Rexel Reports Fourth-Quarter Sales & Full-Year 2022 Results

PARIS, France — Rexel today reported its fourth-quarter sales and full-year 2022 results.

HIGHLIGHTS:

• FY22: Record results – Delivering on our Power Up 2025 strategic journey
• FY 22 sales of €18,701.6m [USD ±$20,000.43m], up +14.1% on a same day basis, driven by both volume and prices. Sales growth boosted by accelerating electrification trends in Europe.
• Q4 22 sales of €4,802.3m [USD ±$5,135.82m], up +12.3% on a constant and same-day basis
• FY adj. EBITA of €1,368.5m [USD ±$1,463.54m], up +35.7% and adjusted EBITA margin at 7.3% (up +118 bps) from robust activity coupled with our more efficient organization. Adj. EBITA margin includes 66 bps of positive one-off effects from inventory price inflation on non-cable products, net of higher performance-linked bonuses
• Recurring net income up +58.6% in FY 2022 to €911.8m [USD ±$975.12m], reaching a new all-time high, leading to a record dividend of €1.20 per share.
• Record positive Free Cash Flow before interest and tax of €873.3m [USD ±$933.95m] in FY 2022 [€680.6m (USD ±$727.87m) in 2021]. Lowest-ever full-year indebtedness ratio at 0.96x. Rating upgraded in 2022 by both S&P and Moody’s.
• Active portfolio management with 5 acquisitions and 4 disposals, including the operations announced in January 2023, fully in line with our strategy. The combined net effect is positive on sales, profitability and ROCE
• 2023 outlook: Same-day sales growth of between 2% and 6%, adjusted EBITA margin between 6.3% and 6.7% and conversion of free cash flow before interest and tax above 60%
• Power up 2025: Well on track to deliver our 2022-2025 ambitions

Rexel had another excellent year in 2022, performing above the upgraded guidance it provided in Q3 and confirming that Rexel can consistently deliver in terms of profitability, agility and resilience. The Group’s record results enable it to pay an all-time high dividend to shareholders. The indebtedness ratio, below 1 time for the first time ever, leaves ample room for value-creating acquisitions and further share buybacks. 2022 was also the year that saw a step change in electrification trends worldwide. We are entering 2023 with a solid platform to drive further growth, continuing to harness powerful and sustainable electrification trends, deploy our digitalization strategy and heighten our focus on ESG, as illustrated by our inclusion in the CAC 40 ESG Index. We are also unveiling today our purpose statement, which points to our key role in electrification and to our focus on sustainability. Building on Rexel’s achievements, as well as on its engaged and highly-performing teams, we are well on track to achieve our Power Up 2025 objectives presented last June. — Guillaume TEXIER, Chief Executive Officer of Rexel

Rexel recently announced three transactions to reinforce its portfolio and its local footprint in key regions. They include:

• Two acquisitions of quality businesses in North America: one in the US, with further market share gains and one in Canada, complementary to our existing footprint.
• The disposal of Rexel’s activity in Norway.

The combined operations will contribute positively to our sales, earnings and Return On Capital Employed in year 1.

Acquisition of Buckles Smith Electric Company in the US

On January 5th, Rexel US signed and closed the acquisition of Buckles Smith Electric Company, a regional industrial automation distributor, the last independent player in the region. Based in Santa Clara, California, the company generated USD150m of sales in 2022, through 6 branches and 153 employees.

Buckles Smith is a high-quality company with higher profitability than Rexel’s North American average. This acquisition is highly synergistic with our other Rockwell specialized distribution territories as well as with our Californian operations. It strengthens our position in the region and allow us to gain further market share in California, the biggest addressable market in the U.S. (c. 13% of the total U.S. market).

Acquisition of Lineman’s Testing Laboratories in Canada

On January 17th, Rexel Canada signed and closed the acquisition of Lineman’s Testing Laboratories, a leading provider of high-voltage electrical services and products to the utility and industrial markets. The company was founded in Toronto in 1958, has 63 employees and generated c. 25m of sales in 2022. This acquisition will be a valuable complement to Rexel’s portfolio, notably for the utility market.

Disposal of operations in Norway

Rexel also announces the signing of the divestment of its operations in Norway to Kesko on January 27. Rexel’s activities in Norway, generating sales of approximately €250m in 2022, were less profitable than Group average and presented less strategic and value creation potential for the future. The completion of the transaction is subject to the approval of Norway’s competition authority.