Cavotec

JULY–SEPTEMBER 2024

• Order intake decreased -6.0% to EUR 36.1 million (38.5)
• Revenue increased 5.1% to EUR 44.1 million (42.0)
• EBIT increased 76.3% to EUR 3.0 million (1.7) and the EBIT margin improved to 6.8% (4.1%)
• Net result for the period increased to EUR 1.0 million (0.1)
• Operating cash flow decreased to EUR -1.1 million (4.3)
• Earnings per share, basic and diluted, increased to EUR 0.010 (0.001)

JANUARY–SEPTEMBER 2024

• Order intake decreased -0.3% to EUR 116.3 million (116.7)
• Order backlog decreased -19.1% to EUR 110.4 million (136.5)
• Revenue increased 1.8% to EUR 129.5 million (127.2)
• EBIT improved 129.9% to EUR 7.3 million (3.2) and the EBIT margin increased to 5.6% (2.5%)
• Net result for the period increased to EUR 2.2 million (-2.2)
• Operating cash flow improved to EUR 3.9 million (-3.2)
• Earnings per share, basic and diluted, increased to EUR 0.021 (-0.021)
• Net debt decreased to EUR -15.3 million from EUR -18.6 million at year-end 2023 and the leverage ratio improved to 0.85x from 1.29x

KEY EVENTS DURING THE THIRD QUARTER

• New production facility in India inaugurated.

KEY EVENTS AFTER THE THIRD QUARTER

• Two shore power orders for Mediterranean ports signed, worth a total of EUR 6.5 million.

Comment from the CEO

We see good opportunities to continue growing our business and strengthening profitability

The improved profitability demonstrates that we are on the right track to build a stronger Cavotec. The markets we target are to an increasing extent driven by new regulations in the environmental field and the urgent need to reduce emissions. This, combined with our ability to further enhance our offer, gives us good momentum to continue growing with both new and existing customers.

Revenue increased 5.1% in the quarter to EUR 44.1 million, mainly as a result of a strong quarter for the Industry segment with good sales of radio remote controls and services. We continue to gain positive effects from our ongoing change programs and increased cost control as well as improved purchasing procedures. EBIT increased 76.3% to EUR 3.0 million with an EBIT margin that improved 2.7 percentage points to 6.8%.

A large portion of Cavotec’s business is project-driven and order intake can fluctuate between quarters depending on timing of the order signing. Although order intake declined slightly in the quarter, the underlying market demand for our climate-friendly solutions remains good, driven by the customers’ need to increase efficiency as well as to decarbonise and adapt to new environmental regulations.

Operating cash flow was negative in the quarter, negatively affected by increased working capital. This is due to lower customer pre-payments and increased receivables. The development of our working capital and the further strengthening of our financial position remain key focus areas.

Growing role as system integrator

A key part of our change programs that we initiated in 2022/2023 is the increased focus on our service offering that we developed and adapted to the needs of the market. This has been a successful achievement and we now see that we can take another position in the value chain by increasingly becoming system integrators. In the long term, our growing service business is expected to have a leveling effect on sales development, which today is strongly project-related and can thus fluctuate between quarters.

Our change programs also include an increased focus on innovation and product development. This has led to us identifying product areas where we see exciting potential. One area is radio remote controls, where we have a strong position with, among other, world-leading companies that manufacture heavy duty vehicles. Within all these product areas that we have identified, we see good opportunities to grow with both new and existing customers.

Focus on profitability part of our daily work

One of the most essential elements in our change programs is of course the focus on profitability. We have now steadily improved EBIT for seven quarters in a row and have reported positive net profit for five consecutive quarters. The improvements have so far been successfully driven by the Ports & Maritime segment and there is still a good potential for continued improvements especially within the Industry segment but also for group-wide initiatives. We now have clear plans and projects underway within Industry to improve profitability. Working with profitability is a constant task and today an established part of our daily work and routines.

Good momentum

We see continued good momentum in the organization and a strong drive from all our employees to continue to exceed customers’ expectations. Our internal change work continues as purposefully as before to make Cavotec an even stronger company. That, together with the strong underlying driving forces in our markets, makes me confident in Cavotec's ability to continue to grow and create value.

David Pagels
Chief Executive Officer

Webcasted presentation and telco
CEO David Pagels and CFO Joakim Wahlquist will present the interim report on Friday 8 November at 10:00 am CET. If you wish to participate via webcast, please use the link https://ir.financialhearings.com/cavotec-sa-q3-report-2024. Via the webcast you may submit written questions. If you wish to participate via teleconference, please register on the link https://conference.financialhearings.com/teleconference/?id=50048867. After registration you will be provided phone numbers and a conference ID to access the conference. You can ask questions verbally via the teleconference. The presentation is in English.

Interim reports on cavotec.com
The full report and previous interim and annual reports are available on https://ir.cavotec.com/financial-reports.

Next report
The year-end and fourth quarter report is published 21 February 2025 at 7:00 am CET.