Rexel (RXL) H1 2024 earnings summary

Executive summary

• H1 2024 sales reached €9.6 billion, with Q2 sales up 1.8% year-over-year, offsetting a Q1 decline; North America and APAC performed strongly while Europe remained weak.

• Adjusted EBITDA/EBITA margin was 6.0% in H1, reflecting resilience but down from 7.3% in H1 2023 due to lower sales and gross margin contraction.

• Free cash flow before interest and tax hit a record €335 million, with a 53% conversion rate, reflecting strong operational discipline.

• Net income was €353 million, down 17.6% year-over-year, with recurring net income at €341 million.

• Strategic acquisitions (Talley in the US, Wasco in the Netherlands, Electrical Supplies Inc. in Florida, Itesa in France) and digital transformation initiatives supported growth.

Financial highlights

• Q2 2024 sales were €4.9–5.0 billion, up 1.8% year-over-year, with acquisitions contributing +3.2–3.4% and offsetting organic decline.

• Adjusted EBITDA/EBITA for H1 2024 was €574 million, margin at 6.0%, down from 7.3% in H1 2023.

• Gross margin for H1 was 25%, similar to H2 2023 but down 84 bps year-over-year.

• Net financial expenses increased to €96 million, mainly due to higher interest rates and gross debt.

• CapEx to sales ratio was 0.6%, in line with last year.

Outlook and guidance

• Full-year 2024 guidance confirmed at the lower end for same-day sales growth and adjusted EBITDA/EBITA margin.

• Guidance: stable to slightly positive same-day sales growth, adjusted EBITDA/EBITA margin between 6.3% and 6.6%, and free cash flow conversion above 60%.

• No sequential recovery assumed in Europe; North America expected to remain resilient due to backlog.

• Margin improvement in H2 expected from cost reductions and easing deflationary effects.