|
FIRST-QUARTER 2022 SALES Strong start to the year
with sales up +16.0%, driven by strong inflation and positive
volumesVolumes continue to improve in Europe and North America
despite continued product availability challengesBacklogs
increasing in our main countries on sustained demand, acceleration
in electrification trends and supply chain tensions |
→ Sales of €4,377.4m in Q1 2022, up +16.0% on a
same-day basis
- Positive trends in all geographies,
confirming increasing demand for electrical products and the key
role of distributors in the energy transition
- Growth supported by both volume
increase (283bps contribution) and high selling prices (405bps
contribution in cable and 910bps in non-cable products)
- Acceleration in North America, up
+21.6%, driven by both volume recovery and further price
increases
- High selling price increases in Q1
2022. Pricing contribution from carryover effect expected to ease
in coming quarters on difficult base effects on both cable and
non-cable products
→ Sales up +19.1% on an actual-day basis,
benefiting from a favorable calendar effect (+3.1%) largely due to
specific US accounting rules (reversal expected in Q4 22)
→ Continued supply chain tensions and resource
scarcity, further impacted by the lockdown in China
→ Digital revenue in Q1 2022 represented 23.6%
of total sales, up +177bps and 25.5% excl. Mayer, up +201bps
→ Q1 2022 also marked by the disposal of our
Russian business
→ FY 2022 guidance confirmed, in a context of
growing geopolitical and macroeconomic uncertainties
Key figures (€m) |
Q1 2022 |
YoY change |
Sales on a reported basis |
4,377.4 |
+31.4% |
On a constant and actual-day basis |
|
+19.1% |
On a constant and same-day basis |
|
+16.0% |
Same-day sales growth by geography |
|
|
Europe |
2,284.8 |
+13.6% |
France |
865.5 |
+10.4% |
Scandinavia |
278.5 |
+12.5% |
Benelux |
257.5 |
+16.8% |
Germany |
226.5 |
+17.0% |
UK |
223.4 |
+18.0% |
North America |
1,764.6 |
+21.6% |
US |
1,432.3 |
+23.2% |
Canada |
332.3 |
+14.9% |
Asia-Pacific |
328.0 |
+5.5% |
China |
145.5 |
+4.8% |
Australia |
131.3 |
+4.1% |
Guillaume TEXIER, Chief Executive Officer, said:
“Rexel’s strong start to the year demonstrates that we continue to
benefit from solid underlying demand and electrification trends,
which should accelerate in the current environment. It also
highlights our ability to transform supply chain tensions into an
opportunity to help customers navigate product shortages, while
ensuring pass-through of supplier price increases. In this context,
notwithstanding the current geopolitical and economic
uncertainties, we are confident that we will achieve our 2022
objectives. We will present our medium-term roadmap at our Capital
Markets Day on June 16.” |
SALES REVIEW FOR THE PERIOD ENDED MARCH 31,
2022 |
- Unless otherwise stated, all comments are on a constant and
adjusted basis and, for sales, at same number of working days.
SALES
In Q1, sales were up +31.4% year-on-year
on a reported basis and +16.0% on a constant and same-day basis,
reflecting positive momentum in all three geographies.
Key figures (€m) |
Q1 2022 |
YoY change |
Sales on a reported basis |
4,377.4 |
+31.4% |
On a constant and actual-day basis |
|
+19.1% |
On a constant and same-day basis |
|
+16.0% |
In the first quarter Rexel posted sales of
€4,377.4m, up +31.4% on a reported basis, including:
- A positive currency
effect of €104.3m (i.e. +3.1% of Q1 2021 sales), mainly due to the
appreciation of the US & Canadian dollars against the euro
- A positive net
scope effect of €240.0m (i.e. +7.2% of Q1 2021 sales) mainly due to
Mayer acquisition in the US
- A positive calendar
effect of +3.1%, largely resulting from specific US accounting
rules.
On a constant and same-day basis, sales were up
+16.0%, as a result of:
- An excellent
performance in North America, with further recovery, and strong
resilience in Europe on more difficult base effects, offsetting
lower growth in Asia-Pacific as business recovered from the
pandemic earlier than in other geographies
- Strong underlying
trends from electrification and growing demand for energy
efficiency solutions in a context of rising energy costs, as
illustrated by growth of product categories such as PV, EV or HVAC
at rates above Group average
- A favorable pricing
environment for both cable (4.1% contribution in Q1 2022 vs 2.9% in
Q1 2021) and non-cable (9.1% contribution in the quarter) products,
resulting from a carryover effect of price increases passed in 2021
and an additional rise recorded in 2022
- Further growth in
digitalization in all three geographies, with digital sales now
representing 25.5% of Group sales excluding Mayer, up +201bps
compared to Q1 2021, or 23.6% of sales, up +177bps including Mayer,
considering its low digital penetration. Trends were positive in
Europe (up to 35.0% of sales, an increase of +166bps), North
America (up to 12.4% of sales, an increase of +304bps including
Mayer) and Asia-Pacific (4.6% of sales, up +72bps).
