|
THIRD-QUARTER 2022 SALES Record quarter with
same-day sales growth up 16.3%Acceleration in volume growth
capturing electrification trends & additional selling price
increase 2022 guidance upgraded for the second time |
→ Sales of €4,816.6m in Q3 2022, up +16.3% on a
same-day basis, accelerating after a robust start to the
year
→ Record quarter driven by acceleration
in volume growth (c. 750bps contribution in Q3 22 vs
+60bps in Q2 22), demonstrating our ability to fully capture the
boost in electrification, notably in Europe
→ Strong selling price increase on non-cable
products in all geographies (900bps contribution), reflecting
pass-through of the rise in production costs
→ Robust growth in our three end-markets with
Residential, Commercial and Industrial up double digits
→ Double-digit growth in all three
geographies. Strong momentum in the US
reflecting good underlying demand and internal transformation
→ Strategic focus on organic growth and M&A
translating into +35.5% reported sales
growth in Q3 22
→ Digital penetration up c.
+240bps, representing c. 25% of Group revenues in Q3 22,
with +467bps improvement in the US, now at c. 18% of digital
sales
→ FY 22 guidance upgraded for same-day
sales growth and adjusted Ebita
margin
→ Share buyback with €60m
completed (c. 3.7 million shares)
Key
figures (€m) |
Q3 2022 |
YoY change |
9m 2022 |
YoY change |
Sales on
a reported basis |
4,816.6 |
+35.5% |
13,899.4 |
+31.0% |
On a constant and actual-day basis |
|
+15.5% |
|
+15.4% |
On a constant and same-day basis |
|
+16.3% |
|
+14.7% |
Same-day sales growth by geography |
|
|
|
|
Europe |
2,292.5 |
+15.9% |
6,947.5 |
+13.2% |
France |
808.3 |
+10.2% |
2,570.8 |
+9.3% |
Scandinavia |
292.3 |
+21.2% |
878.8 |
+14.0% |
Benelux |
268.0 |
+27.0% |
792.1 |
+19.8% |
Germany |
258.8 |
+25.7% |
726.6 |
+19.4% |
UK |
194.8 |
+9.5% |
613.9 |
+12.2% |
North America |
2,142.3 |
+17.3% |
5,893.0 |
+18.5% |
US |
1,753.6 |
+18.1% |
4,788.2 |
+19.5% |
Canada |
388.7 |
+14.0% |
1,104.8 |
+14.3% |
Asia-Pacific |
381.8 |
+12.7% |
1,058.9 |
+5.0% |
China |
164.2 |
+12.7% |
453.4 |
+1.7% |
Australia |
161.8 |
+12.7% |
445.5 |
+7.4% |
Guillaume TEXIER, Chief Executive Officer, said:
“Rexel benefited in the third quarter from solid underlying markets
as well as accelerating demand for electrification, driven by the
high price of energy, especially in Europe. These results and
trends enable us to upgrade our full-year targets for 2022, which
should be another record year, both in sales and profitability.Our
strong third quarter is also an excellent illustration of how our
new strategy, Power Up 2025, allows us to tap into high growth
segments of the electrical materials market, driven by powerful and
resilient mega trends such as sustainability, energy transition or
resource and labor scarcity. These trends, combined with a very
strong backlog and our relentless focus on efficiency and digital,
position us well for the future, in an economic environment that
continues to offer little visibility.” |
SALES REVIEW FOR THE PERIOD ENDED SEPTEMBER 30,
2022 |
- Unless otherwise stated, all comments are on a constant and
adjusted basis and, for sales, at same number of working days.
SALES
In Q3, sales were up +35.5% year-on-year
on a reported basis and +16.3% on a constant and
same-day basis, reflecting positive momentum in all three
geographies.
Key
figures (€m) |
Q3 2022 |
YoY change |
9m 2022 |
YoY change |
Sales on
a reported basis |
4,816.6 |
+35.5% |
13,899.4 |
+31.0% |
On a constant and actual-day basis |
|
+15.5% |
|
+15.4% |
On a constant and same-day basis |
|
+16.3% |
|
+14.7% |
In the third quarter, Rexel posted record sales
of €4,816.6m, up +35.5% on a reported basis, with a well-balanced
contribution from both organic growth and M&A. It includes
:
- A positive constant
and same-day sales growth of
+16.3%
- A negative calendar
effect of (0.8)%
- A positive currency
effect of €235.2m (i.e. +6.6%
of Q3 2021
sales), mainly due to the appreciation of the US
& Canadian dollars against the euro;
- A positive net
scope effect of €380.7m (i.e.
+10.7% of Q3
2021 sales), mainly due to Mayer
acquisition in the US.
On a constant and same-day basis, sales were up
+16.3% resulting from :
- Accelerating trends
in all 3 geographies with North America up +17.3%, Europe up +15.9%
and Asia-Pacific up +12.7%.
