Scienza e Tecnologia
FIRST QUARTER 2021 SALES
FIRST QUARTER 2021 SALES
Strong start to the year with same-day sales up +8.6%
Growth driven by robust business model, healthy demand and accelerating recovery
Positive pricing environment to accelerate in coming quarters
→ Sales of €3,331.2m in Q1 2021, up +8.6% on a same-day basis
→ Activity above pre-crisis level for the first time:
same-day sales growth +5.4% above Q1 2019
→ Full capacity to capture the recovery thanks to our agile business model leveraging our intact branch network and further boost in digital
adoption
→ Digital revenue in Q1 2021 represented 22.6% of total sales, up
+ 242 bps despite tough base effect as digital activity surged in the pandemic last year
→ FY 2021 guidance confirmed
Patrick BERARD, Chief Executive Officer, said:
“I am extremely pleased with the strong start to the year, demonstrating the relevance of the strategy we presented at our Capital Market Day and reflecting robust underlying demand from increasing electrical usage and the energy transition. The strong quarter also demonstrates the continuing increased effects of our deep digital transformation, as substantiated by the growth in digital sales penetration, now at 22.6% of sales.
Our teams further demonstrated their agility and ability to adapt to a constantly changing environment, to react and deal with certain end-markets still deeply affected by the pandemic as well as sudden price increases and scarcity of products. In this context, the role of the distributor in the value chain is again reinforced as we support customers in better managing the situation .
Our Q1 sales together with trends we have seen in April reinforce our confidence in achieving our full-year targets and medium-term ambition.”
SALES REVIEW FOR THE PERIOD ENDED MARCH 31, 2021
SALES
In Q1, sales were up +3.3% year-on-year on a reported basis and up +8.6% on a constant and same-day basis, showing a solid improvement over Q4 2020.
In the first-quarter, Rexel posted sales of €3,331.2 million, up +3.3% on a reported basis, including:
On a constant and same-day basis, sales were up +8.6%, including a positive effect from the change in copper-based cable prices (+2.9% in Q1 2021 vs (0.4)% in Q1 2020). This robust Q1 2021 sales performance was the result of :
At Group level, this is the first time that activity is above the pre-crisis level as reflected by same-day sales growth of +5.4% versus Q1 2019 , largely thanks to Europe at +9.2% and Asia-Pacific at +13.8%, while North America is still lagging, down (3.1)% versus Q1 2019, below its pre-crisis level.
More specifically, the quarter benefited from further growth in digitalization, with digital sales now representing 22.6% of Group sales, up +242 bps compared to Q1 2020. This comes despite a challenging base effect, as digital sales surged in the pandemic, especially in China in Q1 2020 and in other countries from March 2020 onwards. Trends in Asia-Pacific (3.9% of sales down (88)bps) were largely offset by very favorable growth in digital sales in Europe, where they accounted for 32.7% of sales, up +353bps and further progress in North America up to 8.9% of sales, an increase of +37 bps.
France saw its digital penetration grow by a strong +489bps, representing 25% of sales in Q1, with sales improving in both Web (+339bps) & EDI (+149bps). This notably reflects an increased conversion from “search to cart”, with the conversion rate now over 10% of connected customers, helped by several factors:
We saw growing demand in digital in all segments in France in Q1 2021, with a clear acceleration in residential, with visits up 43% and orders up 35%.
Europe (59% of Group sales): +10.8% in Q1 on a constant and same-day basis
In the first-quarter , sales in Europe increased by +9.2% on a reported basis, with non-material currency and scope effects. On a constant and same-day basis, sales were up +10.8%.
North America (32% of Group sales): +1.2% in Q1 on a constant and same-day basis
In the first-quarter , sales in North America dropped by (10.5)% on a reported basis, including a negative currency effect of (7.0)%, or €(82.7)m, mainly due to the depreciation of the US dollar against the euro and a negative scope effect of (1.9)%, or €(22.6)m from the disposal of Gexpro Services and the recent acquisition of the former Wesco Utility business in Canada. On a constant and same-day basis, sales were up +1.2%, driven by Canada.
Asia-Pacific (9% of Group sales): +23.7% in Q1 on a constant and same-day basis
In the first-quarter , sales in Asia-Pacific were up +25.9% on a reported basis, including a positive currency effect of +2.8% or +€6.7m, due to the appreciation of the Australian dollar against the euro. On a constant and same-day basis, sales were up +23.7%.
2021 GUIDANCE CONFIRMED
Leveraging our continuous efforts, we target for 2021, at comparable scope of consolidation and exchange rates*:
* Assuming an improvement in the sanitary situation as vaccines become available.
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.
CALENDAR
July 28, 2021 Second-quarter sales and half-year 2021 results
October 21, 2021 Third-quarter 2021 sales
FINANCIAL INFORMATION
A slideshow of the first-quarter 2021 sales is also available on the Group's website.
ABOUT REXEL GROUP
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 25 countries, with more than 24,000 employees.
The Group's sales were €12.6 billion in 2020. Rexel is listed on the Eurolist market of Euronext Paris (compartment A, ticker RXL, ISIN code FR0010451203). It is included in the following indices: SBF 120, CAC Mid 100, CAC AllTrade, CAC AllShares, FTSE EuroMid, STOXX600. Rexel is also part of the following SRI indices: FTSE4Good, Dow Jones Sustainability Index Europe, Euronext Vigeo Europe 120, STOXX® Global ESG Environmental Leaders, 2021 Global 100 Index, S&P Global Sustainability Yearbook 2021, in recognition of its performance in terms of corporate social responsibility (CSR). Rexel is rated A- in the 2020 CDP Climate Change assessment and ranked in the 2020 CDP Supplier Engagement Leaderboard.
For more information, visit www.rexel.com/en.
CONTACTS
GLOSSARY
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 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 adjusted 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 appendices, please open the pdf file by clicking on the link at the end of the press release
DISCLAIMER
The Group is exposed to fluctuations in copper prices in connection with its distribution of cable products. Cables accounted for approximately 15% 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 11, 2021 under number D.21-0111, and its amendment filed with the AMF, on March 29, 2021 under number D.21-0111-A01. 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 11, 2021 under number D.21-0111, its amendment filed with the AMF, on March 29, 2021 under number D.21-0111-A01, as well as the consolidated financial statements and activity report for the 2020 fiscal year which may be obtained from Rexel's website (www.rexel.com).
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