Koenig & Bauer (SKB) Q3 2024 earnings summary

Executive summary

• Order intake rose 18.9% year-over-year to €988.1 million for the first nine months, with a record order backlog of €1,080.0 million, providing a strong foundation for Q4.

• Revenue for the first nine months was €819.6 million, down 8% year-over-year, mainly due to prior year order weakness and lower production progress in Banknote Solutions.

• Operating EBIT for the nine months was €-20.7 million, impacted by €34.9 million in non-operational special effects, including €24.4 million from the Spotlight program.

• Sequential improvement in operating EBIT in Q3 compared to Q2, with Q3 operating EBIT at €4.2 million.

• The Spotlight program is targeting cost improvements and future EBIT gains, with €24.4 million in special expenses recognized year-to-date.

Financial highlights

• Order intake reached €988.1 million (+18.9% year-over-year); order backlog at €1,080.0 million, a record high.

• Revenue for the first nine months was €819.6 million, down €72 million from last year; gross margin dropped to 22.9% from 27.0% year-over-year.

• Group EBIT for the nine months was €-55.6 million (margin -6.8%); operational EBIT at €-20.7 million; net loss of €-77.3 million after nine months.

• Free cash flow improved to €-35.8 million from €-74.7 million year-over-year, mainly due to better net working capital management.

• Net working capital improved by €13.3 million; net financial position at €-189.4 million.

Outlook and guidance

• Full-year 2024 guidance confirmed: operating EBIT expected at lower end of €25–40 million range, revenue target of €1.3 billion.

• Q4 expected to be decisive, with projected revenue of €480 million and operating profit of €45 million.

• Midterm guidance for 2026 reaffirmed: 6% profit margin and €1.5 billion turnover; medium-term targets include revenue of €1.8 billion and EBIT margin of 8–9%.

• Spotlight program to deliver €60–70 million gross annual savings by 2026, with €15–20 million EBIT effect in 2024 and €40–50 million in 2025.