- Robust volume
growth, reflecting favorable underlying demand as well as our
ability to benefit from electrification trends and growing demand
for energy efficiency solutions amid rising energy costs, as
illustrated by above-Group average growth of product categories
such as PV, EV or HVAC.
By geography :
- North America is up
+10.1% in volume in the quarter, twice the Q2 22 growth of +5.1%,
notably thanks to favorable trends in Project activity and
sustained demand in Proximity
- Europe is up +5.7%
in volume vs (0.5)% in Q2 22 on market share gains, an easier base
effect and strong demand in electrification
- Asia-Pacific is up
+4.1% in volume vs (13.6)% in Q2 22, benefiting from the
post-lockdown recovery in China and positive momentum in
Australia.
- A favorable pricing
environment for non-cable products (900bps contribution in the
quarter), resulting from an additional rise recorded in Q3 2022,
offsetting the lower expected carryover effect of price increases
passed in 2021. Those additional rises in selling price result from
the overall rise of production costs from our suppliers, notably
reflecting increases in wages and energy costs.
- A neutral
copper-cable price contribution (-0.2% contribution in Q3 2022),
resulting from the lower copper price during the quarter compared
to Q3 21.
- Further growth in
digitalization in all three geographies, with a strong increase in
the US. Digital sales now represent c. 25% of sales, up c. 240bps,
with North America up +409bps (16.9% of sales), Europe up +127bps
(35.2% of sales) and Asia-Pacific up +49bps (5.5% of sales).
In the quarter, supply chain tensions improved
slightly overall, with the exception of semi-conductors. This
“scarcity environment” continues to be an opportunity for Rexel, as
we help our customers deal with product and labor availability
shortages to unlock productivity gains.
In 9m 2022, Rexel posted sales of €13,899.4m, up
+31.0% on a reported basis, including:
- A positive constant
and same-day sales growth of +14.7% including a positive impact of
+1.9% from the change in copper-based cable prices (vs a positive
impact of +5.2% in 9m 2021)
- A positive calendar
effect of +0.7%
- A positive currency
effect of €516.2m (i.e. +4.9% of 9m 2021 sales), mainly due to the
appreciation of the US & Canadian dollars against the euro
- A positive net
scope effect of €916.1m (i.e. +8.6% of 9m 2021 sales), mainly
resulting from the acquisition of Mayer in the US
Europe (48% of Group sales): +15.9% in
Q3 on a constant and same-day basis
In the third quarter, sales in Europe increased
by +15.9% on a reported basis, including a positive currency effect
of +0.6%, or €10.9m, mainly due to the appreciation of the Swiss
Franc against the euro and a positive scope effect of +0.7%, or
€14.3m, resulting from the acquisition of Trilec in Belgium. The
calendar effect stood at (1.5)% in the quarter. On a constant and
same-day basis, sales were up +15.9% in Q3 accelerating versus
+10.4% posted in Q2 22.
Key
figures (€m) |
Q3 2022 |
YoY change |
9m 2022 |
YoY change |
Europe |
2,292.5 |
+15.9% |
6,947.5 |
+13.2% |
France |
808.3 |
+10.2% |
2,570.8 |
+9.3% |
Scandinavia |
292.3 |
+21.2% |
878.8 |
+14.0% |
Benelux |
268.0 |
+27.0% |
792.1 |
+19.8% |
Germany |
258.8 |
+25.7% |
726.6 |
+19.4% |
UK |
194.8 |
+9.5% |
613.9 |
+12.2% |
Switzerland |
158.7 |
+6.3% |
451.7 |
+5.2% |
Overall in Europe, sales growth acceleration is
largely driven by the boost in volumes (+5.7% in Q3 22 vs (0.5)% in
Q2 22), resulting from market outperformance, a more favorable base
effect and robust demand in electrification product categories: PV,
HVAC, EV (12% of sales) were up more than 80%, contributing for
650bps to same-day sales growth in the quarter. In an environment
of rising energy prices, the payback of energy efficiency projects
has been significantly shortened, from 9 years on average to up to
1 year depending on countries. In addition, through PV solutions,
customers increase their energy autonomy.
- Sales in
France (35% of the region’s sales) were up +10.2%,
driven by continued market share gains amid labor and product
scarcity. The environment remains favorable in the renovation
construction business (both residential and commercial). Electric
Vehicles, Photovoltaic and HVAC contributed for c. 200bps. The
quarter was also marked by higher digital penetration (c. 29% of
sales, up c. 260bps).
- Sales in
Scandinavia (13% of the region’s sales) were up
+21.2%. Robust sales growth in Sweden, the largest country, was
driven by the Residential market, largely boosted by our ability to
serve PV demand. The Commercial and Industrial segments also
contributed to the overall growth.
-
Benelux (12% of the region’s sales) grew by
+27.0%, thanks to renewable energy products (PV/EV/HVAC
representing 18% of sales, up c. 90% yoy and contributing for
1,110bps), in a context of rising energy prices.
