REXEL
Paris : RXL

July 27, 2011 02:50 ET

Rexel: Second-quarter & half-year 2011 results

PARIS--(Marketwire - Jul 27, 2011) -


                    SECOND-QUARTER & HALF-YEAR 2011 RESULTS
     Financial statements at June 30, 2011 were authorised for issue by the
                       Management Board on July 21, 2011.


                            SOLID PERFORMANCE IN Q2:
                 CONTINUED GROWTH IN SALES, MARGINS AND PROFITS
                          FULL-YEAR TARGETS CONFIRMED

  * CONTINUED SALES AND PROFIT GROWTH IN Q2
      * Sales up 5.1% on a constant and same-day basis
      * Gross margin improved by 10bps to 24.6%
      * EBITA[1]1 margin up 80bps to 5.7%

  * STRONG PERFORMANCE IN H1
      * Sales up 6.1% on a constant and same-day basis and up 7.3% on a
        Reported basis
      * EBITA[1]1 margin up 90bps to 5.3%
      * Net income up 88% at EUR174m

  * STRENGTHENED FINANCIAL STRUCTURE
      * Free cash flow before interest and tax of EUR123m in Q2
      * Indebtedness ratio at 3.0x EBITDA at June 30, 2011

  * FULL-YEAR TARGETS CONFIRMED
      * Improvement of EBITA[1]1 margin by at least 50bps
      * Free cash flow before interest and tax above EUR500m


+-----------------------------------+-------+----------+-------+----------+
|At June 30                         |Q2 2011|YoY Change|H1 2011|YoY Change|
+-----------------------------------+-------+----------+-------+----------+
|On a reported basis                |                  |                  |
+-----------------------------------+-------+----------+-------+----------+
|Sales (EURm)                       |3,157.6|     +3.6%|6,162.5|     +7.3%|
|                                   |       |          |       |          |
|% change organic same-day          |       |     +5.1%|       |     +6.1%|
+-----------------------------------+-------+----------+-------+----------+
|EBITA (EURm)                       |  174.1|    +17.6%|  333.8|    +29.7%|
+-----------------------------------+-------+----------+-------+----------+
|EBITA margin (as a % sales )       |   5.5%|    +60bps|   5.4%|    +90bps|
+-----------------------------------+-------+----------+-------+----------+
|Operating income (EURm)            |  157.7|    +26.2%|  308.8|    +44.3%|
+-----------------------------------+-------+----------+-------+----------+
|Net income (EURm)                  |   87.2|    +38.3%|  173.7|    +87.9%|
+-----------------------------------+-------+----------+-------+----------+
|Free cash flow before interest and |       |          |       |          |
|tax paid (EURm)                    |  122.7|    -21.5%|   77.5|    -57.6%|
+-----------------------------------+-------+----------+-------+----------+
|Net debt end of period (EURm)      |       |          |2,363.8|     +4.0%|
+-----------------------------------+-------+----------+-------+----------+
|On a constant and adjusted basis1  |                  |                  |
+-----------------------------------+-------+----------+-------+----------+
|Gross profit (EURm)                |  775.9|     +5.5%|1,522.8|     +6.7%|
+-----------------------------------+-------+----------+-------+----------+
|Gross margin (as a % sales)        |  24.6%|    +10bps|  24.7%|    stable|
+-----------------------------------+-------+----------+-------+----------+
|EBITA (EURm)                       |  179.1|    +22.2%|  325.7|    +29.4%|
+-----------------------------------+-------+----------+-------+----------+
|EBITA margin (as a % sales)        |   5.7%|    +80bps|   5.3%|    +90bps|
+-----------------------------------+-------+----------+-------+----------+

1 Constant and adjusted = at comparable scope of consolidation and exchange rates, excluding the non-recurring effect related to changes in copper-based cable prices and before amortization of purchase price allocation; an extract of financial statements is presented in Appendix.

Jean-Charles Pauze, Chairman of the Management Board and CEO, said: "Rexel's performance since the beginning of the year enhances our confidence that we will achieve our full-year objectives. In the second quarter, Rexel continued to deliver a solid performance, driven by further growth in sales and volumes while maintaining a strong focus on cost control. We will continue, in the second half, to accelerate our strategy combining organic growth, through an expanded offer of value-added services and energy-efficient solutions, and selective acquisitions."

              Financial review for the period ended June 30, 2011
Unless otherwise stated, all comments are on a constant and adjusted basis
                and, for sales, at same number of working days

Solid organic sales growth in Q2: +5.1% on a constant and same-day basis, despite a challenging base effect

In the second quarter, Rexel recorded sales of EUR3,157.6 million, up 3.6% on a reported basis and up 5.1% on a constant and same-day basis. The 3.6% rise in sales on a reported basis included:

  * A negative currency impact of EUR65.3 million (mainly due to the
    depreciation of the USD against the euro),
  * A net positive impact of EUR23.8 million from changes in the scope of
    consolidation (acquisitions: EUR48.6m - divestments: EUR24.8m).

The 5.1% organic growth reflects continued improvement in sales trends given the tougher comparison basis (organic growth resumed at +2.3% in Q2 2010 after -5.7% in Q1 2010). It included a positive impact of 2.2 percentage points due to the rise in copper-based cable prices (compared to 3.0 percentage points in Q1 2011). Growth in volume was mainly driven by the industrial end-market in all the regions in which the Group operates. The residential and commercial end-markets showed some signs of improvement but remained weak. In the half-year, Rexel recorded sales of EUR6,162.5 million, up 7.3% on a reported basis and up 6.1% on a constant and same-day basis. The 7.3% rise in sales on a reported basis included:

  * A positive currency impact of EUR13.9 million,
  * A net positive impact of EUR25.4 million from changes in the scope of
    consolidation (acquisitions: EUR87.6m - divestments: EUR62.2m),
  * A positive calendar impact of 0.4 percentage points.

The 6.1% organic growth included a positive impact of 2.6 percentage points due to the rise in copper-based cable prices.

Europe (59% of Group sales): +5.1% in Q2 and +5.6% in H1 on a constant and same-day basis

In France, sales were up 7.7% in the quarter, in line with the growth recorded in Q1 2011, driven by all three end-markets, notably the industrial one.

In the UK, sales were up 7.2% (after 1.5% in Q1 2011) and volumes were up year-on-year, thanks to targeted commercial initiatives and projects, in spite of an economic context that remains fragile.

In Germany, sales were down 7.3%. They were impacted more than in Q1 2011 by the unfavourable base effect of strong photovoltaic sales that were boosted in the first-half 2010 by tax incentives that expired on June 30, 2010. Excluding photovoltaic sales, Germany was up 6.3% in the quarter thanks to industrial end-market activity, especially in the chemical sector.

Switzerland and Austria continued to post solid organic growth (respectively +8.4% and +4.6%) while Benelux and Eastern Europe posted double-digit growth (respectively +10.0% and +18.5%). In Scandinavia, sales rose by 5.2% with double-digit growth (+13.8%) in Finland, driven by contractors and utilities.

