Rexel S.A. (RXLSF) Q4 2024 Earnings Call Transcript

2025-02-12 19:05:18 ET

Rexel S.A. (RXLSF)

Q4 2024 Earnings Conference Call

February 12, 2025 12:00 PM ET

Company Participants

Guillaume Texier – Chief Executive Officer

Laurent Delabarre – Chief Financial Officer

Conference Call Participants

Martin Wilkie – Citi

Alexander Virgo – Bank of America

Daniela Costa – Goldman Sachs

Akash Gupta – JPMorgan

Max Yates – Morgan Stanley

George Featherstone – Barclays

Eric Lemarié – CIC

Miguel Borrega – BNP Paribas Exane

Presentation

Operator

Good evening. This is the conference operator. Welcome, and thank you for joining the Rexel's 2024 Results Conference Call. As a reminder, all participants are in a 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 of Rexel. Please go ahead.

Guillaume Texier

Yes. Good evening, everyone, and welcome to our full year and fourth quarter 2024 results conference. Thank you, first, for making the time to join us and for accommodating the change of date, which we hope, if anything, made it slightly easier for you to be with us today in a busy results season.

I'm here with Laurent Delabarre, our CFO, who will be giving you a detailed account of our financials after we've completed a short tour of the main highlights of the last quarter and the full year. And after Laurent's deep dive, I'll come back to discuss our outlook for 2025 and give you a progress update on our strategic road map before we open up for questions.

So switching to Slide 3. In 2024, overall, we operated in a market which proved more challenging than anticipated. This is especially true in Europe where a soft economy, a complex political landscape and a slowdown of electrification were as many additional headwinds for Rexel. So that's the environment. But in this context, I'm really proud of the way the Rexel strategy has delivered and the way our teams have reacted not only because it allows us to post what I consider very solid figures, but more importantly, because it allows us to enter 2025 with good momentum.

Let us talk about the figures. First, we finished the year at minus 2.4% like-for-like growth, right within our latest guidance update, but obviously below our initial expectations. And to give you a historical perspective, apart from COVID, this is the first negative year since 2016. So in this context, the fact that the EBITA margin landed at 5.9%, exactly where we had forecasted, it's quite impressive. I remember two years ago, many questions being asked about whether we would return back to the 4% range in difficult years. I think you have the answer right there, which is a clear no. On the free cash flow side, we strongly outperformed the guidance, finishing the year at 76% cash conversion.

Now let me come back to this important message about 2025 momentum. There are many uncertainties in the market for 2025, but there are three areas in which we have good initial speed, which is always a nice situation to be in. Market share gains, first, in many important countries, allowing us to beat the market. Usually, when the market is softer, solid players tend to benefit, and we are taking advantage of that. Cost savings gains, second, with many projects having been initiated, but not having delivered yet their full year results....

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