Light-maker Signify shares dip as parts shortage dims output

AMSTERDAM (Reuters) -Shares of Signify fell as much as 9% early on Friday as the world’s largest lighting maker said a lack of parts had reduced output and the problem could persist for many more months.

FILE PHOTO: Signify's logo is pictured at the headquarters in Eindhoven, Netherlands August 30, 2018. REUTERS/Piroschka van de Wouw

Other industry executives have already said a semiconductor shortage could last well into 2022, as one-off purchases to meet work-from-home needs drive demand.

Signify has also struggled to source other components, including some metals and plastics.

Chief Executive Eric Rondolat said 85 million euros ($100 million) in sales had been missed in the first six months of the year.

“We could do more if we had more components,” Rondolat told reporters. “Recovery could come maybe in the fourth quarter, probably in the beginning of next year. But it’s a very tough situation.”

Signify shares rallied slightly to trade down 6.5% at 0750 GMT in Amsterdam. They are still up almost 25% since the start of the year after a strong rally in recent months.

“Second quarter results were not as strong as expected (and) Signify mentions supply constraints as a limiting factor,” ING analyst Marc Hesselink wrote in a note.

The company, formerly known as Philips Lighting, said comparable sales were up 14% in the second quarter from a year before — when the outbreak of the COVID-19 pandemic caused a deep slump — as consumer demand jumped, especially for networked lights that can be adjusted by mobile phone.

Adjusted earnings before interest, taxes, and amortisation (EBITA) increased 32% to 175 million euros.

The improved results fell short of analyst expectations in a company-compiled poll.

Signify maintained its outlook for a 3% to 6% comparable sales growth for 2021.

($1 = 0.8498 euros)

Reporting by Bart Meijer; Editing by Jacqueline Wong, Uttaresh.V and Barbara Lewis