WESCO AR 2007

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1. 2007 CUSTOMER FOCUSED / MARKET DRIVEN ANNUAL REPORT & FORM 10-K INTERNATIONAL, INC. 2. NET SALES NET INCOME RETURNON EQUITY In millions In millions$6,003.5$240.639.5% $5,320.6 $217.3$4,421.128.5% $3,741.3$3,286.8 21.1% 18.4% $103.5 17.9% $64.9 $30.0 2004 2004 20042003 2003 20032005 2006 2005 2006 20052006200720072007 FINANCIAL HIGHLIGHTSYear Ended December 31 2007 20062005 20042003 (Dollars in millions)Net sales$ 6,003.5$ 5,320.6 $ 4,421.1$ 3,741.3 $ 3,286.8 Cost of goods sold 4,781.4 4,234.1 3,580.43,029.2 2,676.7 Income from operations (EBIT)394.2364.9 209.3 149.586.1 Interest and other expenses 63.247.4 58.450.047.0 Net income 240.6217.3 103.564.930.0 Working capital388.6464.3 189.0 290.7 176.6 Long-term debt (including current portion) 1,316.3 1,140.3403.6 417.6 422.2 Stockholders equity 608.5763.2 491.5 353.6 167.7 Return on equity 39.5%28.5%21.1%18.4% 17.9% 3. WESCO INTERNATIONAL, INC. 2007 ANNUAL REPORT & FORM 10-K CORPORATE PROFILE WESCO International, Inc. (NYSE: WCC) is a publicly traded Fortune 500 holding company, headquartered in Pittsburgh, Pennsylvania, whose primary operating entity is WESCO Distribution, Inc. WESCO Distribution is a leading distributor of electrical construction products and electrical and industrial maintenance, repair and operating (MRO) supplies, and is the nations largest provider of integrated supply services. 2007 annual sales were approximately $6.0 billion. The Company employs approximately 7,300 people, maintains relationships with over 24,000 suppliers, and serves more than 110,000 customers worldwide. Major markets include commercial and industrial rms, contractors, government agencies, educational institutions, telecommunications businesses, and utilities. WESCO operates seven fully automated distribution centers and approximately 400 full-service branches in North America and selected international markets, providing a local presence for area customers and a global network to serve multi-location businesses and multi-national corporations. COMPARISON OF 5 YEAR CUMULATIVE TOTAL RETURN*WESCO International, Inc. Russell 2000Peer Group12001000 800 600 400 20002002 200320042005 20062007* $100 invested on 12/31/02 in stock or index-including reinvestment of dividends. Fiscal year ending December 31. Peer Group Allegheny Energy, Inc. Cameron International Medtronic, Inc. Sonoco Products Company Alliant Techsystems Inc. Corporation Milacron Inc. Temple-Inland Inc. Anixter Inc. Cooper Industries, Inc. MSC Industrial Direct Co., Inc. Teradyne, Inc. Applied Industrial TechnologiesDana CorporationNCR Corporation Textron Inc. Arrow Electronics, Inc.Diebold, Incorporated Pitney Bowes, Inc.Thomas & Betts Corporation AutoZone, Inc. Ecolab Inc. Praxair, Inc. The Timken Company Avnet, Inc.FMC TechnologiesRockwell Automation, Inc. Unisys Corporation Belden Inc.Fortune Brands, Inc.Rockwell Collins, Inc.United Stationers Inc. BlueLinx Corporation Hubbell IncorporatedRyerson, Inc. Valmont Industries, Inc. BorgWarner Inc.Ingersoll-Rand CompanySauer-Danfoss Inc.Vulcan Materials Company Brightpoint, Inc.Kaman Corporation Sealed Air CorporationW.R. Grace & Co.W.W. Grainger, Inc. 4. 2TO OUR SHAREHOLDERS, EMPLOYEES, AND FRIENDS The year 2007 was another year of outstanding record-setting performance for WESCO. Sales revenue increased 13% to $6 billion. Additionally, we ended the year with a record backlog of orders scheduled for future delivery. Net income for the year increased to $241 million, and earnings per share increased 21% to $4.99 per share. Strong free cash ow of more than $240 million facilitated the repurchase of approximately 15% of our outstanding shares.Despite concerns about the current economic climate in the U.S. and the potential for slower growth in international markets, WESCOs business strategy remains solidly positioned for future growth. Our commitment to outstanding customer service and value creation has never been higher. Recent investments in organizational effectiveness, sales force expansion, and strategic acquisitions give us additional capability and the capacity to target growth markets and take advantage of opportunities that are likely to arise in the current environment. Recent investments in organizational effectiveness, sales force expansion, and strategic acquisitions give us additional capability and the capacity to target growth markets and take advantage of opportunities that are likely to arise in the current environment. 