Agfa-Gevaert (AGFB) H1 2024 earnings summary

Executive summary

• Solid Q2 performance with positive momentum in Healthcare IT, DPC, and ZIRFON, offset by ongoing challenges in film-related radiology.

• Highest-ever order intake in Healthcare IT, driven by cloud transition and new customer wins.

• Revenue for Q2 2024 was €286M, nearly flat year-over-year; H1 2024 revenue declined 4% to €536M compared to H1 2023.

• Q2 2024 net profit was €5M, reversing a €14M loss in Q2 2023; H1 2024 net loss narrowed to €17M from €81M in H1 2023.

• Launched a €50 million productivity program targeting film-related activities to address volume weakness.

Financial highlights

• Sales were flat year-over-year, with radiology declining, DPC growing 8%, and Healthcare IT seeing lower sales but improved margins.

• Gross profit rose to €96M in Q2 2024 from €87M in Q2 2023; gross margin improved to 33.6% from 30.3%.

• Adjusted EBITDA reached €22M in Q2 2024, up from €13M in Q2 2023.

• Free cash flow was negative at €40M outflow in Q2 2024, due to higher-than-expected working capital outflow and peak CapEx.

• Earnings per share from total operations was €0.03 in Q2 2024, up from a €0.09 loss per share in Q2 2023.

Outlook and guidance

• Expect continued growth in Healthcare IT and DPC, with Q4 anticipated as the strongest quarter due to seasonality.

• Radiology Solutions expected to remain weak; cost reduction plan is critical.

• Working capital expected to normalize by year-end, following historical patterns.

• Management is comfortable with analyst consensus of €13 million for the year.