FORM 10-Q
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
|X| QUARTERLY REPORT PURSUANT TO SECTION 13 or 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
For the Quarterly Period Ended September 30, 1996
Commission file number: 1-5731
REXEL, INC.
(Exact name of registrant as
specified in its charter)
New York 13-1474527
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
150 Alhambra Circle, Coral Gables, Florida 33134
(Address of principal executive offices) (Zip Code)
(305) 446-8000
(Registrant's telephone number,
including area code)
Indicate by check mark whether the registrant (1) has filed all
reports required to be filed by Section 13 or 15(d) of the Securities Exchange
Act of 1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.
Yes [X] No ___
Indicate number of shares outstanding of each of the issuer's classes
of common stock, as of the latest practicable date:
<TABLE>
<CAPTION>
<S> <C> <C>
Date Class Shares Outstanding
---- ----- ------------------
October 9, 1996 Common Stock 25,675,090
--------------- ------------ ----------
</TABLE>
<PAGE>
REXEL, INC.
INDEX
-----
Page Number
-----------
Part I - Financial Information
Condensed Consolidated Balance Sheets (Unaudited)
at September 30, 1996 and December 31, 1995.................1
Condensed Consolidated Statements of Income
(Unaudited) for the Nine and Three Months Ended
September 30, 1996 and 1995.................................2
Condensed Consolidated Statements of Cash Flows
(Unaudited) for the Nine Months Ended September 30, 1996
and 1995....................................................3
Notes to Unaudited Condensed Consolidated
Financial Statements........................................4
Report of Independent Accountants.............................5
Management's Discussion and Analysis of Financial
Condition and Results of Operations.........................6
Part II - Other Information.........................................10
<PAGE>
REXEL, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(000's omitted, except for share amounts)
<TABLE>
<CAPTION>
Sept. 30, Dec. 31,
1996 1995
--------- ---------
(UNAUDITED)
ASSETS
- ------
<S> <C> <C>
Current Assets
Cash $ 11,854 $ 10,013
Accounts and Notes Receivable - Net 158,037 138,604
Inventories 98,524 102,239
Prepaid Expenses and Other Current Assets 9,637 8,344
Income Taxes Receivable 527 0
Deferred Income Taxes 3,878 3,849
--------- ---------
Total Current Assets 282,457 263,049
Investments and Noncurrent Receivables 872 1,069
Fixed Assets - Net 48,462 49,453
Other Assets 2,789 2,135
Deferred Income Taxes 1,289 834
Goodwill - Net 60,812 58,953
--------- ---------
$ 396,681 $ 375,493
========= =========
LIABILITIES AND STOCKHOLDERS' EQUITY
- ------------------------------------
Current Liabilities
Short-Term Debt $ 10,950 $ 8,050
Current Portion of Long-Term Debt 7,719 7,757
Accounts Payable - Trade and Other Liabilities 154,849 147,031
Income Taxes Payable 0 3,725
Deferred Income Taxes 6 0
--------- ---------
Total Current Liabilities 173,524 166,563
Long-Term Debt 29,716 37,219
Other Long-Term Liabilities 3,660 3,363
Deferred Income Taxes 2,594 2,029
Stockholders' Equity
Preferred Stock (Authorized 2,000,000 Shares, None Issued) 0 0
Common Stock (26,285,833 and 26,258,133 Shares Issued) 26,286 26,258
Capital Surplus 94,365 94,206
Retained Earnings 71,279 50,580
Treasury Stock, at Cost (610,743 and 609,143 Shares) (4,743) (4,725)
--------- ---------
187,187 166,319
--------- ---------
$ 396,681 $ 375,493
========= =========
</TABLE>
See accompanying report of independent accountants and notes
to unaudited condensed consolidated financial statements.
