Wacker Neuson (WAC) Q2 2024 earnings summary

Executive summary

• Revenue for H1 2024 declined 11.8% year-over-year to €1,204.8 million, reflecting persistently weak construction machinery market, subdued order intake since Q4 2023, and high dealer inventories across all regions.

• EBIT for H1 2024 was €83.8 million, with an EBIT margin of 7.0%, down from 12.9% in H1 2023, due to lower revenue and reduced plant utilization.

• Free cash flow turned positive at €4.5 million in H1 2024, supported by inventory reduction.

• Service business, including rental, spare parts, and maintenance, grew by over 3% year-over-year, partially offsetting declines in equipment sales.

• Strategic milestones included SAP S/4 HANA migration, new logistics center, and targeted acquisitions to expand market presence.

Financial highlights

• H1 2024 revenue: €1,204.8m (-11.8% YoY); Q2 2024: €611.7m (-12.5% YoY).

• EBIT: €83.8m (-52.6% YoY); EBIT margin: 7.0% (down from 12.9%).

• Gross profit margin: 23.7% (up 2.2pp since Q4 2023, but down 1.5pp YoY).

• Net working capital ratio: 37% (up from 31.6% YoY), with inventories reduced by €48.2m–€54m in H1 2024.

• Net financial debt at €466m, with equity ratio at 55%.

Outlook and guidance

• Full-year 2024 revenue expected between €2,300–2,400m, with EBIT margin of 6.0–7.0%.

• Net working capital ratio target raised to ~34%; investments planned at ~€100m.

• Market demand is expected to remain weak through year-end, with dealer inventories normalizing into 2025.

• Cost reduction and sales initiatives are expected to yield sustainable savings and position the company for improved performance in 2025.