AddLife (ALIF) Q3 2024 earnings summary

Executive summary

• Net sales grew 1% year-over-year to SEK 2,344m in Q3 2024, with 3% organic and currency-adjusted growth, outperforming a slow market.

• Profitability initiatives progressed, with adjusted EBITA/EBITDA margin stable at 9.8% and operating cash flow at SEK 137m.

• Acquisition of BonsaiLab in Spain and Portugal expanded the cell and molecular biology segment, expected to add SEK 90m in annual net sales.

• Closure of Camanio completed, removing a SEK 15m quarterly loss and yielding significant cost savings from Q4.

• Cost control and restructuring measures implemented, supporting improved profitability.

Financial highlights

• Adjusted EBITA/EBITDA margin at 9.8% (unchanged year-over-year); EBITA SEK 223m, down 9%.

• Operating cash flow SEK 137m in Q3; 9M 2024 cash flow from operations SEK 429m, up from SEK 325m.

• Net debt/EBITDA at 3.6; equity ratio at 40%; interest coverage ratio at 5.4.

• OPEX increased by 2%, including SEK 9m in transaction and restructuring costs.

• EPS for Q3 was SEK 0.19; cash flow per share from operations SEK 7.20.

Outlook and guidance

• Management expects a seasonally stronger Q4, with margin improvement from the Camanio closure and delayed investments and product launches anticipated to materialize.

• Confident in further reduction of net debt to EBITDA by year-end, supported by strong cash flow.

• Profitability improvement and inventory reduction initiatives to continue.

• M&A activity to remain selective in 2024, with increased pace expected in 2025 and 2026.

• Anticipate improved market conditions in the UK and Sweden as new government initiatives and healthcare reforms take effect.