<PAGE>
REXEL, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME
(000's omitted, except for per share amounts)
<TABLE>
<CAPTION>
NINE MONTHS ENDED THREE MONTHS ENDED
SEPTEMBER 30 SEPTEMBER 30
-------------------------------------------------------
1996 1995 1996 1995
-------- --------- -------- ---------
(UNAUDITED) (UNAUDITED)
----------------------- ------------------------
<S> <C> <C> <C> <C>
Net Sales $854,023 $ 849,777 $297,375 $ 282,263
Cost Of Goods Sold 675,829 680,386 236,506 224,966
-------- --------- -------- ---------
Gross Profit 178,194 169,391 60,869 57,297
Selling and Administrative Expenses 138,251 136,947 46,757 45,571
-------- --------- -------- ---------
Operating Profit 39,943 32,444 14,112 11,726
-------- --------- -------- ---------
Interest Expense 3,679 6,310 1,136 1,498
-------- --------- -------- ---------
Other Income (Expense) - Net 259 435 17 (39)
-------- --------- -------- ---------
Income From Operations Before Income Taxes 36,523 26,569 12,993 10,189
Provision For Income Taxes 15,824 11,690 5,471 4,482
-------- --------- -------- ---------
Income Before Extraordinary Charge 20,699 14,879 7,522 5,707
Extraordinary Charge, Net of Income Tax 0 1,542 0 1,542
-------- --------- -------- ---------
Net Income $ 20,699 $ 13,337 $ 7,522 $ 4,165
======== ========= ========= =========
Income Per Common Share
Primary
Income Before Extraordinary Charge $0.80 $0.61 $0.29 $0.23
Extraordinary Charge 0.00 (0.06) 0.00 (0.06)
-------- --------- -------- ---------
Net Income $0.80 $0.55 $0.29 $0.17
======== ========= ========= =========
Fully Diluted
Income Before Extraordinary Charge $0.80 $0.56 $0.29 $0.22
Extraordinary Charge 0.00 (0.06) 0.00 (0.06)
-------- --------- -------- ---------
Net Income $0.80 $0.50 $0.29 $0.16
======== ========= ========= =========
Average Number of Common and Common Equivalent
Shares Primary 25,986 24,567 25,958 25,200
======== ========= ========= =========
Fully Diluted 25,986 28,921 25,958 27,812
======== ========= ========= =========
</TABLE>
See accompanying report of independent accountants and notes
to unaudited condensed consolidated financial statements.
<PAGE>
REXEL, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(000's omitted)
<TABLE>
<CAPTION>
NINE MONTHS ENDED
SEPTEMBER 30,
------------------
1996 1995
------ ------
(UNAUDITED)
<S> <C> <C>
Net Cash Provided By Operating Activities $ 15,926 $ 29,832
-------- --------
Cash Flows From Investing Activities:
Capital Expenditures (3,418) (2,553)
Cost of Acquisitions (5,218) --
Proceeds From Sale of Noncurrent Assets -- 4,050
Other Investing Activities 123 298
-------- --------
Net Cash (Used In) Provided By Investing Activities (8,513) 1,795
-------- --------
Cash Flows From Financing Activities:
Net Borrowings under Line of Credit Arrangements 2,900 12,900
Acquisition of Treasury Shares (18) 0
Proceeds From Exercise of Stock Options 187 0
Redemption of Convertible Debentures -- (36,780)
Other Debt Payments and Financing Activities (8,641) (25,362)
-------- --------
Net Cash Used In Financing Activities (5,572) (49,242)
-------- --------
Net Increase (Decrease) In Cash 1,841 (17,615)
Cash and Cash Equivalents at Beginning of Period 10,013 23,843
-------- --------
Cash and Cash Equivalents at End of Period $ 11,854 $ 6,228
======== ========
</TABLE>
See accompanying report of independent accountants and notes
to unaudited condensed consolidated financial statements.
<PAGE>
REXEL, INC.
NOTES TO UNAUDITED CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
1. The accompanying financial information should be read in conjunction with
the consolidated financial statements, including the notes thereto, for the
year ended December 31, 1995. The condensed consolidated balance sheet as
of December 31, 1995 has been summarized from the Company's audited
consolidated balance sheet as of that date but does not include all
disclosures required by generally accepted accounting principles.
