REXEL :THIRD-QUARTER & 9-MONTH 2015 RESULTS (unaudited)
(Thomson Reuters ONE) -
THIRD-QUARTER & 9-MONTH 2015 RESULTS (unaudited)
Q3 SALES UP 3.7% ON A REPORTED BASIS, BOOSTED BY CURRENCY EFFECT,
DOWN 3.3% ORGANICALLY, REFLECTING
DETERIORATING ENVIRONMENT
Q3 ADJUSTED EBITA MARGIN STABLE SEQUENTIALLY,
DESPITE SEQUENTIAL SLOWDOWN IN ORGANIC
SALES
ACQUISITION OF SOFINTHER TO STRENGTHEN OFFER OF MULTI-ENERGY SOLUTIONS IN FRANCE
REPORTED SALES UP 3.7% IN Q3 AND UP 6.4% IN THE 9 MONTHS
* Strong positive currency effect of 6.4 percentage points in Q3 and 8.0
percentage points in the 9m
ORGANIC SALES DOWN 3.3% IN Q3 AND DOWN 1.8% IN THE 9 MONTHS
* Sales in Q3 reflected deteriorating environment vs. the 1.0% drop in organic
sales in H1
ADJUSTED EBITA MARGIN OF 4.4% IN Q3 AND 4.3% IN THE 9 MONTHS
* Down 70bps year-on-year in Q3 and in the 9m; sequentially stable in Q3
despite slowdown in organic sales, thanks to sequential improvement in North
America
ACQUISITION OF SOFINTHER (to be finalized early 2016)
* Expanding Rexel's current offer of multi-energy solutions in France
FULL-YEAR 2015 TARGETS (as adjusted on October 7)
* Sales down between 2% and 3% on a constant and same-day basis
* Adjusted EBITA margin of between 4.3% and 4.5%
* Solid free cash-flow generation of at least 75% of EBITDA before interest
and tax and around 40% after interest and tax
-------------------------------------------------------------------------------
Key figures(1) Q3 2015 YoY 9m 2015 YoY
-------------------------------------------------------------------------------
Sales ?3,382.6m ?10,027.8m
On a reported basis +3.7% +6.4%
On a constant and same-day basis -3.3% -1.8%
-------------------------------------------------------------------------------
Adjusted EBITA ?148.2m -16.4% ?428.7m -15.4%
As a percentage of sales 4.4% 4.3%
Change in bps as a % of sales -70bps -70bps
-------------------------------------------------------------------------------
Reported EBITA ?139.8m -17.1% ?415.2m -10.9%
-------------------------------------------------------------------------------
Operating income ?119.6m -20.3% ?327.2m -19.4%
-------------------------------------------------------------------------------
Net income from continuing op. ?47.5m -37.9% ?90.7m -51.8%
-------------------------------------------------------------------------------
Recurring net income ?64.5m -16.2% ?197.9m -10.9%
-------------------------------------------------------------------------------
FCF before interest & tax from continuing ?36.6m +56.4% ?39.0m -1.3%
op.
-------------------------------------------------------------------------------
Net debt at end of period ?2,622.6m -1.2% ?2,622.6m -1.2%
-------------------------------------------------------------------------------
(1) See definition in the Glossary section of this document; Latin American
operations, recently divested, are presented as "Discontinued operations"
Rudy PROVOOST, Chairman of the Board of Directors and CEO, said:
"In an environment that became increasingly challenging during the summer, our
performance in the third quarter turned out to be resilient, with a sequentially
stable adjusted EBITA margin, despite a slowdown in organic sales. In
particular, profitability in the third quarter in North America was stable year-
on-year, with a sequential improvement over the second quarter, notwithstanding
a decrease in sales, largely due to further deterioration in the Oil & Gas
market.
More than ever, we are stepping up our efforts to further rationalize our cost
base and drive operational excellence and productivity in order to effectively
address the current headwinds.
With regards to our broader strategic agenda, we are pleased to announce the
recent acquisition of Sofinther in France, which will strengthen our fast-
growing multi-energy business in France."
FINANCIAL REVIEW FOR THE PERIOD ENDED SEPTEMBER 30, 2015
* Financial statements as of September 30, 2015 were authorized for issue by
the Board of Directors on October 28, 2015. They have not been audited by
statutory auditors.
* Latin American operations, recently divested, are presented as "Discontinued
operations" for all periods presented.
* The following terms: EBITA, Adjusted EBITA, EBITDA, Free Cash Flow and Net
Debt are defined in the Glossary section of this document.
* Unless otherwise stated, all comments are on a constant and adjusted basis
and, for sales, at same number of working days.
SALES
In Q3 2015, Rexel posted sales of ?3,382.6m, up 3.7% on reported basis, boosted
by a strong currency effect. They were down 3.3% on a constant and same-day
basis, reflecting a deteriorating environment since the summer, including lower
sales to the Oil & Gas industry and lower copper prices
In 9m 2015, sales amounted to ?10,027.8m, up 6.4% on a reported basis and down
1.8% on a constant and same-day basis
In Q3 2015, Rexel posted sales of ?3,382.6 million, up 3.7% on a reported basis
and down 3.3% on a constant and same-day basis. Excluding the 0.5% negative
impact due to the change in copper-based cable prices, sales were down 2.8% on a
constant and same-day basis.
The 3.7% increase in sales on a reported basis reflected:
* A positive currency effect of ?207.4 million (mainly due to the appreciation
of the US dollar against the euro),
* A positive net effect of ?15.7 million from recent acquisitions (Elevite in
Switzerland, Electro-Industrie en Acoustiek in Belgium, 4 Knights in
Thailand, Beijing Ouneng and Shanghai Maxqueen in China) partly offset by
the divestment of the Czech Republic's operations,
* A positive calendar effect of 0.4 percentage points.
