RXEEY - Rexel S.A. (RXLSF) Q4 2023 Earnings Call Transcript
2024-02-14 16:46:02 ET
Rexel S.A. (RXLSF)
Q4 2023 Earnings Conference Call
February 14, 2024, 12:15 PM ET
Company Participants
Guillaume Texier - Group Chief Executive Officer
Laurent Delabarre - Group Chief Financial Officer
Conference Call Participants
Martin Wilkie - Citi
Daniela Costa - Goldman Sachs
Akash Gupta - JPMorgan
Alexander Virgo - Bank of America
William Mackie - Kepler Cheuvreux
Aurelio Calderon - Morgan Stanley
Nick Amicucci - TD Cowen
Andre Kukhnin - UBS
Alasdair Leslie - Société Générale
Miguel Borrega - BNP Paribas Exane
Presentation
Operator
Good afternoon. This is the conference operator. Welcome and thank you for joining the Rexel’s Fourth Quarter and Full Year 2023 Results Conference Call. As a reminder, all participants are in listen-only mode. After the presentation, there will be an opportunity to ask questions. [Operator Instructions]
At this time, I would like to turn the conference over to Mr. Guillaume Texier, Group CEO. Please go ahead, sir.
Guillaume Texier
Hi. Good evening to everyone and thank you for joining us today for our fourth quarter sales and the full year 2023 results conference. Thank you also for making yourselves available at an unusual time. As you know, Rexel usually communicates in the morning, but there were a number of other companies issuing results tomorrow morning. So to help make your lives easier, we moved the time of our call. We hope we are not spoiling your Valentine’s Day plan.
I’m here today with Laurent Delabarre, our CFO. I will focus on a few highlights on our performance. Laurent will give you greater granularity on our numbers. And I conclude with a progress report on our strategic roadmap, as well as the outlook for 2024.
So let’s begin on slide three with the main takeaways of 2023. This was a record year by many metrics, but equally importantly for me, it was also a year of significant progress in our strategy. Indeed, as we will see in greater detail in today’s presentation, almost all of our main metrics hit a historical high, like sales, profit margin and free cash flow generation with free cash flow conversion significantly above guidance.
Among other highlights, we also continue to execute our value creating M&A strategy with very satisfactory results, as illustrated by Wasco in the Netherlands and we did that while maintaining a very healthy balance sheet. And this performance allows us to continue to be a very shareholder friendly company and we are proposing today to maintain our cash dividend at last year’s record level.
So, all in all, there are many reasons for satisfaction as we look back at our 2023 performance. The Rexel team, so once again, proved their ability to deliver profitable growth and I would like to thank them for their engagement.
What is particularly satisfying to me is that they achieved this in a more mixed environment in H2, where we faced a high 2022 comparable base with less of a booster from electrification categories. This is a great proof point of how resilient our model now is, benefiting from midterm megatrends and delivering high profitability. This puts us on a very sound footing to achieve our medium-term ambitions.
I will discuss this in the latter part of my presentation. But let’s now focus in the coming slides on our 2023 key performance indicators that form the basis of our guidance. First of all, on slide four, we set a new sales record in 2023.
Rexel’s full year sales came in at €19.2 billion, up from €18.7 billion one year earlier, representing same day sales growth of 4.3%. That’s perfectly in line with the upgraded guidance we communicated of growth in the upper end of the initial 2% to 6% range. The same day sales growth benefited from several megatrends, notably electrification in Europe, more in H1 than in H2, as we will see later, and reshoring and stimulus plans in the U.S....
Rexel S.A. (RXLSF) Q4 2023 Earnings Call Transcript