In Southern Europe, Spain and Italy recorded low single-digit declines (respectively -3.9% and -3.8%) while Portugal posted a 1.1% growth in sales.

North America (28% of Group sales): +5.7% in Q2 and +7.9% in H1 on a constant and same-day basis

In the US, Rexel continued to grow with sales up 4.6% in the quarter, on a constant and same-day basis. In an environment that remains uncertain, growth was driven by the industrial end-market, mainly in the energy and mining sectors. Energy efficiency, transportation, infrastructure, education and healthcare initiatives also contributed to positive sales evolution. Residential and commercial end-markets continued to be tough, with some segments showing signs of improvement.

In Canada, after the historic highs recorded in Q4 2010 and Q1 2011 (respectively +14.5% and +19.7%), growth returned to high single-digit figures (+8.4%). Growth was mainly driven by the industrial end-market, in particular in the mining and oil & gas sectors.


Asia-Pacific (10% of Group sales): +5.3% in Q2 and +6.6% in H1 on a constant and same-day basis

In the quarter, sales in Asia-Pacific were up 11.0% on a reported basis, including a positive impact of EUR8.1 million due to the consolidation, as from January 1st, 2011, of our acquisition in India, Yantra Automation, and of two acquisitions in China, Beijing Lucky Well Zhineng and Wuhan Rockcenter Automation. On a constant and same-day basis, sales were up 5.3%, driven by continued double-digit growth in China.

In Australia (over 60% of the region's sales), organic sales grew by only 1.8%, after 7.3% in Q1 2011. This slowdown was due to a challenging base effect and to the unfavourable impact of higher interest rates on the economic activity. In New Zealand (over 10% of the region's sales), sales were impacted by a second earthquake in April and growth was limited to 1.2%.

In China (over 20% of the region's sales), sales posted double-digit growth (+16.0%), in line with Q1 2011, driven by strong performance in the industrial automation segment and despite very challenging comparables (organic growth in Q2 2010 stood at +27.6%).

Latin America and Other operating segments (3% of Group sales)

These operations, together with the unallocated corporate overheads, are reported in Rexel's consolidated financial statements under the "Other Operations" segment.

  * Latin America (2% of Group sales): +18.0% in Q2 and +24.0% in H1 on a
    constant and same-day basis

Latin American countries include Chile (consolidated since 1999) and Brazil (Nortel Suprimentos Industriais consolidated as from January 1, 2011). Sales in Latin America amounted to EUR58.5 million in the quarter, including a positive impact of EUR27.4 million due to the consolidation of Nortel Suprimentos Industriais (Brazil) as from January 1st, 2011. On a constant and same-day basis, they were up 18.0%, reflecting double-digit growth in both Chile and Brazil.

  * Other operating segments (1% of Group sales)

Other operating segments include the remaining part of the ACE (Agencies Consumer Electronics) division acquired from Hagemeyer in 2008 that was not divested in 2010 and other businesses managed at Rexel Group level. In the quarter, sales from the other operating segments amounted to EUR42.9m, down 56.9% on a reported basis, including a negative impact of EUR24.8 million due to the 2010 disposals of HCL Asia and Haagtechno.

Continuous improvement in earnings and profitability since the beginning of the year: EBITA1 margin up 90bps to 5.3% and reported EBITA up 30% to EUR334 million

In the quarter, EBITA[1] margin stood at 5.7% vs. 4.9% in Q2 2010. This 80 basis point improvement reflected:

  * A 10bps improvement in gross margin[1]: from 24.5% of sales in Q2 2010
    to 24.6% in Q2 2011,
  * A 70bps reduction in distribution and administrative expenses[2]: from
    19.6% in Q2 2010 to 18.9% in Q2 2011 (these expenses grew by only 1.4%
    while sales grew by 5.1%).

In the half-year, EBITA margin1 stood at 5.3% vs. 4.4% in H1 2010; this 90bps improvement mainly resulted from strict control of distribution and administrative expenses[2].

Reported EBITA reached EUR174.1 million in the quarter and EUR333.8 million in the half, up 29.7% year-on-year.

Strong increase in operating income (+44%) and in net income (+88%)

In the half-year,operating income increased by 44.3% to EUR308.8 million, reflecting the strong rise in EBITA and reduced restructuring costs.

  * Amortization of purchase price allocation amounted to EUR9.2 million
    (vs. EUR12.3 million in H1 2010),
  * Other income and expenses amounted to a net charge of EUR15.8 million
    (vs. a net charge of EUR31.1 million in H1 2010). They included EUR9.1
    million of restructuring costs (vs. EUR29.5 million in H1 2010) and
    EUR7.0 million of asset impairment (related to Hagemeyer Brands
    Australia, a non-core business that is part of the ACE division).

In the half-year,net income increased by 87.9% to EUR173.7 million (vs. EUR92.4 million in H1 2010).

  * Net financial expenses amounted to EUR94.7 million (vs. EUR103.5
    million in H1 2010). The average effective interest rate for the half
    stood at 6.9% (vs. 7.1% in H1 2010). Net financial expenses throughout
    the period benefited from the reduction applicable to the Senior Credit
    margin as the indebtedness ratio at the end of December 2010 was 3.19x
    (vs. 4.32x at the end of December 2009),
  * Income tax represented a charge of EUR40.5 million (vs. EUR18.5 million
    in H1 2010),
  * Share of profit in associates amounted to EUR0.1 million.

Free cash flow before interest and tax3 of EUR123m in Q2 and indebtedness ratio reduced to 3.0x at June 30

In the half-year,free cash flow before interest and tax[3] was an inflow of EUR77.5 million, of which EUR122.7 million was generated during Q2 (in Q1, it was an outflow of EUR45.2m). The inflow in the half included:

  * Net capital expenditure of EUR27.0 million (of which gross capital
    expenditure represented EUR44.4 million),
  * A EUR237.4 million outflow from change in working capital, resulting
    from stronger sales.

Net debt stood at EUR2,363.8 at June 30, 2011, up EUR90.5 million vs. December 31, 2010. It included:

  * EUR55.2 million of net financial investment (including the acquisitions
    of Nortel Suprimentos Industriais in Brazil, Yantra Automation and AD
    Electronics in India, Wuhan Rockcenter Automation and Beijing Zhongheng
    in China and Tegro in Germany),
  * EUR71.4 million of net interest paid,
  * EUR47.5 million of income tax paid,
  * EUR19.2 million of dividends paid in cash,
  * EUR44.4 million of favourable currency effect.

Indebtedness ratio (Net financial debt / EBITDA), as calculated under the Senior Credit Agreement terms, stood at 3.03x at June 30, 2011, vs. 3.19x December 31, 2010.

                                    Outlook

Thanks to its solid performance since the beginning of the year, Rexel confirms its full-year objectives.

  * Improvement of EBITA4 margin by at least 50 basis points in 2011,
  * Free cash flow before interest and tax above EUR500 million.

