Q2 2024 H+H International A/S Earnings Call Transcript
Key Points
- H+H International AS (FRA:J0H) reported double-digit revenue growth in the UK and Poland, with the UK seeing an 11% increase and Poland a remarkable 36% increase in Q2.
- The company is reinstating capacity in response to positive market trends, including reopening the Pollington plant in the UK and increasing shifts in Poland.
- The potential sale of the Warsaw plant is expected to improve liquidity and financial gearing, aligning with long-term financial targets.
- The company has successfully reduced stock levels to a more manageable 1.5 months, which is expected to stabilize gross margins in the second half of the year.
- H+H International AS (FRA:J0H) has achieved significant cost savings, reducing fixed costs by DKK50 million per quarter, which equates to DKK200 million annually.
- The German market is underperforming, with a 25% revenue loss in Q2 due to a decline in new build activity and high construction costs.
- Gross margins have been negatively impacted by unfavorable gas hedges and destocking, with a reported gross margin of 18% compared to 24% last year.
- Financial gearing has increased, although it remains within bank covenants, due to lower EBITDA over the last 12 months.
- The company anticipates further restructuring costs in the CWE region due to market deterioration.
- The guidance for organic growth and EBIT before special items has been narrowed to the lower end of the previous range, reflecting challenges in the German market and production disruptions.
Welcome to H+H International 2024 H1 conference call. (Operator Instructions) This call is being recorded.
And I will now hand it over to your speakers. Please begin.
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Thank you, and good morning, and welcome to H+H conference call covering the first half of 2024. My name is Niclas. I am the Head of Investor Relations and Treasury. Joining me today, as always, our CEO, Jorg Brinkmann; and our CFO, Bjarne Pedersen. Yesterday evening, the half year report and related documents, including the presentation for this call, was put on our Investor Relations website.
During today's call, management will present the interim financial report, after which there will be a Q&A session. Please note that this conference call is being recorded and will be made available on our Investor Relations website after the call. Before I hand the call over to Jorg and Bjarne. I would like to direct your attention to the disclaimer
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