Sinch (SINCH) Q2 2024 earnings summary

Executive summary

• Q2 2024 net sales were SEK 7,041 million, flat year-over-year; gross profit rose 3% to SEK 2,386 million, and adjusted EBITDA was SEK 867 million.

• Operating cash flow reached a record SEK 1,049 million in Q2, with SEK 3.2 billion over the last 12 months.

• Net debt/Adjusted EBITDA improved to 1.7x from 2.4x a year ago, with SEK 881 million debt repaid in Q2.

• Growth acceleration plan targets SEK 300 million gross opex savings run-rate by year-end 2024, with SEK 58 million realized in Q2.

• Market conditions remain stable, with low single-digit organic growth and continued focus on operational efficiency.

Financial highlights

• Gross margin rose to 34%, up 0.8pp year-over-year; adjusted EBITDA margin at 12%.

• Adjusted EBITDA for Q2 was SEK 867 million; adjusted EBIT was SEK 738 million.

• Cash conversion from adjusted EBITDA at 72% (rolling twelve months), above 40–50% target.

• SEK 881 million in financial debt repaid in Q2; SEK 3.1 billion over the last 12 months.

• Free cash flow of SEK 903 million in Q2; rolling twelve-month free cash flow at SEK 2.6 billion.

Outlook and guidance

• Near-term growth expected to remain in the low single-digit range due to slow customer investment.

• Growth acceleration plan aims to deliver higher growth and margin expansion in the medium term.

• Cost savings target of SEK 300 million run rate to be achieved before year-end.

• Adjusted EBITDA per share targeted to grow 20% per year; net debt to remain below 3.5x Adjusted EBITDA.

• No formal forecasts provided; company remains focused on profitability and cash flow.