ElringKlinger (ZIL2) Q2 2024 earnings summary

Executive summary

• SHAPE30 transformation strategy is being implemented, focusing on sustainability, digitalization, product transformation, and competitiveness.

• Expansion in battery and fuel cell technology includes new facilities in Germany and the US, and partnerships such as with FAW Group and for hydrogen flight applications.

• AGM approved unchanged dividend of €0.15 per share; Helmut P. Merch appointed as new Chairman of the Supervisory Board.

• New battery center established in South Carolina, US, with operations starting mid-2025.

• Discontinuation of engine testing services and closure of a German production site as part of transformation.

Financial highlights

• Q2 2024 sales revenue was €445 million, down 5.1% year-over-year; H1 2024 revenue was €910.2 million, down 4.8% year-over-year.

• Adjusted EBIT margin was 5.0% in Q2 and 5.1% for H1 2024; adjusted EBIT in Q2 was €22.5 million.

• EBITDA in Q2 2024 was €49.7 million, up 6.2% year-over-year; EBITDA margin 11.2%.

• Earnings per share rose to €0.37 in H1 2024, up from €0.14 year-over-year; Q2 EPS was €0.15, up from €0.04.

• Net income attributable to shareholders was €9.8 million in Q2 2024, up from €2.4 million in Q2 2023.

Outlook and guidance

• Full-year 2024 outlook confirmed: slight organic revenue growth and adjusted EBIT margin around 5%.

• Operating free cash flow expected at about 2% of group revenue; ROCE/ROACE target around 6%.

• Double-digit growth expected in electric and fuel cell vehicle production in H2 2024.

• Midterm targets: 5–7% annual organic growth, adjusted EBIT margin around 7%, and operating free cash flow about 3% of revenue.

• Order backlog at €1,249.3 million at period end, supporting future growth.