PARIS--(Marketwire - Oct 31, 2012) -
THIRD-QUARTER & 9-MONTH 2012 RESULTS (unaudited)
Financial statements at Sept. 30, 2012 were authorized for issue by the
Management Board on October 24, 2012.
REPORTED SALES UP 7.2% IN Q3 AND 6.8% IN THE 9 MONTHS
RESILIENT PERFORMANCE IN A CHALLENGING ENVIRONMENT
FULL-YEAR PROFITABILITY AND CASH-FLOW TARGETS CONFIRMED
NEW STRATEGIC ACQUISITION IN THE US
SOLID GROWTH IN REPORTED SALES
* Reported sales up 7.2% in Q3 and up 6.8% in the 9 months
* Strong contribution from acquisitions and positive currency effect more
than offset the decrease in organic sales
RESILIENT PERFORMANCE IN INCREASINGLY CHALLENGING CONDITIONS
* Q3: Reported EBITA up 3.9% and Adjusted EBITA(1) margin of 5.6%
* 9 months: Reported EBITA up 8.2% and Adjusted EBITA(1) margin of 5.6%
FULL-YEAR PROFITABILITY AND CASH-FLOW TARGETS CONFIRMED
NEW STRATEGIC ACQUISITION IN THE US: MUNRO DISTRIBUTING COMPANY
+----------------------------------+-------+----------+--------+----------+
|At September 30 |Q3 2012|YoY Change| 9m 2012|YoY Change|
+----------------------------------+-------+----------+--------+----------+
|On a reported basis | | | | |
+----------------------------------+-------+----------+--------+----------+
|Sales (EURm) |3,441.3| +7.2%|10,009.4| +6.8%|
| | | | | |
|% change constant & same-day | | -3.6%| | -0.8%|
+----------------------------------+-------+----------+--------+----------+
|EBITA (EURm) | 190.8| +3.9%| 561.2| +8.2%|
+----------------------------------+-------+----------+--------+----------+
|EBITA margin (as a % sales) | 5.5%| -20bps| 5.6%| +10bps|
+----------------------------------+-------+----------+--------+----------+
|Operating income (EURm) | 172.0| +3.9%| 482.2| +1.4%|
+----------------------------------+-------+----------+--------+----------+
|Net income (EURm) | 85.3| +1.3%| 236.4| -7.8%|
+----------------------------------+-------+----------+--------+----------+
|Recurring net income (EURm) | 96.4| +0.3%| 286.7| +10.0%|
+----------------------------------+-------+----------+--------+----------+
|Free cash flow before interest and| 103.8| -34.8%| 228.6| -3.4%|
| tax paid (EURm) | | | | |
+----------------------------------+-------+----------+--------+----------+
|Net debt end of period (EURm) | | | 2,773.2| +22.2%|
+----------------------------------+-------+----------+--------+----------+
|On a constant and adjusted basis | | | | |
|(1) | | | | |
+----------------------------------+-------+----------+--------+----------+
|Gross profit (EURm) | 834.0| -3.3%| 2,456.0| +0.3%|
+----------------------------------+-------+----------+--------+----------+
|Gross margin (as a % sales) | 24.2%| +20bps| 24.5%| +20bps|
+----------------------------------+-------+----------+--------+----------+
|EBITA (EURm) | 191.7| -8.2%| 558.1| +1.7%|
+----------------------------------+-------+----------+--------+----------+
|EBITA margin (as a % sales ) | 5.6%| -20bps| 5.6%| +10bps|
+----------------------------------+-------+----------+--------+----------+
(1) Constant and adjusted = at comparable scope of consolidation and
exchange
rates, excluding the non-recurring effect related to changes in
copper-based cable prices and before amortization of purchase price
allocation; an extract of
financial statements is presented in Appendix.
Rudy PROVOOST, Chairman of the Management Board and CEO, said:
"In the past quarter, we demonstrated the resilience of our business
model
despite a challenging environment. Supported by acquisitions and driven
by our
Energy in Motion initiatives, Rexel posted solid growth in reported
sales and
reported EBITA. The strategic acquisition of Munro announced today is a
further
demonstration of our commitment to increase our footprint in the US
market and
expand our offer in Energy Efficiency solutions.
In an increasingly uncertain macroeconomic context, we target mid- to
high-single-digit growth in reported sales and reported EBITA for
the year and
confirm our targets of profitability and cash generation with an adjusted
EBITA
margin of 5.7% and free cash-flow before interest and tax of around
EUR600m."
Financial review for the period ended September 30, 2012
Unless otherwise stated, all comments are on a constant and adjusted basis
and, for sales, at same number of working days
Reported sales: +7.2% in Q3 and +6.8% in the 9 months, supported by
solid
contribution from acquisitions and a positive currency effect
Constant and same-day sales evolution: -3.6% in Q3, reflecting the
economic
slowdown and challenging comparables vs. Q3 2011; -0.8% in the 9 months
In the third quarter, Rexel recorded sales of EUR3,441.3 million, up
7.2% on a
reported basis and down 3.6% on a constant and same-day basis.
Excluding the
negative 1.0 percentage point impact due to the change in copper-based
cable
prices, sales were down 2.6% on a constant and same-day basis.
The 7.2% rise in sales on a reported basis included:
· A positive currency effect of EUR191.4 million (mainly due to the
appreciation
of the USD, the CAD, the GBP and the AUD against the euro),
· A net positive effect of EUR191.5 million from changes in
the scope of
consolidation (acquisitions: EUR193.4 million minus divestments: EUR1.9
million),
which accelerated in Q3 due to the consolidation of Platt as from July 1,
· A negative calendar effect of 0.6 percentage point.
On a constant and same-day basis, sales reflected increasingly
challenging
conditions in Rexel's end-markets:
* Slowing momentum from industry,
* Persistently low level of residential construction,
* Weak activity in the commercial end-market, impacted by postponement of
projects, as well as challenging comparables: Q3 2011 was the strongest
quarter last year
(+7.5% on a constant and same-day basis).
In the nine months, Rexel recorded sales of EUR10,009.4 million, up
6.8% on a
reported basis and down 0.8% on a constant and same-day basis.
Excluding the
negative 0.9 percentage point impact due to the change in copper-based
cable
prices, sales were slightly up (+0.1%) on a constant and same-day basis.
The 6.8% rise in sales on a reported basis included:
· A positive currency effect of EUR410.5 million (mainly due to the
appreciation
of the USD, the CAD, the GBP and the AUD against the euro),
· A net positive effect of EUR281.3 million from changes in
the scope of
consolidation (acquisitions: EUR346.2 million minus divestments: EUR64.9
million),
· A positive calendar effect of 0.2 percentage points.
