Svitzer Group (SVITZR) Q2 2024 earnings summary

Executive summary

• Achieved 11% revenue growth and 15% adjusted EBITDA growth year-over-year for H1 2024, reflecting strong operational and commercial performance, with margin improving to 30.8%.

• Successfully completed demerger from A.P. Moller-Maersk and listed as an independent company on the Danish Stock Exchange in April 2024.

• Renewed all terminal towage contracts up for renewal and secured new contracts in Australia, Panama, Brazil, and Liberia.

• Continued focus on decarbonization, with biofuel conversions in the Netherlands and Oman, and ordered a methanol battery hybrid tug.

Financial highlights

• Revenue increased from DKK 2,832m in H1 2023 to DKK 3,138m in H1 2024 (+11%), driven by growth in both harbor and terminal towage, tariff increases, and new contracts.

• Adjusted EBITDA rose from DKK 839m to DKK 968m (+15%), with margin at 30.8% for H1 2024.

• Free cash flow increased to DKK 303m from DKK 288m, aided by vessel sales and strong cash conversion.

• Net interest-bearing debt reduced to DKK 3,541m as of 30 June 2024.

• Return on invested capital improved to 8.6% for the past 12 months, up from 7.6% at year-end 2023.

Outlook and guidance

• Upgraded 2024 revenue growth guidance to 6.0–7.5% in constant exchange rates, expecting to reach the upper end.

• Adjusted EBITDA guidance raised to DKK 1,775–1,875m, with margin expected around 30%, excluding DKK 130m in separation and listing costs.

• Gross CAPEX for 2024 expected at DKK 900–1,100m, with DKK 483m spent in H1 and growth CAPEX of DKK 400–500m.

• H2 revenue growth expected to moderate due to fewer new vessel additions and normalization of short-term high-margin contracts.