Carel Industries (CRL) Q3 2024 earnings summary

Executive summary

• Nine-month 2024 revenues were €432.9 million, down 12.9% year-over-year (16.4% organic), mainly due to EMEA weakness and heat pump declines; Q3 revenue and EBITDA margin were stable sequentially from Q2.

• EBITDA margin was 18.2%, down from 22.3% in 2023, reflecting negative operating leverage.

• Net profit for 9M 2024 was €39.7 million, a 32.8% decrease compared to last year.

• R&D investments remained above 5% of revenues, supporting innovation and product development.

• North and South America showed positive revenue trends, while EMEA and APAC faced headwinds from high comparables and macroeconomic conditions.

Financial highlights

• Revenues: €432.9 million for the first nine months, down 12.9% from €497.2 million in 2023; organic revenues down 16.4%.

• EBITDA: €78.7 million (18.2% margin), down 28.9% year-over-year.

• Net profit: €39.7 million, down from €59.1 million last year.

• CapEx: €22 million, up 47.1% year-over-year, mainly for R&D and plant expansion.

• Net financial position: negative €84 million, impacted by the €44 million CFM acquisition and dividend payout; NFP/LTM EBITDA below 1x, or 0.5x excluding IFRS 16.

Outlook and guidance

• Q4 2024 consolidated revenues expected to be in line with previous quarters; full-year revenues projected close to €580 million.

• Visibility remains low, with short order lead times and uncertainty about December customer activity.

• Positive expectations for North America (data centers, refrigeration) and APAC; EMEA recovery in refrigeration slower than anticipated.

• Kiona expected to accelerate growth above 20% top-line in the near future, driven by pipeline projects.

• Management remains confident in long-term market trends for energy efficiency and sustainable refrigerants.