Europe (55% of Group sales): -5.2% in Q3 and -2.5% in 9m on a constant and
same-day basis
In the third quarter, sales in Europe decreased by 0.7% on a reported
basis,
including a positive impact of EUR67.8 million from the consolidation of
Eurodis
and Toutelectric in France, Wilts in the UK, La Grange in Belgium and
Erka in
Spain.
On a constant and same-day basis, sales slowed sequentially: -5.2% in
Q3 vs.
-2.7% in Q2. Excluding photovoltaic, sales were down 4.6% in Q3.
In France, sales were down 4.9% in Q3 (vs. -2.8% in the previous
quarter),
reflecting lower demand from the industrial end-market as well as a
slowdown in
residential and commercial construction.
In the UK, sales were down 3.3% in Q3, in line with the previous
quarter and
against very challenging comparables (Q3 2011 was the strongest quarter
last
year at +11.0%). Excluding photovoltaic and the impact of the
branch
optimization program that was implemented in recent quarters (438
branches at
September 30, 2012 vs. 452 branches at September 30, 2011), sales were down
only
-1.6% in Q3 (vs. -2.5% in the previous quarter).
In Germany, sales were down 5.1%, in Q3 (vs. -5.4% in the previous
quarter).
Excluding photovoltaic, sales were down 3.4% in Q3 (vs. +0.1% in the
previous
quarter), reflecting slowing momentum from the industrial end-market and
lower
export activity
In Belgium, sales were down 13.9%, in Q3. Excluding photovoltaic, sales
were
down 6.8% (vs. -0.4% in the previous quarter), impacted by delayed
commercial
projects and lower residential activity.
In the Netherlands, sales posted a 9.6% decline in Q3, continuing to
reflect
difficult market conditions and the business transformation underway.
In both Switzerland and Austria, sales grew in Q3, respectively by
2.3% and
4.2%.
In Scandinavia, sales decreased by 3.3% in Q3. They were up 1.4% in
Norway,
while Sweden and Finland were down respectively 5.2% and 6.4%,
reflecting
challenging macroeconomic conditions in both countries.
Southern European countries posted a decline of 11.8% in Q3, largely due
to the
continued poor performance of Spain (-16.8%) and Italy
(-8.4%), while Portugal
posted an increase of 4.6%, helped by export activity.
North America (32% of Group sales): +0.1% in Q3 and +3.2% in 9m on a
constant
and same-day basis
In the third quarter, sales in North America were up 22.5% on a reported
basis,
including a positive effect of EUR116.1 million from exchange rates (USD
and CAD
against the euro) and a further positive effect of EUR100.8 million
resulting from
the consolidation of Liteco (Canada) as from January 2012 and,
more
significantly, from the acquisition of Platt (US) as from July 2012.
Platt
represented EUR86.0 million out of the EUR100.8 million scope effect in the
quarter.
On a constant and same-day basis, sales were broadly flat (+0.1%),
reflecting
contrasting situations: -1.8% in the US and +5.0% in Canada.
In the US, sales were down 1.8% in Q3, reflecting challenging
comparables (Q3
2011 was the strongest quarter last year: +9.2% on a constant and
same-day
basis). On a 24-month basis, sales were up 8.9% in Q3 2012 (vs. Q3 2010) in
line
with the 8.7% growth posted in Q2 2012 (vs. Q2 2010).
In Canada, sales were up 5.0%, despite a challenging base effect
(constant and
same-day growth was +11.2% in Q3 2011). Growth continued to be driven
by the
industrial end-market, particularly in the mining and oil & gas segments.
Asia-Pacific (10% of Group sales): -9.0% in Q3 and -4.4% in 9m on a
constant and
same-day basis
In the third quarter, sales in Asia-Pacific were up 0.9% on a reported
basis,
including a positive effect of EUR40.9 million from favorable
exchange rates
(primarily the appreciation of the AUD against the euro).
On a constant and same-day basis, sales were down 9.0% in Q3.
In China (c. 25% of the region's sales), sales were down 7.4%,
reflecting a
strong decline in wind sales and extremely challenging comparables as Q3
2011
was the strongest quarter last year, notably due to the positive impact
of a
large project operated by Gexpro China (+33.3% on a constant and
same-day
basis). Excluding wind, sales were up 1.1% in Q3.
In Australia (c. 60% of the region's sales), sales were down 8.5%,
still
impacted by difficult macroeconomic conditions but also by the
implementation of
a new carbon tax as from July 1, that severely hit mining and projects.
In New Zealand (c. 10% of the region's sales), sales were down 14.8%,
still
reflecting the poor macroeconomic environment, branch closures (50
branches at
September 30, 2012 vs. 61 branches at September 30, 2011) and delay in
post-earthquake reconstruction.
Latin America (3% of Group sales): +4.3% in Q3 and +5.4% in 9m on a
constant and
same-day basis
In the third quarter, sales in Latin America were up 47.7% on a reported
basis,
including a positive effect of EUR24.6 million resulting from the
consolidation of
Delamano and Etil in Brazil and V&F Tecnologia in Peru.
On a constant and same-day basis, sales were up 4.3% due to strong
performance
in Chile (+15.9%) and Peru (+15.8%), while sales in Brazil were slightly
down
(-2.0%), impacted by slower momentum in industry and the integration
process of
the recently acquired Delamano.
Resilient profitability in Europe and improvement in North America (87% of
sales) despite increasingly challenging macroeconomic conditions;
Asia-Pacific and Latin America under pressure
In the third quarter, EBITA[1] margin decreased by 20 basis points and
stood at
5.6%.
This 20 basis point drop reflected:
* A 20 basis point improvement in gross margin, to 24.2%,
* An increase in distribution and administrative expenses[2] as a
percentage of sales (from 18.20% in Q3 2011 to 18.66% in Q3 2012): these
expenses were reduced by 1.8% while sales decreased by 4.2% on a constant
and actual-day basis.
By geography:
* Europe demonstrated very strong resilience with stable EBITA(1) margin
of 6.5% (sales were down 5.9% in the quarter on a constant and actual-day
basis),
* North America continued to improve its EBITA(1) margin by 20bps to 5.4%
(sales were flat in the quarter on a constant and actual-day basis),
* Asia-Pacific posted a 230bp drop in EBITA(1) margin to 5.1%, impacted
by the strong decline in sales (down 9.7% in the quarter on a constant and
actual-day basis) and adverse geographic mix,
* Latin America posted a 220bp drop in EBITA(1) margin to 1.5% (although
sales were up 1.2% in the quarter on a constant and actual-day basis),
impacted by strong inflation in personnel costs and expense due to building
a strong national platform in Brazil.
Europe and North America, which demonstrated either very resilient or
improved
EBITA(1) margin, represent over 85% of Group sales.
