Loomis (LOOMIS) Q2 2024 earnings summary

Executive summary

• Achieved record quarterly revenue of SEK 7,639 million in Q2 2024, with 7.0% organic growth and contributions from acquisitions, despite negative currency impacts and cyclical headwinds.

• Operating margin improved to 11.6%, driven by volume growth, operational efficiency, and margin expansion in Europe and the U.S.

• Strong operating cash flow, with a 12-month cash conversion ratio of 92% and operating cash flow of EBITA at 126%.

• Over SEK 1 billion returned to shareholders via dividends and share repurchases; new buyback program of up to SEK 200 million announced.

• Significant reduction in injury rate and ongoing commitment to sustainability and emission reduction initiatives.

Financial highlights

• Revenue reached SEK 7,639 million, up from SEK 7,072 million year-over-year, with organic growth of 7.0%.

• Operating income (EBITA) rose to SEK 887 million, with an operating margin of 11.6% (up from 10.6%).

• Net income for Q2 was SEK 396 million, up from SEK 357 million.

• Loomis Pay revenues grew to SEK 28 million, with transaction volumes surpassing SEK 1.8 billion.

• Cash conversion ratio was 92% on a rolling 12-month basis.

Outlook and guidance

• Expectation of continued normal seasonality in Q3 for Europe and LatAm, with no significant deviations anticipated.

• Margin expansion in Europe and LatAm expected as restructuring savings are realized, with savings projected to be 30%-40% higher than costs.

• Ongoing focus on operational efficiency, margin recovery, and sustainability, with a strong balance sheet supporting strategic M&A.

• Cyclical headwinds in international business expected to persist but not worsen, with potential recovery by year-end.