In 9m 2015, Rexel posted sales of ?10,027.8 million, up 6.4% on a reported basis
and down 1.8% on a constant and same-day basis. Excluding the 0.2% negative
impact due to the change in copper-based cable prices, sales were down 1.6% on a
constant and same-day basis.
The 6.4% increase in sales on a reported basis reflected:
* A positive currency effect of ?753.5 million (mainly due to the appreciation
of the US dollar against the euro),
* A positive net effect of ?35.6 million from recent acquisitions (Elevite in
Switzerland, Electro-Industrie en Acoustiek in Belgium, 4 Knights in
Thailand, Beijing Ouneng and Shanghai Maxqueen in China) partly offset by
the divestment of the operations in the Czech Republic,
* A neutral calendar effect.
Europe (53% of Group sales): -0.9% in Q3 and +0.2% in 9m on a constant and same-
day basis
In the third quarter, sales in Europe increased by 1.6% on a reported basis and
dropped by 0.9% on a constant and same-day basis. They were impacted by a
negative effect of 0.3 percentage points due to the change in copper-based cable
prices.
* In France (30% of the region's sales), sales fell sequentially (down 3.6%
after a drop of only 0.3% in Q2). This performance reflected lack of
momentum and continuing lower construction levels, as well as a more
challenging base effect (sales were down only 0.2% in Q3 2014, while they
were down 3.4% in Q2 2014).
* In the UK (16% of the region's sales), sales were down 1.9%, reflecting
lower photovoltaic sales, as well as branch network optimization. Of this
1.9% drop in sales, branch closures accounted for 0.6 percentage points and
the 16% drop in photovoltaic sales accounted for 0.7 percentage points.
* In Germany (12% of the region's sales), sales were down 1.2%, also
reflecting lower photovoltaic sales. Of this 1.2% drop in sales, the 41%
drop in photovoltaic sales accounted for 0.8 percentage points.
* In Scandinavia (12% of the region's sales), sales posted a 1.3% growth, with
Sweden up 6.2%, Finland down 1.1% and Norway down 3.2%, impacted by a
tougher environment related to the Oil & Gas industry.
* In other European countries, performance was as follows:
* Sales in Belgium and Austria were up 3.4% and 1.8% respectively,
* In Southern Europe, Spain posted double-digit growth (+23.9%), thanks to
strong domestic and export activity, while sales in Italy dropped by
9.1%,
* In Switzerland, sales were down 6.0%, impacted by lower pricing due to
the evolution of the Swiss franc and lower volume,
* In the Netherlands, sales were down 1.6%, another sequential improvement
after dropping by 13.2% in Q1 and 3.1% in Q2.
North America (37% of Group sales): -7.2% in Q3 and -4.7% in 9m on a constant
and same-day basis
In the third quarter, sales in North America were up 5.8% on a reported basis
including a significant positive currency effect of ?165.3m (mainly due to the
appreciation of the American dollar against the euro). On a constant and same-
day basis, sales were down 7.2%, mainly reflecting both the strong deterioration
in sales to the Oil & Gas industry, which represent about 10% of the region's
sales and dropped by 37% on average in the quarter, as well as lower cable sales
(copper prices dropped by 24% in the quarter).
* In the US (77% of the region's sales), sales were down 5.6%, of which:
* 3.4 percentage points attributable to the 36% drop in sales to the Oil &
Gas industry,
* 2.1 percentage points attributable to lower cable sales,
* 1.4 percentage points attributable to branch network optimization.
* In Canada (23% of the region's sales), sales were down 12.7%, of which:
* 3.9 percentage points attributable to the 38% drop in sales to the Oil &
Gas industry,
* 3.0 percentage points attributable to lower cable sales,
* 1.3 percentage points attributable to the 74% drop in photovoltaic
sales.
The above-mentioned branch network optimization in the US is part of a program
of cost efficiency measures implemented in North America that was presented on
July 29, during the presentation of the half-year 2015 results.
Asia-Pacific (10% of Group sales): -0.8 in Q3 and -1.4% in 9m on a constant and
same-day basis
In the third quarter, sales in Asia-Pacific were up 8.4% on a reported basis,
including a positive effect of ?10.5m from currencies (primarily the Chinese
Yuan against the euro) and a positive effect of ?19.4m from the acquisitions of
4 Knights International in Thailand and Beijing Ouneng and Shanghai Maxqueen in
China. On a constant and same-day basis, sales were down 0.8%.
* In Asia (53% of the region's sales), sales were up 0.5%:
* In China (c. 70% of Asia), sales dropped by 2.3%, reflecting tougher
macroeconomic conditions,
* In South-East Asia (c. 20% of Asia), sales dropped by 4.8%, of which
17.2 percentage points were attributable to the 37% drop in sales to the
Oil & Gas industry.
* In the Pacific (47% of the region's sales), sales were down 2.3%:
* In Australia (c. 80% of Pacific), sales were down 3.7%, reflecting
continuing low project activity, the tough macro-environment in China
(one of Australia's major export markets) and the impact of branch
closures. Excluding the impact of branch closures, sales were down 2.5%,
* In New Zealand (c. 20% of Pacific), sales were back in positive
territory, up 3.9% after -6.5% in Q1 and -4.0% in Q2.
PROFITABILITY
Adjusted EBITA of ?148.2m in Q3, at 4.4% of sales, down 70bps year-on-year;
sequentially stable vs. Q2 2015, despite slowdown in sales, thanks to sequential
improvement in North America
Adjusted EBITA of ?428.7m in 9m, at 4.3% of sales, down 70bps year-on-year
In Q3, gross margin stood at 23.3% of sales, down 30 basis points year-on-year.
This decline mainly reflected a drop in gross margin in Europe and Asia-Pacific,
partly offset by a rise in North America. In Europe, gross margin was impacted
by a sequential slowdown in sales, as well as an unfavorable country mix effect:
combined sales of France and Switzerland, whose margin is significantly above
European average, dropped by 4.0%, while combined sales of all other European
countries grew by 1.0%. In Asia-Pacific, gross margin was impacted by lower
activity and by a one-off effect due to an adjustment in prior years' rebates.