In the quarter, the tensions on the supply chain
remained unchanged and we don’t expect any improvement before the
second part of the year, as visibility remains low (lockdown in
China, Russia/Ukraine war). This “scarcity environment” continues
to be an opportunity for Rexel, as we continue to help our
customers deal with product shortages and labor availability to
unlock productivity gains.
Europe (52% of Group sales): +13.6% in
Q1 on a constant and same-day basis
In the first quarter, sales in Europe increased
by +15.6% on a reported basis, including a positive currency effect
of +0.6%, or €12.1m, mainly due to the appreciation of the British
pound and the Swiss Franc against the euro and a negative scope
effect of (0.2)%, or €(4.9)m, from the disposals of our activity in
Russia in March 2022 and a small business in France in Q1 2021. On
a constant and same-day basis, sales were up +13.6%.
Key figures (€m) |
Q1 2022 |
YoY change |
Europe |
2,284.8 |
+13.6% |
France |
865.5 |
+10.4% |
Scandinavia |
278.5 |
+12.5% |
Benelux |
257.5 |
+16.8% |
Germany |
226.5 |
+17.0% |
UK |
223.4 |
+18.0% |
Switzerland |
145.3 |
+5.6% |
Austria |
129.3 |
+16.7% |
Southern Europe |
85.8 |
+21.9% |
Overall in Europe, activity remained robust,
still driven by proximity and renovation activities. Acceleration
in volume and price increases on non-cable products drove the good
performance in Q1 22, despite continuing limitations caused by
supply chain tensions. More specifically, in our larger
countries:
- Sales in
France (38% of the region’s sales) were up +10.4%,
with similar progression in all 3 end-markets. The quarter was
marked by significant market outperformance and increased digital
penetration (28.4% of sales, up 328bps). Service and EV activities
contributed positively to the overall performance.
- Sales in
Scandinavia (12% of the region’s sales) were up
+12.5%, with a slow start to the year, notably in Sweden, due to
the pandemic. Trends significantly accelerated in March. Q1 sales
growth was largely driven by the residential & commercial
markets and boosted by PV activity.
-
Benelux (11% of the region’s sales) grew by
+16.8%, with strong demand in the residential market in Belux,
boosted by robust growth from green products, now representing 10%
of sales. Growth in the Netherlands was also boosted by renewable
energy products (PV/EV/HVAC up c. 40% yoy), in a context of rising
energy prices.
- Sales in
Germany (10% of the region’s sales) posted strong
+17.0% growth, supported by residential & industrial markets.
Residential was boosted by PV demand (up 190%, contributing for
550bps). Industrial demand was driven by metal, energy & water
markets offsetting low demand in automotive.
- In the
UK (10% of the region’s sales), sales increased by
+18.0%, with a strong demand in residential and commercial markets.
The pipeline is robust in all 3 markets.
Disposal of our Russian activity
With circa €10m of revenues generated in 2021,
Rexel had limited exposure to Russia (below 0.1% of Group
sales).
Following recent events in the region, Rexel
took the decision to fully dispose this activity through a
Management Buy Out (MBO) that was completed on March 23, 2022.
North America (40% of Group sales): +21.6% in Q1 on a
constant and same-day basis
In the first quarter, sales in North America
increased by +67.5% on a reported basis, including a positive
currency effect of +7.4%, or €78.1m, due to the appreciation of the
US & Canadian dollars against the euro, a positive scope effect
of +23.7%, or €249.8m, from the acquisition of Mayer in the US, as
well as a positive calendar effect of +6.1%. On a constant and
same-day basis, sales were up +21.6%, driven by the US and
Canada.
Key figures (€m) |
Q1 2022 |
YoY change |
North America |
1,764.6 |
+21.6% |
Total US |
1,432.3 |
+23.2% |
Mayer |
|
+27.5% |
US excl. Mayer |
|
+22.1% |
Gulf Central |
|
+42.0% |
Mountain Plains |
|
+33.9% |
Northwest |
|
+24.6% |
Florida |
|
+23.0% |
Southeast |
|
+16.4% |
California |
|
+14.3% |
Midwest |
|
+12.8% |
Northeast |
|
(0.6) % |
Canada |
332.3 |
+14.9% |
In line with the Q4 21 trend, North America
further recovered, benefiting from better volume and non-cable
price increases. Backlogs further increased in the quarter.