2. Results for interim periods are not necessarily indicative of the results
to be expected for the year. The accompanying financial information
reflects all adjustments which are, in the opinion of Management, of a
normal, recurring nature and necessary for a fair presentation of the
results for the periods.
3. Inventories are stated at the lower of LIFO cost or market.
4. Primary income per common share is computed by dividing net income by the
weighted average number of common and common equivalent shares outstanding
during the periods. Fully diluted income per share assumes the conversion
of convertible debentures in 1995 and the resultant reduction in interest
costs, net of tax.
5. On August 11, 1995, the Company redeemed all of its outstanding 7%
Convertible Subordinated Debentures Due 2014, which had an original
principal amount of $50 million. Of such principal amount, $35.5 million
was redeemed for cash at a redemption price of 102.8% of principal, plus
accrued and unpaid interest to the redemption date, or a total redemption
payment of $36.5 million. The balance of the Debentures were converted in
accordance with the terms thereof into Common Stock of Rexel at a
conversion price of $9.57 per share, or a total of 1.5 million shares.
6. On August 7, 1996, the Company acquired Utility Products Supply of Denver,
Colorado, a distributor of electrical products to the utility industries
with locations in Colorado, Arizona, California and Kansas, for cash of
$5.0 million. The acquisition has been recorded as a purchase and the
excess of the total purchase price over the fair value of the net assets
acquired ($3.1 million) is being amortized over 40 years. Utility Products
Supply's results of operations are included in the Company's financial
statements from the date of acquisition. Pro forma data for this
acquisition has been omitted as such information would not be materially
different from historical results.
7. Certain prior year amounts have been reclassified to conform with the 1996
presentation.
<PAGE>
REPORT OF INDEPENDENT ACCOUNTANTS
The Board of Directors
Rexel, Inc.
We have reviewed the accompanying condensed consolidated balance sheet of Rexel,
Inc. (the "Company") as of September 30, 1996, and the related condensed
consolidated statements of income for the three-month and nine-month periods
ended September 30, 1996 and 1995 and the related condensed consolidated
statements of cash flows for the nine-month periods ended September 30, 1996 and
1995. These financial statements are the responsibility of the Company's
management.
We conducted our review in accordance with standards established by the American
Institute of Certified Public Accountants. A review of interim financial
information consists principally of applying analytical procedures to financial
data and making inquiries of persons responsible for financial and accounting
matters. It is substantially less in scope than an audit conducted in accordance
with generally accepted auditing standards, the objective of which is the
expression of an opinion regarding the financial statements taken as a whole.
Accordingly, we do not express such an opinion.
Based on our review, we are not aware of any material modifications that should
be made to the accompanying financial statements for them to be in conformity
with generally accepted accounting principles.
We have previously audited, in accordance with generally accepted auditing
standards, the consolidated balance sheet as of December 31, 1995, and the
related consolidated statements of income, changes in stockholders' equity and
cash flows for the year then ended (not presented herein), and in our report
dated February 23, 1996, we expressed an unqualified opinion on those
consolidated financial statements. In our opinion, the information set forth in
the accompanying condensed consolidated balance sheet as of December 31, 1995,
is fairly stated, in all material respects, in relation to the consolidated
balance sheet from which it has been derived.
COOPERS & LYBRAND L.L.P.
Miami, Florida
October 16, 1996
<PAGE>
Management's Discussion and Analysis of Financial
Condition and Results of Operations
Results of Operations
- ---------------------
Primary earnings per share before extraordinary charge for the third quarter of
1996 increased 26.1% to $.29 per share from $.23 per share in 1995, and for the
nine months primary earnings per share before extraordinary charge increased
31.1% to $.80 per share in 1996 from $.61 per share in 1995. In the third
quarter of 1995, the Company reported an extraordinary charge to earnings of
approximately $2.5 million ($1.5 million after tax or $.06 per share) in
connection with the redemption of its then outstanding 7% Convertible
Subordinated Debentures Due 2014.
