Festi (FESTI) Q2 2024 earnings summary

Executive summary

• Q2 2024 sales of goods and services reached ISK 36,037 million, up 5.4% YoY, with margin from sales up 10.8% to ISK 8,593 million.

• EBITDA increased 13.8% YoY to ISK 2,915 million; profit for the period rose 29.1% to ISK 953 million.

• Lyfja acquisition completed in July, to be consolidated from Q3 2024, expected to generate ISK 200-400 million in annual synergies.

• All main business segments reported growth in sales or margin, except for a slight decline in ELKO's profit.

• Total revenue for Q2 2024 was ISK 36,564 million, up 5.3% YoY.

Financial highlights

• Margin from sales was 23.8%, up 1.1 percentage points YoY.

• Salaries/personnel expenses increased 6.6% YoY to ISK 4,410 million; FTEs up 4.5%.

• Cash from operating activities was ISK 3,063 million, up 7.1% YoY.

• Net interest-bearing debt stood at ISK 33,779 million, stable from year-end; net interest-bearing debt/EBITDA at 2.8x, improved from 3.8x YoY.

• Total assets at quarter-end were ISK 96,929 million, up ISK 897 million from year-end.

Outlook and guidance

• EBITDA guidance for 2024 raised by ISK 800 million to ISK 12,300-12,700 million, reflecting Lyfja's addition.

• CAPEX forecast for 2024 is ISK 4,400-4,800 million.

• Synergy effects from Lyfja merger expected to reach ISK 200-400 million annually.

• Sale preparations for ODR, EBK, and EAK underway, with investor presentations in Q3.

• Business outlook described as good, with strong financial position.