Kitwave Group (KITW) H1 2024 earnings summary

Executive summary

• Revenue increased 8% year-over-year to £297.0m for H1 2024, with stable gross margin at 21.5%.

• Adjusted EBITDA was £15.9m, slightly down from £16.0m in H1 2023; adjusted operating profit fell 7.7% to £10.8m.

• Two acquisitions (Wilds and Total Foodservice) were completed and integrated into the Foodservice division.

• Cash generation from operations was strong at £12.4m, with pre-tax operational cash conversion of 93%.

• Interim dividend increased by 3% to 3.85p per share, reflecting confidence in future growth.

Financial highlights

• Operating profit decreased 9% to £9.3m compared to H1 2023; profit before tax was £6.9m, down from £8.3m.

• Group revenue up 8.0% year-over-year to £297.0m; like-for-like revenue up 5.9%.

• Net cash from operations £12.4m, up £0.7m year-over-year.

• Net debt increased to £83.9m, mainly due to acquisition outflows; leverage rose to 2.0x adjusted EBITDA.

• Basic EPS was 7.3p, down from 9.1p in H1 2023, due to lower operating profit and higher interest costs.

Outlook and guidance

• Full-year performance expected to be in line with market expectations, with results weighted to H2 2024.

• Benefits from recent investments and acquisitions anticipated to materialize in the second half.

• New Southwest distribution centre to be operational in Q3 2024, expected to drive further growth and efficiencies.