Winpak (WPK) Q2 2024 earnings summary

Executive summary

• Q2 2024 revenue was $283.5M, down 1.4% year-over-year; net income attributable to equity holders fell 3% to $38.8M.

• First half 2024 revenue declined 5.4% to $560.3M; net income attributable to equity holders decreased 6.2% to $74.3M.

• Gross profit margins improved to 32.5% in Q2 and 31.8% year-to-date, driven by raw material cost reductions outpacing selling price decreases.

Financial highlights

• Q2 EBITDA was $61.1M, nearly flat year-over-year; year-to-date EBITDA was $117.0M, down from $122.3M.

• Basic and diluted EPS for Q2 was 61 cents, down from 62 cents; year-to-date EPS was 116 cents, down from 122 cents.

• Operating expenses rose 11.6% in Q2, mainly due to higher personnel costs and ERP implementation.

• Net finance income increased due to higher cash invested in short-term deposits.

Outlook and guidance

• Sales volumes expected to grow 4–6% in the second half of 2024, supported by new business and capacity expansions.

• Gross profit margins for H2 2024 projected to remain similar to Q2 levels.

• Capital expenditures for 2024 forecast at $125–$135M, focused on expanding the Winnipeg facility.

• Company is evaluating further share repurchases and potential acquisitions aligned with core strengths.