Cembre (CMB) Q3 2024 earnings summary

Executive summary

• Revenue for the first nine months of 2024 increased by 1.3% year-over-year to €171.3 million, with growth in most product lines and geographies except Germany and Italy.

• Net profit declined by 9.3% year-over-year to €29.1 million, representing 17.0% of sales, due to margin pressure and higher personnel costs.

• Growth in Italian and non-European markets offset declines in other European markets, with UK and Spain subsidiaries posting double-digit growth.

• October 2024 saw a positive trend, with cumulative ten-month revenues up 3.0% year-over-year.

• CEMBRE remains Europe's leading manufacturer of electrical crimp connectors, with a diversified product mix and strong international presence.

Financial highlights

• EBITDA for the period was €49.5 million (28.9% margin, down 6.1% year-over-year); EBIT was €39.6 million (23.1% margin, down 8.6%).

• Net profit margin was 17.0% (down from 19.0%).

• Net financial position was negative €2.5 million at September 30, 2024, compared to positive €18.2 million at year-end 2023, mainly due to dividend payments and capital expenditures.

• Capital expenditure totaled up to €24.2 million, mainly for new industrial buildings and plant investments.

• Net operating working capital rose to €88.3 million, 39.3% of sales.

Segment performance

• Electrical connectors accounted for 44.6% of revenues, up 4% year-over-year; tools and marking systems also grew.

• Railway products and cable glands saw declines of 4.5% and 2.3% respectively.

• Italy contributed 43.8%–44.4% of sales (down 2.1% or up 1.4% depending on source), Europe ex-Italy 43.8%–44.4% (up 1.4% or down 2.1%), and Rest of World 11.8% (up 16.7%).

• UK subsidiary posted 11.8% growth, France 7.3%, Spain 6.0%, while Germany declined 10.8%.

• Sales mix remained stable in Italy, with slight growth in the rest of the world share.