ADDvise Group (ADDV) Q2 2024 earnings summary

Executive summary

• Net sales reached SEK 412 million in Q2 2024, up 20% year-over-year, with strong order intake up 67%, but organic growth declined 20.6% due to tough comparables in pharma and clinical trials.

• Excluding two exceptional businesses, organic growth would have been 13% for the quarter, indicating underlying portfolio strength.

• Profit for Q2 rose to SEK 30 million from SEK 3 million last year, with EPS at SEK 0.15; EBITDA was SEK 102 million with a 25% margin.

• Cash flow was below expectations due to working capital build-up and investments, but liquidity remains strong with over SEK 400 million in cash and equivalents.

• CEO transition announced, with Staffan Torstensson to succeed Rikard Akhtarzand; main market listing on Nasdaq Stockholm targeted for Q1 2025.

Financial highlights

• Net sales: SEK 412 million in Q2 2024, up 20% year-over-year.

• EBITDA: SEK 102 million, 25% margin; rolling 12-month EBITDA at SEK 420 million.

• Net profit: SEK 30 million, up from SEK 3 million last year; EPS SEK 0.15.

• Order intake: SEK 434 million, 67% total growth, 13% organic.

• Cash conversion dropped to 30% from 84% year-over-year.

Outlook and guidance

• Organic growth expected to return by mid to late Q4 2024 as exceptional comparables roll out.

• Gross margins expected to remain stable or slightly improve in Q3, with gradual improvement from pricing initiatives.

• Strong order backlog and robust demand for cleanrooms provide good sales visibility.

• M&A activity to continue with focus on deleveraging and selective opportunities.

• Main market listing on Nasdaq Stockholm targeted for Q1 2025.