Rexel Sa · EURONEXT:RXL
Rexel Sa — Rexel Sa Ord — Q4 2024 Earnings Presentation
37 slides from Rexel Sa's earnings presentation, Feb 13, 2025
Slide 1: Fourth-quarter sales & FY 2024 results
Fourth-quarter sales & FY 2024 results Paris, February 12, 2025 2024 consolidated financial statements were authorized for issue by the Board of Directors held on February 12, 2025
Slide 2: Key highlights
a world of eneray
Slide 3: Very solid performance in a challenging environment
Very solid performance in a challenging environment Despite strong headwinds in 2024… …Rexel delivered a resilient performance • Construction downturn in most European countries • Further market outperformance in our key countries, including France and the US • Difficult base effect and temporary sl
Slide 4: Key differentiation levers
Market share gain in our key countries Key differentiation levers NORTH • Digital offering AMERICA • Supply chain excellence EUROPE • Teams expertise and engagement • Added value services 4
Slide 5: Active opex management and optimization actions
Active opex management and optimization actions 2024 2025 2026 Volume change FTE change 2024 vs. 2023 2024 vs. 2023 Sales force Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 & branches organization -0.3% -0.4% Supply chain & logistics -0.9% optimization -1.6% -1.6% -1.7% Gross margin actions -2.7% Back-office -3.1% effic
Slide 6: Resilient profitability reflecting group transformation
Resilient profitability reflecting group transformation % Current adj. Ebita margin 6.7% 6.8% 5.8% 5.9% 4.8% 5.0% 4.2% 4.4% 4.2% 1 1 2016 2017 2018 2019 2020 2021 2022 2023 2024 2 2 norm. norm. % SD sales -1.9% +3.5% +3.5% +1.4% -6.5% +15.6% +14.1% +4.3% -2.4% growth Volume - + + + - + + + - Price -
Slide 7: Momentum built throughout the year
Momentum built throughout the year NB: 2024 same-day sales growth by quarter Europe Group (49% Group sales) North America Asia Pacific (45% Group sales) Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 (6% Group sales) Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 +3.6% +4.1% -0.5% -2.1% -3.8% -2.4% -4.5% -4.4% -4.6% +0.2% -0.9% -1.1% -0.9% -6.9
Slide 8: Profitable North America platform saw sales rebound in H2
Profitable North America platform saw sales rebound in H2 • Acceleration in Q4 24 vs Q3 24 driven % of Q4 NA sales % NA SD sales growth by non-residential and industrial 46% 10% end-markets 45% 8% 44% 6% 42% 42% 42% 3.6% 4% • Leveraging our regional organization 40% 2% and market positioning to outg
Slide 9: Record high FCF conversion
Record high FCF conversion FCF before interest and tax (€m) 1200 1,200 996 • Disciplined capex at 0.7% of sales in a 1000 1,000 917 declining topline environment 873 800 681 600 76% • Active working capital management 73% • Day of Inventory reduced by 1 day 400 66% • Strict credit management policy
Slide 10: Results in line with revised guidance, exceeding cash conversion goal
Results in line with revised guidance, exceeding cash conversion goal -2.4% 5.9% 76% Same-day Current adjusted Ebita FCF before Interest and tax sales growth margin (%) conversion -3.5% in H1, -1.3% in H2 FY 24 guidance -2.5% to -2.0% c. 5.9% Above 65% 10
Slide 11: Q4 & FY 2024 Group financial review
Q4 & FY 2024 Group financial review
Slide 12: Q4 reported sales up +3.6%, with significant M&A contribution
Q4 reported sales up +3.6%, with significant M&A contribution +1.5% €4,893m +2.1% €4,846m -0.5% +0.4% €4,725m Actual-day change +1.0% Q4 2023 Forex Acquisitions Q4 2023 Organic Calendar Q4 2024 (Itesa, Talley & ESI) comparable same-day 12
Slide 13: Volume-driven acceleration in Q4 Core ED sales
Volume-driven acceleration in Q4 Core ED sales Q1 2024 Q2 2024 Q3 2024 Q4 2024 % SD sales o/w o/w SD sales o/w o/w SD sales o/w o/w SD sales o/w o/w (in contrib.) mix change Price Volume change Price Volume change Price Volume change Price Volume 2024 Core ED1 79% -1.8% -1.0% -0.7% -0.4% -0.6% +0.2%
Slide 14: North America rebound balanced by continued weakness in Europe
North America rebound balanced by continued weakness in Europe NB: 2024 same-day sales growth by quarter Group Q1 Q2 Q3 Q4 -0.5% Europe North America (49% Group sales) -2.1% Asia Pacific -2.4% (45% Group sales) Q1 Q2 Q3 Q4 (6% Group sales) -4.6% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 +3.6% +4.1% -3.8% -4.5% -4.4%
Slide 15: Europe: gradual improvement in a muted environment
Europe: gradual improvement in a muted environment By country By product category 2024 SD sales • Outperformance in France in a declining market change Q1 Q2 Q3 Q4 (in contrib.) • Positive momentum in non-residential Core ED1 -2.9% -1.1% -1.8% -2.1% • Pressure on industry segment Electrification -4.