Sales for the third quarter ended September 30, 1996 were up 5.4% (3.1% on same
branch sales) to $297.4 million compared to third quarter 1995 sales of $282.3
million. For the nine months ended September 30, 1996, sales were up 0.5% (0.2%
on same branch sales) to $854.0 million from $849.8 million for 1995.
Improvement in sales and gross margins resulted in an increase in operating
profit of 20.4% in the third quarter of 1996 compared to the third quarter of
1995 and 23.1% for the nine months ended September 30, 1996 compared to the same
period of the prior year.
Income before extraordinary charge for the third quarter ended September 30,
1996 increased 31.8% to $7.5 million from $5.7 million in 1995. Income before
extraordinary charge for the nine months ended September 30, 1996 increased
39.1% to $20.7 million from $14.9 million in 1995.
The following table sets forth the percentage which certain income and expense
items bear to net sales:
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
September 30, September 30,
--------------- --------------
1996 1995 1996 1995
----- ------ ----- -----
<S> <C> <C> <C> <C>
Net Sales 100.0% 100.0% 100.0% 100.0%
===== ===== ===== =====
Gross Margin 20.5% 20.3% 20.9% 19.9%
Selling and Administrative Expenses 15.7 16.1 16.2 16.1
----- ------ ----- -----
Operating Profit 4.8 4.2 4.7 3.8
Interest Expense .4 .5 .4 .7
Other Income -- .1 -- --
----- ------ ----- -----
Income Before Taxes 4.4% 3.6% 4.3% 3.1%
===== ===== ===== =====
</TABLE>
As noted above, sales for the nine months ended September 30, 1996 were up 0.5%
(0.2% on some branch sales) compared to the same period of the prior year, but
<PAGE>
for the third quarter of 1996, sales were up 5.4% (3.1% on same branch sales)
reflecting the improving sales trend that began in the second quarter of 1996.
On a same branch basis, all divisions of the Company reported sales increases in
the third quarter of 1996 compared to the third quarter of 1995 except for the
Company's midwest operations. This growth is attributable to strengthening in
the construction markets served by the Company in the central and western parts
of the country, which began in the second quarter of 1996. The decrease in the
Midwest reflects a softening of the Company's sales to the automotive industry
market. The acquisition of Utility Products Supply of Denver, Colorado in August
1996 added $5.1 million in sales in the third quarter. The Company opened three
new branches in the 1996 quarter bringing to seven the total number of branches
opened in 1996. Finally, the Company estimates that deflation in copper prices
had the effect of reducing 1996 nine month sales by approximately $6.3 million.
For the third quarter of 1996, gross margins increased $3.6 million to $60.9
million or 6.2% over the same period in 1995. For the nine months ended
September 30, 1996, gross margin increased $8.8 million to $178.2 million, or
5.2% over the same period in 1995. As a percentage of sales, gross profit
improved to 20.5% in the third quarter of 1996 from 20.3% in the third quarter
of 1995. For the nine months ended September 30, 1996, the improvement was to
20.9% from 19.9% for the same period of 1995. The improvement in the gross
profit percentage points can be analyzed as follows:
<TABLE>
<CAPTION>
Three Months Ended Nine Months Ended
September 30, 1996 September 30, 1996
------------------ ------------------
<S> <C> <C>
Trading Margin (0.1%) 0.6%
Effect of LIFO 0.3 0.4
---- ----
0.2% 1.0%
==== ====
</TABLE>
The trading margin reflects gross profit improvement initiatives implemented
during 1995, which focused on developing improved pricing capabilities and
control over price change authority within our branches. This improvement was
offset by a lower gross profit percentage for the Company's utility division's
sales. Utility companies have been consolidating their purchasing and reducing
the number of their electrical suppliers, which has impacted sales favorably but
has put gross margins under pressure. Gross profit was favorably impacted by
decreases in LIFO inventory reserves of $0.1 million and $0.2 million,
respectively, for the quarter and nine months ended September 30, 1996 compared
to increases of $0.8 million and $2.2 million, respectively, for the comparable
periods of 1995, resulting primarily from the deflation in copper prices in
1996. The mix of stock sales (sales from inventory) and direct sales (sales
shipped directly to the customer from the vendor) for the quarter and nine
months ended September 30, 1996 was the same for the comparable periods of 1995.
