Solar (SOLAR) Q3 2024 earnings summary

Executive summary

• Q3 2024 revenue declined to DKK 2,860m–2.9bn, down 3–3.5% year-over-year, with all segments posting negative growth but sequential improvement and recovery most pronounced in Denmark.

• EBITDA for Q3 was DKK 202m, in line with expectations, supported by cost reductions and non-recurring income from warehouse sales.

• Adjusted organic growth improved to -5.3% in Q3, with September at -0.6%, indicating ongoing recovery, especially in Denmark.

• Cyber and information security enhancements, including NIS2 and ISO 27001 certifications, are strengthening customer trust and supporting critical infrastructure customers.

• Launch of Solar Assistant, a generative AI chatbot, aims to enhance customer experience and drive sales.

Financial highlights

• Q3 revenue: DKK 2,860m–2.9bn, down 3–3.5% year-over-year; Q1–Q3 revenue: DKK 8,990m, down 8.9%.

• Q3 EBITDA: DKK 202m (margin 7.1%); Q1–Q3 EBITDA: DKK 427m (margin 4.7%).

• Gross profit margin in Q3: 20.7% (down from 21.5%); Q1–Q3: 20.6% (down from 22.5%).

• Q3 net profit: DKK 78m, up from DKK 71m in Q3 2023.

• Cash flow from operating activities Q1–Q3: DKK 13m; total cash flow Q1–Q3: DKK -173m.

Outlook and guidance

• 2024 EBITDA guidance reconfirmed at DKK 600m, including DKK 35m non-recurring income and DKK 35m restructuring costs.

• Revenue guidance for 2024 revised down to DKK 12,300m from DKK 12,500m, reflecting slower recovery and organic growth of approx. -6%.

• All segments and markets expected to show negative growth in 2024, with recovery anticipated by year-end, especially in Denmark.

• Gross profit margin expected to remain under pressure due to product mix, higher delivery costs, and price pressure.

• Guidance reflects ongoing macroeconomic uncertainties and expects continued cost and wage inflation.