Albany International (AIN) Q2 2024 earnings summary

Executive summary

• Q2 2024 revenue rose 21.1% year-over-year to $332 million, driven by the Heimbach acquisition and growth in Engineered Composites, though organic Machine Clothing sales declined.

• Net income attributable to the company was $24.6 million ($0.79 per share), down from $26.7 million ($0.85 per share) in Q2 2023; adjusted diluted EPS was $0.89, flat year-over-year.

• Operating income declined to $42.9 million from $45.5 million year-over-year, with margin compression in both segments due to higher SG&A and restructuring expenses.

• Integration of Heimbach is progressing, with SAP transition completed in July and contributing to revenue growth and margin expansion.

Financial highlights

• Q2 2024 net revenues: $332 million (+21.1% YoY); gross profit: $112.4 million (33.9% margin); operating income: $42.9 million (12.9% margin).

• Machine Clothing Q2 revenues up 21.6% to $194 million, driven by Heimbach; organic MC sales declined.

• Engineered Composites Q2 revenues up 20.5% to $138 million, led by CH-53K, 787, and space programs.

• Adjusted EBITDA was $63.1 million, down from $65 million last year; margin decreased to 19.0% from 23.7%.

• Cash from operations for six months: $93 million; cash and equivalents at June 30, 2024: $116.4 million.

Outlook and guidance

• Full-year 2024 revenue guidance reaffirmed at $1.26–$1.33 billion; adjusted diluted EPS expected between $3.55 and $4.05.

• Machine Clothing outlook ranges from softness in Europe/Asia to improved conditions and synergy realization.

• AEC guidance reflects potential further reductions in LEAP production and 787 rates, but also upside from new program ramps and $900M+ in new contracts.

• Margin improvement in AEC expected in the second half due to operational improvements, program mix, and restructuring.

• Management expects additional restructuring expenses in MC for the remainder of 2024.