In the nine months, EBITA(1) margin improved by 10 basis points and
stood at
5.6%
This 10bp improvement reflected:
* A 20bp improvement in gross margin, to 24.5%,
* An increase in distribution and administrative expenses2 as a
percentage of sales (from 18.87% in 9m 2011 to 18.96% in 9m 2012): these
expenses were reduced by 0.1% while sales decreased by 0.6% on a constant
and actual-day basis.
Reported EBITA up 3.9% in Q3 and up 8.2% in the nine months
Reported EBITA reached EUR190.8 million in the quarter, up 3.9%
year-on-year, and
EUR561.2 million in the nine months, up 8.2% year-on-year, boosted by
acquisitions
and a positive currency effect.
Operating income up 3.9% in Q3 and 1.4% in the nine months
Recurring net income up 10.0% in the nine months; reported net income
impacted
by rise in tax rate
In the nine months, operating income was up 1.4% at EUR482.2 million.
* Amortization of purchase price allocation amounted to EUR9.3 million
(vs. EUR13.1 million in 9m 2011).
* Other income and expenses amounted to a net charge of EUR69.7 million
(vs. a net charge of EUR29.9 million in 9m 2011, which benefited from the
net proceeds from the disposals of HBA and Kompro for EUR26.1 million).
They included EUR27.6 million of goodwill impairment (already accounted for
as of June 30 and mainly due to weaker than expected performance in the
Netherlands and in New Zealand). They also included EUR28.2 million of
restructuring costs (vs. EUR15.2 million in 9m 2011).
In the nine months, net income stood at EUR236.4 million vs. EUR256.3
million in
9m 2011. The 7.8% decrease was mainly attributable to the rise in the
effective
tax rate: as expected, this rate increased to 29.5% in 9m 2012 vs.
21.2% in
9m 2011, which benefited from the recognition of prior-year losses
carried
forward.
It included:
* Net financial expenses for EUR149.0 million (vs. EUR152.1 million in
9m 2011). The average effective interest rate for the nine months stood at
7.2% (flat vs. 9m 2011).
* Income tax represented a charge of EUR98.3 million (vs. EUR68.5
million in 9m 2011), as explained above.
* Share of profit/loss in associates was a profit of EUR1.5 million (vs.
a profit of EUR1.2 million in 9m 2011).
In the nine months, recurring net income amounted to EUR286.6 million, up
10.0%
year-on-year (see appendix 2).
Positive free cash-flow before interest and tax(3) of EUR228.6 million in
the nine
months
Temporary rise in indebtedness ratio to slightly above 3 times
EBITDA at
September 30, 2012 (vs. 2.80x at September 30, 2011) due to the impact
of the
payment of Platt in early July
In the nine months, free cash flow before interest and tax[3] was an
inflow of
EUR228.6 million (vs. an inflow of EUR236.6 million in 9m 2011).
This inflow
included:
* Net capital expenditure of EUR54.2 million,
* A EUR268.0 million outflow from change in working capital, resulting
from stronger sales, higher inventories and lower level of trade payables.
At September 30, 2012, net debt stood at EUR2,773.2 million, vs. 2,270.2
million
at September 30, 2011 and vs. 2,078.2 million at December 31, 2011. It took
into
account:
· EUR491.6 million of net financial investment, of which EUR338.1
million in Q3
largely attributable to the payment of Platt in early July,
· EUR126.1 million of net interest paid,
· EUR94.9 million of income tax paid,
· EUR143.0 million of dividend paid in cash,
· EUR19.9 million of unfavorable currency effect.
At the end of September, the indebtedness ratio (Net financial debt /
EBITDA),
as calculated under the Senior Credit Agreement terms, stood at 3.07 (vs.
2.80x
at September 30, 2011 and vs. 2.40x at December 31, 2011). This
level was
temporarily impacted by the payment of Platt in early July. It will
return to
around 2.8 times at the end of the year (including the impact of
the two
acquisitions announced below), thanks to the strong seasonality of cash
flow
generation during Q4.
Two new acquisitions in line with Rexel's external growth strategy and
Energy in
Motion plan
* USA: strengthened presence and acceleration in energy efficiency with
the strategic acquisition of Munro Distributing Company
Rexel reached an agreement yesterday to acquire Munro Distributing
Company, an
innovative electrical products & services distributor specializing in
energy
efficiency and conservation solutions in the Eastern US and California.
This
acquisition significantly reinforces Rexel's position in the US as a
premier
provider of energy efficiency solutions. The combination of Rexel's
robust
energy platform - within its Gexpro and Rexel Inc. banners - and
Munro
Distributing Company will create an energy efficiency solutions
offering of
unrivaled scope in the U.S. market, in line with Rexel's Energy in
Motion
strategic plan.
Munro Distributing Company's history of innovative energy efficiency
solutions
and strong partnerships with energy services companies (ESCOs) and
utilities
will create significant value for the Group.
Founded in 1951 and based in Massachusetts, the company operates 12
branches
located in 5 states (Massachusetts, Rhode Island, New York, New
Jersey and
California) and employs about 185 people. It should post annual sales of c.
EUR115
million this year (vs. EUR88 million in 2011).
This acquisition represents c. EUR115 million (enterprise value) for Rexel
and it
will be accretive by the end of 2013. The transaction, subject to
customary
conditions, should close in early December and Munro Distributing
Company's
operations should be consolidated from December 1.
* Peru: expanded footprint and strengthened links to the mining industry
through the acquisition of Dirome
In early August, Rexel acquired one of the leading players in Peru, Dirome.
This
acquisition expands Rexel's footprint in the fast-growing Peruvian
market and
strengthens its presence in the mining industry, one of the
priorities of
Rexel's Energy in Motion company plan.
With its experience in distributing a broad offer of electrical
products to
large industrial and service companies, small and medium-sized
contractors and
retail operators, Dirome offers strong geographical and business
complementarity
with V&F Tecnologia, which Rexel acquired in October 2011.
Founded in 1996, Dirome operates 4 branches (2 in Trujillo, 1 in Piura and
1 in
Lima), employs 55 people and serves the Peruvian coast from North to
South. It
should post annual sales of c. EUR10 million in 2012.
This acquisition will be accretive by the end of 2013 and Dirome's
operations
are consolidated as from October 1.
2012 outlook
In a macroeconomic environment that has slowed continuously since the
beginning
of the year, Rexel, driven by its acquisition strategy, targets:
* Mid- to high-single digit growth in reported sales (vs. previous target
of "organic growth above weighted GDP average growth"),
* Mid- to high-single digit growth in reported EBITA (new target).
Despite the increasingly uncertain macroeconomic context, Rexel
confirms its
profitability and cash-flow targets:
* Adjusted EBITA(1) margin of 5.7% (in line with the previously-announced
target of "at least 5.7%"),
* Free cash-flow before interest and tax of around EUR600 million
(unchanged).
