Kongsberg Automotive (KOA) Q2 2024 earnings summary

Executive summary

• Q2 2024 EBIT reached €6.4M, up €18.9M from Q2 2023, driven by cost optimization and improved KPIs despite a challenging automotive market.

• Revenues declined 6.8% to €209.3M, mainly due to lower volumes in Europe, partially offset by growth in the Americas.

• Book-to-bill ratio hit a record 2.1, with €695M in new business wins in Q2 and €1.1B in H1, up from €369M in H1 2023.

• Free cash flow was -€4.4M, but positive when adjusted for accelerated bond interest payments; focus remains on delivering positive free cash flow for the year.

• Leverage ratio increased to 1.7x, and net interest-bearing debt rose to €116.5M, mainly due to negative free cash flow and bond refinancing.

Financial highlights

• EBIT for Q2 was €6.4M, up €18.9M year-over-year, with adjusted EBIT at €7.9M.

• Revenues fell by €15.2M to €209.3M, mainly due to European market decline.

• Net profit for Q2 was €3.7M, compared to -€21.7M last year.

• Liquidity at quarter-end was €100.8M, with €85.8M in cash and a €50M undrawn credit facility.

• Equity ratio improved to 34.3%, and return on capital employed was 1.7%.

Outlook and guidance

• 2024 full-year revenue guidance adjusted to €790–830M due to volume reductions in Europe and Asia and economic uncertainty in North America.

• EBIT guidance for 2024 set at €28–35M.

• New business wins guidance for 2024 raised to above €1.5B, with book-to-bill ratio above 1.5.

• Positive free cash flow targeted for the full year.

• Focus for H2 2024 includes cost optimization, manufacturing footprint assessment, and product portfolio development.