Signify Confident in Handling Potential US Tariffs
By Toby Sterling
AMSTERDAM - Dutch lighting company Signify does not expect a big financial impact from possible new U.S. import tariffs, its chief executive said on Friday.
Signify, like its competitors, has significant production in China and Mexico, markets which U.S. President Donald Trump has targeted for possible tariff increases.
"When we look at our Chinese imports to our U.S. business, it's less than 20% of what we import," Eric Rondolat said on a call with analysts after the company reported fourth quarter earnings.
"We believe we will find a way to compensate through footprint (changes) and price increases," he added.
Signify is the largest maker of lights globally by sales, but its market capitalisation is far smaller than that of its top U.S. rival, Acuity Brands.
In October, before Trump's election, Rondolat said the company would consider shifting more of its assembly operations out of China to markets such as India and Mexico if necessary, though it would likely always purchase some components in China.
"The reality is that the production of some components in China today is so efficient that even with tariffs, it would likely continue to make sense for them to be sourced from this market," Rondolat told Reuters on Friday.
He said during the analyst call that it was difficult to know how any new tariffs would play out, but the company had navigated similar moves in 2018 and new tariffs could even present an opportunity.
"We have an important part of what we produce in Mexico, but less probably than other competitors ... we think our footprint is better positioned," he said.
(Reporting by Toby Sterling in Amsterdam, additional reporting by Leo Marchandon and Hugo Lhomedet in Gdansk. Editing by Jason Neely, Mark Potter and Milla Nissi)
