In This Article:
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Revenue Growth: Increased by 5.1% in the third quarter.
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EBIT Growth: Grew by 76.3% over last year.
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EBIT Margin: Improved to 6.8%.
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Net Profit: Reported for the fifth consecutive quarter.
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Order Intake: Decreased by 6% in the quarter.
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Leverage Ratio: Improved to 0.85 from last year's 2.68.
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Ports and Maritime EBITA Margin: 13.2% in the quarter.
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Industry Division Revenue Growth: Increased by 11.6%.
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Cash Flow: Decreased due to increased working capital.
Release Date: November 08, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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Cavotec SA (OSTO:CCC) reported a revenue growth of 5.1% in the third quarter, driven by strong sales in the industry segment.
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The company achieved a positive EBIT for the seventh consecutive quarter, with a significant growth of 76.3% over the previous year.
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Cavotec SA (OSTO:CCC) has a strong market position supported by megatrends and regulations aimed at reducing emissions and noise in critical infrastructures.
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The company has a large installed base in over 80 countries, providing a solid foundation for customer relations and service business growth.
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Cavotec SA (OSTO:CCC) is actively working on strategic change programs and supply chain improvements, which are starting to show positive impacts on profitability.
Negative Points
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Order intake decreased by 6% in the quarter, reflecting fluctuations in project-driven business and timing of order signings.
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The industry segment showed a decrease in EBITA margin, indicating challenges in profitability despite revenue growth.
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Cash flow was negatively affected by increased working capital due to lower prepayments and timing of receivables.
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Lead times for projects in the ports and maritime segment remain long, ranging from 1 to 2 years, which could impact revenue realization.
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The company is still undergoing transformation efforts, indicating ongoing challenges in achieving desired operational efficiency and profitability.
Q & A Highlights
Q: Your order intake was down slightly this quarter, and your order backlog seems to have normalized. When can we expect to see a positive trend in orders? A: We don't speculate on forecasts, but historically, we have strong fourth quarters. Currently, we have high tendering activity and opportunities, particularly in Europe and the UK, driven by regulations and EU funding. I'm confident about the order intake and not worried about the recent decrease. - David Pagels, CEO
Q: Can you give examples of initiatives to enhance profitability in the industry segment? A: We are focusing on precision in tendering, seamless collaboration between sales, engineering, and operations, and applying successful strategies from the ports and maritime segment to the industry segment. We are also focusing on new product development to generate order intake opportunities. - David Pagels, CEO