5. WESCO International, Inc. 2007 Annual Report & Form 10-K 3MANAGEMENT TEAMFrom left to right John J. EngelSenior Vice President andChief Operating Ofcer Stephen A. Van OssSenior Vice Presidentand Chief Financial andAdministrative Ofcer Roy W. HaleyChairman andChief Executive Ofcer INVESTING FOR GROWTH oriented catalogs, data-mining activitiesand direct mail response programs, technical Over the past four years, we have placedtrade shows, and joint selling initiatives and signicant emphasis on operational effectivenesstraining programs with the management of key and productivity. These initiatives have beensuppliers. In 2007, we began work on a major based on the adaptation of a manufacturing-industrial and construction electrical safety oriented process improvement methodologytraining initiative in conjunction with the known as LEAN. Widespread use of LEANElectrical Safety Foundation and their govern- continuous improvement techniques hasmental safety agency partners. All of these helped us improve virtually every aspect ofactivities help to increase awareness, better nancial performance while simultaneouslyposition WESCO in the marketplace, and increasing organizational infrastructure tosupport our sales teams in all industry support future growth. We are now extendingsegments and service locations. our LEAN initiatives to provide direct assistance to customers. WESCOs CustomerAlso in 2007, we signicantly increased Value Creation program applies our LEANactivity in areas supporting our sales capacity. experience to customer projects, productivityIn addition to continuing our program of and coordination initiatives, and problem,selective acquisitions which add management solving activities. We believe this program willand sales talent, service locations, and product have a long-term positive effect on customerline expansions, we opened new branch relationships by differentiating our servicelocations in 6 markets, launched new training capability and building comprehensive,programs for experienced sales representatives lasting links with management at multipleand all newly hired sales personnel, and began levels within an organization.a special recruiting effort to expand our salesforce by approximately 10%. As part of this For a service company such as WESCO,effort, we have started the process of expanding marketing programs serve as our investmentand continuously improving our college recruiting in research and development. Each year, weand staff development programs, which increase the level of emphasis that we givewe believe will add a new dimension to our to the creation of new product and solution-long-term commitment to Talent Management. 6. 4 For a service company such as WESCO, marketing programs serve as our investment in research and development. Each year, we increase the level of emphasis that we give to the creation of new product and solution-oriented catalogs, data-mining activities and direct mail response programs, technical trade shows, and joint selling initiatives and training programs with the management of key suppliers.ACQUIRED COMPANIES Over the past three years, we have acquired OPERATING PROFIT six businesses, adding over $1.1 billion in PER EMPLOYEE annual sales revenue. These new additions have broadened our sales and marketing capabilities and enhanced our market coverage. During 2007, we made great strides in coordinating and consolidating activities with $57,765 Communications Supply, one of the leaders in $54,481 the data communications products distribution market. WESCO and Communications Supply came together, in part, due to the seemingly never-ending growth in demand for increasing bandwidth and high-performance data delivery $37,326 that also require increasingly sophisticated and more reliable electrical systems.Our combined strengths have allowed us to serve our industrial and commercial customers with a more effective and streamlined supply chain solution. We are increasingly being recognized for an outstanding combination of product breadth, service capabilities, and cost savings programs for our customers electrical and information technology, communications, and security needs. 2005 2006 2007 During the second half of 2007, we made three add-on acquisitions that complement our existing businesses. The addition of Cascade Supply, an industrial automation 7. WESCO International, Inc. 2007 Annual Report & Form 10-K 5 and controls distributor, provides greater of identifying and attracting potential future penetration in the northwestern region ofemployees from a number of sources outside the U.S. The acquisition of J-Mark Electricof the electrical and industrial distribution improved our product portfolio and added toindustry. I am pleased to report that we have our sales opportunities in the manufacturedbeen quite successful in attracting leadership housing business. Monti Electric added capacitytalent from both inside and outside our industry, and capability for the long-term industrial andand organizational leadership transitions have residential rebuilding process in the Gulf Coast occurred in a highly coordinated and effective region following the destruction from the 2005 manner. With this report, I would like to hurricane season. We are enthusiastic aboutacknowledge and give special recognition these additions and look forward to long-termto two of our 40+ year veteran vice presidents relationships with the employees, customer