Half Year 2025 Rexel SA Earnings Call Transcript
Key Points
- Rexel SA (RXEEY) reported strong sales growth in North America, driven by higher volumes in data centers and broadband infrastructure, contributing significantly to Q2 growth.
- Digital sales accounted for approximately 34% of total sales in Q2, up nearly 200 basis points year-on-year, supporting top-line growth and future productivity gains.
- The company achieved a free cash flow conversion rate of 42%, significantly above the five-year H1 average, providing flexibility for strategic investments.
- Rexel SA (RXEEY) maintained a resilient adjusted EBITDA margin of 5.8% in H1, despite a challenging macroeconomic environment, supported by cost initiatives and a reduction in FTEs.
- The company completed five acquisitions in 2025, strengthening its footprint in North America and expanding into higher-margin businesses in Canada and Italy.
- The European market remained challenging, with sales declining due to softer demand, a difficult base effect, and lower solar market contributions.
- Currency effects negatively impacted sales by 2.3% in Q2, primarily due to US dollar depreciation, with an anticipated full-year impact of minus 2.1%.
- Adjusted EBITDA margin in Europe decreased by 55 basis points, mainly due to under-absorption of fixed costs and competitive pressures.
- The company faced a EUR124 million fine from the French Competition Authority, impacting free cash flow despite an appeal.
- Sales in the Asia-Pacific region, particularly in China and Australia, declined due to competitive market conditions and lower volumes in residential and non-residential segments.
Good evening, ladies and gentlemen, and welcome to the Rexel Second Quarter and Half Year 2025 Results Conference Call. (Operator Instructions) At this time, I would like to turn the conference over to Mr. Guillaume Texier, Group CEO of Rexel. Please go ahead, sir.
Thank you. Good evening, everyone, and welcome to Rexel's First Half 2025 Results Conference. Thank you for joining us today, especially during this busy results season. I'm here with Laurent Delabarre, our CFO. And together, we'll take you through the key highlights of the first half and the second quarter period that saw Rexel gain momentum with accelerating sales growth driven by stronger volumes in North America and continued progress in our digital transformation. After a brief overview of our operational and strategic highlights, including our resilient profitability, strong cash conversion and the successful execution of our M&A strategy, Laurent will provide a detailed review of our financial performance. I'll then return to
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