Nederman (NMAN) Q2 2024 earnings summary

Executive summary

• Achieved the second most profitable quarter in company history, with adjusted EBITA margin rising to 12.8% despite a 10.6% currency-neutral sales decline year-over-year.

• Solid profitability, stable cash flow, and advanced positions in growing industries, with a strong service business and investments in digital solutions and operational efficiency supporting margin improvement.

• Lower orders and sales were mainly due to fewer major orders and project deliveries in Process Technology, while other divisions showed stable or positive trends.

• The company maintains a cautiously positive outlook, supported by a large order backlog and increased presence in growth industries.

Financial highlights

• Q2 2024 orders received: SEK 1,415m (down 8.9% currency-neutral year-over-year); net sales: SEK 1,467m (down 10.6%).

• Adjusted EBITDA/EBITA for Q2: SEK 188m (margin 12.8%) vs. SEK 195m (margin 12.0%) last year.

• Profit after tax SEK 97m (EPS 2.77) vs. SEK 100m (EPS 2.86) last year; YTD profit after tax SEK 187m vs. SEK 178m.

• Cash flow from operations YTD SEK 170m; rolling four quarters above SEK 500m.

• Dividend of SEK 139m paid, impacting net debt; net debt at period end SEK 1,332.4m.

Outlook and guidance

• Backlog remains strong and at similar levels to last year, supporting continued profitability.

• Cautiously positive outlook for the second half of the year, with structural growth in recycling, battery, and air quality industries.

• Demand slightly slower, with risks from interest rates, economic activity, and geopolitical uncertainty.