Release Date: July 19, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Sequential improvement in business performance compared to Q1.
- Total sales increased, partly due to acquisitions.
- EBITDA margin improved from 12.2% to 12.5%, excluding integration costs.
- Strong order intake growth compared to the same period last year.
- Laundry segment showed significant organic growth of 6.7%.
Negative Points
- Organic sales declined by 0.7% in Q2.
- Operating cash flow was lower compared to the same quarter last year.
- Geographical performance was mixed, with declines in APAC and the Middle East and Africa regions.
- Food and beverage segment saw a 4.3% organic decline, particularly in the South Pacific area.
- Higher finance net costs due to additional borrowing for acquisitions.
Q & A Highlights
Q: On the order intake growing in July, excluding the Middle East, do you see any relief on the institutional side in Europe? Is that still weak going into Q3?
A: We see a sequential improvement in the institutional side, but the market remains relatively weak in the US. However, the chain side is showing a clear sequential improvement in order intake and sales.
Q: Have you seen any cancellations or withdrawals from the order book?
A: No, we haven't seen any cancellations. There have been some postponements due to site readiness issues, but no order cancellations.
Q: Can you provide an update on the integration costs versus the synergy costs with the acquisitions?
A: The majority of the integration costs were incurred in Q1, with SEK8 million in Q2. We expect some integration costs in the second half of the year, mainly related to aligning processes and IT infrastructure. Synergies will start to materialize in 2025.
Q: What is the expected delta in integration costs for H2?
A: The delta will still be negative in the second half of the year, roughly one-fifth of the SEK50 million incurred in the first half.
Q: What are the expected synergies in 2025?
A: We are not disclosing specific numbers, but Adventys is already accretive. TOSEI is expected to align with group margin expectations by 2025, with a long-term target of 15%.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
