Festi (FESTI) Q2 2024 earnings summary

Executive summary

• Q2 2024 sales of goods and services reached ISK 36.0 bn, up 5.4% year-over-year, with margin from sales up 10.8% to ISK 8,593 million.

• Profit for the six months ended 30 June 2024 was ISK 1,155 million, with total comprehensive income at ISK 1,144 million.

• EBITDA increased 13.8% YoY to ISK 2,915 million in Q2; H1 EBITDA was ISK 4.8 billion, up from ISK 4.0 billion YoY.

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

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

Financial highlights

• Margin from sales was 23.8% in Q2 and 11.7% higher YoY for H1, reaching ISK 15.6 billion.

• 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 in Q2, up 7.1% YoY.

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

• Net interest-bearing debt stood at ISK 33,779 million, stable 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.

• Outlook for H2 2024 is positive, with Lyfja expected to contribute ISK 0.8 billion in H2 EBITDA.