_1_1

September 2007

InvestorsPresentation

Disclaimer

All forward-looking statements are Schneider Electricmanagement’s present expectations of future events and aresubject to a number of factors and uncertainties that couldcause actual results to differ materially from those describedin the forward-looking statements.

_3_3

_04 Overview

_08 Strategy and business update

_14 First-half financial results

_24 Progress of APC integration

_32 Outlook

_34 Pelco acquisition

_4_4

Overview

_5_5

A world leader in Power & Controladdressing 4 end markets

Control and protect machines and installations

Automation& Control

No. 2 worldwide

ElectricalDistribution

No. 1 worldwide

Make power safe, available

and reliable

Energy management

Ensure uninterrupted and high quality power, optimise energy consumption

Buildings – 37%

Industry – 32%

Energy & Infrastructure – 16%

Residential – 15%

_6_6

A worldwide coverage withstrong local operations

Rest of the World Asia-Pacific

North America Europe�€15.6 billion sales,

190 countries

�113,000 employees

�219 factories

�7,300 R&D people in 25 countries

30%

�~ 750,000 references

8% 18%

44%

Sales, Employees, Factories by geographical region

28 000 50 000

27 5007 500

2006 figures including APC on a pro forma basis

48

22 52

97

_7_7

�Excellent sales growth

�Strong earnings growth

� Fast progress of the integration of APC

�Acquisition of Pelco, worldwide leaderof video security

Highlights of the semester

� Synergies well on track: 78% of the $341 million incumulative synergies expected by the end 2009 already allocated in detailed roadmaps

+14.9%Perimeter effect

-3.6%Currency effect

+21%Net income

+14.0%Sales (Organic)

+23%EBITA

+25.3%Sales (Current)

H1 2007 % change

x2.5*APC-MGE EBITA

+17%*APC-MGE Sales (Organic)

� Record organic growth

� 24% average operating earnings growth achieved over the past 4 years

� Solid sales growth coupled with Large Systems profitability improvement

* This figure indicates the underlying performance of the Critical Power & Cooling Services « business unit » on a proforma basis in H1 2007 excluding MGE small systems

_8_8

Strategy and Business update

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�Massive electrification needs worldwide

�Pervasion of automation

�Rising demand for energy savings

�Outsourcing of non core competencies

�Power reliability and quality increasingly critical

A unique positioning in a promising industry

� #1 in Electrical Distribution (LV-MV)� 31% exposure to emerging countries

� Automation solutions for every segment� Open web-enabled systems

� Unique & comprehensive offeringfor energy usage efficiency

� #1 in Power Monitoring and Control

� In-house technical know-how� Very large installed base

� #1 in Critical Power� Energy efficient solutions integrating cooling

_10_10

Energy efficiency A high potential

Schneider Electric’s unique offer

Customers demand

Potential annual market growth of +15% to +20%

� Increasing needs for reduction of:

� energy costs� CO2 emissions

� Energy savings products Variable speed drive, motor control, sensors…

- 10% to - 30%of energy savings

for customers

� Measurement - Metering

� Automation everywhere Supervisory systems

� High value services Audits and assessments, performance based services, energy management tools…

� World energy consumption to rise 70% by 2030 , with 75% of new demand driven by emerging markets

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Energy efficiency: Enhancing performance on every market

Industry & Infrastructurea key target, especially

around motors

Buildingsthe biggest consumer,

hence a priority

Residentialfragmented but high

potential!

� Over 30% of the consumed energy� Motors account for 60% of the

electricity usage � Average facility can reduce energy

consumption by 10 to 20%

Lightingcontrol

� 20% of the consumed energy

� 10 to 40% electricity savings using energy efficient products

Shuttercontrol

Heatingmonitoring

Variable speeddrives

Automationsolutions

Energy management

systems

Power metering

Lightingcontrol

HVACcontrol

Power factorcorrectionBuilding

managementsystems

� Over 20% of the consumed energy

� Renovation can yield up to 30%of energy savings

Deliver a bundle offer

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An efficient growth model

Acquisitionsto enlargeportfolio

and providesolutions

New businessesMore growth

Less cyclicality

Investmentsto deploy

full offering in all

geographies

Technology and commercial

resourcesGeographical coverage

Customer satisfaction

InnovationComplete solutions & Services

Priority to organicgrowth

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A sustained focus on efficiencyin a context of fast-growing demand

