Rexel Updated preview with consensus - A guidance upgrade would be necessary to support the shares

Research evidence excerpt

Rexel Updated preview with consensus - A guidance upgrade would be necessary to support the shares

agement’s estimate of $11K/ton ram.mehta@jpmchase.com

J.P. Morgan India Private Limited

embedded in the guidance. We also expect non-cable prices to gradually

increase reflecting inflation post the Middle East crisis. At the same time, data Specialist Sales contact details:

center growth should remain strong, with hyperscalers increasing their capex

Sam Edmunds - Specialist Sales -

forecasts in recent months. We also expect strong growth in electrification European Industrials

categories like solar, EV charging and HVAC, while the heatwave could also (44-20) 7742-8733

boost growth in Europe in countries where Rexel distributes air-con (France sam.edmunds@jpmorgan.com

and NL). We expect recovery in industrial automation in North America to

continue, while the European outlook is uncertain. There are also some

uncertainties in traditional construction-exposed electrification, where higher

interest rates will likely delay recovery. Net net, we expect Rexel to see higher

growth prospects than at the start of the year.

• H1 expectations: We forecast H1 organic same-day growth of +4.4% (+5.5%

in Q2), which consists of +1.6% in Europe (+2.7% in Q2 vs. +0.6% in Q1),

+6.9% in North America (+8.0% in Q2 vs. +5.8% in Q1) and +10.2% in APAC

(+9.1% in Q2 vs. +11.4% in Q1). We forecast H1 Adj EBIT margin of 6.1% vs.

5.8% in H1’25, with a modest 10bps tailwind from inventory revaluation

benefit. Table 1 in the note summarise our estimates. Our organic same-day

growth forecast is slightly above consensus of +4.1%, while our Adj EBITA

and margin expectations are largely in-line with consensus estimates.

• Takeaways from JPM Industrial conference: The overall message was