Rexel Organic Sales Fall 3.7% in First Quarter

Sales drop was heavily impacted by European conditions.

Paris-based electrical distributor Rexel reported sales in the first quarter 2013 were 3.2 billion (US$4.2 billion), down 2.3 percent on a reported basis and 3.7 percent on an organic basis.

Rexel reported challenging conditions in end-markets, including slowing momentum in industry, except in the U.S. where trends are improving; low residential construction activity, with the exception of the U.S.; and weak activity in commercial end-markets, affected by the postponement of projects.

Europe sales (55 percent of the total) were down 5.5 percent on an organic basis, and 6.1 percent on a reported basis. Excluding photovoltaic, sales were down 4.5 percent.

  • In France, sales were down 3 percent, affected by unfavorable trends in building and industrial equipment and cables, partially offset by a good performance with large customers.
  • In the UK, sales were down 7.7 percent due to weak market conditions, the unfavorable impact of branch closures and the drop in photovoltaic sales. Excluding photovoltaic sales, sales were down 7.1 percent.
  • In Germany, sales were down 5.8 percent. Excluding photovoltaic, sales were down 1.9 percent, reflecting resilience in the industrial end-market and renovation segment.
  • In Belgium, sales were down 22.5 percent, largely impacted by the drop in photovoltaic sales. Excluding photovoltaic, sales were down 10.2 percent.
  • In the Netherlands, sales posted a 14.8 percent decline; business transformation is underway in a persistently difficult market.
  • In both Switzerland and Austria, sales continued to grow in the quarter, respectively by 1.7 percent and 1.1 percent.
  • In Scandinavia, sales decreased by 7 percent, sequentially stable from the fourth quarter 2012 amid a challenging environment.
  • Southern European countries were up 2.6 percent. Spain posted 8.5 percent growth, driven by export business and Italy was broadly stable (-0.8 percent).

North America, 34 percent of sales, was up 1.3 percent on an organic basis. Sales in North America were up 8.2 percent on a reported basis.

  • In the U.S., sales returned to growth, increasing by 2.8 percent in the quarter, confirming the recovery in the residential end-market and improved trends in industry. Excluding the impact of a drop in wind activity due to a change in tax incentives, sales were up 4.5 percent.
  • In Canada, sales were down 2.5 percent, reflecting a slowdown in mining activities.

Asia-Pacific, 9 percent of total sales, was down 10.2 percent on an organic basis.

  • In China, sales were down 5.9 percent, reflecting continued decline in wind sales and challenging comparables. Excluding wind, sales were up 0.9 percent.
  • In Australia, sales were down 13.4 percent, still impacted by tough macroeconomic conditions and by the implementation of a new carbon tax as from July 2012, which severely hit mining and projects.
  • In New Zealand, sales were down 6.2 percent.

Latin America, 2 percent of total sales, was down 3.1 percent on an organic basis. Sales increased by 6.6 percent in Brazil and by 7 percent in Peru, while sales in Chile decreased by 20.3 percent, due to challenging comparables and a slowdown in mining activity.

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