Ferronordic (FNM) Q2 2024 earnings summary

Executive summary

• Group revenue grew 62% year-over-year to SEK 1,095m, primarily driven by the US acquisition and expansion, with US operations contributing SEK 707m in revenue and SEK 51m in operating profit, offsetting declines in Germany and Kazakhstan.

• Net profit fell to SEK -81m, mainly due to foreign exchange losses and increased net debt from the US acquisition.

• Net debt increased to SEK 1,671m following the US acquisition; equity stood at SEK 1,627m.

Financial highlights

• Gross profit rose 139% year-over-year to SEK 202m, with gross margin up to 18.4%.

• Operating margin improved to -0.3% from -1.5%; group operating profit was SEK -4m.

• EPS was SEK -5.56, down 226% year-over-year.

• Net debt/Equity: 1,671m/1,627m; Equity/Assets: 33%.

• Cash flow from operations increased to SEK 270m from SEK 40m.

Outlook and guidance

• Optimism for continued US growth, supported by infrastructure investments and large projects, with focus on market share and aftermarket growth.

• German market remains weak, but long-term aftermarket and e-mobility opportunities are seen; cost reductions underway.

• Kazakhstan/Central Asia expected to remain a small part of the group, with long-term potential and inventory normalization efforts ongoing.