Calendar
February 12, 2013 Fourth-quarter and full-year 2012
results
May 2, 2013 First-quarter 2013 results
July 26, 2013 Second-quarter and half-year 2013
results
October 31, 2013 Third-quarter and 9-month 2013
results
Financial information
The financial report for the period ended September 30, 2012 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 & 9-month 2012 results is also available
on the
Group's website.
Rexel, a global leader in the distribution of sustainable and
innovative
products and services for automation, technical supply and energy
management,
addresses three main markets - industrial, commercial and residential. The
Group
supports customers around the globe, wherever they are, to create value
and run
their business better. With a network of some 2,200 branches in 37
countries,
and over 28,000 employees, Rexel's sales were EUR12.7 billion in
2011. Its
majority shareholders are an investor group led by Clayton, Dubilier &
Rice,
Eurazeo and BAML Capital Partners.
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, FTSE4Good,
STOXX600,
STOXX Europe Sustainability and ASPI Eurozone.
Rexel has elected for early adoption of revised IAS 19 "Employee
Benefits"
following its endorsement by EU on June 6, 2012. The early adoption of
this
amendment improves information of the Group's financial situation, in
particular
the presentation in the financial statements of the surplus or
deficit of
pension funds. Accounting policy changes have been applied retrospectively
of of
January 1, 2011 and comparative information are available in the
consolidated
financial statements.
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 loss of EUR8.8 million in Q3 2011 and a loss of EUR0.9 million in Q3
2012;
- a loss of EUR0.4 million in 9m 2011 and a profit of EUR3.1 million in 9m
2012.
GROUP
+-----------------------+-------+-------+------+---------+---------+------+
|Constant and adjusted |Q3 2011|Q3 2012|Change| 9m 2011 | 9m 2012 |Change|
| basis (EURm) | | | | | | |
+-----------------------+-------+-------+------+---------+---------+------+
|Sales |3,593.7|3,441.3| -4.2%| 10,065.1| 10,009.4| -0.6%|
| | | | | | | |
| on a constant basis| | | | | | |
| and same days | | | -3.6%| | | -0.8%|
+-----------------------+-------+-------+------+---------+---------+------+
|Gross profit | 862.7| 834.0| -3.3%| 2,447.5| 2,456.0| +0.3%|
| | | | | | | |
| as a % of sales | 24.0%| 24.2%|+20bps| 24.3%| 24.5%|+20bps|
+-----------------------+-------+-------+------+---------+---------+------+
|Distribution & adm. | | | | | | |
|expenses | | | | | | |
|(incl. depreciation) |(653.9)|(642.3)| -1.8%|(1,899.0)|(1,897.9)| -0.1%|
+-----------------------+-------+-------+------+---------+---------+------+
|EBITA | 208.8| 191.7| -8.2%| 548.6| 558.1| +1.7%|
| | | | | | | |
| as a % of sales | 5.8%| 5.6%|-20bps| 5.5%| 5.6%|+10bps|
+-----------------------+-------+-------+------+---------+---------+------+
|Headcount | | | | | | |
|(end of period) | 30,927| 30,400| -1.7%| 30,927| 30,400| -1.7%|
+-----------------------+-------+-------+------+---------+---------+------+
EUROPE
+-----------------------+-------+-------+------+---------+---------+------+
| Constant and adjusted |Q3 2011|Q3 2012|Change| 9m 2011 | 9m 2012 |Change|
| basis (EURm) | | | | | | |
+-----------------------+-------+-------+------+---------+---------+------+
|Sales |1,944.9|1,829.3| -5.9%| 5,690.1| 5,525.6| -2.9%|
| | | | | | | |
| on a constant basis| | | | | | |
| and same days | | | -5.2%| | | -2.5%|
| | | | | | | |
|o/w France | 606.6| 576.9| -4.9%| 1,882.8| 1,825.5| -3.0%|
| | | | | | | |
| on a constant basis| | | | | | |
| and same days | | | -4.9%| | | -2.5%|
| | | | | | | |
| United Kingdom | 294.9| 281.3| -4.6%| 806.4| 794.5| -1.5%|
| | | | | | | |
| on a constant basis| | | | | | |
| and same days | | | -3.3%| | | -1.5%|
| | | | | | | |
| Germany | 241.1| 225.5| -6.5%| 669.3| 650.5| -2.8%|
| | | | | | | |
| on a constant basis| | | | | | |
| and same days | | | -5.1%| | | -2.3%|
| | | | | | | |
| Scandinavia | 239.9| 228.6| -4.7%| 682.1| 688.4| +0.9%|
| | | | | | | |
| on a constant basis| | | | | | |
| and same days | | | -3.3%| | | +1.3%|
+-----------------------+-------+-------+------+---------+---------+------+
|Gross profit | 500.8| 482.6| -3.6%| 1,498.6| 1,489.4| -0.6%|
| | | | | | | |
| as a % of sales | 25.7%| 26.4%|+70bps| 26.3%| 27.0%|+70bps|
+-----------------------+-------+-------+------+---------+---------+------+
|Distribution & adm. | | | | | | |
|expenses | | | | | | |
|(incl. depreciation) |(373.8)|(364.1)| -2.6%|(1,124.4)|(1,108.2)| -1.4%|
+-----------------------+-------+-------+------+---------+---------+------+
|EBITA | 127.0| 118.4| -6.7%| 374.2| 381.2| +1.9%|
| | | | | | | |
| as a % of sales | 6.5%| 6.5%|stable| 6.6%| 6.9%|+30bps|
+-----------------------+-------+-------+------+---------+---------+------+
|Headcount (end of | | | | | | |
|period) | 17,818| 17,230| -3.3%| 17,818| 17,230| -3.3%|
+-----------------------+-------+-------+------+---------+---------+------+
NORTH AMERICA
+-------------------------+-------+-------+-------+-------+-------+-------+
| Constant and adjusted|Q3 2011|Q3 2012|Change |9m 2011|9m 2012|Change |
| basis (EURm) | | | | | | |
+-------------------------+-------+-------+-------+-------+-------+-------+
|Sales |1,181.4|1,181.3| 0.0%|3,078.5|3,224.4| +4.7%|
| | | | | | | |
| on a constant basis and| | | | | | |
| same days | | | +0.1%| | | +3.2%|
| | | | | | | |
|o/w United States | 838.2| 826.0| -1.4%|2,125.6|2,209.8| +4.0%|
| | | | | | | |
| on a constant basis and| | | | | | |
| same days | | | -1.8%| | | +1.8%|
| | | | | | | |
| Canada | 343.3| 355.3| +3.5%| 952.9|1,014.6| +6.5%|
| | | | | | | |
| on a constant basis and| | | | | | |
| same days | | | +5.0%| | | +6.5%|
+-------------------------+-------+-------+-------+-------+-------+-------+
|Gross profit | 255.7| 258.2| +1.0%| 659.7| 693.1| +5.1%|
| | | | | | | |
|as a % of sales | 21.6%| 21.8%| +20bps| 21.4%| 21.5%| +10bps|
+-------------------------+-------+-------+-------+-------+-------+-------+