Conversely, in North America, gross margin improved thanks to the positive
effects of margin enhancement actions (including pricing initiatives) that were
taken in the previous quarters.
In Q3, distribution and administrative expenses (including depreciation) stood
at 19.0% of sales, up 40 basis points year-on-year as a percentage of sales. In
Europe, cost control remained efficient and the rise in percentage of sales in
the quarter was limited (from 20.3% of sales in Q3 2014 to 20.4% of sales in Q3
2015). In North America, distribution and administrative expenses (including
depreciation) dropped by ?10.8 million in the quarter, representing a 4.9%
decrease year-on-year. Nevertheless, as sales in North America dropped by 7.2%
in the quarter, distribution and administrative expenses (including
depreciation) rose as a percentage of sales (from 16.4% of sales in Q3 2014 to
16.9% of sales in Q3 2015). In Asia-Pacific, distribution and administrative
expenses (including depreciation) rose by ?4.0 million, impacted by strong
inflation on costs and rose as a percentage of sales (from 14.9% of sales in Q3
2014 to 16.2% of sales in Q3 2015).
As a result, adjusted EBITA margin in Q3 stood at 4.4% of sales, down 70 basis
points year-on-year. Both Europe and Asia-Pacific posted year-on-year drops,
while adjusted EBITA margin in North America was broadly stable year-on-year and
posted a significant sequential improvement (57 basis points) over the Q2 2015
margin.
Adjusted EBITA margin in the 9 months stood at 4.3% of sales, down 70 basis
points year-on-year.
In the 9 months, reported EBITA stood at ?415.2 million, down 10.9% year-on-
year.
NET INCOME
Net income from continuing operations of ?90.7m in 9m, mainly impacted by ?52.5m
due to one-off costs related to financing optimization operations
Recurring net income of ?197.9m in 9m, down 10.9% year-on-year
Operating income in the 9 months stood at ?327.2 million, down 19.4% year-on-
year.
* Amortization of intangibles resulting from purchase price allocation
amounted to ?12.8 million (vs. ?11.5 million in 9m 2014),
* Other income and expenses amounted to a net charge of ?75.3 million (vs. a
net charge of ?48.3 million in 9m 2014). They included ?49.5 million of
restructuring costs (vs. ?35.0 million in 9m 2014) and ?18.5 million from
goodwill impairment related to operations in Australia and The Netherlands
(vs. ?6.3 million in 9m 2014).
Net financial expenses in the 9 months amounted to ?177.5 million (vs. ?135.5
million in 9m 2014) and included one-off costs of ?52.5 million, due to
financing optimization operations:
* ?19.6 million due to the early redemption of the 7.000% EUR Senior notes due
December 2018 (straight repayment) that took place in Q1,
* ?33.0 million due to the early redemption of the 6.125% USD Senior notes due
December 2019, which was refinanced through the new issuance of 3.250% EUR
Senior notes due June 2022 that took place in Q2.
Both operations will generate significant savings in interest charges and
contribute to the continuous improvement in Rexel's financial structure. In the
9 months, the average effective interest rate decreased by 100 basis points
year-on-year: it stood at 4.0% on gross debt (vs. 5.0% in 9m 2014).
Income tax in the 9 months represented a charge of ?59.0 million. The effective
tax rate was 39.4% (vs. 30.4% in 9m 2014). This rise is mainly due to non-
deductible goodwill impairment losses recognized in 2015, as compared to 2014.
Net income from continuing operations in the 9 months was down 51.8%, at ?90.7
million (vs. ?188.3 million in 9m 2014).
Net income from discontinued operations (disposal of Latin America, announced on
April 30 and now finalized) was a loss of ?69.3 million (vs. a loss of ?30.8
million in 9m 2014).
As a result, reported net income in the 9 months amounted to ?21.4 million (vs.
?157.5 million in 9m 2014).
Recurring net income amounted to ?197.9 million (vs. ?221.9 million in 9m 2014)
(see appendix 2).
FINANCIAL STRUCTURE
Free cash-flow before interest and tax from continuing operations of ?39.0m in
9m, similar to last year
Net debt of ?2,622.6m, broadly stable year-on-year
In the 9 months, free cash flow before interest and taxfrom continuing
operations was an inflow of ?39.0 million (very close to the inflow of ?39.5
million in 9m 2014), of which ?36.6 million was generated during the third
quarter.
The ?39.0 million net inflow in the 9 months included:
* Gross capital expenditure of ?74.0 million (vs. ?66.6 million in 9m 2014),
* An outflow of ?294.8 million from change in working capital (vs. an outflow
of ?361.6 million in 9m 2014).
At September 30, 2015, net debt stood at ?2,622.6 million, broadly stable (-
1.2%) year-on-year.
Change in net debt in the 9 months included:
* ?109.8 million of net interest paid,
* ?96.3 million of income tax paid,
* ?51.0 million of one-offs related to financing optimization operations,
* ?91.3 million of dividend paid in cash,
* ?82.2 million of unfavorable currency effect.
ACQUISITION
Rexel strengthens its offer of multi-energy solutions in France through the
acquisition of Sofinther
Rexel recently announced the acquisition of Sofinther, a French company
specialized in thermal, heating and control solutions.
By acquiring Sofinther, Rexel reinforces its multi-energy expertise in France,
which it has been developing since 2012 in order to complement its electrical
solutions offer. It will also allow Rexel to grow its presence in thermal
control and regulation, as well as in the connected devices markets and will
contribute to building closer relationships with customers in the collective
housing, commercial buildings and industrial sectors.
Sofinther posted sales of ?106 million in 2014. This acquisition will allow
Rexel to more than double its multi-energy sales in France, which have recorded
double-digit growth since the launch of this business in 2012.
