TCM Group (TCM) Q2 2024 earnings summary

Executive summary

• Organic revenue grew 5% in Q2 2024, with total revenue up 30% year-over-year to DKK 332.2 million, driven by strong B2C sales and the inclusion of AUBO.

• B2C order intake rose over 20%, with B2C sales up over 25%, while B2B sales declined due to a weak project market.

• Denmark accounted for 80% of group revenue, with a 14.7% year-over-year increase and 5.6% organic growth.

• Two new AUBO-branded stores opened in Denmark, bringing the total to 113 branded stores in Denmark and Norway.

• Gross margin improved to 21.5% from 20.2%, driven by higher-margin B2C sales and AUBO integration.

Financial highlights

• Q2 revenue was DKK 332.2 million, up 30% year-over-year; H1 revenue reached DKK 624.7 million, up 20.3%.

• Adjusted EBIT reached DKK 28 million (up from DKK 22 million), with an 8.4% margin; underlying margin improved to 8.9% excluding AUBO amortization.

• Free cash flow was DKK 25.8 million, a significant improvement from DKK -2 million last year; cash conversion was 95%.

• Net working capital ratio improved to -1.3% from -0.1% last year.

• CapEx ratio reduced to 1.3% from 2.3% last year.

Outlook and guidance

• Full-year 2024 net revenue guidance raised to DKK 1,125–1,200 million (previously DKK 1,000–1,150 million).

• Adjusted EBIT guidance increased to DKK 70–90 million (previously DKK 55–85 million), including a DKK 3–5 million positive effect from AUBO contingent consideration adjustment.

• Upside depends on continued strong B2C growth and a rebound in B2B; downside reflects ongoing B2B weakness and potential B2C slowdown.

• Project sales expected to continue declining in H2 2024, with recovery not anticipated until well into 2025.

• Revenue classification change reduces reported revenue by DKK 20–25 million annually; historical figures restated.