� Rebalancing of production to low-cost countries

� Optimization of logistics

� Lean Manufacturing

� Monitoring of base costs

� Pricing management

� Integration of acquisitions

� Raw materials & components� Currency imbalance

EFFICIENCY INITIATIVES

COST HEADWINDS

� High-level of customer service� Deployment of new businesses

& change of mix

INVESTMENT IN GROWTH

OPERATING LEVERAGE

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First halffinancial results

_15_15

* Including APC on a proforma basis since February 15, 2006** EBIT before net depreciation and amortization***EBIT before amortization of purchase accounting intangibles of €27m in H1 07 (€10m in H1 06)

and including restructuring costs & impairment of €61m in H1 07 (€70m in H1 06)

+12%-0.4pt

3,37840.9%

3,00641.3%

+23%-0.9pt

3,37840.9%

2,75441.8%

Gross profitMargin %

14.2%1,175

1,38516.8%

8,254

H1 2007

(2)

COMPARABLE FIGURESREPORTED FIGURES

+15%

+21%

-0.3pt+23%

+16%-1.4pt

+25%

Change

(2) / (1)

13.7%997

1,25917.3%

7,278

H1 2006*

(3)

(19)(18)Minority interest

729604Net income

3.162.75Earnings per share

+10%-0.5pt

1,38516.8%

1,19818.2%

EBITDA**Margin %

+18%1,175954EBITA***+0.5pt14.2%14.5%Margin %

(107)(58)Net financial expense

(293)(264)Income tax

+13%8,2546,586Sales

Change

(2) / (3)

H1 2007

(2)

H1 2006

(1)

Strong increase of earnings 1/2

Key profitability indicators in €m

_16_16

�Sustained investments to deploy new businesses & ex pand geographic coverage

�On-time delivery to customer in a context of high d emand

�Strong price realization offsetting raw material co st increases: 2.4% of sales

** Sales organic growth*** Emerging countries: Eastern Europe + Asia-Pacific

+ Rest of the World

� Stringent management of the supply chain

* Orders organic growth

Strong increase of earnings 2/2

+12%Ultra Terminal

+25%Services

+19%Building Automation+22%Energy Efficiency

H12007*

+21%Inc. Emerging countries***

+25.0%Rest of the World+14.0%Group

+12.4%Europe

+15.5%Asia-Pacific

+12.5%North America

H12007**

_17_17

H1 2007H1 2006

VolumeGrossIndustrialProductivity

CurrencyEffects

954

1,175

+321

+126-216

-50+117

+16% -5% +12%���� 07/06 +23%

+155-9

Other

Organic Growth

* Of which Production Labour & Other Costs: -34, SG&A/R&D costs: -182

-91

Mix

Analysis of change in EBITA (in €m)

OperatingCosts*

RawMaterials

Reinvestment of higher growth benefits to deploy resources in promising areas

APC +88Other +29perimeter

-132

Price

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3.6%4.6%as % of products’ cost of sales*

1931Other plans

126148Gross industrial productivity

4761Purchasing

3330Rebalancing

2726Lean Manufacturing

H1 2007H1 2006

Breakdown of productivity gains (in €m)

Good level of productivityin a context of high volume growth

* Excluding cost of sales for services and related businesses

_19_19

Solid profit growth across regions and businessesInvestments in Asia Pacific and turnaround of Critica l Power

585+23%

15.3%+0.7pt

Europe

325+14%

14.2%+1.0pt

North America

162+5%

11.0%-1.0pt

Asia-Pacific

103+24%

15.3%+1.0pt

Rest of world

739+15%

15.6%-0.2pt

Electrical Distribution

313+11%

13.0%+0.1pt

Automation & Control

123+76%

11.0%+4.0pts

Critical Power**

Breakdown by region Breakdown by business

Sales breakdown

EBITA* (€m)

EBITA Margin*

46% 18%28% 57%8% 14%29%

* Compared to H1 2006 EBITA including APC on a proforma basis since February 15, 2006** Including MGE Small Systems business

