OVERVIEW OF THE REXEL GROUP 1.4.3.3 Improve operational and financial – Continuing to shift countries towards the shared performance platform developed by the Rexel Group. This Rexel aims at continuously increasing its profitability shared platform already accounted for 65% of through gross margin enhancement and strict cost the Group’s online sales at the end of 2017; control. – Promoting customer use of the digital tools Gross margin improvement wi l l be driven by available to them; systematic implementation of pricing initiatives and – Continuing to innovate, by offering new supplier relationship management. Rexel wil l also functionalities. strictly manage its cost base, reducing overhead 1 and improving productivity, while, at the same time, •The Rexel Group also plans to digitize its back- reallocating operating expenses to accelerate sales office activities with the twofold objective of growth and digitization. increasing productivity and improving customer and employee experience. This includes the In addition to these Group initiatives, the Rexel digitization of invoicing and payment processes Group drives deep transformations to enhance its and the administration of human resources. profitability in key geographies, mainly the USA, Germany and the UK. 1.4.4 Research and development, patents and •In the USA, Rexel wi l l gradual ly move from a licenses national / banner approach to a regional / multi- Due to the nature of its business, the Rexel Group banner approach, focusing on nine key regions. does not carry out any research and development Through this approach, Rexel notably aims at activities. gaining market share and improving profitability. In the UK, Rexel merged its banners, reducing The Rexel Group’s intel lectual property policy is • centered on protection for its brands (mainly the their number from five to two, al lowing it to Rexel brand and own-brands such as BizLine, benefit from better purchasing conditions and Sector, Newlec and Gigamedia) and its domain improved supply chain efficiency. names (mainly rexel.com). This policy means that •In Germany, Rexel focuses on the development Rexel files or registers brands and domain names of its industrial offer. locally or with all the countries where it operates for ➤ Rexel’s medium-term ambition is to continuously more widely-used ones. grow Adjusted EBITA and improve Adjusted The Rexel Group’s policy is to protect its trademarks EBITA margin through enhanced gross margin, appearing on some products by registering them strict cost control and turnaround of countries in the sales territories and in registration classes for that offer significant potential. products sold. In addition, the Rexel Group uses intellectual property 1.4.3.4 Accelerating digital transformation rights (in particular, names, brands, logos, drawings, The digital transformation of the Rexel Group is models or creations) that are not necessari ly in progress: both with its customers and for its registered because they are used occasional ly for internal processes. A significant and growing share a specific purpose (e.g. marketing campaign) or of capital expenditure is al located to digital and IT, they are difficult to protect. This second category, which accounted for 56% of the investments made however, remains marginal. To the Rexel Group’s in 2017, and are expected to continue to attract knowledge, use of these rights does not violate any a major portion of investment over the next few third party’s rights. years. In April 1998, Rexel Distribution signed an agreement •Digitalization is a lever for organic growth. The on the coexistence and global use of the “Rexel” Rexel Group aims to achieve in the middle-term trade name with a company, which had already 35-40% of digital sales (via e-commerce and EDI), registered the trade name and which operates with three priorities: in a different sector than the Rexel Group. Under REXEL 2017 – REGISTRATION DOCUMENT 27