Garo (GARO) Q2 2024 earnings summary

Executive summary

• Net sales for Q2 2024 were SEK 306.3 million, down 21% year-over-year, mainly due to weak E-mobility demand in Sweden and challenging market conditions.

• Operating profit (EBIT) was SEK -4.3 million, a significant decline from SEK 18.2 million in Q2 2023, with an EBIT margin of -1.4%.

• Electrification delivered stable performance, while E-mobility faced macroeconomic headwinds, especially in Sweden.

• Recruitment for a new CEO has begun, with the current CEO remaining until early 2025.

• The company is investing in European expansion, notably in Germany and Spain, despite current market headwinds.

Financial highlights

• Net sales: SEK 306.3 million, down 21% year-over-year.

• Operating profit: SEK -4.3 million (Q2 2023: SEK 18.2 million); EBIT margin: -1.4% (4.7%).

• E-Mobility net sales: SEK 84.4 million, down 45% year-over-year; EBIT margin -29.8%.

• Electrification net sales: SEK 221.9 million, down 5% year-over-year; EBIT margin 9.2%.

• Temporary power product area grew 12% year-over-year.

Outlook and guidance

• E-mobility market recovery is slower than expected, especially in Sweden; gradual improvement anticipated with a more positive outlook for 2025.

• Construction market in the Nordics remains weak for 2024 but is expected to recover gradually in 2025.

• Positive demand trends in commercial, public, and international markets support continued investment.

• Long-term vision for electrification and e-mobility remains unchanged.