...and its three medium-term strategic priorities:

  * Strengthen its market position through organic growth and acquisitions,
  * Enhance its profitability and optimize capital employed to achieve its
    2013 targets of an EBITA[4] margin close to 6.5% and a return on
    capital employed close to 14%,
  * Generate solid free cash flow.

[1] Constant and adjusted = at comparable scope of consolidation and exchange rates, excluding the non-recurring effect related to changes in copper-based cable prices and before amortization of purchase price allocation

[2] including depreciation

[3] Cash from operating activities minus net capital expenditure and before net interest and income tax paid

[4] Constant and adjusted = at comparable scope of consolidation and exchange rates, excluding the non-recurring effect related to changes in copper-based cable prices and before amortization of purchase price allocation

                                    Calendar

November 9, 2011 Third-quarter and 9-month 2011 results

                             Financial information

The financial report for the period ended June 30, 2011 is available on the Group's website (www.rexel.com), in the "Regulated information" section, and has been filed with the French Autorité des Marchés Financiers.

A slideshow of the second quarter and half-year 2011 results is also available on the Company's website.

Rexel, a global leader in the distribution of electrical supplies, serves three main end markets: industrial, commercial and residential. The Group operates in 36 countries, with a network of some 2,200 branches, and employs 28,000 people. Rexel's sales were EUR12.0 billion in 2010. Its majority shareholders are an investor group led by Clayton, Dubilier & Rice, Eurazeo and BAML Capital Partners.

Rexel is listed on the Eurolist market of Euronext Paris (compartment A, ticker RXL, ISIN code FR0010451203). It is integrated in the following indices: SBF 120, CAC Mid 100, CAC AllTrade, CAC AllShares, FTSE EuroMid, FTSE4Good and STOXX600.

For more information, visit Rexel's web site at www.rexel.com

                                   Appendix 1

              Segment reporting - Constant and adjusted basis (*)

(*) Constant and adjusted = at comparable scope of consolidation and
 exchange rates, excluding the non-recurring effect related to changes in
 copper-based cables price and before amortization of purchase price
 allocation; the non-recurring effect related to changes in copper-based
 cables price was, at the EBITA level :

  * a profit of EUR5.0 million in Q2 2010 and a loss of EUR4.9 million in
    Q2 2011,
  * a profit of EUR12.8 million in H1 2010 and a profit of EUR8.1 million
    in H1 2011.

Group

+-----------------------+-------+-------+------+---------+---------+------+
|Constant and adjusted  |       |       |      |         |         |      |
| basis (EURm)          |Q2 2010|Q2 2011|Change| H1 2010 | H1 2011 |Change|
|                       |       |       |      |         |         |      |
+-----------------------+-------+-------+------+---------+---------+------+
|Sales                  |3,005.5|3,157.6| +5.1%|  5,783.9|  6,162.5| +6.5%|
|                       |       |       |      |         |         |      |
|  on a constant basis  |       |       |      |         |         |      |
|  and same days        |       |       | +5.1%|         |         | +6.1%|
+-----------------------+-------+-------+------+---------+---------+------+
|Gross profit           |  735.2|  775.9| +5.5%|  1,427.1|  1,522.8| +6.7%|
|                       |       |       |      |         |         |      |
|  as a % of sales      |  24.5%|  24.6%|+10bps|    24.7%|    24.7%|stable|
+-----------------------+-------+-------+------+---------+---------+------+
|Distribution & adm.    |       |       |      |         |         |      |
|expenses (incl.        |       |       |      |         |         |      |
|depreciation)          |(588.6)|(596.8)| +1.4%|(1,175.4)|(1,197.1)| +1.8%|
+-----------------------+-------+-------+------+---------+---------+------+
|EBITA                  |  146.6|  179.1|+22.2%|    251.6|    325.7|+29.4%|
|                       |       |       |      |         |         |      |
|  as a % of sales      |   4.9%|   5.7%|+80bps|     4.4%|     5.3%|+90bps|
+-----------------------+-------+-------+------+---------+---------+------+
|Headcount (end of      | 28,717| 28,344| -1.3%|   28,717|   28,344| -1.3%|
| period)               |       |       |      |         |         |      |
+-----------------------+-------+-------+------+---------+---------+------+

Europe

+--------------------------+-------+-------+------+-------+-------+-------+
| Constant and adjusted    |       |       |      |       |       |       |
|  basis (EURm)            |Q2 2010|Q2 2011|Change|H1 2010|H1 2011|Change |
|                          |       |       |      |       |       |       |
+--------------------------+-------+-------+------+-------+-------+-------+
|Sales                     |1 765,7|1 853,9| +5,0%|3 429,2|3 641,4|  +6,2%|
|                          |       |       |      |       |       |       |
|      on a constant basis |       |       |      |       |       |       |
|      and same days       |       |       | +5,1%|       |       |  +5,6%|
|                          |       |       |      |       |       |       |
|o/w France                |  584,8|  629,8| +7,7%|1 152,7|1 251,2|  +8,5%|
|                          |       |       |      |       |       |       |
|      on a constant basis |       |       |      |       |       |       |
|      and same days       |       |       | +7,7%|       |       |  +7,7%|
|                          |       |       |      |       |       |       |
|    United Kingdom        |  211,9|  223,3| +5,4%|  448,7|  463,6|   3,3%|
|                          |       |       |      |       |       |       |
|      on a constant basis |       |       |      |       |       |       |
|      and same days       |       |       | +7,2%|       |       |  +4,1%|
|                          |       |       |      |       |       |       |
|    Germany               |  243,6|  226,3| -7,1%|  443,0|  428,2|  -3,3%|
|                          |       |       |      |       |       |       |
|      on a constant basis |       |       |      |       |       |       |
|      and same days       |       |       | -7,3%|       |       |  -4,1%|
|                          |       |       |      |       |       |       |
|    Scandinavia           |  215,6|  225,5| +4,6%|  411,4|  436,2|  +6,0%|
|                          |       |       |      |       |       |       |
|      on a constant basis |       |       |      |       |       |       |
|      and same days       |       |       | +5,2%|       |       |  +5,6%|
+--------------------------+-------+-------+------+-------+-------+-------+
|Gross profit              |  453,3|  481,7| +6,3%|  891,1|  956,7|  +7,4%|
|                          |       |       |      |       |       |       |
|    as a % of sales       |  25,7%|  26,0%|+30bps|  26,0%|  26,3%| +30bps|
+--------------------------+-------+-------+------+-------+-------+-------+
|Distribution & adm.       |       |       |      |       |       |       |
|expenses                  |       |       |      |       |       |       |
|(incl. depreciation)      |(347,2)|(354,2)| +2,0%|(700,5)|(714,3)|  +2,0%|
+--------------------------+-------+-------+------+-------+-------+-------+
|EBITA                     |  106,1|  127,5|+20,1%|  190,7|  242,5| +27,2%|
|                          |       |       |      |       |       |       |
|    as a % of sales       |   6,0%|   6,9%|+90bps|   5,6%|   6,7%|+110bps|
+--------------------------+-------+-------+------+-------+-------+-------+
|Headcount (end of period) | 16 756| 16 597| -0,9%| 16 756| 16 597|  -0,9%|
+--------------------------+-------+-------+------+-------+-------+-------+

