Osmosun (ALWTR) H1 2024 earnings summary

Executive summary

• Specializes in low-carbon, solar-powered desalination with patented technology, offering units from 1 to 50,000 m³/day and a strong ESG profile.

• 73 units sold as of June 2024, producing 4 million m³ of drinking water and avoiding ~6,569 tonnes of CO2.

• Major projects deployed globally, including Mauritania, Cape Verde, the Caribbean, France, and Vanuatu, with significant subcontracting costs for Mauritania.

• Workforce increased to 32.3 FTE in H1 2024, reflecting strengthened operations and development.

• Group underwent reorganisation and governance changes, including a new CEO, to adapt and accelerate project transformation.

Financial highlights

• H1 2024 revenue rose 15% year-over-year to €1.5m, driven by large and small project contracts, with export sales dominating.

• Gross margin turned negative at -€563k (-36.6%) due to high subcontracting costs and low-margin contracts.

• Net loss widened to -€2.63m in H1 2024 from -€1.13m in H1 2023, with operating loss at -€2.7m.

• Adjusted EBITDA was -€2.5m in H1 2024, down from -€0.8m in H1 2023.

• Cash and cash equivalents at €4.2m as of June 30, 2024; net cash position at €2.1m.

Outlook and guidance

• Order backlog of €1.7m with 10 projects, 90% to be delivered by year-end 2024, but backlog declined from €4.4m a year earlier.

• Nearly 80 projects under advanced negotiation, representing €88m in potential revenue, but with low visibility on conversion timing.

• FY 2024 revenues expected to be stable year-over-year, with H2 earnings anticipated to improve slightly.

• Strategic review and cost/cash flow optimisation underway; additional funding may be considered if needed.

• Cash visibility secured through June 2025, supported by ongoing projects and expected client payments.