-
In the US (81% of the region’s sales), sales
posted solid +23.2% growth on a same-day basis, with positive
trends in all regions including the Northwest, despite a difficult
base effect, and significant recovery in the Mountain Plains
(robust demand in Las Vegas and Denver) and Gulf Central (recovery
in Oil & Gas sector) regions. By market, all three end-markets
grew at a similar pace with further positive development in
commercial and residential and recovery from a lower base in
industry. The backlog remains healthy, up +63% at end of March 2022
yoy. Mayer is progressing well, up +27.5%, and the integration
process is occurring smoothly. We are on track to achieve our
upgraded synergy ambitions presented in February 2022.
-
In Canada (19% of the region’s sales), sales grew
by +14.9% on a same-day basis, Q1 performance was driven by the
industrial end-market up c. 20%, contributing for c. 900bps notably
boosted by robust demand in oil & gas and mining.
Asia-Pacific (8% of Group sales): +5.5%
in Q1 on a constant and same-day basis
In the first quarter, sales in Asia-Pacific were
up +9.1% on a reported basis, including a positive currency effect
of +4.7%, or €14.2m, mainly due to the appreciation of the Chinese
renminbi against the euro and a negative scope effect of (1.7)%, or
€(5.0)m, related to the disposal of Rexel Saudi Arabia in Q4 2021.
On a constant and same-day basis, sales were up +5.5%.
Key figures (€m) |
Q1 2022 |
YoY change |
Asia-Pacific |
328.0 |
+5.5% |
Australia |
131.3 |
+4.1% |
China |
145.5 |
+4.8% |
- In the Pacific (49%
of the region’s sales), sales were up +5.5% on a constant and
same-day basis. More specifically:
- In
Australia (82% of Pacific’s sales), sales
increased by +4.1%, boosted by price increases, offsetting a slow
start to the year, impacted by difficult weather conditions notably
in the New South Wales & Queensland regions as well as
Covid-related staff shortages.
- In Asia (51% of the
region’s sales), sales increased by +5.5% on a constant and
same-day basis:
- In
China (86% of Asia’s sales), sales were up +4.8%.
The acceleration was supported by demand from municipalities,
renewables and infrastructure & transportation, offsetting the
lack of demand in automotive and food & beverage as a result of
chip shortages as well as the continuing pandemic situation. The
quarter benefited from selling price increases. Orders are growing
significantly. We anticipate the coming quarter to be impacted by
the recent local lockdowns that took place in large cities.
We remain confident we will achieve our 2022
objectives despite geopolitical and macroeconomic
uncertainties.
Leveraging our transformation and enhanced
efficiency, we target for 2022, at comparable scope of
consolidation and exchange rates*:
- Same-day sales growth of between 4%
and 6%
- An adjusted EBITA1 margin above
6%
- Free cash flow conversion2 above
60%
* Assuming no severe deterioration of the
sanitary environment
An updated strategic roadmap,
will be presented at a Capital Markets Day to be held at our
Group's biggest branch in Zurich on June
16, 2022.
1 Excluding (i) amortization of PPA and (ii) the non-recurring
effect related to changes in copper-based cable prices. 2 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.
June 3, 2022
Ex-dividend
date June 7, 2022 Dividend Payment of €0.75 per share (issue
premium)June 16, 2022 Capital Markets Day July 28,
2022 First-half
2022 results
A slideshow of the first quarter 2022 sales is
available on the Group’s website.
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 over 1,900 branches in 24 countries, with more than
26,000 employees. The Group’s sales were €14.7 billion in 2021.
Rexel is listed on the Eurolist market of Euronext Paris
(compartment A, ticker RXL, ISIN code FR0010451203). It is included
in the following indices: CAC Next 20, SBF 120, CAC Large 60, CAC
AllTrade, CAC AllShares, FTSE EuroMid, and STOXX600. Rexel is also
part of the following SRI indices: FTSE4Good, Dow Jones
Sustainability Index Europe, Euronext Vigeo Europe 120 and Eurozone
120, STOXX® Global ESG Environmental Leaders, and S&P Global
Sustainability Yearbook 2022, in recognition of its performance in
terms of Corporate Social Responsibility (CSR). For more
information, visit www.rexel.com/en
FINANCIAL ANALYSTS / INVESTORS
Ludovic
DEBAILLEUX |
+33 1 42 85 76
12 |
ludovic.debailleux@rexel.com |
PRESS
Sara DU REAU |
+33 6 60 31 77
72 |
sara.dureau@rexel.com |
Brunswick: Thomas
KAMM |
+33 1 53 96 83
92 |
tkamm@brunswickgroup.com |
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
Reported 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 restated 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 appendix, please open the pdf file by clicking on the
link at the end of the press release.
The Group is exposed to fluctuations in copper
prices in connection with its distribution of cable products.
Cables accounted for approximately 17% 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 10,
2022 under number D.22-0083.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 10, 2022 under number D.22-0083, as well as the
financial statements and consolidated result and activity report
for the 2021 fiscal year which may be obtained from Rexel’s website
(www.rexel.com).
- PR - First-quarter 2022 Sales
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