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* Including R&D capitalization of €63m** Including bridging investment for APC financing of -€189m

(5,658)

(3,823)

(167)**

1,057

(4,322)

(668)277(4)

(454)(298)*1,033

(1,835)

H1 2007

1,103Capital increase

(120)Other

(3,444)Increase in net debt

(5,658)Net debt at June 30

75Change in non-operating working capital1,094Free cash flow(668)Dividends

(4,853)Acquisitions

2,030Operating cash flow

(481)Change in operating working capital(530)Capital expenditure – net

(2,214)Opening net debt

LTMUses and sources of cash in €m

Solid cash generation

_21_21

-1.4

+5.3

Days of Inventories

Days of Payables

Days of Receivables23.8%

21.2%

51.4

46.1

H1 2006 H1 2007*-1.545.3

46.8

H1 2007*

H1 2006

WCR components in days of sales WCR in % of sales

Increase of working capital requirementsin a context of strong demand and with the impact of APC

67.4

66.0

H1 2007*

H1 2006

H1 2007*

H1 2006

* Including APC consolidation on a 4.5 months period

APC impact

22.5%

_22_22

2,240

1,892

+12%

+8%

EBITA (LTM)

Capital Employed**

EBITDA (LTM)

* Including APC on a proforma basis since February 15, 2006** Capital employed = shareholders’ equity + net debt + provisions

2,693

2,402

14,725

13,676

ROCEAfter tax EBITA / Capital Employed*

10.9%

9.9%

Cash ROCEAfter tax EBITDA / Capital Employed*

+0.6pt13.1%

12.5%

+18%+1.0pt

Analysis of change in return on capital employed (i n €m)

Improvement of ROCEon a comparable basis

Cash ROEOperating cash flow / Shareholders’ equity

+0.7pt20.5%

19.8%

H1 2007

H1 2006*

H1 2007

H1 2006*

H1 2007

H1 2006*

H1 2007

H1 2006*

H1 2007

H1 2006*

H1 2007

H1 2006*

_23_23

12xNa24xInterest coverage (EBITDA / Debt costs)36%38%105%Operating cash flow / net debt

31%31% 66%Funds from operations / net debt**

9,8819,8168,838Consolidated shareholders’ equity

57%52%21%Net debt-to-equity ratio

5,6585,1091,835Net debt

H1 20072006

Including APC*

2006

Releveraged balance sheet supported by solid cash generation

* Including APC acquisition at December 31, 2006 and after capital increase on a pro forma basis** S&P definition

Financial ratios in €m

_24_24

Progressof APC integration

_25_25

�Strengthen leadership in electrical distribution th rough a widened offer and gain a new stature

�Critical Power & Cooling Services: a fast growing s egment, +8% per year

�APC – MGE : an uncontestable global leader with mark et share above 30%

�Sizeable synergies of $220m between APC and MGE (re search & development, SG&A, sales, services, purchasing, routes to market …)

�A turnaround opportunity in large systems

High value creation potential

Value creation of $3.3 bn

_26_26

Main action plans in progressalong key value drivers

TurnaroundEnterprise &

Systems

DeployProjects & Services

BoostManagement

Software

LeverageHome &

Distributed

To stop unprofitable

products lines

Accelerated product

roadmap

Common R&D program

BRIC countries presence

Installed base maintenance

A new line of business

Projects delivery

Commercial coverage / Quality & processes / On-Time delivery / Customer centric

Stranded capacity / Distribution center optimization / SKUs reduction / Supply & Demand optimization

Capture synergies

Purchasing productivity / R&D optimization / Administrative expenses / Commercial alignment

Deliver full datacenter solution

Ensure customersatisfaction

Improvesupply chain

A key differentiator

Total data center solution with Schneider Electric

_27_27

Strong increase in Critical Power & Cooling Services results

* On a 6-month basis without MGE Small Systems business** Excluding restructuring costs ($24m in H1 2007) *** Operating income before amortization of purchase accounting intangibles

x2.5+5.5pts

18010.9%

725.4%

EBITA before restructuring**Margin %

1569.4%

715.3%

EBITA***Margin %

+17%Organic growth+24%1,6591,337Sales

+33%+2.6pts

61837.3%

438

46434.7%

392

Gross ProfitGross Margin %

Operating Expenses

%chg

H1 2007Proforma*

H1 2006 Proforma*(in $m)