|Distribution & adm. | | | | | | |
|expenses | | | | | | |
|(incl. depreciation) |(194.0)|(194.5)| +0.2%|(528.6)|(530.7)| +0.4%|
+-------------------------+-------+-------+-------+-------+-------+-------+
|EBITA | 61.7| 63.7| +3.3%| 131.1| 162.4| +23.9%|
| | | | | | | |
| as a % of sales | 5.2%| 5.4%| +20bps| 4.3%| 5.0%| +70bps|
+-------------------------+-------+-------+-------+-------+-------+-------+
|Headcount (end of period)| 8,378| 8,485| 1.3%| 8,378| 8,485| 1.3%|
+-------------------------+-------+-------+-------+-------+-------+-------+
ASIA-PACIFIC
+-------------------------+-------+-------+-------+-------+-------+-------+
| Constant and adjusted|Q3 2011|Q3 2012| Change|9m 2011|9m 2012| Change|
| basis (EURm) | | | | | | |
+-------------------------+-------+-------+-------+-------+-------+-------+
|Sales | 390.8| 352.9| -9.7%|1,071.9|1,026.0| -4.3%|
| | | | | | | |
| on a constant basis| | | | | | |
| and same days | | | -9.0%| | | -4.4%|
| | | | | | | |
|o/w China | 103.3| 97.2| -5.8%| 264.3| 274.9| +4.0%|
| | | | | | | |
| on a constant basis| | | | | | |
| and same days | | | -7.4%| | | +3.2%|
| | | | | | | |
| Australia | 226.7| 203.8| -10.1%| 634.2| 599.9| -5.4%|
| | | | | | | |
| on a constant basis| | | | | | |
| and same days | | | -8.5%| | | -5.5%|
| | | | | | | |
| New Zealand | 41.0| 34.4| -16.1%| 115.6| 100.1| -13.4%|
| | | | | | | |
| on a constant basis| | | | | | |
| and same days | | | -14.8%| | | -12.5%|
+-------------------------+-------+-------+-------+-------+-------+-------+
|Gross profit | 88.5| 74.6| -15.7%| 238.2| 218.2| -8.4%|
| | | | | | | |
| as a % of sales | 22.6%| 21.1%|-150bps| 22.2%| 21.3%| -90bps|
+-------------------------+-------+-------+-------+-------+-------+-------+
|Distribution & adm. | | | | | | |
|expenses | | | | | | |
|(incl. depreciation) | (59.4)| (56.4)| -5.0%|(172.2)|(168.1)| -2.4%|
+-------------------------+-------+-------+-------+-------+-------+-------+
|EBITA | 29.1| 18.1| -37.6%| 66.0| 50.1| -24.2%|
| | | | | | | |
| as a % of sales | 7.4%| 5.1%|-230bps| 6.2%| 4.9%|-130bps|
+-------------------------+-------+-------+-------+-------+-------+-------+
|Headcount (end of period)| 2,920| 2,794| -4.3%| 2,920| 2,794| -4.3%|
+-------------------------+-------+-------+-------+-------+-------+-------+
LATIN AMERICA
+-------------------------+-------+-------+-------+-------+-------+-------+
| Constant and adjusted |Q3 2011|Q3 2012|Change |9m 2011|9m 2012|Change |
| basis (EURm) | | | | | | |
+-------------------------+-------+-------+-------+-------+-------+-------+
|Sales | 76.7| 77.6| +1.2%| 224.4| 233.2| +3.9%|
| | | | | | | |
| on a constant basis| | | +4.3%| | | +5.4%|
| and same days | | | | | | |
| | | | | | | |
|o/w Brazil | 49.1| 47.3| -3.5%| 137.1| 135.8| -0.9%|
| | | | | | | |
| on a constant basis| | | -2.0%| | | +0.3%|
| and same days | | | | | | |
| | | | | | | |
| Chile | 24.3| 26.2| +8.0%| 77.9| 86.1| +10.6%|
| | | | | | | |
| on a constant basis| | | +15.9%| | | +12.9%|
| and same days | | | | | | |
| | | | | | | |
| Peru | 3.4| 4.1| +19.3%| 9.4| 11.3| +20.4%|
| | | | | | | |
| on a constant basis| | | +15.8%| | | +18.5%|
| and same days | | | | | | |
+-------------------------+-------+-------+-------+-------+-------+-------+
|Gross profit | 17.3| 18.1| +4.7%| 48.8| 53.8| +10.1%|
| | | | | | | |
| as a % of sales | 22.5%| 23.3%| +80bps| 21.8%| 23.1%|+130bps|
+-------------------------+-------+-------+-------+-------+-------+-------+
|Distribution & adm. | | | | | | |
|expenses | (14.4)| (16.9)| +17.4%| (40.7)| (48.3)| +18.6%|
|(incl. depreciation) | | | | | | |
+-------------------------+-------+-------+-------+-------+-------+-------+
|EBITA | 2.9| 1.2| -58.5%| 8.1| 5.5| -32.1%|
| | | | | | | |
| as a % of sales | 3.7%| 1.5%|-220bps| 3.6%| 2.4%|-120bps|
+-------------------------+-------+-------+-------+-------+-------+-------+
|Headcount (end of period)| 1,614| 1,685| 4.4%| 1,614| 1,685| 4.4%|
+-------------------------+-------+-------+-------+-------+-------+-------+
Appendix 2
Extract of Financial Statements
Consolidated Income Statement
+-----------------------+-------+-------+------+---------+---------+------+
| Reported basis (EURm)|Q3 2011|Q3 2012|Change| 9m 2011 | 9m 2012 |Change|
+-----------------------+-------+-------+------+---------+---------+------+
|Sales |3,210.8|3,441.3| +7.2%| 9,373.3| 10,009.4| +6.8%|
+-----------------------+-------+-------+------+---------+---------+------+
|Gross profit | 761.9| 833.1| +9.3%| 2,294.5| 2,459.3| +7.2%|
| | | | | | | |
| as a % of sales | 23.7%| 24.2%| | 24.5%| 24.6%| |
+-----------------------+-------+-------+------+---------+---------+------+
|Distribution & adm. | | | | | | |
|expenses | | | | | | |
|(excl. depreciation) |(560.4)|(623.3)|+11.2%|(1,721.0)|(1,843.7)| +7.1%|
+-----------------------+-------+-------+------+---------+---------+------+
|EBITDA | 201.5| 209.7| +4.1%| 573.5| 615.6| +7.3%|
| | | | | | | |
| as a % of sales | 6.3%| 6.1%| | 6.1%| 6.2%| |
+-----------------------+-------+-------+------+---------+---------+------+
|Depreciation | (17.9)| (18.9)| | (54.8)| (54.4)| |
+-----------------------+-------+-------+------+---------+---------+------+
|EBITA | 183.6| 190.8| +3.9%| 518.7| 561.2| +8.2%|
| | | | | | | |
| as a % of sales | 5.7%| 5.5%| | 5.5%| 5.6%| |
+-----------------------+-------+-------+------+---------+---------+------+
|Amortization of | | | | | | |
|purchase price | | | | | | |
|allocation | (3.9)| (4.2)| | (13.1)| (9.3)| |
+-----------------------+-------+-------+------+---------+---------+------+
|Operating income | | | | | | |
| bef. other inc. | | | | | | |
|and exp. | 179.7| 186.6| +3.8%| 505.6| 551.9| +9.2%|
| | | | | | | |
| as a % of sales | 5.6%| 5.4%| | 5.4%| 5.5%| |
+-----------------------+-------+-------+------+---------+---------+------+
|Other income and | | | | | | |
|expenses | (14.1)| (14.6)| | (29.9)| (69.7)| |
+-----------------------+-------+-------+------+---------+---------+------+
|Operating income | 165.6| 172.0| +3.9%| 475.7| 482.2| +1.4%|
