Agfa-Gevaert (AGFB) Q3 2024 earnings summary

Executive summary

• Q3 2024 sales were €277 million, down 1.2% year-over-year, with adjusted EBITDA at €15 million, down 10.8% from Q3 2023; DPC delivered double-digit growth and became the main profitability driver, while Healthcare IT saw a 23% rise in order intake, especially for cloud contracts.

• Radiology Solutions faced an accelerated market decline, especially in medical film and China, prompting a major transformation program with significant workforce reductions in Belgium and a global restructuring effort.

• A €50 million cost savings program is being prepared to address the decline in film-related business, with savings expected to start in H2 2025 and full impact by 2027.

• Group sales remained stable year-over-year, with DPC up double digits, Radiology down double digits, and Healthcare IT slightly eroded.

• Net loss for Q3 2024 was €13 million, compared to €15 million in Q3 2023; 9M 2024 net loss was €29 million, a significant improvement from €96 million in 9M 2023.

Financial highlights

• Q3 2024 sales: €277m (-1.2% year-over-year); adjusted EBITDA: €15m (-10.8% year-over-year); adjusted EBIT: €4m (-27.1% year-over-year).

• Gross profit margin for Q3 2024 was 29.5%, down from 30.5% in Q3 2023; gross profit was €82m, down from €86m.

• Net result for Q3 2024 was a loss of €13m, compared to a €15m loss in Q3 2023.

• Q3 free cash flow was negative €6 million, impacted by working capital and higher CapEx for the green membrane plant; 9M 2024 free cash flow was (€81m), unchanged from 9M 2023.

• Net debt increased to €118m at the end of Q3 2024, up from €33m a year earlier.

Outlook and guidance

• Q4 is expected to be the strongest quarter, with DPC and Healthcare IT maintaining momentum; no short-term improvement anticipated for Radiology, with benefits from restructuring expected mainly in 2025 and beyond.

• Working capital is projected to return to normal by year-end, mirroring last year's pattern.

• Guidance for Healthcare IT revised to be roughly in line with prior year, reflecting faster-than-expected cloud transition and its short-term impact; order intake growth slightly above 20%.

• Digital Print & Chemicals anticipates significant top-line and profitability growth, while no improvement is expected for Radiology Solutions versus Q3 2024.

• The €50m cost reduction program for film-related activities is on track, with first savings in H2 2025 and full impact by 2027.