Release Date: August 01, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Grupa Kety SA (FRA:GQ2, Financial) reported a 10% year-over-year increase in net profit, reaching PLN166 million.
- The company achieved a significant increase in volumes across all three segments, demonstrating resilience in challenging market conditions.
- EBITDA improved by 7%, amounting to PLN256 million, indicating strong operational performance.
- The acquisition of a major player in the sun visors market is expected to enhance Grupa Kety's market position and synergies with existing businesses.
- The company has completed two-thirds of its annual investment plan, aligning with strategic goals and enhancing production capabilities.
Negative Points
- The Polish and European markets are experiencing poor conditions, with negative manufacturing indicators, particularly in Germany.
- Grupa Kety is facing pressure on margins, especially in the extrusion products segment, due to challenging market dynamics.
- The company is experiencing a decrease in sales to the automotive industry, impacting the structure of its sales volumes.
- There is significant competition from Turkish imports, affecting the extrusion products segment.
- The company is facing challenges in maintaining stable prices due to fluctuating aluminum costs and market competition.
Q & A Highlights
Q: Do you assume a further increase in SWW volumes in H2 versus Q2?
A: Dariusz Małko, CEO: Yes, historically, Q3 has been the best quarter for extruded products. Despite the poor market demand, we are using strong commercial efforts to acquire orders and utilize our capacity, which serves as a counterbalance to lower margins.
Q: What caused the increase in billet premiums from $300 to $600 per tonne?
A: Dariusz Małko, CEO: The pricing of aluminum and billets is complex and not always correlated with market factors. While closures of mines and billet manufacturers can influence prices, financial institutions also play a role. The premium affects manufacturers' profitability, leading some to reduce production.
Q: Have there been any changes in the price list for aluminum systems and rollers since the beginning of the year?
A: Rafal Warpechowski, CFO: Prices changed by about 5-6% in Q3 2023, but have remained stable since. Although aluminum prices fluctuated, we have not changed our price list recently. Competitors have also adjusted prices, but market conditions vary.
Q: Is there still significant competition from Turkish products in the SWW segment?
A: Roman Przybylski, Vice President: The competition from Turkey has decreased, particularly when billet premiums were lower. However, we expect imports from Turkey to remain significant, and we have been effectively managing this competition.
Q: What are the perspectives for aluminum systems in 2025, considering market signals?
A: Dariusz Małko, CEO: It's difficult to predict market improvements, but we are focusing on Western Europe, which offers rich and interesting markets. Even without market improvements, we aim to expand our presence and increase sales in these regions.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