The acquisition remains subject to the approval of relevant authorities and
should be completed by the beginning of 2016.
OUTLOOK
On October 7, Rexel adjusted its full-year 2015 sales and profitability targets,
taking into account the deteriorating macro-economic environment that has
impacted its operations since the summer and that was reflected in its Q3
activity.
Rexel expects for the full-year:
* An organic sales decline of between 2% and 3% on a constant and same-day
basis,
* An adjusted EBITA margin of between 4.3% and 4.5%.
Rexel maintains unchanged its target of generating solid free cash-flow in the
full-year of:
* At least 75% of EBITDA before interest and tax,
* Around 40% of EBITDA after interest and tax.
CALENDAR
February 11, 2016 Fourth-quarter and full-year 2015
results
FINANCIAL INFORMATION
The financial report for the period ended September 30, 2015 is available on the
Group's website (www.rexel.com), in the "Regulated information" section, and has
been filed with the French Autorité des Marchés Financiers.
A slideshow of the third-quarter and 9-month 2015 results is also available on
the Group's website.
ABOUT REXEL GROUP
Rexel, a global leader in the professional distribution of products and services
for the energy world, addresses three main markets - residential, commercial and
industrial. The Group supports its customers to be at their best in running
their business, by providing a broad range of sustainable and innovative
products, services and solutions in the field of technical supply, automation
and energy management. Rexel operates through a network of some 2,100 branches
in 35 countries, with c. 28,000 employees. The Group's sales were ?13.1 billion
in 2014.
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: DJSI Europe, FTSE4Good Europe & Global, EURO
STOXX Sustainability, Euronext Vigeo Europe 120 and ESI Excellence Europe.
Finally, Rexel is included on the Ethibel EXCELLENCE Investment Register in
recognition of its performance in corporate social responsibility (CSR). For
more information, visit Rexel's web site at www.rexel.com
CONTACTS
FINANCIAL ANALYSTS / INVESTORS
Marc MAILLET +33 1 42 85 76 12 marc.maillet(at)rexel.com
Florence MEILHAC +33 1 42 85 57 61 florence.meilhac(at)rexel.com
PRESS
Pénélope LINAGE +33 1 42 85 76 28 penelope.linage(at)rexel.com
Brunswick: Thomas KAMM +33 1 53 96 83 92 tkamm(at)brunswickgroup.com
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.
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.
APPENDICES
Appendix 1: Segment reporting - Constant and adjusted basis*
* Constant and adjusted = at comparable scope of consolidation and exchange
rates, excluding the non-recurring effect related to changes in copper-based
cables price and before amortization of purchase price allocation; the non-
recurring effect related to changes in copper-based cables price was, at the
EBITA level:
* a profit of ?2.9 million in Q3 2014 and a loss of ?8.4 million in Q3 2015
and
* a loss of ?3.9 million in 9m 2014 and a loss of ?13.5 million in 9m 2015.
GROUP
+--------------------------+-------+-------+-------+---------+---------+-------+
| Constant and |Q3 2014|Q3 2015|Change | 9m 2014 | 9m 2015 |Change |
| adjusted basis (?m) | | | | | | |
+--------------------------+-------+-------+-------+---------+---------+-------+
|Sales |3,483.5|3,382.6| -2.9%| 10,211.2| 10,027.8| -1.8%|
| | | | | | | |
| on a constant basis | | | | | | |
| and same days | | | -3.3%| | | -1.8%|
+--------------------------+-------+-------+-------+---------+---------+-------+
|Gross profit | 823.7| 790.4| -4.0%| 2,478.6| 2,405.3| -3.0%|
| | | | | | | |
| as a % of sales | 23.6%| 23.4%| -28bps| 24.3%| 24.0%| -29bps|
+--------------------------+-------+-------+-------+---------+---------+-------+
|Distribution & adm. | | | | | | |
|expenses (incl. | | | | | | |
|depreciation) |(646.4)|(642.2)| -0.6%|(1,971.8)|(1,976.6)| +0.2%|
+--------------------------+-------+-------+-------+---------+---------+-------+
|EBITA | 177.2| 148.2| -16.4%| 506.9| 428.7| -15.4%|
| | | | | | | |
| as a % of sales | 5.1%| 4.4%| -71bps| 5.0%| 4.3%| -69bps|
+--------------------------+-------+-------+-------+---------+---------+-------+
|Headcount (end of period) | | | | 28,589| 27,790| -2.8%|
+--------------------------+-------+-------+-------+---------+---------+-------+
EUROPE
+--------------------------+-------+-------+-------+---------+---------+-------+
| Constant and |Q3 2014|Q3 2015|Change | 9m 2014 | 9m 2015 |Change |
| adjusted basis (?m) | | | | | | |
+--------------------------+-------+-------+-------+---------+---------+-------+
|Sales |1,792.6|1,792.1| -0.0%| 5,371.9| 5,396.9| +0.5%|
| | | | | | | |
| on a constant basis | | | | | | |
| and same days | | | -0.9%| | | +0.2%|
| | | | | | | |
|o/w France | 554.4| 543.5| -2.0%| 1,752.0| 1,717.0| -2.0%|
| | | | | | | |
| on a constant basis | | | | | | |
| and same days | | | -3.6%| | | -2.5%|
| | | | | | | |
| United Kingdom | 296.1| 290.5| -1.9%| 850.2| 834.7| -1.8%|
| | | | | | | |
| on a constant basis | | | | | | |
| and same days | | | -1.9%| | | -1.8%|
| | | | | | | |
| Germany | 210.8| 209.6| -0.5%| 596.8| 599.2| +0.4%|
