In This Article:
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Gross Margin: 24%, a significant improvement from the first half.
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EBIT: DKK50 million, marking the strongest delivery after seven quarters.
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Volume Growth: 5%, mainly from Poland and the UK.
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Revenue Growth (UK): 4% in the last quarter.
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Revenue Growth (Poland): 29% quarter-on-quarter.
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Revenue Decline (Germany): 9% negative revenue development.
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SG&A Cost Savings: DKK100 million, mainly realized this year.
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Project One Cost Savings: Expected DKK50 million in SG&A savings by 2025.
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Special Items: DKK8 million recognized in Q3 for restructuring; expected DKK40 million in Q4.
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Sale of Warsaw Plant: Cash equivalent of DKK190 million, expected gain of DKK160 million in Q4.
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Gearing: Reduced to 4.4 times, expected to decrease to around 3 times EBITDA by year-end.
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Financial Outlook: EBIT before special items adjusted to DKK50 million to DKK80 million.
Release Date: November 20, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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H+H International AS (FRA:J0H) reported a significant improvement in gross margin to 24%, showcasing the underlying performance after restructuring.
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The company achieved its strongest EBIT delivery in seven quarters, reaching DKK50 million, indicating a positive turnaround.
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Volume growth of 5% was observed, primarily driven by increased building activities in Poland and the UK.
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The reopening of the mothballed plant in Pollington is expected to meet rising demand, contributing to operational efficiency.
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The sale of the Warsaw plant generated DKK190 million, improving financial gearing and supporting future EBITDA growth.
Negative Points
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Revenue in the CWE region, particularly Germany, declined by 9% due to high construction costs and regulatory challenges.
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Germany's recession and declining building permits are negatively impacting market activity and consumer confidence.
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The company's guidance for EBIT before special items was adjusted downwards to DKK50 million to DKK80 million, reflecting market uncertainties.
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Project One restructuring costs increased by DKK20 million due to further adjustments needed in the German market.
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The company's reliance on favorable seasonal conditions and production ramp-up to achieve upper-end guidance poses a risk if conditions change.
Q & A Highlights
Q: Can you quantify the negative impact from Borough Green and destocking on the gross margin? A: Bjarne Pedersen, CFO, explained that the impact was minor, affecting both top line and costs. The total effect bridges the gross margin from 24% to the 25% target despite market conditions.