Delfi Limited (P34) H1 2024 earnings summary

Executive summary

• 1H 2024 revenue was US$260.8 million, down 7.8% year-over-year, with PATMI at US$19.6 million, reflecting satisfactory results despite currency headwinds and lower promotional spending.

• EBITDA fell 17.8% to US$32.8 million, and gross profit margin declined by 0.4 percentage points to 28.8%, mainly due to weaker regional currencies impacting raw material costs.

• Own Brands and Agency Brands revenue declined by 11.8% and 2.1% year-over-year, respectively, with Agency Brands in Indonesia impacted by a terminated brand.

• Net cash from operations increased to US$37.6 million, up US$14.1 million year-over-year, reflecting tight working capital management.

• Focus remains on investing in growth brands, launching new products, and strengthening retail partnerships.

Financial highlights

• Revenue declined 7.8% year-over-year to US$260.8 million; in constant currency, down 3.3%.

• EBITDA was US$32.8 million (down 17.8% year-over-year); EBITDA margin 12.6%.

• PATMI dropped 22.3% year-over-year to US$19.6 million; EPS 3.20 US cents.

• Gross profit margin: 28.8% (down 0.4 percentage points year-over-year).

• Cash and bank deposits stood at US$54.8 million as of 30 June 2024.

Outlook and guidance

• Management expects continued global uncertainties, geopolitical tensions, high interest rates, supply chain pressures, and elevated cocoa prices to persist.

• Plans to mitigate risks include managing trade promotion spend, focusing on core products, driving premium category growth, and strengthening distribution.

• Higher working capital requirements anticipated to support future growth, with vigilant management of receivables, inventories, and payables.

• Strong balance sheet, healthy cash, and prudent cost management position the group to tackle future uncertainties.