CAG Group (CAG) Q2 2024 earnings summary

Executive summary

• Q2 2024 revenue reached 226 MSEK, up 1.4% year-over-year, with organic growth of 1.4% and no acquired growth.

• EBITA for Q2 was 19.0 MSEK, with a margin of 8.4%, slightly down from 8.8% last year.

• After-tax profit for Q2 was 11.9 MSEK, with profit per share after dilution at 1.67 SEK.

• Defence and Banking & Finance segments saw continued strong demand, while system development remained weak but showed signs of recovery.

• CAG maintained its 3rd place in Great Place to Work's 2024 survey, supporting its employer brand.

Financial highlights

• Cash flow from operations in Q2 was 27.1 MSEK, down from 35.2 MSEK year-over-year.

• For H1 2024, revenue was 458.2 MSEK, down 0.4% year-over-year; EBITA was 40.4 MSEK with an 8.8% margin (down from 9.8%).

• Cash and cash equivalents at period end were 97.7 MSEK; equity ratio improved to 52.8% (49.2%).

• Dividend of 3.90 SEK/share paid in May/Q2, yielding approximately 3.6%.

• Average number of employees in Q2 was 444, up from 429 last year.

Outlook and guidance

• Market activity is increasing, with stabilizing demand in system development and new assignments starting in August.

• Solid demand continues in Defence and Banking & Finance segments.

• Regulatory requirements (NIS-2, DORA, CSRD) are driving demand for advisory services.

• CAG targets 1000 MSEK turnover and a gradual increase in adjusted EBITA margin to 10% by 2025, combining organic growth and acquisitions.