Industrie De Nora (DNR) Q3 2024 earnings summary

Executive summary

• Revenues for the first nine months of 2024 reached €601.2 million, down 4.5% year-over-year, mainly due to a decline in Electrode Technologies and currency effects, while Water Technologies and Energy Transition segments showed growth or stability.

• Adjusted EBITDA margin was 17.8% for 9M 2024, in line with guidance, reflecting a resilient business model despite a soft Q3 and increased R&D and ramp-up costs.

• Net profit for 9M 2024 was €52.5 million, significantly lower than the prior year due to the absence of one-off gains from the tk nucera IPO.

• The company maintained a strong net cash position of €29.7 million at September 30, 2024, supported by operating cash flow exceeding €80 million.

• Strategic partnerships, new product launches, and ESG initiatives, including the Italian Gigafactory and Dragonfly electrolyzer, support long-term growth.

Financial highlights

• Revenue for 9M 2024 was €601.2 million, down 4.5% year-over-year, with a negative FX impact, especially from the Japanese yen.

• Adjusted EBITDA was €107.3 million (margin 17.8%), down from €122.0 million (19.4%) in 9M 2023, reflecting lower volumes and a different revenue mix.

• Net income for 9M 2024 was €52.5 million, with a margin of 8.7%-9%.

• Net cash position at September 2024 was €29.7 million, with operating cash flow of €81 million.

• Basic and diluted EPS were €0.26, compared to €0.98 in the prior year.

Outlook and guidance

• Full-year 2024 guidance confirmed: low single-digit group revenue growth, with Water Technologies and Energy Transition expected to grow and Electrode Technologies to remain broadly flat.

• Adjusted EBITDA margin for the year expected at around 17%.

• Q4 revenues are secured in the backlog and expected to drive a strong finish to the year.

• Recovery in Electrode Technologies orders anticipated in Q4 and into 2025, especially in Chlor Alkali and Electronics markets.

• CapEx plan is under review and will be updated in March 2025, with flexibility to adjust investment intensity based on hydrogen demand.