Andritz (ANDR) Q3 2024 earnings summary

Executive summary

• Q3 order intake increased 6% year-over-year to €1.9 billion despite challenging market conditions, but revenue declined 3% to €2.0 billion and order backlog fell 9%.

• Profitability remained stable with Q3 EBITDA at €174 million (8.5% margin) and net income at €118 million (5.8% margin); EBITA for Q1–Q3 was €507 million (8.4% margin).

• Service business and demand for green technologies remained strong, offsetting weak capital investment in Pulp & Paper and Metals.

• Additional provisions for capacity adjustments and restructuring were recognized, with project execution improving due to better mix and price increases.

• Order backlog and net income were negatively impacted by currency effects and market weakness in Pulp & Paper.

Financial highlights

• Q3 2024 revenue was €2,041.5m (down 3% YoY); Q3 order intake rose 5.5% to €1,903.1m; order backlog dropped 9% to €9.4bn.

• Q3 EBITDA was €211.5m; Q3 EBITA was €174m (8.5% margin); Q3 net income was €118m (5.8% margin).

• For Q1–Q3, order intake was €5.7bn (down 12% YoY), revenue €6.0bn (down 3% YoY), EBITA €507m (8.4% margin), and net income €342m (5.7% margin).

• Free cash flow for Q1–Q3 was €247m; operating cash flow surged to €404m; net liquidity at €815m.

• Equity ratio improved to 27.4%; EPS for Q1–Q3 was €3.45.

Outlook and guidance

• 2024 revenue guidance adjusted from stable to slightly decreasing (around 3% down), with stable EBITA margin and profitability expected.

• No quick recovery anticipated; project activity is increasing but order-to-revenue conversion remains slow.

• Long-term targets for 2026 include revenue above €10bn, EBITA margin above 9%, and net income margin above 6%.

• Weakness in Pulp & Paper and Metals investment activity expected to persist for the remainder of 2024.

• Robust demand for green technologies and service business supports profitability.