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STRATEGY

GLOBAL FOOTPRINT LANDMARKS STRATEGY GOVERNANCE

Message from Rudy Provoost, Chairman and CEO of the Rexel Group. After a challenging year that demonstrated the resilience of Rexel s business model,

Rudy Provoost outlines the Group s strategy and discusses the progress made in driving forward the Group s sustainability and climate change commitments agenda.

A DYNAMIC YEAR 2014 can be described as a dynam- ic year for Rexel with important progress in developing our stra- tegic growth areas and reinforc- ing our operational capabilities, as well as the implementation of a one-tier board governance mod- el in line with the evolution of the shareholding structure. Overall, we were able to demon- strate the robustness of our busi- ness model with sales climbing to slightly more than 13bn over the year, mostly driven by organic growth from North America. Our operating margin was on target at 5% and we generated strong free cash flow before interest and tax of just above 560m. We have also confirmed our dividend policy of paying out at least 40% of recurring net income and have maintained the 2015 dividend at last year s level of 0.75 per share.

A STREAMLINED ORGANIZATION To reinforce Rexel s commitment to increase its organizational effectiveness and to leverage synergy and scale across both the US and Canada, Rexel appoint- ed Brian McNally to the position of CEO of Rexel North America in August 2014. In 2015, we further reinforced the accountability structure at region- al level by placing all our European operations under a single region- al leader, with the appointment of Patrick Berard as head of Rexel Europe, effective July 1st.

FOCUS ON STRATEGIC DRIVERS In a persistently challenging market environment, we further expanded our high-growth cate- gories, such as energy efficiency, building automation and renew- able energy, as well as our inter- national customers and projects business, and vertical markets such as mining. We continue to

We were able to demonstrate the robustness of our business model with sales climbing to slightly more than 13bn over the year.