| | | | | | | |
| on a constant basis | | | | | | |
| and same days | | | -1.2%| | | +0.2%|
| | | | | | | |
| Scandinavia | 213.7| 216.5| +1.3%| 635.7| 672.7| +5.8%|
| | | | | | | |
| on a constant basis | | | | | | |
| and same days | | | +1.3%| | | +5.6%|
+--------------------------+-------+-------+-------+---------+---------+-------+
|Gross profit | 473.0| 462.9| -2.1%| 1,453.3| 1,427.6| -1.8%|
| | | | | | | |
| as a % of sales | 26.4%| 25.8%| -56bps| 27.1%| 26.5%| -60bps|
+--------------------------+-------+-------+-------+---------+---------+-------+
|Distribution & adm. | | | | | | |
|expenses (incl. | | | | | | |
|depreciation) |(363.2)|(365.3)| +0.6%|(1,126.9)|(1,127.5)| -0.0%|
+--------------------------+-------+-------+-------+---------+---------+-------+
|EBITA | 109.8| 97.6| -11.1%| 326.4| 300.1| -8.0%|
| | | | | | | |
| as a % of sales | 6.1%| 5.4%| -68bps| 6.1%| 5.6%| -51bps|
+--------------------------+-------+-------+-------+---------+---------+-------+
|Headcount (end of period) | | | | 16,518| 16,103| -2.5%|
+--------------------------+-------+-------+-------+---------+---------+-------+
NORTH AMERICA
+--------------------------+-------+-------+-------+---------+---------+-------+
| Constant and |Q3 2014|Q3 2015|Change | 9m 2014 | 9m 2015 |Change |
| adjusted basis (?m) | | | | | | |
+--------------------------+-------+-------+-------+---------+---------+-------+
|Sales |1,341.5|1,244.1| -7.3%| 3,817.2| 3,623.5| -5.1%|
| | | | | | | |
| on a constant basis | | | | | | |
| and same days | | | -7.2%| | | -4.7%|
| | | | | | | |
|o/w United States |1,028.1| 970.5| -5.6%| 2,913.1| 2,795.9| -4.0%|
| | | | | | | |
| on a constant basis | | | | | | |
| and same days | | | -5.6%| | | -3.5%|
| | | | | | | |
| Canada | 313.4| 273.6| -12.7%| 904.1| 827.5| -8.5%|
| | | | | | | |
| on a constant basis | | | | | | |
| and same days | | | -12.7%| | | -8.5%|
+--------------------------+-------+-------+-------+---------+---------+-------+
|Gross profit | 286.8| 271.2| -5.5%| 832.6| 799.7| -3.9%|
| | | | | | | |
|as a % of sales | 21.4%| 21.8%| +41bps| 21.8%| 22.1%| +26bps|
+--------------------------+-------+-------+-------+---------+---------+-------+
|Distribution & adm. | | | | | | |
|expenses (incl. | | | | | | |
|depreciation) |(220.4)|(209.6)| -4.9%| (655.3)| (652.5)| -0.4%|
+--------------------------+-------+-------+-------+---------+---------+-------+
|EBITA | 66.4| 61.5| -7.4%| 177.3| 147.2| -17.0%|
| | | | | | | |
| as a % of sales | 5.0%| 4.9%| -1bps| 4.6%| 4.1%| -58bps|
+--------------------------+-------+-------+-------+---------+---------+-------+
|Headcount (end of period) | | | | 8,509| 8,219| -3.4%|
+--------------------------+-------+-------+-------+---------+---------+-------+
ASIA-PACIFIC
+--------------------------+-------+-------+-------+---------+---------+-------+
| Constant and |Q3 2014|Q3 2015|Change | 9m 2014 | 9m 2015 |Change |
| adjusted basis (?m) | | | | | | |
+--------------------------+-------+-------+-------+---------+---------+-------+
|Sales | 349.4| 346.4| -0.9%| 1,021.8| 1,007.4| -1.4%|
| | | | | | | |
| on a constant basis | | | | | | |
| and same days | | | -0.8%| | | -1.4%|
| | | | | | | |
|o/w China | 136.4| 133.3| -2.3%| 381.2| 373.0| -2.1%|
| | | | | | | |
| on a constant basis | | | | | | |
| and same days | | | -2.3%| | | -2.1%|
| | | | | | | |
| Australia | 133.1| 128.2| -3.7%| 404.8| 386.1| -4.6%|
| | | | | | | |
| on a constant basis | | | | | | |
| and same days | | | -3.7%| | | -5.0%|
| | | | | | | |
| New Zealand | 30.0| 31.2| +3.9%| 93.7| 91.6| -2.3%|
| | | | | | | |
| on a constant basis | | | | | | |
| and same days | | | +3.9%| | | -2.3%|
+--------------------------+-------+-------+-------+---------+---------+-------+
|Gross profit | 63.7| 56.4| -11.5%| 192.4| 178.0| -7.5%|
| | | | | | | |
| as a % of sales | 18.2%| 16.3%|-196bps| 18.8%| 17.7%|-117bps|
+--------------------------+-------+-------+-------+---------+---------+-------+
|Distribution & adm. | | | | | | |
|expenses (incl. | | | | | | |
|depreciation) | (52.1)| (56.1)| +7.6%| (160.4)| (164.8)| +2.7%|
+--------------------------+-------+-------+-------+---------+---------+-------+
|EBITA | 11.6| 0.3| -97.6%| 32.0| 13.2| -58.9%|
| | | | | | | |
| as a % of sales | 3.3%| 0.1%|-323bps| 3.1%| 1.3%|-183bps|
+--------------------------+-------+-------+-------+---------+---------+-------+
|Headcount (end of period) | | | | 3,304| 3,207| -2.9%|
+--------------------------+-------+-------+-------+---------+---------+-------+
Appendix 2: Extract of Financial Statements
Consolidated Income Statement
+----------------------------+-------+-------+------+---------+---------+------+
| Reported basis (?m) |Q3 2014|Q3 2015|Change| 9m 2014 | 9m 2015 |Change|
+----------------------------+-------+-------+------+---------+---------+------+
|Sales |3,260.4|3,382.6| +3.7%| 9,422.1| 10,027.8| +6.4%|
+----------------------------+-------+-------+------+---------+---------+------+
|Gross profit | 779.4| 781.6| +0.3%| 2,300.7| 2,391.0| +3.9%|
| | | | | | | |
| as a % of sales | 23.9%| 23.1%| | 24.4%| 23.8%| |
