Scienza e Tecnologia
THIRD-QUARTER 2023 SALES
→ Sales of €4,665.1m in Q3 2023, up +2.6% on a same day basis
→hVolumes up +2.3% on the back of high electrification comparable base and more mixed market environment, demonstrating the strength of Rexel's market positioning
→ Favorable pricing environment on non-cable products, up +1.3% in the quarter
→ FY 23 guidance confirmed: Resilient growth, sustained profitability and strong cash generation thanks to Rexel's strategic action plans
→ Well on track to achieve our 2025 ambition; an update on Rexel's strategic roadmap will be presented at a Capital Markets Day in June 2024
→ Completion of the Wasco acquisition on September 1 , giving Rexel exposure to the fast-growing Dutch HVAC market, driven by energy efficiency regulations
→ Successful issuance of a €400m Sustainability Linked Bond maturing in 2030, at a competitive rate of 5.25%
SALES
In Q3, sales were down (3.1)% year-on-year on a reported basis, impacted by currency effect and up a resilient +2.6% on a constant and same-day basis.
In the third quarter, Rexel posted sales of €4,665.1m, down (3.1)% on a reported basis, including:
In Q3 2023, sales were up +2.6% on a constant and same-day basis (or +1.8% on a constant and actual-day basis), with positive volumes and selling price increases on non-cable products.
Including positive scope effect and added product categories (notably in HVAC segment)
At comparable scope, forex and product categories
In 9m 2023, Rexel posted sales of €14,428.1m , up +3.8% on a reported basis, including:
Europe (48% of Group sales): +3.4% in Q3 on a constant and same-day basis
In the third quarter, sales in Europe were down (1.9)% on a reported basis, including:
On a constant and same-day basis, sales were up +3.4%, including a positive volume contribution of +0.9% on a high comparable base from electrification products, a positive price effect of +2.6% on non-cable products and a price effect of (0.2)% on cable products.
Overall in Europe, we posted strong growth in Germany, Austria, Switzerland & the UK, offsetting lower momentum in the Nordics and Benelux.
North America (45% of Group sales): +2.7% in Q3 on a constant and same-day basis
In the third quarter, sales in North America decreased by (2.4)% on a reported basis including:
On a constant and same-day basis, sales were up +2.7%, including a positive volume contribution of +4.3% and a positive price effect of +0.5% on non-cable products offsetting a price effect of (2.0)% on cable products.
Asia-Pacific (7% of Group sales): (2.7)% in Q3 on a constant and same-day basis
In the third quarter, sales in Asia-Pacific were down (14.7)% on a reported basis, including:
On a constant and same-day basis, sales were down (2.7)%, including a volume contribution of (0.3)% and price effects of (2.3)% on non-cable products and (0.2)% on cable products.
In line with our Power Up 2025 strategy, we continue to execute our M&A strategy, with the objective to add up to €2bn of acquired sales over the 2022-2025 period. Since our CMD in June last year, we have acquired the equivalent of €1bn of sales. This quarter was marked by the completion of two acquisitions:
In the quarter, we further executed our share buyback program and reached an amount of €92m of shares re-purchased in the first nine months of 2023 (c. 4.4 million shares). We target c. €200m on a cumulative basis for 2022-2023.
Rexel confirms its FY 2023 guidance, leveraging the diversity of its portfolio and its sales force efficiency to navigate a mixed growth environment. The Group has become leaner and more agile and will sustain a high level of profitability thanks to continued efforts on productivity and pricing.
We anticipate for 2023, at comparable scope of consolidation and exchange rates:
Excluding (i) amortization of PPA and (ii) the non-recurring effect related to changes in copper-based cable prices.
FCF Before interest and tax/EBITDAaL
NB: The estimated impacts per quarter of (i) calendar effects by geography, (ii) changes in the consolidation scope and (iii) currency fluctuations (based on assumptions of average rates over the rest of the year for the Group's main currencies) are detailed in appendix 2.
February 15, 2024 Full-year 2023 results
April 30, 2024 First-quarter 2024 sales
April 30, 2024 Annual Shareholders' Meeting
June 2024 Capital Markets Day
A slideshow of the third quarter 2023 sales is available on the Group's website.
Rexel, worldwide expert in the multichannel professional distribution of products and services for the energy world, addresses three main markets: residential, commercial, and industrial. The Group supports its residential, commercial, and industrial customers by providing a tailored and scalable range of products and services in energy management for construction, renovation, production, and maintenance. Rexel operates through a network of more than 1,900 branches in 21 countries, with more than 26,000 employees. The Group's sales were €18.7 billion in 2022.