+-----------------------+-------+-------+------+---------+---------+------+
|Financial expenses | | | | | | |
|(net) | (54.4)| (52.0)| | (152.1)| (149.0)| |
+-----------------------+-------+-------+------+---------+---------+------+
|Share of profit | | | | | | |
|(loss) in associates | 1.1| 1.3| | 1.2| 1.5| |
+-----------------------+-------+-------+------+---------+---------+------+
|Net income (loss) | | | | | | |
|before income tax | 112.3| 121.3| +8.1%| 324.8| 334.7| +3.0%|
+-----------------------+-------+-------+------+---------+---------+------+
|Income tax | (28.1)| (36.0)| | (68.5)| (98.3)| |
+-----------------------+-------+-------+------+---------+---------+------+
|Net income (loss) | 84.2| 85.3| +1.3%| 256.3| 236.4| -7.8%|
+-----------------------+-------+-------+------+---------+---------+------+
|Net income (loss) attr.| | | | | | |
|to non-controlling | | | | | | |
|interests | 0.6| 0.6| | 1.0| 0.7| |
+-----------------------+-------+-------+------+---------+---------+------+
|Net income (loss) attr.| | | | | | |
|to equity holders of | | | | | | |
|the parent | 83.6| 84.7| +1.3%| 255.3| 235.7| -7.7%|
+-----------------------+-------+-------+------+---------+---------+------+
Recurring Net Income
+---------------------------+-------+-------+------+-------+-------+------+
| In millions of euros|Q3 2011|Q3 2012|Change|9m 2011|9m 2012|Change|
+---------------------------+-------+-------+------+-------+-------+------+
|Reported net income | 84.2| 85.3| +1.3%| 256.3| 236.4| -7.8%|
| | | | | | | |
|Non-recurring copper effect| 8.6| 0.9| | 0.6| -3.1| |
| | | | | | | |
|Other expense & income | 14.2| 14.6| | 29.9| 69.7| |
| | | | | | | |
|Financial expense | 3.1| 0.0| | 13.1| -7.4| |
| | | | | | | |
|Tax expense | -13.9| -4.4| | -39.4| -9.0| |
| | | | | | | |
|Recurring net income | 96.1| 96.4| +0.3%| 260.5| 286.7|+10.0%|
+---------------------------+-------+-------+------+-------+-------+------+
Sales and profitability by segment
+---------------------+-------+-------+------+-------+--------+------+
|Reported basis (EURm)|Q3 2011|Q3 2012|Change|9m 2011|9m 2012 |Change|
+---------------------+-------+-------+------+-------+--------+------+
|Sales |3,210.8|3,441.3| +7.2%|9,373.3|10,009.4| +6.8%|
| | | | | | | |
| Europe |1,842.2|1,829.3| -0.7%|5,480.3| 5,525.6| +0.8%|
| | | | | | | |
| North America | 964.5|1,181.3|+22.5%|2,712.9| 3,224.4|+18.9%|
| | | | | | | |
| Asia-Pacific | 349.7| 352.9| +0.9%| 953.0| 1,026.0| +7.7%|
| | | | | | | |
| Latin America | 52.6| 77.6|+47.7%| 162.1| 233.2|+43.9%|
+---------------------+-------+-------+------+-------+--------+------+
|Gross profit | 761.9| 833.1| +9.3%|2,294.5| 2,459.3| +7.2%|
| | | | | | | |
| Europe | 467.9| 482.7| +3.2%|1,442.5| 1,494.2| +3.6%|
| | | | | | | |
| North America | 203.7| 257.9|+26.6%| 577.6| 692.2|+19.8%|
| | | | | | | |
| Asia-Pacific | 76.6| 73.8| -3.6%| 210.3| 217.6| +3.5%|
| | | | | | | |
| Latin America | 12.3| 18.0|+46.1%| 36.4| 53.7|+47.5%|
+---------------------+-------+-------+------+-------+--------+------+
|EBITA | 183.6| 190.8| +3.9%| 518.7| 561.2| +8.2%|
| | | | | | | |
| Europe | 119.3| 118.6| -0.5%| 368.7| 385.8| +4.6%|
| | | | | | | |
| North America | 48.4| 63.4|+31.0%| 114.4| 161.5|+41.2%|
| | | | | | | |
| Asia-Pacific | 25.4| 17.4|-31.4%| 59.8| 49.5|-17.2%|
| | | | | | | |
| Latin America | 2.1| 1.1|-48.7%| 6.5| 5.4|-16.4%|
+---------------------+-------+-------+------+-------+--------+------+
Impact on sales from changes in the scope of consolidation
+-------------------+--------------------------+--------+-------+-------+
| Acquisitions | Country | Conso. |Q3 2012|9m 2012|
| | | | | |
| | |as from | | |
+-------------------+--------------------------+--------+-------+-------+
|Europe |France, UK, Spain, Belgium| misc. | 67.8| 136.0|
| | | | | |
|North America | Canada, USA | misc. | 100.8| 123.7|
| | | | | |
|Asia-Pacific | China, India |01/07/11| 0.2| 23.1|
| | | | | |
|Latin America | Brazil, Peru | misc. | 24.6| 63.4|
+-------------------+--------------------------+--------+-------+-------+
|Total acquisitions | | | 193.4| 346.1|
+-------------------+--------------------------+--------+-------+-------+
| Divestments | Country |Deconso.|Q3 2012|9m 2012|
| | | | | |
| | |as from | | |
+-------------------+--------------------------+--------+-------+-------+
|ACE | ACE |01/07/11| -1.9| -64.9|
+-------------------+--------------------------+--------+-------+-------+
|Total divestments | | | -1.9| -64.9|
+-------------------+--------------------------+--------+-------+-------+
|Net impact on sales| | | 191.5| 281.2|
+-------------------+--------------------------+--------+-------+-------+
Consolidated Balance Sheet
+------------------------------------+-----------------+------------------+
|Assets (EURm) |December 31, 2011|September 30, 2012|
+------------------------------------+-----------------+------------------+
|Goodwill | 4,002.2| 4,348.2|
| | | |
|Intangible assets | 935.7| 1,045.5|
| | | |
|Property, plant & equipment | 261.7| 276.1|
| | | |
|Long-term investments((1)) | 97.1| 89.9|
| | | |
|Investments in associates | 11.8| 11.2|
| | | |
|Deferred tax assets | 153.2| 164.9|
+------------------------------------+-----------------+------------------+
|Total non-current assets | 5,461.7| 5,935.8|
+------------------------------------+-----------------+------------------+
|Inventories | 1,240.8| 1,468.6|
| | | |
|Trade receivables | 2,122.9| 2,316.8|
| | | |
|Other receivables | 476.2| 473.4|
| | | |
|Assets classified as held for sale | 3.7| 3.3|
| | | |
|Cash and cash equivalents | 413.7| 251.6|
+------------------------------------+-----------------+------------------+
|Total current assets | 4,257.3| 4,513.7|
+------------------------------------+-----------------+------------------+
|Total assets | 9,719.0| 10,449.5|
+------------------------------------+-----------------+------------------+
+------------------------------------+-----------------+------------------+
|Liabilities (EURm) |December 31, 2011|September 30, 2012|
+------------------------------------+-----------------+------------------+