APC-MGE results

_28_28

Strong growth prospects

� Very attractive long-term growth drivers

�Solid growth for all lines of business in H1

Trend

A key differentiator with strong growth potential

21%3%“Management Software”

Strong demand for both APC and MGE value propositions

27%52%“Enterprise” + “Services”

US Channels restructuringTermination of unprofitable products lines

5%45%“Home & Distributed”

CommentsOrganicGrowth

% of sales

� Gartner Research: 70% of data centers managers recently said power and/or cooling issues are now their single largest problem

� Energy Efficiency is common issue across applications and businesses

_29_29

Strong improvement of APC performanceand first effects from synergies

H1 2006 ex-APC ex-MGE Synergies H1 2007

Analysis of Critical Power & Cooling ServicesEBITA increase (in $m)

72

180

�Strong improvement for ex-APC: Large Systems turnar ound

�Solid performance for ex-MGE after carve out of 0-1 0 KVA business

� $5m synergies “in the bank” after 3.5 months

+87

+16

+5

_30_30

x3.3

+6.7pts

132

10.6%

EBITA before restructuring*Margin %

+14%

+20%

% chg

Organic growth

1229.8%

EBITAMargin %

1,245Sales

H1 2007Proforma$m

APC results

APC performance improvement driven by a few key factors

�Pricing / Mix

�Productivity / Raw materials

�Support function costs

� Improved productivity / logistics

� Transfer to low cost countries

� Impact of lead cost increase

� Strong price management

� Stringent project selection

� Mix impact (Enterprise vs H&D)

� Unprofitable product line termination

� Headcount reduction

� G&A synergies (shared services, IT infrastructure, insurance, etc.)

* Excluding restructuring costs of $10m in H1 2007

_31_31

Update on synergies

2007 2008 2009 Aggregate

Synergies ramp-up (in $m)

Allocated to date

78%

�Definition of key action plans along:

� Synergy targets on track

� Leverage Home & Distributed

� Turnaround Enterprise & Systems

� Improve supply chain

� Deliver full data center solution

� 44 detailed roadmaps launched

� 19 additional roadmaps to be finalized by September

� 78% of 2007-2009 cumulated synergies of 341m$ allocated

� Confirmation of 2011 annual synergy target of 220m$

� Set-up Integration backbone

� Optimize commercial & marketing

� Optimize support functions

4 value drivers 3 transversal work streams

341166

63

112

_32_32

Outlook

_33_33

Outlook

Assuming current economic conditions,

Schneider Electric revises upwards its target

and anticipates a 2007 organic sales growth above 10%

_34_34

Pelco Acquisition

_35_35

Integration of HVAC and Security provides more than 25% savings on both Capex and Opex

Building Automation is more and more integratedinto a unique system to answer customers’ needs

HVAC & Power control Fire safetyElectronic security

BUILDING AUTOMATION

Temperature controlValves, actuators

Energy services & solutions

Fire DetectionEvacuation

Access controlVideo management

Intruder alarm / Monitoring

� Building is a significant market for Schneider Elec tric (52% of sales)

� Building Automation addresses 2 growing needs: Secu rity & Energy Efficiency

_36_36

91120

165204

242

306 308

388435

506

1997 1998 1999 2000 2001 2002 2003 2004 2005 2006

Others 16%

Sensing(i)

61%

Control(ii)

23%

� A leader in the fast growing video security industry

� Strong sales & marketing organization

� Strong innovation capabilities with R&D representin g 7.5% of sales

� Broadest product line and unique ability to offer a fu ll end to end solution

� Premium customer base: world-class technical support and customer service

Pelco is a key leader of video security industry

� Highest brand recognition in the industry

(i) Sensing include cameras and domes(ii) Control include DVRs and NVRs

SalesEmployeesPresence

Key Figures$506 m

2,200130 countries

CAGR: 21%

_37_37

Schneider Electric rebalances its Building Automation solution portfolio by reinforcing its security offering

