Eletromidia (ELMD3) Q2 2024 earnings summary

Executive summary

• Gross revenue reached R$286.2 million in 2Q24, up 34.8% year-over-year, and R$564.1 million in 1H24, up 38.1% year-over-year, driven by digital expansion, new concessions, and major events.

• Adjusted EBITDA for 2Q24 was R$83.4 million (+66.6% YoY, 33.4% margin), and R$160 million in 1H24 (+58.9% YoY), reflecting operational leverage and cost discipline.

• Adjusted net income for 1H24 was R$57.8 million (+54.5% YoY, 11.7% margin); net income for 1H24 totaled R$38.7 million (+422.3% YoY).

• Expansion of digital panels and new concessions, especially in Streets and Buildings, supported revenue growth and market leadership.

• Notable events included the launch of immersive and sustainability projects, and recognition with international and national awards.

Financial highlights

• Net revenue in 2Q24 was R$249.8 million (+34.2% YoY); 1H24 net revenue was R$491.9 million (+31.8% YoY).

• Adjusted gross profit in 2Q24 was R$106.4 million (+45.9% YoY) with a margin of 42.6%.

• Operating cash flow before tax and fees was R$168.2 million in 1H24, with 105% EBITDA conversion.

• Net debt at the end of 2Q24 was R$518.4 million, 1.3x LTM EBITDA, down from 1.8x YoY.

• Cash and equivalents at period end were R$335.7 million.

Outlook and guidance

• Management expects continued digitization and expansion in street furniture and digital panels, with significant room to increase inventory in key markets.

• Sees 30-40 new city concessions in the next 3-4 years, especially in Tier 2 and 3 cities.

• Strategic focus on automation, new product launches for SMEs, and cross-media projects integrating OOH and TV.

• S&P upgraded the company’s rating to 'brAA-' with a stable outlook, reflecting expectations of continued scale expansion and profitability gains.

• M&A remains a strategic possibility, with a dedicated team monitoring opportunities.