WESCO International (WCC) Baird 2024 Global Industrials Conference summary

Strategic transformation and digitalization

• Undergoing a six-year enterprise-wide digital transformation, now more than halfway complete, with a new tech stack across all systems.

• Digitalization aims to unlock big data, accelerate growth, expand margins, and speed up value from future acquisitions.

Capital allocation and financial performance

• Average annual cash flow conversion to free cash flow is about 100% of net income; 2023 guide is $800M–$1B.

• Targeting $3B cumulative free cash flow from 2025–2027, with 75% allocated to M&A and 25% to buybacks and dividends.

• Through three quarters, $475M of debt paid down and $375M of stock repurchased.

Market outlook and secular trends

• Expecting all business units to grow in 2025, driven by secular trends like electrification, AI, automation, and nearshoring.

• Rising U.S. power demand and reindustrialization are seen as multi-year growth drivers, independent of election outcomes.

• Nearshoring and reshoring are accelerating, with major U.S. infrastructure investments underway.