- Sales in
Germany (11% of the region’s sales) posted strong
+25.7% growth, with further market share gains while increasing
business selectivity. Growth during the quarter was supported by
Residential and Industrial markets. PV demand was a major growth
driver (up c. 280%, contributing for 1,270bps), driven by the focus
on increasing the country’s energy independence in the context of
the war in Ukraine. Industrial demand was driven by machine
manufacturers, automotive and energy & water markets.
- In the
UK (8% of the region’s sales), sales increased by
+9.5%, mostly from the Commercial segment. The country benefited
from a strong selling price contribution to compensate for currency
depreciation on imported products.
North America (44% of Group sales): +17.3% in Q3 on a
constant and same-day basis
In the third quarter, sales in North America
increased by +70.0% on a reported basis, including a positive
currency effect of +15.5%, or €195.6m, from the appreciation of the
US & Canadian dollars against the euro, and a positive scope
effect of +29.3%, or €368.7m, from the acquisition of Mayer and, to
a lesser extent, Horizon Solutions in the US. On a constant and
same-day basis, sales were up +17.3%, driven by the US and
Canada.
Key
figures (€m) |
Q3 2022 |
YoY change |
9m 2022 |
YoY change |
North America |
2,142.3 |
+17.3% |
5,893.0 |
+18.5% |
United States |
1,753.6 |
+18.1% |
4,788.2 |
+19.5% |
Gulf Central |
|
+40.8% |
|
+38.4% |
Mountain Plains |
|
+38.6% |
|
+36.1% |
California |
|
+33.5% |
|
+20.1% |
Midwest |
|
+28.9% |
|
+20.8% |
Florida |
|
+21.5% |
|
+21.6% |
Northwest |
|
+15.2% |
|
+20.0% |
Southeast |
|
+13.8% |
|
+13.9% |
Northeast |
|
+13.6% |
|
+6.9% |
Mayer |
|
+2.7% |
|
+11.6% |
Canada |
388.7 |
+14.0% |
1,104.8 |
+14.3% |
-
In the US (82% of the region’s sales), sales
posted solid +18.1% growth on a same-day basis, accelerating
compared to Q2 22 with above average trends in Gulf Central
(Industrial automation and Oil & Gas), Mountain Plains
(Commercial segment in large cities) and California (Commercial
business). By market, all three end-markets grew at a similar pace
with further positive development in Commercial, Residential and
Industrial. We recorded a growth acceleration in our Projects
activity and a steady level of order intake.
-
In Canada (18% of the region’s sales), sales grew
by +14.0% on a same-day basis. It was notably driven by the
Industrial end-market up c. 25%, contributing for c. 1,060bps
notably boosted by robust demand in oil & gas and mining,
contributing to growth for 190bps and 100bps respectively.
Asia-Pacific (8% of Group sales): +12.7%
in Q3 on a constant and same-day basis
In the third quarter, sales in Asia-Pacific were
up +20.6% on a reported basis, including a positive currency effect
of +9.1%, or €28.7m, mainly due to the appreciation of the Chinese
renminbi and the Australian dollar against the euro and a negative
scope effect of (0.7)%, or €(2.3)m, related to the disposal of
Rexel Saudi Arabia in Q4 2021. On a constant and same-day basis,
sales were up +12.7%.
Key
figures (€m) |
Q3 2022 |
YoY change |
9m 2022 |
YoY change |
Asia-Pacific |
381.8 |
+12.7% |
1,058.9 |
+5.0% |
China |
164.2 |
+12.7% |
453.4 |
+1.7% |
Australia |
161.8 |
+12.7% |
445.5 |
+7.4% |
- In the Pacific (51%
of the region’s sales), sales were up +14.8% on a constant and
same-day basis:
- In
Australia (83% of Pacific’s sales), sales
increased by +12.7%, accelerating from 5% in Q2, driven by robust
growth in all segments, particularly Commercial, amid labor
scarcity.
- In Asia (49% of the
region’s sales), sales increased by +10.6% on a constant and
same-day basis:
- In
China (88% of Asia’s sales), sales were up +12.7%.
The acceleration post lockdown was supported by demand from
machinery, automotive, power and renewables. The quarter benefited
from selling price increases.
Following stronger than projected activity, we
are upgrading our FY 22 guidance for the second time.
We now anticipate for 2022, at comparable scope
of consolidation and exchange rates:
- Same-day sales growth of c. 12% (vs
7%-9% previously)
- An adjusted EBITA1 margin of c.
7.2%, including 70bps of non-recurring items (vs 6.7%, including
50bps of non-recurring items)
- Free cash flow conversion2 above
60% (unchanged)
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.
February 16, 2023
Full-year
2022 results April 20,
2023 First-quarter
2023 salesApril 20,
2023 Annual
Shareholders’ Meeting
A slideshow of the third 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
40 ESG, 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
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 - Third-quarter 2022 Sales
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