Kendrion (KENDR) Q4 2024 earnings summary

Executive summary

• Completed strategic repositioning by divesting nearly all automotive activities, now operating as a pure-play industrial company focused on high-growth, high-margin markets in Europe, China, and the U.S.

• Cost reduction program fully implemented, delivering €9 million in annual savings and supporting improved profitability.

• Pro forma FY 2024 revenue mix: IAC 40%, IB 39%, Mobility 21%.

• 2024 marked by challenging industrial markets, especially in Germany, but operational progress and cost savings initiatives were implemented.

• Targeting global niche leadership in selected industrial markets, with a focus on sustainable growth and profitability (15%+ EBITDA margin from 2025).

Financial highlights

• Q4 2024 revenue increased 8% year-over-year to €76.0 million, driven by 39% growth in Mobility; industrial revenues stable.

• Full-year 2024 revenue decreased 2% to €301.5 million due to weak global industrial production, notably in Germany.

• EBITDA from continued operations declined 11% year-over-year to €37.0 million, impacted by unfavorable sales mix and temporary synergies post-divestment.

• Net profit before amortization for FY 2024 at €11.8 million, down 15% year-over-year.

• Proposed dividend of €0.45 per share, representing a 59% payout of normalized net profit before amortization.

Outlook and guidance

• Confident in achieving 15%-18% EBITDA margin from 2025 onwards, with ROI targets of 23%-27% by 2027.

• Economic conditions in H1 2025 expected to mirror 2024, with modest organic growth and improvements mainly from gross margin expansion and OPEX reduction.

• Anticipates annual dividend payments of at least 50% of normalized profit.

• Profitability improvements expected from internal initiatives, strict cost control, and operational efficiency, including ERP system transition.

• Positioned to capitalize on economic rebound as a pure-play industrial company.