North America

+-------------------------+-------+-------+-------+-------+-------+-------+
| Constant and adjusted   |       |       |       |       |       |       |
|  basis (EURm)           |Q2 2010|Q2 2011|Change |H1 2010|H1 2011|Change |
|                         |       |       |       |       |       |       |
+-------------------------+-------+-------+-------+-------+-------+-------+
|Sales                    |  835,3|  883,2|  +5,7%|1 601,8|1 729,0|  +7,9%|
|                         |       |       |       |       |       |       |
|      on a constant basis|       |       |       |       |       |       |
|      and same days      |       |       |  +5,7%|       |       |  +7,9%|
|                         |       |       |       |       |       |       |
|o/w United States        |  579,3|  605,7|  +4,6%|1 111,1|1 170,8|  +5,4%|
|                         |       |       |       |       |       |       |
|      on a constant basis|       |       |       |       |       |       |
|       and same days     |       |       |  +4,6%|       |       |  +5,4%|
|                         |       |       |       |       |       |       |
|    Canada               |  256,1|  277,5|  +8,4%|  490,7|  558,3| +13,8%|
|                         |       |       |       |       |       |       |
|      on a constant basis|       |       |       |       |       |       |
|      and same days      |       |       |  +8,4%|       |       | +13,8%|
+-------------------------+-------+-------+-------+-------+-------+-------+
|Gross profit             |  179,8|  189.6|  +5,4%|  346,0|  367,2|  +6,1%|
|                         |       |       |       |       |       |       |
|    as a % of sales      |  21,5%|  21,5%| stable|  21,6%|  21,2%| -40bps|
+-------------------------+-------+-------+-------+-------+-------+-------+
|Distribution & adm.      |       |       |       |       |       |       |
|expenses                 |       |       |       |       |       |       |
|(incl. depreciation)     |(154,5)|(152.6)|  -1,2%|(307,8)|(306,5)|  -0,4%|
+-------------------------+-------+-------+-------+-------+-------+-------+
|EBITA                    |   25,4|   37,0| +45,8%|   38,2|   60,7| +59,0%|
|                         |       |       |       |       |       |       |
|    as a % of sales      |   3,0%|   4,2%|+120bps|   2,4%|   3,5%|+110bps|
+-------------------------+-------+-------+-------+-------+-------+-------+
|Headcount (end of period)|  7 519|  7 184|  -4,5%|  7 519|  7 184|  -4,5%|
+-------------------------+-------+-------+-------+-------+-------+-------+


Asia-Pacific

+---------------------------+-------+-------+------+-------+-------+------+
|  Constant and adjusted    |       |       |      |       |       |      |
|   basis (EURm)            |Q2 2010|Q2 2011|Change|H1 2010|H1 2011|Change|
|                           |       |       |      |       |       |      |
+---------------------------+-------+-------+------+-------+-------+------+
|Sales                      |  303,0|  319,1| +5,3%|  566,7|  603.2| +6,4%|
|                           |       |       |      |       |       |      |
|      on a constant basis  |       |       |      |       |       |      |
|      and same days        |       |       | +5,3%|       |       | +6,6%|
|                           |       |       |      |       |       |      |
|o/w Australia              |  191,9|  195,3| +1,8%|  362,1|  376,9| +4,1%|
|                           |       |       |      |       |       |      |
|      on a constant basis  |       |       |      |       |       |      |
|      and same days        |       |       | +1,8%|       |       | +4,4%|
|                           |       |       |      |       |       |      |
|    China                  |   60,6|   70,6|+16,6%|  107,8|  125,5|+16,5%|
|                           |       |       |      |       |       |      |
|      on a constant basis  |       |       |      |       |       |      |
|      and same days        |       |       |+16,0%|       |       |+16,1%|
|                           |       |       |      |       |       |      |
|    New Zealand            |   35,6|   36,0| +1,2%|   66,8|   66,7| -0,2%|
|                           |       |       |      |       |       |      |
|      on a constant basis  |       |       |      |       |       |      |
|      and same days        |       |       | +1,2%|       |       | -0,2%|
+---------------------------+-------+-------+------+-------+-------+------+
|Gross profit               |   65,1|   69,5| +6,8%|  123,4|  132,4| +7,3%|
|                           |       |       |      |       |       |      |
|    as a % of sales        |  21,5%|  21,8%|+30bps|  21,8%|  21,9%|+10bps|
+---------------------------+-------+-------+------+-------+-------+------+
|Distribution & adm.        |       |       |      |       |       |      |
|expenses                   |       |       |      |       |       |      |
|(incl. depreciation)       | (48,1)| (50,5)| +5,0%| (93,0)| (99,3)| +6,7%|
+---------------------------+-------+-------+------+-------+-------+------+
|EBITA                      |   17,0|   19,0|+11,8%|   30,4|   33,1| +8,8%|
|                           |       |       |      |       |       |      |
|    as a % of sales        |   5,6%|   6,0%|+40bps|   5,4%|   5.5%|+10bps|
+---------------------------+-------+-------+------+-------+-------+------+
|Headcount (end of period)  |  2 734|  2 837|  3,8%|  2 734|  2 837| +3,8%|
+---------------------------+-------+-------+------+-------+-------+------+

Other (Latin America, Other Operating Segments + Corporate Holdings)

