Gestamp Automoción (GEST) Q2 2024 earnings summary

Executive summary

• H1 2024 sales reached €6.14 billion, down 2.1% year-over-year, with EBITDA at €654 million (excluding Phoenix Plan), and net income at €106 million.

• Free cash flow was negative in H1 but turned positive in Q2 (€77 million), offsetting Q1 outflows.

• The Phoenix Plan delivered €12 million P&L impact in H1, driving sequential margin improvement and targeting structural profitability in NAFTA.

• The company outperformed its market footprint by 6.4 percentage points at constant FX.

• Net debt reduced to €2.19 billion, with leverage at 1.7x net debt/EBITDA, the lowest H1 net debt since IFRS 16.

Financial highlights

• Revenues declined 2.1% year-over-year, mainly due to negative FX impact, but auto business at FX constant grew 5.1% in H1.

• EBITDA margin was 10.6% (excluding Phoenix), with sequential improvement in Q2.

• EBIT dropped 22% year-over-year to €285 million; EBIT margin at 4.8% (excluding Phoenix).

• Gescrap sales fell 10%, but EBIT margin improved to 8.4%.

• Net financial expenses improved, decreasing 4.9% to €110.3 million.

Outlook and guidance

• 2024 is a transition year, with auto business revenue expected to outperform market growth in the low-single digit range and flat or slightly higher EBITDA margin.

• Positive free cash flow targeted at around €200 million, with leverage to be preserved at 1.0–1.5x net debt/EBITDA.

• Company remains focused on achieving full-year targets for revenue, EBITDA margin, free cash flow, and leverage.

• ESG efforts recognized with improved ratings from EcoVadis, Sustainalytics, and FTSE Russell.