Current Building Automationsolutions portfolio : €1.0 bn*

� Video is the most attractive segment of security in dustry� Rapid and sustainable growth, expected CAGR 07-10: 12%� Shift to high value added IP protocol and software based systems

HVACControl

67%

Fire& Security

18% HVACControl

48%

Fire& Security

42%

Building Automation solutions portfolio with Pelco acquisition: €1.4 bn*

� Video is one of the critical application in the bui lding� Video provides the source data (location, movement, …) transported via IT infrastructure� Data is translated into meaningful information through video content analysis software � Video complements/replaces other security systems: intrusion, detection

* 2007 forecasts

EnergySolutions

15%

EnergySolutions

10%

_38_38

Pelco has a strong marginimprovement potential

� High operational leverage potential

� Significant investments achieved in the last few ye ars

� $100 million of R&D spending over the last 3 years to support the IP shift

� Expansion of international commercial coverage in 130 countries

� Strong sales growth track record, CAGR 00-06: 16%

� R&D spending has reached an adequate amount

� Most of commercial resources have been deployed

19

7.3%

20

10.1%

27

269

H1 2007

+3.0 pts

+100%

+2.6 pts

+50%

+13%

Change

38

6.0%

30

9.1%

46

506

2006

43

8.8%

50

11.4%

65

569

2007E

+2.8 pts

+67%

+2.3 pts

+41%

+12%

Change

EBITA

Margin %

R&D

EBITDAMargin %

Sales

$m

_39_39

Sales synergies: $168 million

� Sale of video solutions into TAC channels

� Pelco & TAC integrated access and video solutions

� Pelco cameras/accessories sales into TAC channels

Cost synergies: $32 million

The objective is to reach a 19% EBITDA margin including synergies

� Purchasing conditions

� Optimisation of back office

� Operating efficiencies

2011 Synergies Target

EBITDA$ 67 million

� Significant synergies will be extracted through the combination of Pelco and TAC

_40_40

Transaction

� Price to be paid in cash at closing expected by October 2007

� Debt-free/cash-free basis

� Approximately $320 m of tax benefits(i)

� Expected Return On Capital Employed (ii) to exceed cost of capital (iii) in year 3

� Transaction subject to antitrust and other regulatory clearance

� EPS accretive in year 1

� Total acquisition price : $1,540 m

� Enterprise value of $1,220 million

(i) Discounted at 7.5%(ii) After tax EBITA / Enterprise value(iii)Schneider Electric cost of capital estimated at 7.5%

_41_41

Appendices

_42_42

� Develop new businesses

� Increase advantage in R&D and innovation

� Deploy comprehensive solutions & services for each type of customer

� Optimise of logistics

� Develop competencies & diversity

� Expand geographic coverage

� Rebalance production

� Boost productivity & globalisation

new² priorities: an offensive strategyof profitable growth

_43_43

Contribution of emerging countriesto Group sales (%)

2004 2006

Sales organic growth2005-2006 average: +15%

27

31

2001

18South

America+26%

India+34%

AfricaMiddle East

+19%

OtherAsia Pacific

+9%

EasternEurope+17%

China+16%

Invest in fast growing emerging countries

� High growth in emerging countries in 2006 combinedto an exceptional performance in mature countries

_44_44

Energy Management

Low & MediumVoltage

Control

Building Automation

Home Control Ultra Terminal

Industrial Control

Automation

Services

Power

Orders organic growthaverage 2005-2006

+7%

+16%

+15%

Contribution of new businessesto Group sales (%)

+9%

+8%

Increase growth potential and reduce cyclesensitivity through new businesses

Critical Power Energy efficiency

+8%

2004 20062001

36

42

21

� Contribution of new businesses x2 over 2001-2006

_45_45

Rebalancing from high-costto low-cost countries

2004A

2006A

2008F

SalesProduction

costs

Sales

Productioncosts

SalesProduction

costs

% in low-cost countries

�Rebalanced production costs

� € 529m to low-cost countries

� of which € 250m to non-euro zone

�Stepped-up transfer of sourcing

� +70% in volume over 2 years

Produce closer to the customer to improve customer service & reduce logistics cost s