+-------------------------+-------+-------+-------+-------+-------+-------+
| Constant and adjusted   |       |       |       |       |       |       |
|  basis (EURm)           |Q2 2010|Q2 2011|Change |H1 2010|H1 2011|Change |
|                         |       |       |       |       |       |       |
+-------------------------+-------+-------+-------+-------+-------+-------+
|Operating segments       |       |       |       |       |       |       |
+-------------------------+-------+-------+-------+-------+-------+-------+
|Sales                    |  101.5|  101.4|  -0.1%|  186.2|  188.9|  +1.4%|
|                         |       |       |       |       |       |       |
|    on a constant basis  |       |       |       |       |       |       |
|    and same days        |       |       |  -1.6%|       |       |  +0.2%|
|                         |       |       |       |       |       |       |
|o/w Latin America        |   48.1|   58.5| +21.6%|   86.2|  109.5| +27.0%|
|                         |       |       |       |       |       |       |
|      on a constant basis|       |       |       |       |       |       |
|      and same days      |       |       | +18.0%|       |       | +24.0%|
|                         |       |       |       |       |       |       |
|    ACE                  |   47.1|   34.5| -26.7%|   87.5|   63.0| -28.0%|
|                         |       |       |       |       |       |       |
|      on a constant basis|       |       |       |       |       |       |
|      and same days      |       |       | -26.7%|       |       | -28.1%|
+-------------------------+-------+-------+-------+-------+-------+-------+
|Gross profit             |   37.0|   35.2|  -4.9%|   66.6|   66.4|  -0.2%|
|                         |       |       |       |       |       |       |
|    as a % of sales      |  36.4%|  34.7%|-170bps|  35.8%|  35.2%| -60bps|
+-------------------------+-------+-------+-------+-------+-------+-------+
|Distribution & adm.      |       |       |       |       |       |       |
|expenses                 |       |       |       |       |       |       |
|(incl. depreciation)     | (30.7)| (29.7)|  -3.3%| (61.4)| (58.8)|  -4.2%|
+-------------------------+-------+-------+-------+-------+-------+-------+
|EBITA                    |    6.3|    5.4| -14.1%|    5.2|    7.6| +46.2%|
|                         |       |       |       |       |       |       |
|    as a % of sales      |   6.2%|   5.3%| -90bps|   2.8%|   4.0%|+120bps|
+-------------------------+-------+-------+-------+-------+-------+-------+
|Headcount (end of period)|  1,038|  1,084|   4.4%|  1,038|  1,084|   4.4%|
+-------------------------+-------+-------+-------+-------+-------+-------+
|Corporate Holdings       |       |       |       |       |       |       |
+-------------------------+-------+-------+-------+-------+-------+-------+
|EBITA                    |  (8.2)|  (9.8)| +19.6%| (12.8)| (18.2)| +42.1%|
+-------------------------+-------+-------+-------+-------+-------+-------+
|Headcount (end of period)|    670|    642|  -4.2%|    670|    642|  -4.3%|
+-------------------------+-------+-------+-------+-------+-------+-------+


                                   Appendix 2

                        Extract of Financial Statements


                         Consolidated Income Statement

+-----------------------+-------+-------+------+---------+---------+------+
|                       |       |       |      |         |         |      |
|  Reported basis (EURm)|Q2 2010|Q2 2011|Change| H1 2010 | H1 2011 |Change|
|                       |       |       |      |         |         |      |
+-----------------------+-------+-------+------+---------+---------+------+
|Sales                  |3 047,0|3 157,6| +3,6%|  5 744,6|  6 162,5| +7,3%|
+-----------------------+-------+-------+------+---------+---------+------+
|Gross profit           |  744,6|  771,2| +3,6%|  1 422,8|  1 532,6| +7,7%|
|                       |       |       |      |         |         |      |
|  as a % of sales      |  24,4%|  24,4%|      |    24,8%|    24,9%|      |
+-----------------------+-------+-------+------+---------+---------+------+
|Distribution & adm.    |       |       |      |         |         |      |
|expenses (excl.        |       |       |      |         |         |      |
|depreciation)          |(577,6)|(578,6)| +0,2%|(1 127,4)|(1 161,9)| +3,1%|
+-----------------------+-------+-------+------+---------+---------+------+
|EBITDA                 |  167,0|  192,6|+15,3%|    295,4|    370,7|+25,5%|
|                       |       |       |      |         |         |      |
|  as a % of sales      |   5,5%|   6,1%|      |     5,1%|     6,0%|      |
+-----------------------+-------+-------+------+---------+---------+------+
|Depreciation           | (19,0)| (18,5)|      |   (38,0)|   (36,9)|      |
+-----------------------+-------+-------+------+---------+---------+------+
|EBITA                  |  148,0|  174,1|+17,6%|    257,4|    333,8|+29,7%|
|                       |       |       |      |         |         |      |
|  as a % of sales      |   4,9%|   5,5%|      |     4,5%|     5,4%|      |
+-----------------------+-------+-------+------+---------+---------+------+
|Amortization of        |       |       |      |         |         |      |
|purchase               |       |       |      |         |         |      |
|price allocation       |  (7,2)|  (4,6)|      |   (12,3)|    (9,2)|      |
+-----------------------+-------+-------+------+---------+---------+------+
|Operating income bef.  |       |       |      |         |         |      |
|other                  |       |       |      |         |         |      |
|inc. and exp.          |  140,8|  169,6|+20,4%|    245,1|    324,6|+32,5%|
|                       |       |       |      |         |         |      |
|  as a % of sales      |   4,6%|   5,4%|      |     4,3%|     5,3%|      |
+-----------------------+-------+-------+------+---------+---------+------+
|Other income and       |       |       |      |         |         |      |
|expenses               | (15,9)| (11,9)|      |   (31,1)|   (15,8)|      |
+-----------------------+-------+-------+------+---------+---------+------+
|Operating income       |  124,9|  157,7|+26,2%|    214,0|    308,8|+44,3%|
+-----------------------+-------+-------+------+---------+---------+------+
|Financial expenses     |       |       |      |         |         |      |
| (net)                 | (52,8)| (53,1)|      |  (103,5)|   (94,7)|      |
+-----------------------+-------+-------+------+---------+---------+------+
|Share of profit (loss) |       |       |      |         |         |      |
|in associates          |    1,5|    1,0|      |      0,4|      0,1|      |
+-----------------------+-------+-------+------+---------+---------+------+
|Net income (loss)      |       |       |      |         |         |      |
|before income tax      |   73,6|  105,6|+43,5%|    110,9|    214,2|+93,1%|
+-----------------------+-------+-------+------+---------+---------+------+
|Income tax             | (10,5)| (18,4)|      |   (18,5)|   (40,5)|      |
+-----------------------+-------+-------+------+---------+---------+------+
|Net income (loss)      |   63,1|   87,2|+38,3%|     92,4|    173,7|+87,9%|
+-----------------------+-------+-------+------+---------+---------+------+
|Net income (loss) attr.|       |       |      |         |         |      |
|to non-controlling     |       |       |      |         |         |      |
|interests              |    0,3|    0,3|      |      0,4|      0,4|      |
+-----------------------+-------+-------+------+---------+---------+------+
|Net income (loss) attr.|       |       |      |         |         |      |
|to equity holders of   |       |       |      |         |         |      |
|the parent             |   62,8|   86,9|+38,4%|     92,0|    173,3|+88,4%|
+-----------------------+-------+-------+------+---------+---------+------+

