Amotiv (AOV) H2 2024 earnings summary

Executive summary

• Results for the period were in line with expectations and guidance, driven by diversified earnings, organic growth, and acquisitions, with all segments performing as expected.

• Transitioned to a pure automotive play after the sale of Davey, now diversified across resilient, largely ICE-agnostic, non-discretionary revenue streams.

• Gross margin expanded to 44.1%, reflecting strong execution and margin management.

• Ongoing debt reduction and strong cash conversion have strengthened the balance sheet.

• Strategic initiatives advanced, including greenfield expansion in South Africa, new product development, and sustainability actions.

Financial highlights

• Group revenue grew 8.6% for the half and 7.7% for FY24, with underlying EBITDA up 11.6% and EBITA up 5.0% compared to PCP.

• APG EBITDA rose 28.85% to $32.3 million, and underlying NPATA grew 10.5% year-over-year.

• Interim dividend of $18.5 per share, up 8.8% on PCP; full year dividend increased 3.8% to 40.5c.

• Cash conversion reached 93.5% for the half and 92.9% for the year.

• Net debt reduced to $329.4m, with leverage at 1.6x, at the bottom end of the target range.

Outlook and guidance

• Further growth in group revenue and underlying EBITA expected in FY25, with robust market conditions and aging car park supporting demand.

• APG expects H2 EBITDA slightly below H1 due to Toyota production disruptions, but normalization and growth anticipated into FY25.

• FY25 capex expected to be ~$25m; cash conversion forecast at ~85%.

• Price increases and FX hedging expected to support margins in H2.

• No formal guidance provided due to ongoing market volatility; trading update to be given at Q4 Investor Day.