+----------------------------+-------+-------+------+---------+---------+------+
|Distribution & adm. expenses| | | | | | |
|(excl. depreciation) |(590.8)|(619.8)| +4.9%|(1,776.0)|(1,909.5)| +7.5%|
+----------------------------+-------+-------+------+---------+---------+------+
|EBITDA | 188.6| 161.8|-14.2%| 524.7| 481.6| -8.2%|
| | | | | | | |
| as a % of sales | 5.8%| 4.8%| | 5.6%| 4.8%| |
+----------------------------+-------+-------+------+---------+---------+------+
|Depreciation | (20.0)| (22.0)| | (58.9)| (66.4)| |
+----------------------------+-------+-------+------+---------+---------+------+
|EBITA | 168.6| 139.8|-17.1%| 465.8| 415.2|-10.9%|
| | | | | | | |
| as a % of sales | 5.2%| 4.1%| | 4.9%| 4.1%| |
+----------------------------+-------+-------+------+---------+---------+------+
|Amortization of intangibles | | | | | | |
|resulting from purchase | | | | | | |
|price allocation | (3.9)| (4.2)| | (11.5)| (12.8)| |
+----------------------------+-------+-------+------+---------+---------+------+
|Operating income bef. other | | | | | | |
|inc. and exp. | 164.7| 135.6|-17.7%| 454.4| 402.4|-11.4%|
| | | | | | | |
| as a % of sales | 5.1%| 4.0%| | 4.8%| 4.0%| |
+----------------------------+-------+-------+------+---------+---------+------+
|Other income and expenses | (14.6)| (16.0)| | (48.3)| (75.3)| |
+----------------------------+-------+-------+------+---------+---------+------+
|Operating income | 150.1| 119.6|-20.3%| 406.1| 327.2|-19.4%|
+----------------------------+-------+-------+------+---------+---------+------+
|Financial expenses (net) | (43.8)| (38.1)| | (135.5)| (177.5)| |
+----------------------------+-------+-------+------+---------+---------+------+
|Net income (loss) before | | | | | | |
|income tax | 106.3| 81.4|-23.4%| 270.6| 149.6|-44.7%|
+----------------------------+-------+-------+------+---------+---------+------+
|Income tax | (29.9)| (33.9)| | (82.3)| (59.0)| |
+----------------------------+-------+-------+------+---------+---------+------+
|Net income (loss) from | | | | | | |
|continuing operations | 76.4| 47.5|-37.9%| 188.3| 90.7|-51.8%|
+----------------------------+-------+-------+------+---------+---------+------+
|Net income (loss) from | | | | | | |
|discontinued operations | (9.4)| (27.5)| | (30.8)| (69.3)| |
+----------------------------+-------+-------+------+---------+---------+------+
|Net income (loss) | 67.1| 20.0|-70.3%| 157.5| 21.4|-86.4%|
+----------------------------+-------+-------+------+---------+---------+------+
Bridge Between Operating Income Before Other Income And Other Expenses And
Adjusted EBITA
+----------------------------------------------+-------+-------+-------+-------+
|in ?m |Q3 2014|Q3 2015|9m 2014|9m 2015|
+----------------------------------------------+-------+-------+-------+-------+
|Operating income before other income and other| | | | |
|expenses | 164.7| 135.6| 454.4| 402.4|
+----------------------------------------------+-------+-------+-------+-------+
|Change in scope of consolidation | 1.3| | 2.9| |
| | | | | |
|Foreign exchange effects | 10.3| | 34.2| |
| | | | | |
|Non-recurring effect related to copper | -2.9| 8.4| 3.9| 13.5|
| | | | | |
|Amortization of intangibles assets resulting | | | | |
|from PPA | 3.9| 4.2| 11.5| 12.8|
+----------------------------------------------+-------+-------+-------+-------+
|Adjusted EBITA on a constant basis | 177.2| 148.2| 506.9| 428.7|
+----------------------------------------------+-------+-------+-------+-------+
Recurring Net Income
+------------------------+-----------+-------+------+-----------+-------+------+
| In millions of euros|Q3 2014( 1)|Q3 2015|Change|9m 2014( 1)|9m 2015|Change|
+------------------------+-----------+-------+------+-----------+-------+------+
|Reported net income | 67.1| 47.5|-29.2%| 157.5| 90.7|-42.4%|
| | | | | | | |
|Non-recurring copper | -2.9| 8.4| | 3.4| 13.5| |
|effect | | | | | | |
| | | | | | | |
|Other expense & income | 15.8| 16.0| | 73.4| 75.3| |
| | | | | | | |
|Financial expense | | | | | 52.5| |
| | | | | | | |
|Tax expense | -3.0| -7.5| | -12.4| -34.1| |
| | | | | | | |
|Recurring net income | 77.0| 64.5|-16.2%| 221.9| 197.9|-10.9%|
+------------------------+-----------+-------+------+-----------+-------+------+
(1)as reported in 2014
Sales And Profitability By Segment
+---------------------+-------+-------+------+-------+--------+------+
| Reported basis (?m)|Q3 2014|Q3 2015|Change|9m 2014|9m 2015 |Change|
+---------------------+-------+-------+------+-------+--------+------+
|Sales |3,260.4|3,382.6| +3.7%|9,422.1|10,027.8| +6.4%|
| | | | | | | |
| Europe |1,764.6|1,792.1| +1.6%|5,272.6| 5,396.9| +2.4%|
| | | | | | | |
| North,America |1,176.2|1,244.1| +5.8%|3,257.3| 3,623.5|+11.2%|
| | | | | | | |
| Asia-Pacific | 319.5| 346.4| +8.4%| 892.0| 1,007.4|+12.9%|
+---------------------+-------+-------+------+-------+--------+------+
|Gross profit | 779.4| 781.6| +0.3%|2,300.7| 2,391.0| +3.9%|
| | | | | | | |
| Europe | 469.2| 455.4| -2.9%|1,423.9| 1,419.0| -0.3%|
| | | | | | | |
| North,America | 249.8| 269.9| +8.0%| 704.7| 794.0|+12.7%|
| | | | | | | |
| Asia-Pacific | 60.3| 56.4| -6.5%| 171.9| 178.0| +3.5%|