Although margin percentages show an improvement over the comparable period of
the prior year, they have been trending slightly downward in the second and
third quarters of 1996 as a result of the Company's effort to drive sales and
because of pressure on copper related sales due to declining copper prices.
<PAGE>
For the quarter ended September 30, 1996, selling and administrative expenses
increased $1.2 million to $46.8 million, or 2.6%, compared to the same period of
the prior year. For the nine months ended September 30, 1996, selling and
administrative expenses increased $1.3 million to $138.3 million compared to the
same period of the prior year. As a percentage of sales, selling and
administrative expenses were 15.7% and 16.2%, respectively, for the quarter and
nine months ended September 30, 1996, as compared to 16.1% for the quarter and
nine months ended September 30, 1995, with all variances principally due to the
level of sales in the respective periods. As a percentage of gross profit,
selling and administrative expenses improved to 76.8% in the third quarter of
1996 from 79.5% in the third quarter of 1995. For the nine months ended
September 30, 1996, the improvement was to 77.6% from 80.8% for the comparable
period in 1995, from 52.2% in the third quarter of 1995.
Labor as a percentage of gross profit improved to 51.9% in the third quarter of
1995. For the nine months, the improvement was to 52.0% from 52.3%. Average
headcount for the quarter was up 1.9% over the third quarter of 1995 due to
increases in the Company's outside sales force and partly due to the Utility
Products acquisition.
Interest expense decreased by $0.4 million and $2.6 million, respectively, for
the quarter and nine months ended September 30, 1996 compared to the same
periods of the prior year, reflecting the payment of debt, particularly the
redemption of the 7% Convertible Subordinated Debentures in August 1995 and
installment payments on the Senior Notes.
Liquidity and Capital Resources
- -------------------------------
Total assets at September 30, 1996 increased $21.2 million or 5.6% compared to
year-end 1995. Cash increased $1.9 million to $11.9 million at September 30,
1996 compared to $10.0 million at December 31, 1995. The net cash provided by
operating activities of $15.9 million reflects an increase in trade working
capital of approximately $7.9 million. Accounts and notes receivable increased
$19.4 million to $158.0 million at September 30, 1996 compared to $138.6 million
at December 31, 1995 with the number of days sales represented by accounts
receivable at 48 days at September 30, 1996 compared to 46 days at December
31,1995. Inventory decreased $3.7 million to $98.5 million at September 30, 1996
compared to $102.2 million at December 31, 1995 with inventory days decreasing
to 65 days from 78 days at December 31, 1995.
Total liabilities at September 30, 1996 increased $0.3 million compared to
year-end 1995. At September 30, 1996, the Company had $48.3 million of
indebtedness for borrowed money compared to $53.0 million at December 31, 1995.
Capital expenditures were $3.4 million during the first nine months of 1996.
The Company's debt to equity ratio (defined as the ratio of debt including
capital lease obligations to total stockholders' equity) was 0.3 to 1 at both
September 30, 1996 and December 31, 1995. The current ratio was 1.6 at the end
of both periods.
During the first quarter of 1996, the Company repurchased 1,600 shares of its
outstanding Common Stock in open market transactions.
<PAGE>
On August 7, 1996, the Company completed its acquisition of Utility Products
Supply of Denver, Colorado for cash of $5.0 million. Utility Products Supply is
a distributor of electrical products to the utility industry with sales of $29.0
million for its year ended May 31, 1996.
