Eletromidia (ELMD3) Q3 2024 earnings summary

Executive summary

• Gross revenue for 9M24 reached R$908 million, up 36% year-over-year, with EBITDA of R$272 million (+51%) and net income of R$106 million (+62%), driven by digital expansion, new concessions, and strategic acquisitions.

• Major investments in technology, street furniture, and omnichannel initiatives, including the acquisition of 4YouSee, enhanced SaaS and digital content capabilities.

• Secured exclusive 20-year concession for all bus shelters and street clocks in Rio de Janeiro, starting January 2027, expanding reach in Brazil's second-largest advertising market.

• Globo agreed to acquire control of the company, valuing it at R$4 billion, with a premium per share and pending antitrust approval.

• Full occupancy at major events and new automation initiatives, such as WhatsApp sales channel, highlighted operational momentum.

Financial highlights

• 3Q24 gross revenue was R$343.9 million (+32.9% YoY); 9M24 gross revenue reached R$908 million (+36% YoY).

• Adjusted EBITDA for 3Q24 was R$112.5 million (margin 37.1%, +41.6% YoY); 9M24 EBITDA was R$272 million (+51% YoY, margin 34.3%).

• Adjusted net profit for 3Q24 was R$48.5 million (margin 16%, +71% YoY); 9M24 net profit was R$106 million (+62% YoY, margin 13.4%).

• Operating cash generation in 9M24 was R$307 million, representing 113% of EBITDA.

• Ended the period with R$443 million in cash and net debt of R$136 million; net debt/EBITDA ratio improved to 1.0x.

Outlook and guidance

• Anticipates short-term leverage increase due to upfront payment for Rio de Janeiro concession, with positive impact expected from 2027.

• Strategic focus for 2025 includes new projects (Summer and Carnival, TikTok Out of Home, Football) and continued digital expansion.

• Management expects continued growth from digital transformation, new concessions, and expanded omnichannel solutions.

• Integration of 4yousee metrics and technology to enhance digital signage and OOH offerings.

• Expects continued growth from new concessions and maturing investments, with leverage expected to rise in the short term and normalize as new projects generate cash.