Rexel Reports Third-Quarter 2024 Sales

Rexel recently reported its third-quarter 2024 financial results.

→ Q3 24 sales of €4,762.3m, down (2.1)% on a same-day basis, or (0.7)% on an actual-day basis:

• North America: Positive evolution in Q3 24, driven by good backlog execution, notably in non-residential and pick-up in residential, despite negative impact from weather events in September
• Europe: Good performance amid challenging markets
  • More difficult macro conditions, especially in Central and Northern Europe (Germany, Austria, Benelux)
  • No recovery yet of construction markets, which should start benefiting from recent interest rate cuts
  • Electrification categories, especially solar, still contributing negatively despite easier comparable base
  • Market share gains in most of our 19 countries, including France and Germany
• Improved pricing environment on both cable and non-cable products, but further price deterioration in solar
• Activity improved sequentially over the quarter, reaching close to breakeven in September

→ Q3 24 sales up +2.1% on a reported basis with a +3.1% contribution from acquisitions, including Wasco in Europe and Talley and Electrical Supplies Inc in North America

→ Ramp-up of digital sales to 32% of sales in Q3 24, up +254bps, in line with our roadmap

→ 2024 outlook lowered to reflect the recent negative evolution of the trading environment in Europe

• Same-day sales between -2.5% and -2.0%, with stable trends in North America and mid-single digit drop in Europe (vs previous indication of being in the low end of the initial guidance of stable to slightly positive same-day sales growth in FY 24)
• Adjusted EBITA margin around c. 5.9% (vs previous indication of being in the low end of the initial guidance of between 6.3% and 6.6%), with rapid cost reduction actions partly mitigating volume drop-through effect and gross margin pressure
• Strong Free Cash Flow focus, with conversion now expected to be above 65% (vs previous guidance of 60%)

→ Accelerating structural transformation of the organization, resulting in expected annualized savings of c.45m by end-2025

→ Rexel confirms its medium-term ambitions as detailed in its June 2024 CMD on the back of solid electrification trends, positive commercial dynamics, fundamental changes in the business model and acceleration of savings programs

The change in guidance we are announcing reflects the recent negative evolution of our markets, notably in Europe. In this more challenging context, the Rexel teams are performing particularly well, limiting the drop in volumes compared to construction market metrics, gaining market share, succeeding in reducing our cost base in line with volume while still delivering great service to our customers. We are also taking the opportunity to accelerate our transformation initiatives and advance towards our midterm goals. Delivering close to 6% profitability in 2024 in a down cycle year is clear proof of the new Rexel’s resilience. ~ Guillaume Texier, Chief Executive Officer