On October 28, 1996, the Company reached an agreement in principle to acquire
Cable & Connector Warehouse, Inc. of Dallas, Texas ("CCW") for an undisclosed
amount of cash. The purchase is subject to certain conditions, including Rexel,
Inc.'s completing its review of operations, the negotiation of a definitive
purchase agreement and the termination of the Hart-Scott-Rodino waiting period.
CCW is a distributor of electronic wire, cable, connectors and related apparatus
for manufacturers of data and telecommunication products. CCW had sales of $39
million in its fiscal year ending June 30, 1996. CCW has 11 branches from the
Mississippi River to the Pacific Coast with sales offices and stocking
warehouses in New Orleans, Baton Rouge, Houston, Austin, Irving, Lenexa/Kansas
City, Denver, Irvine, California, Freemont, California, Sacramento and Portland,
Oregon.
The Company's working capital requirements are generally met by internally
generated funds and short-term borrowings under the Company's credit agreement.
Management believes sufficient cash resources will be available to support its
long-term growth strategies through internally generated funds, credit
arrangements and the ability of the Company to obtain additional financing.
However, no assurance can be given that financing will continue to be available
on terms attractive to the Company.
<PAGE>
PART II - OTHER INFORMATION
<TABLE>
<CAPTION>
Item 6. Exhibits and Reports on Form 8-K
(a) Exhibits
--------
Exhibit No. Description
----------- -----------
<S> <C>
11.1 Computation of net income per common and common
equivalent shares.
15.1 Awareness letter of independent accountants.
27.1 Financial Data Schedule (Filed with EDGAR filing
only)
(b) Reports on Form 8-k
-------------------
During the quarter ended September 30, 1996, the Company did not
file any Current Reports on Form 8-K.
</TABLE>
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by
undersigned thereunto duly authorized.
REXEL, INC.
Date: November 13, 1996 By:/s/ Allan Gonopolsky
--------------------
Allan Gonopolsky
Vice President and
Chief Accounting Officer
<PAGE>
Index to Exhibits
<TABLE>
<CAPTION>
Exhibit No. Description
----------- -----------
<S> <C>
11.1 Computation of net income per common and common
equivalent shares.
15.1 Awareness letter of independent accountants.
27.1 Financial Data Schedule (Filed with EDGAR filing only)
</TABLE>
REXEL, INC.
COMPUTATION OF NET INCOME PER COMMON AND COMMON EQUIVALENT SHARE
(000's Omitted, Except Per Share Amounts)
<TABLE>
<CAPTION>
NINE MONTHS ENDED THREE MONTHS ENDED
SEPTEMBER 30, SEPTEMBER 30,
---------------------- ----------------------
1996 1995 1996 1995
------- ------- ------ ------
<S> <C> <C> <C> <C>
Income Applicable To Primary Common And Common
Equivalent Shares
Income From Continuing Operations $20,699 $14,879 7,522 5,707
Extraordinary Charge 0 1,542 0 1,542
------- ------- ------ ------
Net Income $20,699 $13,337 $7,522 $4,165
======= ======= ====== ======
Income Applicable To Fully Diluted
Common And Common Equivalent Shares
Income From Continuing Operations $20,699 $14,879 $7,522 $5,707
Interest Reduction, Net of Taxes,
Upon Conversion Of Convertible
Subordinated Debentures 0 1,182 0 202
------- ------- ------ ------
Income From Continuing Operations 20,699 16,061 7,522 5,909
Extraordinary Charge 0 1,542 0 1,542
------- ------- ------ ------
Net Income $20,699 $14,519 $7,522 $4,367
======= ======= ====== ======
Primary Shares:
Weighted Average Number Of Common Shares And
Common Share Equivalents Outstanding During
The Period:
Common (Net Of Treasury Shares) 25,657 24,368 25,666 24,875
Options 329 199 292 325
------- ------- ------ ------
Total 25,986 24,567 25,958 25,200
======= ======= ====== ======
Fully Diluted Shares:
Weighted Average Number Of Common Shares And
Common Share Equivalents Outstanding During
The Period:
Common (Net Of Treasury Shares) 25,657 24,368 25,666 24,875
Options 329 199 292 325
Conversion Of Subordinated Debentures 0 4,354 0 2,612
------- ------- ------ ------
Total 25,986 28,921 25,958 27,812
======= ======= ====== ======
</TABLE>
<PAGE>
Exhibit 11.1
------------
(continued)
REXEL, INC.