|Total equity | 4,042.5| 4,132.8|
+------------------------------------+-----------------+------------------+
|Long-term debt | 2,182.3| 2,557.6|
| | | |
|Deferred tax liabilities | 111.3| 163.0|
| | | |
|Other non-current liabilities | 437.2| 471.2|
+------------------------------------+-----------------+------------------+
|Total non-current liabilities | 2,730.8| 3,191.8|
+------------------------------------+-----------------+------------------+
|Interest bearing debt & accrued | | |
|interests | 333.5| 503.2|
| | | |
|Trade payables | 1,903.3| 1,926.1|
| | | |
|Other payables | 708.9| 695.6|
| | | |
|Liabilities classified as held for | | |
|sale | 0.0| 0.0|
+------------------------------------+-----------------+------------------+
|Total current liabilities | 2,945.7| 3,124.9|
+------------------------------------+-----------------+------------------+
|Total liabilities | 5,676.5| 6,316.7|
+------------------------------------+-----------------+------------------+
|Total equity & liabilities | 9,719.0| 10,449.5|
+------------------------------------+-----------------+------------------+
(1) Includes Fair value hedge derivatives for EUR23.8 million at December
31, 2011 and for EUR36.0 million at September 30, 2012
Change in Net Debt
+---------------------------------------+-------+-------+-------+-------+
|EURm |Q3 2011|Q3 2012|9m 2011|9m 2012|
+---------------------------------------+-------+-------+-------+-------+
|EBITDA | 201.5| 209.7| 573.5| 615.6|
+---------------------------------------+-------+-------+-------+-------+
|Other operating revenues & costs((1)) | (10.8)| (19.5)| (40.9)| (64.8)|
+---------------------------------------+-------+-------+-------+-------+
|Operating cash flow | 190.7| 190.2| 532.6| 550.8|
+---------------------------------------+-------+-------+-------+-------+
|Change in working capital | (16.5)| (69.0)|(253.9)|(268.0)|
| | | | | |
|Net capital expenditure, of which: | (15.1)| (17.4)| (42.1)| (54.2)|
| | | | | |
| Gross capital expenditure| (16.0)| (20.2)| (60.4)| (53.8)|
| | | | | |
| Disposal of fixed assets & other| 0.9| 2.8| 18.3| (0.4)|
+---------------------------------------+-------+-------+-------+-------+
|Free cash flow before interest and tax | 159.1| 103.8| 236.6| 228.6|
+---------------------------------------+-------+-------+-------+-------+
|Net interest paid / received | (43.8)| (44.7)|(115.2)|(126.1)|
| | | | | |
|Income tax paid | (24.1)| (27.1)| (71.6)| (94.9)|
+---------------------------------------+-------+-------+-------+-------+
|Free cash flow after interest and tax | 91.2| 32.0| 49.8| 7.6|
+---------------------------------------+-------+-------+-------+-------+
|Net financial investment((2)) | 41.2|(353.1)| (14.0)|(491.6)|
| | | | | |
|Dividends paid | (0.1)| 0.0|(105.3)|(143.0)|
| | | | | |
|Net change in equity | 0.0| (0.2)| 88.4| 0.0|
| | | | | |
|Other | (15.1)| (13.4)| (36.6)| (48.1)|
| | | | | |
|Currency exchange variation | (23.6)| 19.9| 20.8| (19.9)|
+---------------------------------------+-------+-------+-------+-------+
|Decrease (increase) in net debt | 93.6|(314.8)| 3.1|(695.0)|
+---------------------------------------+-------+-------+-------+-------+
|Net debt at the beginning of the period|2,363.8|2,458.4|2,273.3|2,078.2|
+---------------------------------------+-------+-------+-------+-------+
|Net debt at the end of the period |2,270.2|2,773.2|2,270.2|2,773.2|
+---------------------------------------+-------+-------+-------+-------+
(1) Includes restructuring outflows of :
* 7.0 million in Q3 2011 and EUR10.6 million in Q3 2012
* 34.4 million in 9m 2011 and EUR29.5million in 9m 2012
(2) Q3 2012 includes EUR338.1 million of acquisitions (net of cash) and 9m
2012
includes EUR473.1 million of acquisitions (net of cash)
Appendix 3
Working Capital Analysis
+-----------------------------------+------------------+------------------+
| | September 30, | September 30, |
| Constant basis | 2011 | 2012 |
+-----------------------------------+------------------+------------------+
| Net inventories | | |
| | | |
| as a % of sales 12 rolling months | 10.0% | 10.3% |
| | | |
| as a number of days | | |
+-----------------------------------+------------------+------------------+
| Net trade receivables | | |
| | | |
| as a % of sales 12 rolling months | 18.2% | 17.2% |
| | | |
| as a number of days | | |
+-----------------------------------+------------------+------------------+
| Net trade payables | | |
| | | |
| as a % of sales 12 rolling months | 14.9% | 13.8% |
| | | |
| as a number of days | | |
+-----------------------------------+------------------+------------------+
| Trade working capital | | |
| | | |
| as a % of sales 12 rolling months | 13.3% | 13.6% |
+-----------------------------------+------------------+------------------+
| Total working capital | | |
| | | |
| as a % of sales 12 rolling months | 11.8% | 12.4% |
+-----------------------------------+------------------+------------------+
Appendix 4
Headcount and branches by geography
+-----------------------+------------+------------+------------+--------+
| FTEs at end of period | | | | |
| | 30/09/2011 | 31/12/2011 | 30/09/2012 | Change |
| comparable | | | | |
+-----------------------+------------+------------+------------+--------+
| Europe | 17,818 | 17,710 | 17,230 | -3.3% |
+-----------------------+------------+------------+------------+--------+
| USA | 6,017 | 6,078 | 6,070 | 0.9% |
+-----------------------+------------+------------+------------+--------+
| Canada | 2,361 | 2,397 | 2,414 | 2.2% |
+-----------------------+------------+------------+------------+--------+
| North America | 8,378 | 8,475 | 8,485 | 1.3% |
+-----------------------+------------+------------+------------+--------+
| Asia-Pacific | 2,920 | 2,926 | 2,794 | -4.3% |
+-----------------------+------------+------------+------------+--------+
| Latin America | 1,614 | 1,661 | 1,685 | 4.4% |
+-----------------------+------------+------------+------------+--------+
| Other | 197 | 204 | 206 | 4.6% |
