In This Article:
-
Order Intake: SEK18.9 billion for Q2, 3.5% organic growth; SEK37.2 billion for H1, 1.1% growth.
-
Revenue: SEK17.5 billion for Q2, 10.4% growth; SEK32.4 billion for H1, 8% growth.
-
Gross Profit Ratio: Improved by 1% to 33.4%.
-
Operating Income Margin: Improved by 2.2% to 15.6%.
-
Earnings Per Share: SEK4.08 for Q2; SEK8.15 for H1.
-
Adjusted EBITDA Margin: 16.7% or SEK2.9 billion for Q2.
-
Cash Flow from Operating Activities: SEK2.6 billion for Q2.
-
Free Cash Flow: SEK1.9 billion for Q2.
-
Net Debt: Decreased by SEK4.7 billion to SEK11.7 billion.
-
CapEx Guidance: Expected to be SEK2 billion to SEK2.5 billion for the year.
-
Average Tax Rate Guidance: Expected to be 24% to 26%.
Release Date: July 23, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
-
Alfa Laval AB (ALFVF) reported a record order intake for the second quarter, reaching SEK18.9 billion, marking a 3.5% organic growth.
-
The company's balance sheet is in excellent shape, with a strong cash flow and a return on capital employed of 22%.
-
The Marine division experienced strong demand, particularly in the tanker segment, contributing to a solid order book for 2024 and 2025.
-
The Food & Water Division saw improved operating margins and EBITDA due to a recovery in invoicing and solid growth with channel partners.
-
Service growth remains strong, with sequential growth in the Marine and Energy divisions, indicating a robust underlying growth momentum.
Negative Points
-
The Energy division faced weak demand in the high-value segment, particularly in the HVAC/heat pump market, leading to a decrease in order intake.
-
The third quarter is expected to be the bottom of the cycle for brazed heat exchangers, with low volumes and utilization potentially affecting margins.
-
North America showed weaker demand after a long period of strong growth, raising concerns about future performance in the region.
-
The Food & Water Division experienced a decrease in order intake in some product areas, despite improvements in transactional business.
-
There is uncertainty regarding the US market, with potential impacts from tariffs and a slowdown in project decisions affecting future demand.
Q & A Highlights
Q: Is the strong demand in the Marine division driven by speculative preordering, and are lead times expanding? A: Tom Erixon, CEO: We don't see it as speculative preordering. Lead times for ship deliveries are increasing, and we are now placing orders into 2026. There has been some swapping of slots, and we've rushed in a few short-term orders this year. Yard capacity is fully utilized for this year and next, with some expansions expected.