We were once again recognized by several major customers, including The Home Depot and the IMARK Group, as Supplier of the Year for our outstanding service and support. 2011 was the third consecutive year in which we expanded our industry-leading portfolio with the introduction of over 100 new product solutions for indoor and outdoor applications. Additionally, we won multiple awards for innovation and ingenuity. Lastly, we completed four strategic acquisitions, expanding both our addressable market and our capabilities, while reducing our reliance on new construction activity.

From a financial performance perspective, we delivered solid results despite the continuing challenges of a weak economy.

2011 Financial Highlights

• Net sales grew over 10% to $1.8 billion;
• Operating profit margin expanded 80 basis points to 10.5%;
• Diluted earnings per share from continuing operations increased 35% to $2.42; and
• Cash flow provided by operating activities was over $160 million.

These accomplishments in 2011 were due to the focus and passion of our 6,000 associates to provide superior value for our key stakeholders.

There has not been a more exciting time to be in the lighting industry than today. Our industry is at an inflection point as technology is creating the opportunity to provide more intelligent lighting solutions that are elegant, sophisticated, and efficient, while simple to install, maintain, and use. Advances in technology, coupled with changes in public policy, the need for greater energy efficiency, and the demand for environmental sustainability are powerful drivers of the innovation taking place in our industry. Acuity Brands is at the forefront of transforming the lighting industry. Our skill, knowledge and experience as lighting experts, coupled with advancements in technology, are allowing us to deliver superior lighting solutions for virtually any application. We believe this promise is best captured in our new tag line—“Expanding the Boundaries of Lighting™.”

As we look forward, our rich lighting legacy is a prologue to our bright future. Our passion and unyielding focus are to create the very best, most innovative, intelligent lighting solutions that deliver superior quality of lighting, energy efficiency, and performance. As lighting experts, we know superior quality of light enhances how we live and interact, whether it is increasing students’ learning abilities in school, improving worker productivity and comfort in offices and industrial facilities, or accelerating patient healing in hospitals. The possibilities of what can be achieved by intelligent lighting solutions are still being discovered and technology is allowing us to create even more effective solutions. Our associates are rapidly exploiting these new technologies to aggressively expand our industry-leading portfolio by developing intelligent lighting solutions that are significant advancements ahead of traditional technologies. These solutions deliver superior quality of lighting and performance, improve energy efficiency, and easily network with other building systems making them much smarter and more effective.

As we look forward, we believe the lighting industry will experience significant growth over the next decade, particularly as the need for better lighting as well as energy-efficiency requirements and environmental concerns come to the forefront. As the market leader in North America, we believe that our deep knowledge of technology, our expertise in optics and thermal management, our thorough understanding of the art and science of lighting, as well as our ability to provide tailored lighting solutions for numerous applications have positioned the Company to excel in this exciting industry. We expect to continue to execute our profitable growth strategy by focusing on the three mission-critical areas of operational excellence that we refer to as the 3 C’s:

• Providing unparalleled customer service;
• Pursuing world-class cost efficiency by eliminating non-value added activities and transaction costs; and
• Creating a culture that demands excellence in everything we do through continuous improvement.

On behalf of the Board of Directors, I want to thank our 6,000 associates for their continued contributions and dedication to our vision, our customers for their business, our suppliers for their support, and our stockholders for the partnership we share in our enterprise. Acuity Brands—Expanding the Boundaries of Lighting.

Sincerely,

Vernon J. Nagel
Chairman, President, and Chief Executive Officer
November 21, 2011