Ontex Group (ONTEX) Q2 2024 earnings summary

Executive summary

• Achieved 3% like-for-like revenue growth in H1 2024, driven by 5% volume growth, especially in North America and adult care, offsetting price declines in baby and feminine care.

• Adjusted EBITDA rose 31% year-over-year to €110 million, with margin up to 12%, reflecting cost transformation and operational efficiencies.

• Free cash flow reached €43 million, reversing a €29 million outflow last year, and leverage ratio improved to 2.5x from 3.3x at year-end.

• Portfolio refocusing continued with completed divestments in Algeria and Pakistan; strategic options for Brazil and Turkey ongoing.

• Announced restructuring of Belgian operations to enhance efficiency, with a €37 million provision for redundancy costs.

Financial highlights

• H1 2024 revenue: €916 million (+3% LFL); Q2 revenue: €456 million (+2% LFL).

• Adjusted EBITDA: €110 million in H1 (+31% YoY), margin 12% (+2.6pp YoY); Q2 adjusted EBITDA: €57 million (+32% YoY), margin 12.5%.

• Adjusted profit from continuing operations: €41 million, up from €12 million YoY; total group loss for the period: €6 million, improved from €19 million loss YoY.

• Free cash flow: €43 million in H1, up from €-29 million YoY; capex €38 million.

• Net financial debt reduced by €77 million to €588 million, supported by M&A proceeds and improved cash flow.

Outlook and guidance

• Upgraded 2024 outlook: core market revenue expected to grow 4–5% like-for-like, with adjusted EBITDA margin at 12%.

• Free cash flow for the group projected above €20 million, with leverage ratio expected to fall below 2.5x by year-end.

• Continued strong double-digit growth anticipated in North America through 2025.