Arbonia (ARBN) H1 2024 earnings summary

Executive summary

• Net revenues for H1 2024 nearly flat at CHF 278.2M, reflecting a challenging residential construction market, especially in Germany.

• EBITDA increased 20% year-over-year to CHF 21.2M (7.6% margin, excluding one-time effects), driven by operational efficiency, cost measures, and lower material and energy costs.

• Group result improved to CHF 40.9M, including a CHF 28.8M one-time gain from property sale and CHF 18.5M from discontinued operations.

• Acquisitions of Dimoldura (Spain) and Lignis (Czech Republic) expanded market presence and product portfolio, reducing reliance on DACH markets.

• Sale of the Climate Division to Midea Group signed in April 2024, with closing expected in Q4 2024; now reported as discontinued operations.

Financial highlights

• Net revenues for continuing operations at CHF 278.2M, almost unchanged from H1 2023.

• Adjusted EBITDA (excluding one-time effects) up 20% to CHF 21.2M; reported EBITDA CHF 47.4M (17.0% margin) due to one-time property gain.

• EBIT (excluding one-time effects) at CHF -2.0M, improved from CHF -4.0M in H1 2023; reported EBIT CHF 24.3M.

• Net financial result turned positive at CHF 0.9M due to non-cash FX gains.

• Free cash flow decreased by CHF 77M year-over-year, mainly due to Dimoldura acquisition and NWC build-up.

Outlook and guidance

• Guidance for 2024 confirmed, with financial targets for continuing operations to be announced at Capital Markets Day in autumn.

• Expects full-year 2024 revenue for continuing operations to be at prior-year level before acquisition and FX effects.

• Anticipates increase in EBITDA and margin (excluding one-time effects) due to operational improvements and stable renovation business.

• Expected stabilization of negative volume trend and reversal in organic growth in H2 2024.

• Construction industry expected to stabilize short-term and improve medium-term in core markets; positive trends in Eastern Europe.