Sales and profitability by segment

+-----------------+-------+-------+------+-------+-------+------+
| Reported basis  |       |       |      |       |       |      |
|      (EURm)     |Q2 2010|Q2 2011|Change|H1 2010|H1 2011|Change|
|                 |       |       |      |       |       |      |
+-----------------+-------+-------+------+-------+-------+------+
|Sales            |3,047.0|3,157.6| +3.6%|5,744.6|6,162.5| +7.3%|
|                 |       |       |      |       |       |      |
|  Europe         |1,744.5|1,853.9| +6.3%|3,365.3|3,641.4| +8.2%|
|                 |       |       |      |       |       |      |
|  North America  |  919.2|  883.2| -3.9%|1,665.3|1,729.0| +3.8%|
|                 |       |       |      |       |       |      |
|  Asia-Pacific   |  287.4|  319.1|+11.0%|  523.1|  603.2|+15.3%|
|                 |       |       |      |       |       |      |
|  Other          |   95.9|  101.4| +5.7%|  190.9|  188.9| -1.0%|
+-----------------+-------+-------+------+-------+-------+------+
|Gross profit     |  744.6|  771.2| +3.6%|1,422.8|1,532.6| +7.7%|
|                 |       |       |      |       |       |      |
|  Europe         |  451.7|  477.0| +5.6%|  883.8|  962.6| +8.9%|
|                 |       |       |      |       |       |      |
|  North America  |  198.8|  188.8| -5.0%|  362.7|  369.0| +1.7%|
|                 |       |       |      |       |       |      |
|  Asia-Pacific   |   61.7|   69.4|+12.5%|  114.1|  133.7|+17.2%|
|                 |       |       |      |       |       |      |
|  Other          |   32.4|   36.0|+11.1%|   62.1|   67.3| +8.4%|
+-----------------+-------+-------+------+-------+-------+------+
|EBITA            |  148.0|  174.1|+17.6%|  257.4|  333.8|+29.7%|
|                 |       |       |      |       |       |      |
|  Europe         |  108.6|  122.5|+12.8%|  195.9|  246.8|+26.0%|
|                 |       |       |      |       |       |      |
|  North America  |   27.2|   36.2|+33.1%|   41.3|   62.3|+50.8%|
|                 |       |       |      |       |       |      |
|  Asia-Pacific   |   16.0|   18.9|+18.1%|   28.1|   34.4|+22.4%|
|                 |       |       |      |       |       |      |
|  Other          |   -3.9|   -3.5|   n/m|   -8.0|   -9.7|   n/m|
+-----------------+-------+-------+------+-------+-------+------+


                           Consolidated Balance Sheet

+-------------------------------------+--------------------+-------------+
|Assets (EURm)                        |December 31st , 2010|June 30, 2011|
+-------------------------------------+--------------------+-------------+
|Goodwill                             |             3,931.2|      3,946.5|
|                                     |                    |             |
|Intangible assets                    |               934.4|        913.3|
|                                     |                    |             |
|Property, plant & equipment          |               245.4|        258.2|
|                                     |                    |             |
|Long-term investments(1)             |               132.1|         59.4|
|                                     |                    |             |
|Investments in associates            |                 9.3|          8.8|
|                                     |                    |             |
|Deferred tax assets                  |               138.6|        150.4|
+-------------------------------------+--------------------+-------------+
|Total non-current assets             |             5,391.0|      5,336.6|
+-------------------------------------+--------------------+-------------+
|Inventories                          |             1,203.1|      1,206.2|
|                                     |                    |             |
|Trade receivables                    |             2,022.0|      2,176.2|
|                                     |                    |             |
|Other receivables                    |               436.1|        426.9|
|                                     |                    |             |
|Assets classified as held for sale   |                23.1|         76.9|
|                                     |                    |             |
|Cash and cash equivalents            |               311.9|        175.7|
+-------------------------------------+--------------------+-------------+
|Total current assets                 |             3,996.2|      4,061.9|
+-------------------------------------+--------------------+-------------+
|Total assets                         |             9,387.2|      9,398.5|
+-------------------------------------+--------------------+-------------+

+-------------------------------------+--------------------+-------------+
|Liabilities (EURm)                   |December 31st , 2010|June 30, 2011|
+-------------------------------------+--------------------+-------------+
|Total equity                         |             3,834.4|      3,945.5|
+-------------------------------------+--------------------+-------------+
|Long-term debt                       |             2,463.5|      1,923.8|
|                                     |                    |             |
|Deferred tax liabilities             |               144.5|        167.1|
|                                     |                    |             |
|Other non-current liabilities        |               330.7|        294.8|
+-------------------------------------+--------------------+-------------+
|Total non-current liabilities        |             2,938.7|      2,385.7|
+-------------------------------------+--------------------+-------------+
|Interest bearing debt & accrued      |               122.0|        614.3|
| interests                           |                    |             |
|Trade payables                       |             1,866.2|      1,827.0|
|                                     |                    |             |
|Other payables                       |               623.9|        597.1|
|                                     |                    |             |
|Liabilities classified as held for   |                    |             |
| sale                                |                 2.0|         28.9|
+-------------------------------------+--------------------+-------------+
|Total current liabilities            |             2,614.1|      3,067.3|
+-------------------------------------+--------------------+-------------+
|Total liabilities                    |             5,552.8|      5,453.0|
+-------------------------------------+--------------------+-------------+
|Total equity & liabilities           |             9,387.2|      9,398.5|
+-------------------------------------+--------------------+-------------+

(1) Includes Fair value hedge derivatives for EUR0.3m at December 31, 2010
    and for EUR1.4m at June 30, 2011


                               Change in Net Debt

+---------------------------------------+-------+-------+-------+-------+
|EURm                                   |Q2 2010|Q2 2011|H1 2010|H1 2011|
+---------------------------------------+-------+-------+-------+-------+
|EBITDA                                 |  167,0|  192,6|  295,4|  370,7|
+---------------------------------------+-------+-------+-------+-------+
|Other operating revenues & costs(1)    | (22,0)| (13,9)| (74,6)| (28,8)|
+---------------------------------------+-------+-------+-------+-------+
|Operating cash flow                    |  145,0|  178,7|  220,8|  341,9|
+---------------------------------------+-------+-------+-------+-------+
|Change in working capital              |   18,3| (36,2)| (20,4)|(237,4)|
|                                       |       |       |       |       |
|              Gross capital expenditure| (11,8)| (26,0)| (23,7)| (44,4)|
|                                       |       |       |       |       |
|       Disposal of fixed assets & other|    4,8|    6,1|    6,2|   17,4|
|                                       |       |       |       |       |
|Net capital expenditure                |  (7,0)| (19,9)| (17,6)| (27,0)|
+---------------------------------------+-------+-------+-------+-------+
|Free cash flow before interest and tax |  156,3|  122,7|  182,9|   77,5|
+---------------------------------------+-------+-------+-------+-------+
|Net interest paid / received           | (42,4)| (38,2)| (87,0)| (71,4)|
|                                       |       |       |       |       |
|Income tax paid                        | (18,9)| (24,0)| (27,9)| (47,5)|
+---------------------------------------+-------+-------+-------+-------+
|Free cash flow after interest and tax  |   95,0|   60,5|   68,0| (41,4)|
+---------------------------------------+-------+-------+-------+-------+
|Net financial investment(2)            |    9,9|  (5,9)|   11,3| (55,2)|
|                                       |       |       |       |       |
|Dividends paid                         |    0,0|(105,2)|    0,0|(105,2)|
|                                       |       |       |       |       |
|Net change in equity                   |    1,3|   84,3|    6,9|   88,4|
|                                       |       |       |       |       |
|Other(3)                               |  (5,5)|  (5,2)| (21,3)| (21,5)|
|                                       |       |       |       |       |
|Currency exchange variation            | (96,0)| (13,9)|(198,4)|   44,4|
+---------------------------------------+-------+-------+-------+-------+
|Decrease (increase) in net debt        |    4,7|   14,6|(133,5)| (90,5)|
+---------------------------------------+-------+-------+-------+-------+
|Net debt at the beginning of the period|2 539,4|2 378,4|2 401,2|2 273,3|
+---------------------------------------+-------+-------+-------+-------+
|Net debt at the end of the period      |2 534,7|2 363,8|2 534,7|2 363,8|
+---------------------------------------+-------+-------+-------+-------+

