LEGRAND / 2018 Registration document

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MANAGEMENT REPORT ON THE CONSOLIDATED FINANCIAL STATEMENTS FOR THE FINANCIAL YEAR ENDED DECEMBER 31, 2018

YEAR-ON-YEAR COMPARISON: 2018 AND 2017

Rest of Europe . Net sales in the Rest of Europe zone for 2018 came to €1,007.9 million compared with €936.7 million in 2017, an increase of +7.6%. This reflects: W a +3.4% change in scope of consolidation; W the unfavorable -4.7% impact of exchange-rate fluctuations; W and a +9.2% organic rise. Over the full year, this strong rise benefited from double-digit growth in sales in Eastern Europe – including Russia, Romania and Hungary – as well as in Turkey. These very healthy performances, fueled by commercial initiatives, represent high bases of comparison for 2019. A number of mature countries also recorded a strong rise in activity, including Southern Europe (1) , Germany and the Netherlands. Sales in the United Kingdom (around 2% of Group sales) rose moderately. North and Central America . Net sales in the North and Central America zone for 2018 came to €2,175.1 million compared with €1,820.0 million in 2017, an increase of +19.5%. This reflects: W a +20.2% change in scope of consolidation; W the unfavorable -4.6% impact of exchange-rate fluctuations; W and a +4.2% organic rise.

2018 showings were driven by momentum in the United States, where sales rose +5.2% full year. This was achieved thanks to the success of offerings for wire-mesh cable management, intelligent PDUs, and lighting control solutions, as well as Milestone’s audio- video infrastructure and power products. Sales rose very slightly in Canada, while declining in Mexico. Rest of theWorld . Net sales in the Rest of the World zone for 2018 came to €1,355.8 million compared with €1,349.7 million in 2017, an increase of +0.5%. This reflects: W a +2.0% change in scope of consolidation; W the unfavorable -6.1% impact of exchange-rate fluctuations; W and a +4.9% organic rise. The Group reported very healthy performances in a number of Asian countries including India, China and South Korea, along with several African countries. Sales showed moderate growth in Australia, while declining in Malaysia. Business trends were mixed in Latin America, with sales nearly steady in Brazil and declining in Colombia. In the Middle East, sales were down in both the United Arab Emirates and in Saudi Arabia.

R 5.4.1.2 BREAKDOWN OF CHANGES IN NET SALES BY ORIGIN FROM 2017 TO 2018 The following table presents the breakdown of changes in net sales to third parties as reported by zone of origin between 2017 and 2018:

12 months ended December 31,

Exchange-rate effect

Change in scope of consolidation

Organic growth (1)

Net sales (in € million, except %)

2018

2017 Total change

France

1,032.4

1,012.6

2.0%

0.0%

2.0%

0.0%

Italy

578.8

544.7

6.3%

0.0%

6.3%

0.0%

Rest of Europe

978.3

914.5

7.0%

2.7%

9.6%

(5.0)%

North and Central America

2,223.2

1,857.4

19.7%

20.7%

4.0%

(4.6)%

Rest of the World

1,184.5

1,191.6

(0.6)%

1.7%

4.8%

(6.7)%

CONSOLIDATED TOTAL

5,997.2

5,520.8

8.6%

7.8%

4.9% (3.9)%

(1) At constant scope of consolidation and exchange rates.

(1) Southern Europe: Spain + Greece + Portugal.

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LEGRAND

REGISTRATION DOCUMENT 2018