Slide 16: North America: H2 acceleration driven by core ED
North America: H2 acceleration driven by core ED By country/region By product category 2024 SD sales • United States: change Q1 Q2 Q3 Q4 • Positive growth in all three end markets with (in contrib.) residential up for a third consecutive quarter Core ED1 -0.4% 0.0% +2.9% +5.5% • Acceleration in indu
Slide 17: High North America backlogs reflect dynamic project activity
High North America backlogs reflect dynamic project activity US Canada c. 2.5 months of sales c. 4 months of sales • High backlog level, combined with strong backlog execution 222 230 and order intake 288 210 253 250 165 • Backlog remains well above pre- 144 100 95 pandemic level 100 96 12.2019 12.2
Slide 18: FY 24 reported sales up +0.7%, with significant M&A contribution
FY 24 reported sales up +0.7%, with significant M&A contribution +2.9% €19,667m -0.2% +0.5% €19,285m €19,153m -1.5% 0.0% -0.7% -0.2% Same-day change -2.4% FY 2023 Forex Acquisitions Disposals FY 2023 Volume Non-cable Cable Calendar FY 2024 comparable price price Europe North America Asia-Pacific Sam
Slide 19: Resilient FY24 adj. EBITA margin in a negative pricing environment
Resilient FY24 adj. EBITA margin in a negative pricing environment Gross margin: -68bps +2 bps 6.8% -32 bps +47 bps 5.9% -25 bps -43 bps -32 bps -13 bps 2023 current Operating Deflation and Commercial Payrise Other opex Action 2024 current adj. EBITA deleverage business mix in NA environment inflati
Slide 20: 2024 recurring net income at €662m
2024 recurring net income at €662m Main P&L items €1,132m Other income & expenses €341m €(258)m Incl. €124m1 fine from French competition Authority Net income Current adjusted EBITA €55m in GW impairment (vs €775m in 2023) €33m in restructuring Net financial expenses €(208)m Effective interest rate
Slide 21: FCF conversion well above guidance
FCF conversion well above guidance Main FCF items Trade working capital €(16)m €1,204m Stable TWCR/sales at 14.2% €917m 76% conversion Non-trade working capital Free cash flow EBITDAaL €50m before interest & tax Net capex €(126)m Gross capex/sales at 0.7% 21
Slide 22: Capital allocation balancing M&A and return to shareholders
Capital allocation balancing M&A and return to shareholders Free cash flow Main FCF items before interest & tax €917m Financial investment €550m incl. earn-out €506m €522m €(503)m Dividend Free cash flow €357m Increase innetnet Change in debtdebt after interest & tax Post-cash-out for net interest p
Slide 23: Strengthened financial structure with no short-term refinancing
Strengthened financial structure with no short-term refinancing Breakdown of our main debt maturity & liquidity (Dec. 31st, 2024) Liquidity 11,000 000 €1.5bn 800 400 700 600 Schuldschein issued 400 917 in June 24 636 €200m in 2 tranches 600 200 400 80 120 2025 2026 2027 2028 2029 2030 2030 Long Term
Slide 24: Proposed €1.20 dividend, maintaining all-time high level
Proposed €1.20 dividend, maintaining all-time high level 54% Payout ratio €1.20 €1.20 €1.20 In line with policy: ≥ 40% of Recurring Net Income 400 €0.75 40% 43% 54% April 29, 2025 €0.42 €0.44 €0.46 €0.40 €0.40 Dividend subject to AGM approval Covid crisis 40% 45% 48% 44% 41% 50% 600 2015 2016 2017 2
Slide 25: Carbon reduction in line with our 2030 objectives
Carbon reduction in line with our 2030 objectives Scopes 1 &2* : Tonnes of CO2 Scope 3: KTonnes of CO2 91,316 c.-8% -8% 69,381 63,810 -1,302 +2,482 84,249 -4,269 -4,931 -4,487 -132 2023 Electricity & Building Commercial Logistics 2024 2023 Decrease of Rexel actions 2024 heat/steam efficiency fleet f
Slide 26: Outlook
RexeL world of energy
Slide 27: Gradual macro improvement expected throughout 2025
