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2012 REGISTRATION DOCUMENT SCHNEIDER ELECTRIC152
BUSINESS REVIEW
4REVIEW OF THE CONSOLIDATED FINANCIAL STATEMENTS
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2. Review of the consolidated
financial statements
Review of business and consolidated statement of income
Changes in the scope of consolidation
Acquisitions
On May 4, 2012, Schneider Electric announced that it has
signed an agreement to acquire M&C Energy Group (“M&C”), a
fast-growing company specialized in energy procurement and
sustainability services for both multinationals and small to medium
sized enterprises.
M&C provides its customers with energy procurement, compliance
and performance optimization services mostly on recurring
subscription basis. The Company has more than 500employees
including 300 energy specialists and an international presence
with 21 offi ces across 15 countries, particularly in Europe and
Asia-Pacifi c.
M&C will be consolidated in Group’s fi nancial statements from
July1, 2012.
Acquisitions and disposals that took place in2011
and that had an impact on the 2012 financial
statements*
The following entities were acquired during fi nancial year 2011 and
their consolidation on a full-year basis for fi nancial year 2012 had a
scope effect compared to fi nancial year 2011:
•Lee Technologies, consolidated as from April1, 2011;
•Summit Energy, consolidated as from April14, 2011;
•DIGILINK, consolidated as from May13, 2011;
•APW President Systems, consolidated as from May19, 2011;
•Luminous Power Technologies, consolidated as from
June1,2011;
•Steck Da Amazonia Industria Electrica, consolidated as from
July20, 2011;
•Telvent GIT, consolidated as from August31, 2011;
•Leader&Harvest Power Technologies Holdings, consolidated as
from October11, 2011.
Changes in foreign exchange rates
Changes in foreign exchange rates relative to the euro had a
material impact over the year. This positive effect amounts to
EUR981million on consolidated revenue and to EUR171million on
Adjusted EBITA(1).
Revenue
On December 31, 2012, the consolidated revenue of Schneider
Electric totaled EUR23,946million, an increase of 7.2% at current
scope and exchange rates compared to December31, 2011.
This growth breaks down into an organic decrease of 0.7%, a
contribution of acquisitions net of disposals of 3.5% and a positive
exchange rate effect of 4.4%.
* Correspond to the dates on which the Group gained control of the acquired companies.
(1) Adjusted EBITA is EBITA before restructuring costs and before other operating income and expenses, which includes acquisition, integration
and separation costs.
Changes in revenue by operating segment
The Power business generated revenues of EUR8,738million, or
37% of the consolidated total. This represents an increase of +5.8%
on a reported basis and +0.5% like-for-like. This performance
refl ects growth in the Solution business, benefi ting from continued
investments in infrastructure, oil&gas, mining and data centers,
partly offset by the signifi cant decline of solar energy projects.
Product business was stable: stronger construction and industrial
markets in North America, South America and Russia helped to
balance the decline in Western Europe, Australia and China.
The Infrastructure business generated revenues of
EUR5,366million, or 22% of the consolidated total. This represents
an increase of +9.6% on a reported basis and -1.5% like-for-
like. Both Products and Solutions declined. Growth of secondary
distribution products, driven mainly by utility and oil & gas
segments, only partially offset the decline in primary distribution
components, refl ecting challenging market conditions in some key
new economies. The Solution business benefi ted from investments
in resource-intensive industries as well as growth in installed base
services, but saw a decline in sales of substations and equipments,
weighed down primarily by reduced spending in Western Europe.
The Industry business generated revenues of EUR4,483million, or
19% of the consolidated total. This represents an increase of 2.0%
on a reported basis and -3.8% like-for-like. The Solution business
continued to expand at double-digit, aided by the robust trends
of mining and oil & gas segments in new economies, continued
success of the OEM machine solutions and positive trends in
services. The product business remained negative across the Board
as reduced capacity utilization in Western Europe, China and Japan