Troax Group (TROAX) Q1 2025 earnings summary

Executive summary

• Implemented a more decentralized organization from January to empower local decision-making and improve agility, with restructuring effective January 2025.

• Europe, especially construction and general industry, remained weak, while Americas and APAC showed strong and exceptional growth, particularly in automotive and warehousing.

• Order intake and sales both declined 4% year-over-year to EUR 69.5 million and EUR 68.3 million, respectively, but sequential improvement was noted compared to Q3 and Q4 last year.

• EBITA/EBITDA margin decreased to 14.0% from 15.5% year-over-year, mainly due to higher SG&A costs and lower production volumes in Europe.

• Working capital discipline maintained stable net debt and a strong balance sheet, supporting continued growth investments.

Financial highlights

• Order intake: EUR 69.5 million, down 4% year-over-year (5% organic decline, 1% FX gain).

• Sales: EUR 68.3 million, down 4% year-over-year (5% organic decline, 1% FX gain).

• EBITDA: EUR 9.5 million (14% margin), down from EUR 11 million (15.5% margin) in Q1 last year.

• Adjusted EPS: EUR 0.10, down from EUR 0.12 year-over-year.

• Operating/free cash flow: EUR 3.8 million, following typical seasonal patterns.

Outlook and guidance

• Expectation of improved free cash flow in the remaining quarters.

• SG&A costs expected to decrease in Q2 due to seasonal factors and cost control initiatives.

• Capacity adjustments planned in Europe to align with weaker demand, with potential positive cost effects in 2025.

• No material order or revenue delays expected to carry into Q2; Q1 order intake seen as representative.

• Low net debt provides opportunities for acquisitions in the current macro environment.