Nexam Chemical (NEXAM) Q4 2024 earnings summary

Executive summary

• Achieved 5% year-over-year sales growth to SEK 199.6 million despite challenging demand in wind power and construction segments, with a focus on sustainable plastic additives and strong R&D investment.

• Gross margin improved for the eighth consecutive quarter, reaching 47% in Q4 and 46% for the full year.

• EBITDA turned positive to SEK 8.1 million for the year from SEK -5.9 million last year, reflecting cost-saving and insourcing efforts.

• Significant progress in expanding customer base, especially in recycling, and entering Central European markets.

• No dividend proposed for 2024; focus remains on organic growth and international expansion.

Financial highlights

• Q4 net sales: SEK 48.6 million, down 4% year-over-year; full-year net sales: SEK 199.6 million, up 5%.

• Q4 gross margin: 47% (up from 44%); full-year gross margin: 46% (up from 42%).

• Q4 EBITDA: SEK 2.0 million (up from SEK 1.6 million); full-year EBITDA: SEK 8.1 million (up from SEK -5.9 million).

• Cash flow from operating activities improved to SEK 7.4 million for the year, up from SEK -0.4 million in 2023.

• Cash and cash equivalents at year-end: SEK 2.9 million (down from SEK 9.1 million).

Outlook and guidance

• Optimistic about significant business growth in 2025, with timing dependent on customer market recovery.

• Contribution margin expected to remain at least at current levels (45–50%) in coming quarters.

• No high investments planned; company can fund operations and growth from cash flow and has an unused SEK 25 million credit facility.

• Regulatory changes in EU packaging expected to drive demand for advanced recycling solutions.

• Uncertainty remains in the lightweighting segment due to weak demand in Europe and North America, but Asian markets show strength.