INDUS (INH) Q2 2024 earnings summary

Executive summary

• H1 2024 results met expectations despite a 7.2% sales decline year-over-year, with all segments affected by economic headwinds.

• EBIT fell 24.5% to €64.1 million, with margin at 7.6% (prior year: 9.4%), but EPS rose to €1.21 from €0.80.

• Free cash flow increased to €41.2 million, up from €35.2 million, despite the absence of a prior one-off property sale.

• Equity ratio improved to 38.0% as of June 30, 2024, up from 37.3% at year-end 2023.

• Three acquisitions (GESTALT AUTOMATION, GRIDCOM, COLSON) completed, strengthening the portfolio.

Financial highlights

• Group sales fell to €839.1 million (H1 2023: €904.1 million), a 7.2% decrease year-over-year.

• EBIT dropped 24.5% to €64.1 million; adjusted EBITA down 21.8% to €73.9 million.

• Free cash flow rose 17% to €41.2 million, aided by lower working capital increases.

• Net debt increased to €565.3 million, reflecting dividend and buyback; equity ratio improved to 38%.

• Dividend of €1.20 per share paid, totaling €31.0 million; share buyback of 1.1 million shares for €25.3 million.

Outlook and guidance

• Sales and EBIT guidance for 2024 revised downward due to weaker economic environment; group sales now expected at €1.7–1.8 billion, EBIT at €125–145 million.

• EBIT margin projected at 7.0–8.0% (2023: 8.3%).

• Free cash flow target of above €110 million maintained, supported by positive working capital and lower investments.

• Segment guidance: Engineering and Materials expect lower sales and earnings; Infrastructure expects lower sales but higher EBIT.

• M&A budget of €70 million for 2024; further acquisitions planned.