PARIS, July 30 Rexel, the France-based
distributor of electrical parts and supplies to professionals,
cut its profit margin forecast for this year on Wednesday to
reflect a poor first half performance and account for a sharp
increase in costs.
The company said it was now forecasting an adjusted EBITDA
margin of "at least 5 percent," having said in February it would
deliver a result in a range of 5.3 to 5.6 percent, compared with
the 5.4 percent margin it delivered in 2013.
Rexel said its first-half adjusted EBITDA gross margin fell
20 basis points year-on-year, largely impacted by an
"unfavourable geographic mix" that included a
weaker-than-expected performance in Canada and Australia, and
extra costs that were mainly investment related.
"Considering the related additional costs, as well as our
half-year results, we are adjusting our 2014 outlook in terms of
profitability, while confirming our cash flow conversion targets
and cash allocation policy to secure an attractive dividend,
further improve the balance sheet and continue to invest for
growth," said Chairman and Chief Executive Rudy Provoost.
(Reporting by Andrew Callus; Editing by James Regan)