Hove (HOVE) H1 2024 earnings summary

Executive summary

• Revenue for H1 2024 declined 10% year-over-year to DKK 86 million, mainly due to lower lubricant sales, which management views as a temporary timing issue.

• EBITDA dropped to DKK 7.6 million from DKK 13.5 million in H1 2023, impacted by lower sales and higher personnel costs.

• The Brazilian subsidiary faced increased negative EBITDA due to local customs and tax challenges, prompting management changes and external consultancy engagement.

• Strategic investments were made to enter the port terminal crane market, with field tests completed and first delivery agreement expected soon.

• Organizational restructuring aims to reduce personnel expenses by DKK 3 million over the next 12 months.

Financial highlights

• Revenue: DKK 85.7 million (H1 2024) vs. DKK 96.3 million (H1 2023).

• EBITDA: DKK 7.7 million (H1 2024) vs. DKK 13.4 million (H1 2023).

• Net profit: DKK 4.8 million (H1 2024) vs. DKK 7.6 million (H1 2023).

• Cash flow from operations: DKK -6.0 million (H1 2024) vs. DKK -7.5 million (H1 2023).

• Cash and cash equivalents at period end: DKK 4.0 million (H1 2024) vs. DKK 8.8 million (H1 2023).

Outlook and guidance

• Management expects the decline in lubricant sales to be temporary, with no evidence of customer loss to competitors.

• First order in the port terminal crane segment anticipated in the near future following successful field tests.

• Continued focus on debt reduction and cash flow improvement through working capital optimization.