MESSAGE FROM PATRICK BERARD Chief Executive Officer of REXEL Rexel’s performance in 2017 provides once again a I’m pleased to say that we have recorded advances demonstration of the strength and adaptability of in each of them. the Group’s business model. In a more favourable Our first pi l lar is accelerating organic growth, economic environment across most of our markets, notably through better customer knowledge and Rexel del ivered results in l ine with its targets, increased digitization of our activities. Our revenue proving that the strategy that we presented at growth attests that we are on track, and digital sales our Capital Market Day in February 2017 and the represented 1.9 billion euros last year or 14% of Group action plans we are implementing throughout the sales, a 13% increase over the previous year. Digital is Group are already del ivering their first positive growing much faster than our traditional business, effects. with five countries now above 30% in digital sales. Our revenues, at 13.3 billion euros, were up by 3.5% With the recent appointment to our Executive on a constant and same-day basis. Our adjusted Committee of Nathalie Wright as Group Digital and EBITA grew by 6.1% to 580.1 mil l ion euros, with IT Transformation Director, bringing us her great margin improving by 13 basis points. Our recurring experience in top technology groups, we intend to net income, which serves as the base for dividend accelerate Rexel’s multichannel evolution. We also payments, rose 16.4%, to 291.2 million euros. At the improved our customer service level, investing in same time, we strengthened our financial structure, service platforms in several European countries taking advantage of favourable market conditions and redefining branch assortment in key European to refinance our debt and obtain better terms: Our countries as well as the US. net debt, at a little over 2 billion euros, was reduced Our second pil lar is increased selectivity in capital by 131 mil l ion euros, and our indebtedness ratio al location in order to focus our energies and stands at 2.8 times EBITDA, an improvement of resources on our main countries, and we have made 20 basis points. This solid performance across the headway on that front as well. With the disposal of board al lows us to propose to our shareholders a our activities in South-East Asia, we have achieved 5% increase in our dividend to 42 cents per share, 17% of our disposal plan, which should lead, once payable in cash. This represents a payout of 44%, completed, to a reduction in sales of about 800 in line with our policy of paying at least 40% of our million euros and to an improvement of the Group’s recurring net income. profitabi l ity.This increased selectivity is also Another reason to be satisfied is that Rexel’s evident in our capital expenditure: 56% of our 2017 performance improved quarter after quarter investments went to IT and digitization. throughout the year. Our same-day sales growth of Our third pi l lar is improving operations in key 5.4% in the fourth quarter was the highest growth geographies, and we can check that box as well. In rate of the year and marked the fifth consecutive the UK, we have moved from five banners to two; quarter of accelerating sales growth despite a in the Netherlands, we have reshaped the business chal lenging base effect. Sales trends improved with a revamped offer and an optimized footprint; in in al l geographies, with growth in al l three of our the US, we have opened new branches and counters, regions, so we are entering 2018 with positive invested in the sales force and training, boosted momentum. digitization, improved our service level and put in While this performance was helped by a gradual place a new regional organization that sharpens our improvement in the economic environment, it also focus on three main priorities: drive growth in active reflects the successful implementation by our teams customers, increase the number of SKUs and boost of the strategy we outlined at our Capital Market our digital presence and connected customers. Day. This strategy is based on three main pillars, and REXEL 2017 – REGISTRATION DOCUMENT 8