VBG Group (VBG) Q3 2024 earnings summary

Executive summary

• Q3 2024 sales declined by 11.6% year-over-year to SEK 1,273M, with organic growth at -11.5%, mainly due to lower demand in North America and Mobile Thermal Solutions.

• Gross margins improved across all divisions despite lower volumes, supported by efficiency gains, cost management, and product mix improvements.

• EBITA for Q3 was SEK 171.8M (13.5% margin), down from SEK 217M, and EPS dropped 29% to 4.49 SEK.

• Operating cash flow remained stable at SEK 153M, and the group maintained a strong net cash position.

• Strategic consolidation of three Mobile Thermal Solutions facilities in Toronto into one new building is expected to yield efficiency gains.

Financial highlights

• Q3 2024 net sales were SEK 1,273M (-11.6% YoY); EBITA was SEK 171.8M (13.5% margin); profit after tax was SEK 112.3M.

• Year-to-date net sales reached SEK 4,302M (+0.3% YoY), EBITA was SEK 648M (15.1% margin), and EPS was 19.03 SEK.

• Rolling twelve months net sales were SEK 5,752M, EBITA SEK 866M, and EPS 24.21 SEK.

• Operating cash flow for Q3 was SEK 153M, and cash flow from operating activities for nine months was SEK 502.3M.

• Interest-bearing net debt/EBITDA improved to 0.20 from 0.45 YoY.

Outlook and guidance

• Market conditions are expected to remain soft in Q4, with no significant improvement anticipated and continued volatility and geopolitical unrest.

• Order intake decreased by 3% year-to-date September; visibility is three to four months.

• Focus areas include acquisitions, organic growth, new production facilities, and sustainable profitability.

• No formal forecast provided for 2024.

• The group is prepared for continued uncertainty, especially in the U.S. consumer market.