Heeros (HEEROS) Q2 2024 earnings summary

Executive summary

• Q2 2024 delivered outstanding results across all key metrics, with significant improvements in profitability and operational efficiency driven by cost-saving measures over the past 15 months.

• Adjusted EBITDA grew by 94% in Q2 and 65% for H1, reaching €878k (30% margin) in Q2 and €1.46 million (26% margin) for H1.

• Both EBIT and net profit turned positive for H1, with net income at €235k versus a €323k loss a year earlier.

• Sales momentum improved, with new ARR intake up 120% year-over-year in Q2 and 20% for H1.

• Revenue was stable at €5.6 million for H1, with recurring revenue representing 95% of total revenue.

Financial highlights

• Q2 2024 revenue grew 1% year-over-year to €2.9 million; H1 revenue was €5.6 million, down 0.4%.

• Contract revenue increased 6% in Q2 and 4% for H1, while transaction revenue declined 15-16% due to lower volumes.

• Adjusted EBITDA for Q2 was €878k (30% margin), up from €454k (16%) in Q2 2023.

• Operational cash flow improved 22% year-over-year in Q2 and 51% for H1, reaching €1.35 million.

• Net debt reduced to €741 thousand from €2.12 million a year earlier.

Outlook and guidance

• Profitability is expected to continue improving throughout 2024, with both revenue and EBITDA forecasted to exceed 2023.

• Q3 revenue growth will be modest due to lag between sales and implementation, but Q4 and 2025 are expected to be strong.

• Positive profitability trend anticipated to continue through the year.