Below are my notes from today’s Acuity Brands call with investors:
One of the most important points was that the price Increase is sticking.
When asked about the recent M&A activity such as Cree being acquired by a family business, GE/Current being acquired by private equity and Eaton spinning off their lighting business. Acuity made the following points:
- The Lighting Industry is not going anywhere. It is a robust industry and it is growing.
- “Smaller bit players, like Cree,” did not make the right investments and they mis-stepped and they did not win.
- Acuity has been investing heavily for the last decade building out a controls platform and building out an IoT platform.
- Eaton’s announcement to spin off their lighting business was a portfolio decision, Lighting was a small part of their overall portfolio. Eaton’s lighting business isn’t going anywhere, it’s going to become its own public company.
- Eaton came out and said here are our performance requirements and our Lighting business doesn’t quite meet those requirements. Acuity far exceeds those performance requirements.
- Bullish on the lighting industry and where it is going to go.
- The M&A activity has been with relatively minor players so far. The Eaton spinoff deal is not an M&A event, they are alive and well.
Listen to the entire call here.