COMPUTATION OF NET INCOME PER COMMON AND COMMON EQUIVALENT SHARE
(000's Omitted, Except Per Share Amounts)
<TABLE>
<CAPTION>
NINE MONTHS ENDED THREE MONTHS ENDED
SEPTEMBER 30, SEPTEMBER 30,
--------------------- ----------------------
1996 1995 1996 1995
------ ------ ------ ------
<S> <C> <C> <C> <C>
Income Per Common Share
Primary
Income From Continuing Operations $0.80 $0.61 $0.29 $0.23
Extraordinary Charge 0 (0.06) 0 (0.06)
------ ------ ------ ------
Net Income $0.80 $0.55 $0.29 $0.17
====== ====== ====== ======
Fully Diluted
Income From Continuing Operations $0.80 $0.56 $0.29 $0.22
Extraordinary Charge 0 (0.06) 0 (0.06)
------ ------- ------ ------
Net Income $0.80 $0.50 $0.29 $0.16
====== ======= ====== ======
</TABLE>
Securities and Exchange Commission
450 Fifth Street, N.W.
Washington, D.C. 20549
RE: Rexel, Inc. Registration on Form S-8
----------------------------------------
We are aware that our report dated October 16, 1996 on our review of the
condensed consolidated balance sheet of Rexel, Inc. as of September 30, 1996,
and the related condensed consolidated statements of income for the three-month
and nine-month periods ended September 30, 1996 and 1995 and the condensed
consolidated statement of cash flows for the nine-month periods ended September
30, 1996 and 1995 included in the Company's Form 10-Q for the quarter ended
September 30, 1996 is incorporated by reference in Registration Nos. 33-14148,
33-32648 and 33-59307 on Form S-8. Pursuant to Rule 436(c) under the Securities
Act of 1933, this report should not be considered a part of such registration
statements prepared or certified by us within the meaning of Sections 7 and 11
of the Act.
COOPERS & LYBRAND L.L.P.
Miami, Florida
October 16, 1996
<TABLE> <S> <C>
<ARTICLE> 5
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM REXEL, INC.
FORM 10-Q FOR THE QUARTER ENDED SEPTEMBER 30, 1996 AND IS QUALIFIED IN ITS
ENTIRE BY REFERENCE TO SUCH FINANCIAL STATEMENTS.
</LEGEND>
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 9-MOS
<FISCAL-YEAR-END> DEC-31-1995
<PERIOD-END> SEP-30-1996
<CASH> 11,854
<SECURITIES> 0
<RECEIVABLES> 161,136
<ALLOWANCES> 3,099
<INVENTORY> 98,524
<CURRENT-ASSETS> 281,949
<PP&E> 78,549
<DEPRECIATION> 30,087
<TOTAL-ASSETS> 396,011
<CURRENT-LIABILITIES> 173,055
<BONDS> 29,716
0
0
<COMMON> 26,286
<OTHER-SE> 160,901
<TOTAL-LIABILITY-AND-EQUITY> 396,011
<SALES> 854,023
<TOTAL-REVENUES> 854,023
<CGS> 675,829
<TOTAL-COSTS> 675,829
<OTHER-EXPENSES> 0
<LOSS-PROVISION> (538)
<INTEREST-EXPENSE> 3,679
<INCOME-PRETAX> 36,523
<INCOME-TAX> 15,824
<INCOME-CONTINUING> 20,699
<DISCONTINUED> 0
<EXTRAORDINARY> 0
<CHANGES> 0
<NET-INCOME> 20,699
<EPS-PRIMARY> .80
<EPS-DILUTED> .80
</TABLE>
