Harvia (HARVIA) Q3 2024 earnings summary

Executive summary

• Q3 2024 revenue increased by 14% year-over-year to EUR 38.7 million, with organic growth at 7.9% and strong contributions from the ThermaSol acquisition.

• Adjusted operating profit rose 28.8% to EUR 8.9 million, representing 22.9% of revenue, supported by supply chain actions and favorable sales mix.

• North America and APAC & MEA regions delivered robust growth, while Northern Europe saw a 6.8–7% decline due to weak market conditions.

• ThermaSol acquisition in July 2024 strengthened the position in the US steam solutions market and boosted steam product growth.

• Inventory levels increased in anticipation of high winter demand, particularly in North America, leading to lower cash conversion.

Financial highlights

• Q3 2024 revenue: EUR 38.7 million (+14% YoY); adjusted operating profit: EUR 8.9 million (+28.8% YoY).

• January–September 2024 revenue: EUR 124.3 million (+11.8% YoY); adjusted operating profit: EUR 28.4 million (+17.6% YoY).

• Q3 basic EPS: EUR 0.29 (+22% YoY), impacted by EUR 1.3 million in acquisition-related costs.

• Operating free cash flow in Q3: EUR 3.4 million (down from EUR 8.3 million YoY); cash conversion at 31.7%.

• Net debt at end of Q3: EUR 61.8 million (up from EUR 40.6 million YoY), leverage at 1.4x.

Outlook and guidance

• Management expects continued strong demand in North America and APAC & MEA.

• Inventory build-up is a strategic move to capture high winter season sales.

• No short-term outlook published; long-term targets: 10% annual revenue growth, >20% adjusted operating margin, net debt/EBITDA <2.5x.

• Dividend policy aims for regularly increasing, bi-annual payouts.

• Gross margin and cash conversion remain critical focus areas.