(1) Includes restructuring outflows of EUR21.2 million in Q2 2010 and
    EUR13.8 million in Q2 2011 and EUR42.7 million in H1 2010 and
    EUR26.8 million in H1 2011
(2) H1 2011 includes the acquisitions of Nortel Suprimentos Industriais,
    Yantra Automation,  AD electronics, Beijing Zhongheng, Tegro and Wuhan
    Rockcenter Automation for EUR54.2million (net of cash)
(3) Q2 2011 includes a EUR (2.0) million adjustment to the High Yield Bond
    carrying value


                           Return on Capital Employed


+---------------------------------------------+-------------+-------------+
|ROCE calculation                             |June 30, 2010|June 30, 2011|
+---------------------------------------------+-------------+-------------+
|Goodwill                                     |      3 994,5|      3 946,5|
|                                             |             |             |
|Intangible assets                            |        955,6|        913,3|
|                                             |             |             |
|Property, plant & equipment                  |        258,6|        258,2|
|                                             |             |             |
|Inventories                                  |      1 227,8|      1 206,2|
|                                             |             |             |
|Trade receivables                            |      2 096,7|      2 176,2|
|                                             |             |             |
|Other receivables                            |        391,2|        426,9|
|                                             |             |             |
|Other non-current liabilities                |       -369,2|       -294,8|
|                                             |             |             |
|Trade payables                               |     -1 855,8|     -1 827,0|
|                                             |             |             |
|Other payables                               |       -556,5|       -597,1|
|                                             |             |             |
|Reported capital employed                    |      6 142,9|      6 208,4|
|                                             |             |             |
|Restatement GW related to IPO                |     -1 322,0|     -1 322,0|
+---------------------------------------------+-------------+-------------+
|Capital employed used for ROCE calculation(1)|      4 820,9|      4 886,4|
+---------------------------------------------+-------------+-------------+
|Operating inc. bef. other inc. & exp. pre-tax|        540,7|        689,6|
+---------------------------------------------+-------------+-------------+
|Effective tax rate                           |        16,7%|        18,9%|
+---------------------------------------------+-------------+-------------+
|Operating inc. bef. other inc. & exp. after  |             |             |
| tax (2)                                     |        450,4|        559,3|
+---------------------------------------------+-------------+-------------+
|ROCE after tax (2/1)                         |         9,3%|        11,4%|
+---------------------------------------------+-------------+-------------+


                                   Appendix 3

                            Working Capital Analysis

+-----------------------------------+---------------+---------------+
| Constant basis (EURm)             | June 30, 2010 | June 30, 2011 |
+-----------------------------------+---------------+---------------+
| Sales (12 rolling months)         |      11,984.9 |      12,144.8 |
+-----------------------------------+---------------+---------------+
| Net inventories                   |       1,227.8 |       1,206.2 |
|                                   |               |               |
| as a % of sales 12 rolling months |         10.2% |          9.9% |
|                                   |               |               |
|               as a number of days |          46.2 |          45.1 |
+-----------------------------------+---------------+---------------+
| Net trade receivables             |       2,096.7 |       2,176.2 |
|                                   |               |               |
| as a % of sales 12 rolling months |         17.5% |         17.9% |
|                                   |               |               |
|               as a number of days |          54.3 |          54.4 |
+-----------------------------------+---------------+---------------+
| Net trade payables                |       1,855.8 |       1,827.0 |
|                                   |               |               |
| as a % of sales 12 rolling months |         15.5% |         15.0% |
|                                   |               |               |
|               as a number of days |          61.7 |          59.8 |
+-----------------------------------+---------------+---------------+
| Trade working capital             |       1,468.6 |       1,555.4 |
|                                   |               |               |
| as a % of sales 12 rolling months |         12.3% |         12.8% |
+-----------------------------------+---------------+---------------+
| Non-trade working capital         |        -179.2 |        -172.1 |
+-----------------------------------+---------------+---------------+
| Total working capital             |       1,289.4 |       1,383.2 |
|                                   |               |               |
| as a % of sales 12 rolling months |         10.8% |         11.4% |
+-----------------------------------+---------------+---------------+


                                   Appendix 4
                      Headcount and branches by geography

+----------------+--------+----------+--------+---------------------------+
|        FTEs    |        |          |        |     Change 30/06/2011     |
|                |30/06/10|31/12/2010|30/06/11+-------------+-------------+
|     comparable |        |          |        |vs.30/06/2010|vs.31/12/2010|
+----------------+--------+----------+--------+-------------+-------------+
|Europe          |  16,756|    16,543|  16,597|          -1%|           0%|
+----------------+--------+----------+--------+-------------+-------------+
|USA             |   5,390|     5,054|   4,964|          -8%|          -2%|
+----------------+--------+----------+--------+-------------+-------------+
|Canada          |   2,129|     2,201|   2,220|           4%|           1%|
+----------------+--------+----------+--------+-------------+-------------+
|North America   |   7,519|     7,255|   7,184|          -4%|          -1%|
+----------------+--------+----------+--------+-------------+-------------+
|Asia-Pacific    |   2,734|     2,748|   2,837|           4%|           3%|
+----------------+--------+----------+--------+-------------+-------------+
|Latin America  &|        |          |        |             |             |
|Other Op.       |        |          |        |             |             |
| segments       |   1,038|     1,057|   1,084|           4%|           3%|
+----------------+--------+----------+--------+-------------+-------------+
|Corporate       |        |          |        |             |             |
| holdings       |     670|       678|     642|          -4%|          -5%|
+----------------+--------+----------+--------+-------------+-------------+
|Other           |   1,708|     1,735|   1,726|           1%|          -1%|
+----------------+--------+----------+--------+-------------+-------------+
|Group           |  28,717|    28,281|  28,344|          -1%|           0%|
+----------------+--------+----------+--------+-------------+-------------+