Rexel is listed on the Eurolist market of Euronext Paris (compartment A, ticker RXL, ISIN code FR0010451203). It is included in the following indices: CAC Next 20, SBF 120, CAC Large 60, CAC 40 ESG, CAC SBT 1.5 NR, CAC AllTrade, CAC AllShares, FTSE EuroMid, and STOXX600. Rexel is also part of the following SRI indices: FTSE4Good, Dow Jones Sustainability Index Europe, Euronext Vigeo Europe 120 and Eurozone 120, STOXX® Global ESG Environmental Leaders, and S&P Global Sustainability Yearbook 2022, in recognition of its performance in terms of Corporate Social Responsibility (CSR).
For more information, visit www.rexel.com/en.
FINANCIAL ANALYSTS / INVESTORS
PRESS
REPORTED EBITA (Earnings Before Interest, Taxes and Amortization) is defined as operating income before amortization of intangible assets recognized upon purchase price allocation and before other income and other expenses.
ADJUSTED EBITA is defined as Reported EBITA excluding the estimated non-recurring net impact from changes in copper-based cable prices.
EBITDA (Earnings Before Interest, Taxes, Depreciation and Amortization) is defined as operating income before depreciation and amortization and before other income and other expenses.
EBITDAaL is defined as EBITDA after deduction of lease payment following the adoption of IFRS16.
RECURRING NET INCOME is defined as net income restated for non-recurring copper effect, other expenses and income, non-recurring financial expenses, net of tax effect associated with the above items.
FREE CASH FLOW is defined as cash from operating activities minus net capital expenditure.
NET DEBT is defined as financial debt less cash and cash equivalents. Net debt includes debt hedge derivatives.
For appendix, please open the pdf file by clicking on the link at the end of the press release.
The Group is exposed to fluctuations in copper prices in connection with its distribution of cable products. Cables accounted for approximately 19% of the Group's sales and copper accounts for approximately 60% of the composition of cables. This exposure is indirect since cable prices also reflect copper suppliers' commercial policies and the competitive environment in the Group's markets. Changes in copper prices have an estimated so-called "recurring" effect and an estimated so called "non-recurring" effect on the Group's performance assessed as part of the monthly internal reporting process of the Rexel Group: i) the recurring effect related to the change in copper-based cable prices corresponds to the change in value of the copper part included in the sales price of cables from one period to another. This effect mainly relates to the Group's sales; ii) the non-recurring effect related to the change in copper-based cable prices corresponds to the effect of copper price variations on the sales price of cables between the time they are purchased and the time they are sold, until all such inventory has been sold (direct effect on gross profit). Practically, the non-recurring effect on gross profit is determined by comparing the historical purchase price for copper-based cable and the supplier price effective at the date of the sale of the cables by the Rexel Group. Additionally, the non-recurring effect on EBITA corresponds to the non-recurring effect on gross profit, which may be offset, when appropriate, by the non-recurring portion of changes in the distribution and administrative expenses.
The impact of these two effects is assessed for as much of the Group's total cable sales as possible, over each period. Group procedures require that entities that do not have the information systems capable of such exhaustive calculations to estimate these effects based on a sample representing at least 70% of the sales in the period. The results are then extrapolated to all cables sold during the period for that entity. Considering the sales covered. the Rexel Group considers such estimates of the impact of the two effects to be reasonable.
This document may contain statements of future expectations and other forward-looking statements. By their nature, they are subject to numerous risks and uncertainties, including those described in the Universal Registration Document registered with the French Autorité des Marchés Financiers (AMF) on March 9, 2023 under number D.23-0078. These forward-looking statements are not guarantees of Rexel's future performance, Rexel's actual results of operations, financial condition and liquidity as well as development of the industry in which Rexel operates may differ materially from those made in or suggested by the forward-looking statements contained in this release. The forward-looking statements contained in this communication speak only as of the date of this communication and Rexel does not undertake, unless required by law or regulation, to update any of the forward-looking statements after this date to conform such statements to actual results to reflect the occurrence of anticipated results or otherwise.
The market and industry data and forecasts included in this document were obtained from internal surveys, estimates, experts and studies, where appropriate, as well as external market research, publicly available information and industry publications. Rexel, its affiliates, directors, officers, advisors and employees have not independently verified the accuracy of any such market and industry data and forecasts and make no representations or warranties in relation thereto. Such data and forecasts are included herein for information purposes only.
This document includes only summary information and must be read in conjunction with Rexel's Universal Registration Document registered with the AMF on March 9, 2023 under number D.23-0078, as well as the financial statements and consolidated result and activity report for the 2022 fiscal year which may be obtained from Rexel's website (www.rexel.com).
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