Accelleron Industries (ACLN) H2 2023 earnings summary

Executive summary

• FY23 delivered strong standalone performance: revenue grew 17.2% and operational EBITA reached $223m, exceeding guidance after H1.

• Separation from ABB was completed in July; build-up progressed on time and within budget.

Financial highlights

• Revenue was $915m versus $781m in 2022, up 17.2%; organic growth was 15.5%, with 3 ppts from OMT.

• Operational EBITA rose to $223m from $192m; margin was 24.4% versus 24.6%, despite standalone costs.

• Income from operations was $141m after $82m of one-off and non-operational expenses; net income was $110m versus $130m.

• Free cash flow was $109m and conversion was 99%, versus $99m and 77% in 2022; H2 conversion exceeded 150%.

Outlook and guidance

• FY24 guidance, assuming a normalized business environment: total revenue growth of 4–6% and operational EBITA margin of around 24.5%.

• FY24 free cash flow conversion, net leverage and dividend policy expected in line with mid-term guidance.

• Mid-term guidance: organic revenue growth of 2–4%, operational EBITA margin of 23–26%, free cash flow conversion of 90–100%, net leverage of 0.5–1.5x and stable-to-growing dividends.

• 2024 priorities include gaining turbocharger share, expanding Tekomar XPERT, increasing OMT capacity and completing build-up with up to $20m of non-operational costs.