Gradual macro improvement expected throughout 2025 Accelerating growth in North • Activity potentially benefiting from increased industrial investment and reshoring + America • Positive trends in datacenter and in residential construction + • Positive market share gains in most countries + Continued
Slide 28: FY 2025 guidance in a subdued environment
FY 2025 guidance in a subdued environment Stable to slightly c. 6% c. 65% positive Same-day Current adjusted Free cash flow sales growth EBITA margin1 conversion2 Continued weak demand in ‘Inflation gap’ offset by full Excluding the €124m fine from Europe offset by stronger North effect of 2024 cost
Slide 29: Medium-term ambitions confirmed
Medium-term ambitions confirmed Confirmation of electrification trends Same-day 5% to sales growth 8% Focus on AI and digitalization Current adjusted Ebita margin > 7% Accelerating In 2025 operational excellence plan Free cash flow conversion c. 65% Active M&A strategy 29
Slide 30: North America: M&A a driver of sales and profitability improvement
M&A a driver of sales and profitability improvement Consolidation of Growth on Recent portfolio activity highlights core business adjacencies France Talley (c. $360m of sales): • Double-digit sales growth and high single-digit adjusted Ebita margin, well above initial Europe ambitions • Synergies ex
Slide 31: Medium-term electrification trends remain very solid
Medium-term electrification trends remain very solid 2024, a “pause year” for electrification at Rexel Medium-term electrification outlook confirmed • Strong negative impact of Solar after a booming 2023 • Most recent outlooks (ex. IEA) confirm strong and multifactor electrification trends • Politic
Slide 32: Accelerating self help plans to secure our >7% midterm goal
Accelerating self help plans to secure our >7% midterm goal >7% 5.9% Market related Self-help initiatives → Timing uncertainties → accelerated Adj. EBITA Operating Net Gross Operational Accretive Mid term 2024 leverage inflation margin efficiency perimeter changes adj. EBITA Operating leverage Net i
Slide 33: Digital sales have passed a new milestone, supporting higher profitability
Digital sales have passed a new milestone, supporting higher profitability • Rexel is a BtB leader in digital with more than €6bn in FY digital sales Digital sales (% of Group’s sales) 60% • Digital sales multiplied by more than 3x since 2011 to reach 32% of sales in Q4 2024 50% 50% • Ambition to re
Slide 34: Recent progresses on AI unlocks new efficiency potential
Recent progresses on AI unlocks new efficiency potential A sale workload ripe for improvement Key benefits • Inside sales: • Optimize email-based activity • Close to 50% of Rexel’s workforce • Develop user autonomy (self-checkout, 40m emails chatbots, no-touch digital) 50m phone calls 35m orders or
Slide 35: Best practice-sharing to unlock sizeable profitability opportunity
Best practice-sharing to unlock sizeable profitability opportunity Good Better Best-in-class • Accelerating best practices-sharing through 4 countries 10 countries 3 countries clusters organization ~10% of Group sales ~65% of Group sales ~25% of Group sales • Austria-Switzerland-Germany • USA-Canada
Slide 36: Concluding remarks
Concluding remarks • 2024 performance demonstrated the strength and resilience of the “new Rexel”, in a more challenging market • In a persistently uncertain economic environment in 2025, strong action plans will help deliver solid figures, despite the cost inflation headwinds • Encouraging momentum
Slide 37: Disclaimer
Disclaimer The Group is exposed to fluctuations in copper prices in connection with its distribution of cable products. Cables accounted for approximately 16% of the Group's sales and copper accounts for approximately 60% of the composition of cables. This exposure is indirect since cable prices als