+----------------+--------+----------+--------+---------------------------+
|      Branches  |        |          |        |     Change 30/06/2011     |
|                |30/06/10|31/12/2010|30/06/11+-------------+-------------+
|     comparable |        |          |        |vs.30/06/2010|vs.31/12/2010|
+----------------+--------+----------+--------+-------------+-------------+
|Europe          |   1,293|     1,275|   1,269|          -2%|           0%|
+----------------+--------+----------+--------+-------------+-------------+
|USA             |     338|       313|     306|          -9%|          -2%|
+----------------+--------+----------+--------+-------------+-------------+
|Canada          |     209|       210|     209|           0%|           0%|
+----------------+--------+----------+--------+-------------+-------------+
|North America   |     547|       523|     515|          -6%|          -2%|
+----------------+--------+----------+--------+-------------+-------------+
|Asia-Pacific    |     294|       293|     298|           1%|           2%|
+----------------+--------+----------+--------+-------------+-------------+
|Latin America  &|        |          |        |             |             |
|Other Op.       |        |          |        |             |             |
| segments       |      66|        66|      67|           2%|           2%|
+----------------+--------+----------+--------+-------------+-------------+
|Corporate       |        |          |        |             |             |
| holdings       |       6|         6|       6|            -|            -|
+----------------+--------+----------+--------+-------------+-------------+
|Other           |      72|        72|      73|           1%|           1%|
+----------------+--------+----------+--------+-------------+-------------+
|Group           |   2,206|     2,163|   2,155|          -2%|           0%|
+----------------+--------+----------+--------+-------------+-------------+

                                   Appendix 5

                       Senior Credit Agreement main terms

The EUR1.7 billion senior credit agreement, signed in December 2009,
comprises two revolving credit facilities structured as follows:
  * A three-year multi-currency revolving credit facility in an initial
    Amount of EUR600 million, which will reduce to EUR400 million after one
    year and to EUR200 million after two years (Facility A);
  * A five-year multi-currency revolving credit facility in an amount of
    EUR1,100 million (Facility B).

The applicable margins in the senior credit facilities are 50bps lower for Facility A and 25bps lower for Facility B than in the previous senior credit agreement. The margin level varies according to the same Indebtedness Ratio thresholds as in the previous senior credit agreement (IR = adjusted consolidated net debt to adjusted consolidated EBITDA of the last 12 months):

Indebtedness IR sup.  IR sup.  IR sup.  IR sup.  IR sup.  IR sup.  IR inf.
Ratio (IR)   or equal or equal or equal or equal or equal or equal to 2.5x
             to 5.0x  to 4.5x  to 4.0x  to 3.5x  to 3.0x  to 2.5x
                      and inf. and inf. and inf. and inf. and inf.
                      to 5.0x  to 4.5x  to 4.0x  to 3.5x  to 3.0x

Facility A   4.25%    3.50%    3.00%    2.50%    2.00%    1.75%    1.50%

Facility B   4.50%    3.75%    3.25%    2.75%    2.25%    2.00%    1.75%

In addition, the margin applicable to both facilities shall be increased
by an utilisation fee equal to:
  * 25bps if the total amount drawn under both facilities is comprised
    Between 33% and 66% of the total commitment;
  * 50bps if the total amount drawn under both facilities equals or
    exceeds 66% of the total commitment.

The financial covenants related to the Indebtedness Ratio (IR) covenant, to the limitation of capital expenditure and to the limitation of dividend payment remain unchanged:

  * Commitment to keep indebtedness ratio below thresholds:

Date  30 june    31 dec.     30 june     31 dec.     30 june     Thereafter
      2010       2010        2011        2011        2012

Covenant 5.15x        4.90x       4.50x       4.00x       3.75x       3.5x


  * Commitment to suspend dividend payments as long as the Indebtedness
    Ratio equals or exceeds 4.00x;
  * Commitment to limit capital expenditure to 0.75% of sales as long as
    The Indebtedness Ratio equals or exceeds 4.00x.

The senior credit agreement contains customary clauses for this type of agreement. These include clauses restricting the ability of Rexel Group companies to pledge their assets, carry out mergers or restructuring programs, borrow or lend money or provide guarantees. In particular, the Rexel Group has no restriction on acquisitions if the Indebtedness Ratio does not exceed 3.50x and has an acquisition basket of up to EUR200 million for each 12-months period if the Indebtedness Ratio equals or exceed 3.50x.

As the indebtedness ratio at June 30, 2011 stood at 3.03x, the limitations regarding dividend payment, capital expenditure and acquisitions do not apply.

                                   DISCLAIMER

The Group is exposed to fluctuations in copper prices in connection with its distribution of cable products. Cables accounted for approximately 18% of the Group's sales, and copper accounts for approximately 60% of the composition of cables. This exposure is indirect since cable prices also reflect copper suppliers' commercial policies and the competitive environment in the Group's markets. Changes in copper prices have an estimated so-called "recurring" effect and an estimated so called "non-recurring" effect on the Group's performance, assessed as part of the monthly internal reporting process of the Rexel Group:


- the recurring effect related to the change in copper-based cable prices corresponds to the change in value of the copper part included in the sales price of cables from one period to another. This effect mainly relates to the Group's sales;


- the non-recurring effect related to the change in copper-based cables prices corresponds to the effect of copper price variations on the sales price of cables between the time they are purchased and the time they are sold, until all such inventory has been sold (direct effect on gross profit). Practically, the non-recurring effect on gross profit is determined by comparing the historical purchase price for copper-based cable and the supplier price effective at the date of the sale of the cables by the Rexel Group. Additionally, the non-recurring effect on EBITA corresponds to the non-recurring effect on gross profit, which may be offset, when appropriate, by the non-recurring portion of changes in the distribution and administrative expenses (principally, the variable portion of compensation of sales personnel, which accounts for approximately 10% of the variation in gross profit).

The impact of these two effects is assessed for as much of the Group's total cable sales as possible, over each period. Group procedures require that entities that do not have the information systems capable of such exhaustive calculations to estimate these effects based on a sample representing at least 70% of the sales in the period. The results are then extrapolated to all cables sold during the period for that entity. Considering the sales covered, the Rexel Group considers such estimates of the impact of the two effects to be reasonable.

This press release may contain statements of future expectations and other forward-looking statements. By their nature, they are subject to numerous risks and uncertainties, including those described in the Document de Référence registered with the French Autorité des Marchés Financiers (AMF) on April 11, 2011 under number D.11-0272. These forward-looking statements are not guarantees of Rexel's future performance. Rexel's actual results of operations, financial condition and liquidity as well as development of the industry in which Rexel operates may differ materially from those made in or suggested by the forward-looking statements contained in this release. The forward-looking statements contained in this communication speak only as of the date of this communication and Rexel does not undertake, unless required by law or regulation, to update any of the forward-looking statements after this date to conform such statements to actual results, to reflect the occurrence of anticipated results or otherwise.

Rexel: second-quarter & half-year 2011 results:
 http://hugin.info/143564/R/1533620/467215.pdf 

This announcement is distributed by Thomson Reuters on behalf of Thomson Reuters clients. The owner of this announcement warrants that:

(i) the releases contained herein are protected by copyright and other applicable laws; and

(ii) they are solely responsible for the content, accuracy and originality of the information contained therein.

Source: REXEL via Thomson Reuters ONE

[HUG#1533620]

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