FOURTH-QUARTER & FULL-YEAR 2017 RESULTS
CONTINUED ACCELERATION IN SAME-DAY SALES IN Q4 2017, UP 5.4%
IMPROVED OPERATING LEVERAGE IN Q4, WHILE INVESTING IN THE US
ADJUSTED EBITA UP +6.1% IN FY 2017, FULLY IN LINE WITH GUIDANCE
– SALES OF €3.405bn IN Q4, UP IN EVERY GEOGRAPHY
- On a constant and same-day basis, sales up 5.4% of which:
- Europe: +5.5%, benefiting from accelerating sales across most European countries
- North America: +3.2%, supported by Canada and proximity business in the US
- Asia-Pacific: +12.7%, mainly driven by China and Australia
- Organic actual-day growth of 2.7% including -2.7% from calendar and +1.6% from copper
- Reported growth down 1.5%, including unfavorable currency (-3.6%) and scope (-0.5%) effects
– ADJUSTED EBITA UP 8.7% IN Q4, WITH A MARGIN OF 4.7% DESPITE AN UNFAVORABLE CALENDAR EFFECT
- Solid gross margin, up 39 bps at 24.5%, driven by Europe and North America
- Adj. EBITA margin up 26 bps, while accelerating investments in the US
– STRONG INCREASE IN RECURRING NET INCOME OF +32.2% IN Q4
– INCREASE IN PROPOSED DIVIDEND TO €0.42 PER SHARE, PAYABLE IN CASH
|Key figures1||Q4 2017||YoY change||FY 2017||YoY change|
|On a reported basis||-1.5%||+1.1%|
|On a constant and actual-day basis||+2.7%||+2.9%|
|On a constant and same-day basis||+5.4%||+3.5%|
|As a percentage of sales||4.7%||4.4%|
|Change in bps as a % of sales||+26bps||+13bps|
|Recurring net income||€83.0m||+32.2%||€291.2m||+16.4%|
|FCF before interest and tax||€364.8m||vs. €414.7m||€384.3m||vs. €439.1m|
|Net debt at end of period||€2,041.2m||6.0% reduction|
1 See definition in the Glossary section of this document 2 At comparable scope of consolidation and exchange rates and excluding (i) amortization of PPA and (ii) the non-recurring effect related to changes in copper-based cables price
Patrick BERARD, Chief Executive Officer, said:
“Our Q4 and full-year performance demonstrate that the strategy we presented at our Capital Markets Day last February has started to show positive results, thanks to the quality and mobilization of our teams, which allowed us to gain new customers. In France, our business strengthened throughout the year. In the US, we saw much better momentum in our Proximity business. In the UK, we protected our margin, thanks to the merger of our banners. We have also completed the first step of our disposal plan, exiting South East Asia in order to be more focused on our key countries.
In 2018, we expect the market environment to remain favorable in most geographies. We will continue to invest in our digital strategy and operations in the US, while benefiting from previously-launched US initiatives. Consistent with our medium-term ambition, we target further organic sales growth in the low single digits in 2018 and expect a mid- to high-single-digit increase in adjusted EBITA.
We will propose a dividend of €0.42 per share payable in cash, in line with our pay-out policy.”
FINANCIAL REVIEW FOR THE PERIOD ENDED DECEMBER 31, 2017
- Financial statements as of December 31, 2017 were authorized for issue by the Board of Directors on January 13, 2018. They have been audited by statutory auditors.
- The following terms: Reported EBITA, Adjusted EBITA, EBITDA, Recurring net income, 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.
In Q4, sales were down 1.5% year-on-year on a reported basis and up 5.4% on a constant and same-day basis, reflecting improvement in sales trends in all three geographies.
In FY, sales were up 1.1% year-on-year on a reported basis and up 3.5% on a constant and same-day basis.
In the fourth quarter, Rexel posted sales of €3,405.4 million, down 1.5% on a reported basis. On a constant and same-day basis, sales were up 5.4%, including a 1.6% positive effect due to the change in copper-based cable prices.
The 1.5% decrease in sales on a reported basis included:
- A negative currency effect of €123.7 million (i.e. -3.6% of Q4 2016 sales), mainly due to the depreciation of the US dollar and the British pound against the euro,
- A negative net scope effect of €18.3 million (i.e. -0.5% of Q4 2016 sales), resulting from the recent divestments in South East Asia,
- A negative calendar effect of 2.7 percentage points.
In FY 17, Rexel posted sales of €13,310.1 million, up 1.1% on a reported basis. On a constant and same-day basis, sales were up 3.5%, including a 1.4% positive impact due to the change in copper-based cable prices.
The 1.1% …