+---------------------+-------+-------+------+-------+--------+------+
|EBITA | 168.6| 139.8|-17.1%| 465.8| 415.2|-10.9%|
| | | | | | | |
| Europe | 112.4| 90.3|-19.7%| 321.0| 291.7| -9.1%|
| | | | | | | |
| North,America | 57.3| 60.4| +5.5%| 148.0| 142.1| -4.0%|
| | | | | | | |
| Asia-Pacific | 9.4| 0.3|-97.1%| 25.6| 13.2|-48.7%|
+---------------------+-------+-------+------+-------+--------+------+
Consolidated Balance Sheet(1)
+-----------------------------------------+-----------------+------------------+
|Assets (?m) |December 31, 2014|September 30, 2015|
+-----------------------------------------+-----------------+------------------+
|Goodwill | 4,243.9| 4,287.6|
| | | |
|Intangible assets | 1,084.0| 1,091.8|
| | | |
|Property, plant & equipment | 287.1| 284.1|
| | | |
|Long-term investments | 24.8| 42.6|
| | | |
|Deferred tax assets | 175.2| 161.5|
+-----------------------------------------+-----------------+------------------+
|Total non-current assets | 5,815.0| 5,867.6|
+-----------------------------------------+-----------------+------------------+
|Inventories | 1,487.2| 1,519.7|
| | | |
|Trade receivables | 2,206.0| 2,313.6|
| | | |
|Other receivables | 508.7| 544.8|
| | | |
|Assets classified as held for sale | 3.7| 3.5|
| | | |
|Cash and cash equivalents | 1,159.8| 387.5|
+-----------------------------------------+-----------------+------------------+
|Total current assets | 5,365.4| 4,769.1|
+-----------------------------------------+-----------------+------------------+
|Total assets | 11,180.4| 10,636.7|
+-----------------------------------------+-----------------+------------------+
+-----------------------------------------+-----------------+------------------+
|Liabilities (?m) |December 31, 2014|September 30, 2015|
+-----------------------------------------+-----------------+------------------+
|Total equity | 4,343.4| 4,350.7|
+-----------------------------------------+-----------------+------------------+
|Long-term debt | 2,995.9| 2,518.9|
| | | |
|Deferred tax liabilities | 196.9| 191.2|
| | | |
|Other non-current liabilities | 437.9| 400.2|
+-----------------------------------------+-----------------+------------------+
|Total non-current liabilities | 3,630.7| 3,110.2|
+-----------------------------------------+-----------------+------------------+
|Interest bearing debt & accrued interests| 371.2| 524.5|
| | | |
|Trade payables | 2,126.8| 1,948.3|
| | | |
|Other payables | 708.3| 703.0|
+-----------------------------------------+-----------------+------------------+
|Total current liabilities | 3,206.3| 3,175.7|
+-----------------------------------------+-----------------+------------------+
|Total liabilities | 6,837.0| 6,285.9|
+-----------------------------------------+-----------------+------------------+
|Total equity & liabilities | 11,180.4| 10,636.7|
+-----------------------------------------+-----------------+------------------+
(1) Net debt includes:
* Debt hedge derivatives for ?6.5m at December 31, 2014 and ?(29.9)m at
September 30, 2015
* Accrued interest receivables for ?(0.7)m at December, 2014 and for ?(3.4)m
at September 30, 2015
Change in Net Debt
+----------------------------------------------+-------+-------+-------+-------+
|?m |Q3 2014|Q3 2015|9m 2014|9m 2015|
+----------------------------------------------+-------+-------+-------+-------+
|EBITDA | 188.6| 161.8| 524.7| 481.6|
+----------------------------------------------+-------+-------+-------+-------+
|Other operating revenues & costs((1)) | (17.6)| (24.1)| (53.1)| (70.6)|
+----------------------------------------------+-------+-------+-------+-------+
|Operating cash flow | 171.0| 137.7| 471.6| 411.0|
+----------------------------------------------+-------+-------+-------+-------+
|Change in working capital |(123.6)| (81.0)|(361.6)|(294.8)|
| | | | | |
|Net capital expenditure, of which: | (24.0)| (20.0)| (70.5)| (77.2)|
| | | | | |
| Gross capital expenditure| (25.0)| (22.8)| (66.6)| (74.0)|
| | | | | |
| Disposal of fixed assets & other| 1.0| 2.8| (3.9)| (3.2)|
+----------------------------------------------+-------+-------+-------+-------+
|Free cash flow from continuing op. before | | | | |
|interest and tax | 23.4| 36.6| 39.5| 39.0|
+----------------------------------------------+-------+-------+-------+-------+
|Net interest paid / received((2) ) | (38.7)| (33.2)|(113.3)|(109.8)|
| | | | | |
|Income tax paid | (17.3)| (20.8)| (67.9)| (96.3)|
+----------------------------------------------+-------+-------+-------+-------+
|Free cash flow from continuing op. after | | | | |
|interest and tax | (32.5)| (17.3)|(141.7)|(167.2)|
+----------------------------------------------+-------+-------+-------+-------+
|FCF from discontinued operations | 2.0| (5.8)| (6.0)| (18.5)|
| | | | | |
|Net financial investment | (22.7)| (3.6)| (31.9)| (23.6)|
| | | | | |
|Dividends paid | (65.5)| (91.2)| (65.6)| (91.3)|
| | | | | |
|Net change in equity | (27.8)| (3.7)| (29.9)| (1.1)|
| | | | | |
|Other | (2.4)| 3.8| (70.5)| (25.7)|
| | | | | |
|Currency exchange variation | (99.5)| 51.7|(117.3)| (82.2)|
+----------------------------------------------+-------+-------+-------+-------+
