H&D Wireless Sweden (HDW) Q3 2024 earnings summary

Executive summary

• Q3 2024 saw net sales return to 2023 record levels at 6.8 MSEK, with EBITDA improving by 5 MSEK year-over-year, marking the best result since listing.

• Major restructuring reduced the group to one operating subsidiary, focusing on high-growth IoT products.

• Efficiency projects in Q2 and Q4 are expected to yield annual savings of 15 MSEK and debt reduction of 22 MSEK.

• Order intake rebounded sharply in Q2, with a 18 MSEK increase from February to July.

• Strategic partnerships, especially with Avnet, have driven over 100 design-in registrations and new production starts.

Financial highlights

• Q3 2024 net sales: 6.8 MSEK, down 6% year-over-year; total revenue: 11.6 MSEK, up 50% due to capitalized R&D.

• EBITDA: 1.2 MSEK (Q3 2024) vs. -4.8 MSEK (Q3 2023), a 126% improvement.

• EBIT: -1.3 MSEK (Q3 2024) vs. -6.7 MSEK (Q3 2023), an 80% improvement.

• Net result after financials: -2.0 MSEK (Q3 2024) vs. -7.5 MSEK (Q3 2023), a 73% improvement.

• Cash and cash equivalents at period end: 1.0 MSEK, down from 6.8 MSEK year-over-year.

Outlook and guidance

• Management expects the business to become profitable in 2025, driven by cost reductions and focus on core IoT offerings.

• Additional cost savings from Q4 restructuring are anticipated to make the company cash flow positive.

• A rights issue of approximately 9.4 MSEK is planned for November 2024 to support the path to positive cash flow.