ARYZTA (ARYN) H1 2024 earnings summary

Executive summary

• Revenue for H1 2024 was €1,055.2m, down 0.5% year-over-year, with EBITDA of €149.8m and margin of 14.2%, reflecting flat volume and slightly negative organic growth.

• EBITDA rose 7% year-over-year, with margin expanding by 100bps to 14.2%.

• Innovation share nearly doubled to 19.4% of revenue, and premium products now account for 40% of revenue.

• Free cash flow was €53.0m, down from €72.1m in H1 2023, mainly due to higher CapEx and lower working capital contribution.

• ROIC increased to 13.1%, exceeding the mid-term target and approaching top quartile in the industry.

Financial highlights

• Gross profit increased 11.6% to €224.6m, with gross margin improvement driven by innovation and cost optimization.

• Operating profit rose 12.5% to €85.6m, and diluted EPS grew 17% to 4.1 euro cent.

• Net debt (including hybrid and leases) reduced to €927m, with leverage ratio at 2.9x.

• Financing costs decreased by €2.3m, supported by hybrid bond buy-back savings of €7.1m.

• Free cash flow reached €53m, impacted by higher CapEx and lower working capital contribution.

Outlook and guidance

• Guidance for 2024 is reiterated: organic growth in the low to mid-single digit range, continued EBITDA margin expansion, and further improvement in free cash flow and leverage.

• H2 is expected to be stronger, with improved comps, innovation, new listings, and QSR recovery.

• No deflationary trend expected; input cost pressures remain.

• New mid-term plan and targets to be communicated in H1 2025.

• Focus remains on margin progression, cost optimization, and deleveraging.