastructure,
industrial processes, building automation, and data centres/networks, as well as
a broad presence in residential applications. Focused on making energy safe,
reliable, and efficient, the company's 130,000 plus employees achieved sales of
22.4 billion euros in 2011, through an active commitment to help individuals and
organizations "Make the most of their energy."

All forward-looking statements are Schneider Electric management's present
expectations of future events and are subject to a number of factors and
uncertainties that could cause actual results to differ materially from those
described in the forward-looking statements. For a detailed description of these
factors and uncertainties, please refer to the section "Risk Factors" in our
Annual Reference Document (which is available on
Schneider Electric undertakes no obligation to publicly update or revise any of
these forward-looking statements.

Appendix - Sales breakdown by business 

Third-quarter 2012 sales by business were as follows:

                               Changes in
EUR million     Q3 2012  Organic    scope of   Currency  Reported 
             sales   growth  consolidation  effect    growth 
Power            2,233   -3.3%       -0.1%      +6.7%     +3.3%
Infrastructure   1,308   -1.9%       +9.3%      +4.0%    +11.4%
Industry         1,153   -2.7%       +2.2%      +6.3%     +5.8%
IT                 971   +2.8%       -0.5%      +7.8%    +10.1%
Buildings          434   -3.1%       +5.4%      +9.3%    +11.6% 
Total            6,099   -1.9%       +2.6%      +6.4%     +7.1% 
Nine-month 2012 sales by business were as follows: 
                               Changes in
EUR million     9M 2012  Organic    scope of   Currency  Reported 
             sales   growth  consolidation  effect    growth 
Power            6,511    +0.7%      +0.7%      +5.4%     +6.8%
Infrastructure   3,680    -1.1%     +13.1%      +2.9%    +14.9%
Industry         3,372    -5.1%      +2.1%      +4.7%     +1.7%
IT               2,707    +4.2%      +7.0%      +6.8%    +18.0%
Buildings        1,237    -2.5%      +6.1%      +6.7%    +10.3%
Total           17,507    -0.6%      +4.7%      +5.1%     +9.2% 
Appendix - Consolidation impact on sales and EBITA 
In number of months                   2011                2012 
                                   Q1   Q2   Q3   Q4   Q1   Q2   Q3   Q4 
Lee Technologies
IT business
2010 sales $140 million                     3m   3m   3m   3m 
Summit Energy
Buildings business
2011e sales $65 million                     3m   3m   3m   3m 
Power business
2010 sales c. EUR25 million                      4m   3m   3m   3m  -1m 
IT business
FY 31/10/10 sales EUR18 million                  4m   3m   3m   3m  -1m 
IT business
FY 31/3/11 sales c. EUR170 million               4m   3m   3m   3m  -1m 
Power business
2011e sales EUR80 million                        2m   3m   3m   3m   1m 
Infrastructure business 
2010 sales EUR753 million                        1m   3m   3m   3m   2m 
& Harvest
Industry business
2011e sales $150 million                              3m   3m   3m   3m 
Buildings business
FY 30/6/12e sales £35 million                                        3m   3m 
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Schneider Electric                  Schneider Electric
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-0- Oct/25/2012 08:15 GMT
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