In This Article:
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Total Growth: 12% including a negative currency impact of 3%.
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Organic Sales Growth: 3%.
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EBIT: SEK 1.033 billion, up 30% from last year.
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Gross Margin: 11.4%, compared to 11.3% last year.
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EPS Growth: 17% increase.
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Net Profit: SEK 666 million, up 17% from last year.
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Cash Flow: SEK 1.2 billion in Q3, supported by a release of working capital.
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Operating Cash Flow Year-to-Date: SEK 2.2 billion, SEK 1.5 billion ahead of last year.
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Net Debt: SEK 1.1 billion higher than Q3 last year, driven by acquisition activities.
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Net Debt to EBITDA Ratio: 2.01, stable year-over-year.
Release Date: October 24, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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Beijer Ref AB (FRA:BRZ0) reported a total growth of 12% for the quarter, with organic sales increasing by 3%, despite a negative currency impact of 3%.
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The company achieved a solid margin performance with an 11.4% margin, slightly up from 11.3% last year.
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EPS growth was strong at 17%, indicating robust profitability improvements.
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The acquisition of the J A Group, a market leader in Spain, is expected to bolster the company's market position.
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The company is experiencing double-digit growth in the OEM segment, particularly with natural refrigerants and CO2-based pumps, which are environmentally friendly solutions.
Negative Points
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The company faced a negative currency impact of 3%, which affected overall growth figures.
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Southern Europe, a significant market for Beijer Ref AB (FRA:BRZ0), has been weak this year, impacting regional performance.
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The company had to close several branches in the US due to hurricanes, which negatively affected sales in that region.
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There is continued weakness in larger projects in Asia, particularly driven by a sluggish market in China.
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The company is facing headwinds from currency effects, with a negative impact of 26 million on EBIT compared to last year.
Q & A Highlights
Q: How did the regional closures in the US due to Hurricane Lane impact sales, and what is the outlook for Q4 given recent extreme weather conditions? A: The closures resulted in a loss of about one day's sales, particularly in Tennessee and Alabama. However, this did not significantly impact overall sales in the US, which remained positive. There have been no negative weather impacts observed for Q4, and October has started well with solid volume growth. - Christopher Norbye, CEO
Q: What is the expected organic growth for the HVAC segment in the US, considering regulatory tailwinds and past high peaks? A: The US market remains stable, driven by a strong aftermarket service and replacement model. The transition to A2L refrigerants is expected to impact pricing more in the second half of the year. Interest rate reductions could further boost home sales and renovations, positively affecting HVAC demand. - Christopher Norbye, CEO