�Optimisation of manufacturing base

2005-2006 results

Rebalance production costs with sales

27%18%

31%28%

_46_46

Sales Organic Growth

Mid-term, assuming 3% world GDP growth>6%9.3%>5%

Initial new² targets

Actual2005-2006

new 2 second phase targets

EBITA* Margin

Over the business cycle13.0%-15.0%+2.2pts

(2006: 14.7%)12.5%-14.5%

ROCE** Improvement

Assuming organic growth in line with target+2pts+2.0pts+2-4pts

“Stimulate sales growth, achieve higher profitabili ty”

* EBIT before amortisation of purchase accounting intangibles** After tax EBITA / Capital Employed = Shareholders’ equity + Net debt + Provisions

new² second phase targetsPotential for further performance

_47_47

1995-2004

Organic growth relative to World GDP

Initial target2005-2006 new² second

phase target

+1pt

+2pts

+4pts

+3pts

5%

6%

World GDP 3%

+2pts

+3pts

Favourableeconomicconditions

Growth drivers:Emerging countries

New businessesInnovation

Initial

Secondphase

Mid-term organic growth target

APC stronggrowth prospects

Sales organic growth targetlifted to +6%

_48_48

1999 2000 2001 2002 2003 2004 2005 2006 2006Proforma**

13.4%

11.4%

12.4%

14.7%

13.0%-15.0%

EBIT margin sustained between 11.4% and 13.4%

* EBIT before amortisation of purchase accounting intangibles (€12m in 2005 and €18m in 2006)** Including APC consolidation on a full year basis

Target raised by 0.5pt

EBITA* margin up 2.2 pts vs. 2004

1999-2004 2005-2006Initial new 2 target

new 2 second phase target

APC acquisition

13.5%13.7%

EBITA margin analysis

EBITA margin targetlifted to 13.0%-15.0%

12.5%-14.5%

_49_49

+2.0 / +3.0pts

-0.75 / -1.25pt

-0.5 / -1.0pt

2007-2008 period

+1.0 / +1.5ptsvs 2006 Proforma*

* Including APC consolidation on a full year basis

Earnings drivers in pts of margin

Potential EBITA margin improvement> +1pt over 2007-2008

�Potential productivity savings(Rebalancing, Logistics & other)

� Investments in organic growth(New businesses and geographies)

�Business mix(Services, Packages & Solutions, …)

�Potential EBITA margin improvement(in the same economic environment)

+0.5pt� Turnaround of APC and synergies

_50_50

9.3% +2pts9.7%

11.8%

* Capital Employed = Shareholders’ equity + Net debt + Provisions,** Including APC consolidation on a full year basis

Assuming organic growth at 6%

ROCE analysis (EBITA / Capital employed*)

2005-2006 new 2 second phase targetAPC acquisition

13.2%

ROCE improvement target

2004 2006 at constant perimeter

2006Proforma**

2008Target

set at 2pts over 2007-2008

2006

Operating improvement

Impact of acquisitions

+3.5pts

Impact of APC

acquisition

_51_51

Air treatment – HeatingConditioning

Security systems - Emergency lightingAccess control – Smoke detection

TAC VistaWorkstation

Example of dedicated solutions for our customers:Etnapolis, leading trade center in the Mediterranean are a

Lighting bus

TAC Xenta401

CanalisKBA

Building Management ServicesIntegrated Supervision System

Electrical DistributionCommon Areas & Retail Store

Switchboards & Transformers

_52_52

Bus Duct

CanalisKBA

Energy management systems Electrical distribution

Switchboards & Transformers

Critical Power& Cooling Services

Power Logic – Energy Saving

Monitor ProWorkstation

Energy management – Power Control & Monitoring System PCMS

Example of dedicated solutions for our customers:Cairo International Airport, Egypt

_53_53

�

Lighting control system

Pumping control system Power Quality Public lighting

Peak demand avoidance HVAC control

Energy efficiency: Examples of products for applications

_54_54

☎☎☎☎: +33 (0)1 41 29 87 50www. schneider-electric.com

October 233rd Quarter 2007

Sales 9:30 Conference Call

Contacts and Calendar

Alexandre Brunet - Investor Relations Officeralexandre.brunet@schneider-electric.com

Grégoire Rougnon - Investor Relations Managergregoire.rougnon@schneider-electric.com

_55_55

Building

a New Electric World