DKSH (DKSH) H1 2024 earnings summary

Executive summary

• Net sales grew 3.3% at constant exchange rates (CER) to CHF 5.4–5.6 billion in H1 2024, driven by organic growth and acquisitions, despite FX headwinds.

• Core EBIT increased by 8.2% at CER to CHF 163.6 million, with margin expansion to 3.0%.

• Core profit after tax rose 16.7% at CER to CHF 118.2 million, with basic EPS improving to CHF 1.71.

• Free cash flow reached CHF 160.8 million, with a cash conversion rate of 136.0%.

• Continued focus on high-margin business, portfolio expansion, and targeted M&A, with ordinary dividend increased to CHF 2.25 per share.

Financial highlights

• Net sales: CHF 5,441.1–5,600 million (+3.3% CER year-over-year); Core EBIT: CHF 163.6 million (+8.2% CER); margin at 3.0% (+10 bps).

• Core profit after tax: CHF 118.2 million (+16.7% CER); profit after tax: CHF 114.8 million (+13.2% CER).

• Free cash flow: CHF 160.8 million; cash conversion: 136.0%.

• Net debt reduced to CHF 10.2 million, equity ratio at 32.0%.

• Leverage below 0.1x EBITDA, providing significant headroom.

Outlook and guidance

• Expects GDP-plus sales growth and core EBIT growth at CER for 2024, with FX headwinds anticipated to ease.

• Tax rate guidance remains at 27%-29%; capex expected at 0.3%-0.4% of net sales.

• No top-up tax exposure expected for 2024 under BEPS Pillar 2.

• Strong M&A pipeline and further consolidation opportunities in H2 and 2025.

• Outlook assumes continued economic growth in Asia Pacific and no unforeseen events.