ElringKlinger (ZIL2) Q4 2024 earnings summary

Executive summary

• Navigated challenging markets with geopolitical tensions and sluggish macroeconomic conditions, especially in Europe and Germany, while undergoing strategic reorientation and focusing on core business.

• Implemented the Shape 30 transformation strategy, divesting non-performing and capex-intensive units, and discontinuing unprofitable activities.

• Achieved annual targets for adjusted EBIT margin (4.9%) and operating free cash flow (€58–59 million), maintaining a solid financial position.

• Reduced net debt to a long-term low of €245.9 million and secured a new €450 million syndicated loan.

• Established a new Battery Hub Americas in South Carolina to support future growth.

Financial highlights

• Revenue for 2024 was €1.803 billion, a 2.4% year-on-year decline; e-mobility sales more than doubled.

• EBITDA fell 28% to €144 million; adjusted EBITDA was €174.2–197.1 million.

• Adjusted EBIT was €87.6 million, with an adjusted EBIT margin of 4.9%.

• Reported EPS was -€2.18 due to impairments; adjusted EPS was €0.62–0.70.

• CapEx increased to €108.3 million, mainly for e-mobility ramp-up; R&D expenses at 5.3% of revenue.

Outlook and guidance

• FY 2025 revenue expected at previous year's level (excluding divested plants), with moderate medium-term growth.

• Adjusted EBIT margin guidance of around 5% for 2025, targeting 7–8% in the medium term.

• Operating free cash flow expected at 1–3% of revenue, increasing to 2–4% medium term.

• CapEx to remain high short-term for ramp-up, then reduce to 2–4% of sales.

• Focus on cost reduction, portfolio review, and further production network consolidation.