Q2 2024 Grupo Traxion SAB de CV Earnings Call Transcript
Key Points
- Record high figures of revenue and EBITDA, driven by strong demand related to nearshoring.
- Net income almost doubled to MXN222 million, a 98% growth compared to the same quarter last year.
- Shift in focus to more profitable B2B business in the last mile division, expecting benefits by Q4 2024.
- Reduction in CapEx by approximately MXN600 million without affecting expansion plans.
- Strong cash flow generation and a prudent debt utilization approach, maintaining debt level below 2.5 times.
- Timing lag between CapEx investments and actual revenue generation, affecting immediate returns.
- Price disruption in the B2C parcel market for 18 months with no immediate signs of normalization.
- Restructuring expenses of approximately MXN25 million this quarter, with additional one-time expenses expected in Q3.
- Severe storms and border closures in the Nordic region caused temporary disruptions and additional costs.
- Margin compression in the logistics and technology division due to adjustments in the B2C service.
Good day and welcome to the Traxion Second Quarter 2024 earnings call. (Operator Instructions)
I would now like to turn the call over to your host, Aby Lijtszain, the floor is yours.
Good morning, everyone. This period Traxion posted again record high figures of revenue and EBITDA. Both of the highest in the company's history and were driven by strong demand related mainly to nearshoring. We continued to grow with revenues up more than 23% in line with our expectations.
Most important is that net income almost doubled to reach MXN222 million this period, which is more than 98% growth compared to the same quarter of last year. The company has been expanding at high rates, but the timing between the CapEx and actual revenue creates a lag.
The reason is simple. First, we need to invest resources and incur in pre-operating costs and expenses to have new operations up and running. Then we have to wait for some time for
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