+-----------------------+------------+------------+------------+--------+
| Group | 30,927 | 30,976 | 30,400 | -1.7% |
+-----------------------+------------+------------+------------+--------+
+-----------------------+------------+------------+------------+--------+
| Branches | | | | |
| | 30/09/2011 | 31/12/2011 | 30/09/2012 | Change |
| comparable | | | | |
+-----------------------+------------+------------+------------+--------+
| Europe | 1,396 | 1,389 | 1,377 | -1.4% |
+-----------------------+------------+------------+------------+--------+
| USA | 413 | 406 | 395 | -4.4% |
+-----------------------+------------+------------+------------+--------+
| Canada | 223 | 221 | 218 | -2.2% |
+-----------------------+------------+------------+------------+--------+
| North America | 636 | 627 | 613 | -3.6% |
+-----------------------+------------+------------+------------+--------+
| Asia-Pacific | 299 | 293 | 278 | -7.0% |
+-----------------------+------------+------------+------------+--------+
| Latin America | 83 | 85 | 89 | 7.2% |
+-----------------------+------------+------------+------------+--------+
| Group | 2,414 | 2,394 | 2,357 | -2.4% |
+-----------------------+------------+------------+------------+--------+
Appendix 5
Senior Credit Agreement
The EUR1.3bn SCA comprises two revolving credit facilities:
* a 3-year multi-currency revolving credit facility in an amount of
EUR200m (the initial amount was EUR600m and was reduced to EUR400m after
one year and to EUR200m after two years), named "Facility A"
* a 5-year multi-currency revolving credit facility in an amount of
EUR1.1bn,
named "Facility B"
The applicable margin levels vary according to the IR thresholds (IR =
Indebtedness Ratio, i.e. adjusted consolidated net debt to adjusted
consolidated
EBITDA of the last 12 months), as indicated below:
+------------+--------+--------+--------+--------+--------+--------+------+
| | |IR sup. |IR sup. |IR sup. |IR sup. |IR sup. | |
|Indebtedness|IR sup. |or equal|or equal|or equal|or equal|or equal|IR |
|Ratio (IR) |or equal|to 4.5x |to 4.0x |to 3.5x |to 3.0x |to 2.5x |inf. |
| |to 5.0x |and inf.|and inf.|and inf.|and inf.|and inf.|to |
| | |to 5.0x |to 4.5x |to 4.0x |to 3.5x |to 3.0x |2.5x |
+------------+--------+--------+--------+--------+--------+--------+------+
|Facility A |4.25% |3.50% |3.00% |2.50% |2.00% |1.75% |1.50% |
+------------+--------+--------+--------+--------+--------+--------+------+
|Facility B |4.50% |3.75% |3.25% |2.75% |2.25% |2.00% |1.75% |
+------------+--------+--------+--------+--------+--------+--------+------+
In addition, the margin applicable to both facilities shall be increased by
an
utilisation fee equal to:
* 25bps if the total amount drawn under both facilities is comprised
between 33% and 66% of the total commitment;
* 50bps if the total amount drawn under both facilities equals or exceeds
66% of the total commitment.
The applicable financial covenants are the following:
* Commitment to keep indebtedness ratio below thresholds:
+--------+---------+---------+---------+---------+---------+----------+
|Date |30 june |31 dec. |30 june |31 dec. |30 june |Thereafter|
| |2010 |2010 |2011 |2011 |2012 | |
+--------+---------+---------+---------+---------+---------+----------+
|Covenant|5.15x |4.90x |4.50x |4.00x |3.75x |3.5x |
+--------+---------+---------+---------+---------+---------+----------+
* Commitment to suspend dividend payments as long as IR equals or exceeds
4.00x
* Commitment to limit capital expenditure to 0.75% of sales as long as IR
equals or exceeds 4.00x
The SCA contains customary clauses for this type of agreement. These
include
clauses restricting the ability of Rexel Group companies to pledge their
assets,
carry out mergers or restructuring programs, borrow or lend money or
provide
guarantees. In particular, the Rexel Group has no restriction on
acquisitions if
the Indebtedness Ratio does not exceed 3.50x and has an acquisition basket
of up
to EUR200 million for each 12-months period if the Indebtedness Ratio
equals or
exceed 3.50x.
DISCLAIMER
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:
- 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;
- the non-recurring effect related to the change in copper-based cables
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
(principally, the
variable portion of compensation of sales personnel, which accounts
for
approximately 10% of the variation in gross profit).
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 press release 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 Document de
Référence
registered with the French Autorité des Marchés Financiers
(AMF) on March
15, 2012 under number D.12-0164. 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 press release
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 press release includes only summary information and must be
read in
conjunction with Rexel's Document de Référence registered
with the AMF March
15, 2012 under number D.12-0164, as well as the consolidated
financial
statements and activity report for the 2011 fiscal year, which may be
obtained
from Rexel's website (www.rexel.com).
---------------------------------------------------------------------------
[1] Constant and adjusted = at comparable scope of consolidation and
exchange
rates, excluding the non-recurring effect related to changes in
copper-based cable prices and before amortization of purchase price
allocation
[2]Including depreciations
[3]Cash from operating activities minus net capital expenditure and before
net
interest and income tax paid
Thrid-quarter & 9-month 2012 results (non audited):
http://hugin.info/143564/R/1653769/534199.pdf
This announcement is distributed by Thomson Reuters on behalf of
Thomson Reuters clients. The owner of this announcement warrants that:
(i) the releases contained herein are protected by copyright and
other applicable laws; and
(ii) they are solely responsible for the content, accuracy and
originality of the information contained therein.
Source: REXEL via Thomson Reuters ONE
[HUG#1653769]