|Decrease (increase) in net debt |(248.4)| (66.1)|(462.8)|(409.5)|
+----------------------------------------------+-------+-------+-------+-------+
|Net debt at the beginning of the period |2,406.4|2,556.5|2,192.0|2,213.1|
+----------------------------------------------+-------+-------+-------+-------+
|Net debt at the end of the period |2,654.8|2,622.6|2,654.8|2,622.6|
+----------------------------------------------+-------+-------+-------+-------+
1 Includes restructuring outflows of ?17.3m in Q3 2015 and ?55.1m in 9m 2015
2 Excluding settlement of fair value hedge derivatives
Appendix 3: Working Capital Analysis
+-----------------------------------+--------------------+--------------------+
| Constant basis | September 30, 2014 | September 30, 2015 |
+-----------------------------------+--------------------+--------------------+
| Net inventories | | |
| | | |
| as a % of sales 12 rolling months | 11.1% | 11.3% |
| | | |
| as a number of days | 49.7 | 51.7 |
+-----------------------------------+--------------------+--------------------+
| Net trade receivables | | |
| | | |
| as a % of sales 12 rolling months | 17.9% | 17.0% |
| | | |
| as a number of days | 59.2 | 59.3 |
+-----------------------------------+--------------------+--------------------+
| Net trade payables | | |
| | | |
| as a % of sales 12 rolling months | 14.3% | 14.2% |
| | | |
| as a number of days | 56.4 | 56.8 |
+-----------------------------------+--------------------+--------------------+
| Trade working capital | | |
| | | |
| as a % of sales 12 rolling months | 14.7% | 14.2% |
+-----------------------------------+--------------------+--------------------+
| Total working capital | | |
| | | |
| as a % of sales 12 rolling months | 13.4% | 12.6% |
+-----------------------------------+--------------------+--------------------+
Appendix 4: Headcount and branches by geography
+---------------------+----------+----------+----------+-------------------+
|FTEs at end of period| | | | |
| |30/09/2014|31/12/2014|30/09/2015|Year-on-Year Change|
| comparable | | | | |
+---------------------+----------+----------+----------+-------------------+
|Europe | 16,518| 16,327| 16,103| -2.5%|
+---------------------+----------+----------+----------+-------------------+
|USA | 6,145| 6,264| 6,017| -2.1%|
+---------------------+----------+----------+----------+-------------------+
|Canada | 2,364| 2,355| 2,202| -6.9%|
+---------------------+----------+----------+----------+-------------------+
|North America | 8,509| 8,619| 8,219| -3.4%|
+---------------------+----------+----------+----------+-------------------+
|Asia-Pacific | 3,304| 3,312| 3,207| -2.9%|
+---------------------+----------+----------+----------+-------------------+
|Other | 258| 261| 261| 1.2%|
+---------------------+----------+----------+----------+-------------------+
|Group | 28,589| 28,519| 27,790| -2.8%|
+---------------------+----------+----------+----------+-------------------+
+---------------------+----------+----------+----------+-------------------+
| Branches | | | | |
| |30/09/2014|31/12/2014|30/09/2015|Year-on-Year Change|
| comparable | | | | |
+---------------------+----------+----------+----------+-------------------+
|Europe | 1,284| 1,263| 1,242| -3.3%|
+---------------------+----------+----------+----------+-------------------+
|USA | 393| 398| 367| -6.6%|
+---------------------+----------+----------+----------+-------------------+
|Canada | 210| 207| 202| -3.8%|
+---------------------+----------+----------+----------+-------------------+
|North America | 603| 605| 569| -5.6%|
+---------------------+----------+----------+----------+-------------------+
|Asia-Pacific | 266| 264| 259| -2.6%|
+---------------------+----------+----------+----------+-------------------+
|Group | 2,153| 2,132| 2,070| -3.9%|
+---------------------+----------+----------+----------+-------------------+
Appendix 5: Discontinued operations
* On September 16, Rexel announced the completion of the sale of its
operations in Latin America, after approval of the anti-trust authorities.
* At September 30, the detail of net income from discontinued operations is as
follows:
* Sales ?169.7m
* EBITA ?(1.4)m
* PPA amortization ?(0.4)m
* Other income & expense
?(62.5)m
* Net financial expense ?(7.0)m
* Income tax ?2.0m
* Net income from discontinued
operations, ?(69.3)m
of which divestment loss ?(60.0)m
Appendix 6: 2014 continuing operations (i.e. excl. Latam) at 2014 exchange rates
+--------------+---------+---------+---------+---------+----------+
| In ?m | Q1 2014 | Q2 2014 | Q3 2014 | Q4 2014 | FY 2014 |
+--------------+---------+---------+---------+---------+----------+
| Sales | 3,004.4 | 3,157.3 | 3,260.4 | 3,402.3 | 12,824.3 |
+--------------+---------+---------+---------+---------+----------+
| Gross margin | 750.2 | 771.2 | 779.4 | 817.8 | 3,118.6 |
+--------------+---------+---------+---------+---------+----------+
| EBITA | 134.0 | 163.3 | 168.6 | 180.8 | 646.7 |
+--------------+---------+---------+---------+---------+----------+
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Datum: 30.10.2015 - 07:30 Uhr
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