S&P boosts Rexel

S&P said it raised its ratings for Rexel SA and its senior unsecured notes to BB+.

“Our upgrade reflects our view that Rexel can preserve its improved credit metrics. We have seen significant improvements in Rexel's operating performance, leading to higher-than-anticipated revenue and EBITDA in 2021. The positive trend continued to first-quarter 2022, with reported revenue increasing more than 30% year on year, in line with peers in the electrical equipment distribution market,” the agency said in a press release.

S&P said it forecasts organic revenue growth will be 2%-5% in 2022-2024, albeit with a slightly lower EBITDA margin of 8%-8.2%, reflecting the gradual decrease of raw material including copper prices. “We now anticipate our adjusted FFO to debt ratio for Rexel at 25%-28% in 2022-2024, after 29% in 2021.”

The outlook is stable.

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