Amplifon (AMP) Q3 2024 earnings summary

Executive summary

• Revenues reached €1,744.8 million in the first nine months of 2024, up 8% at constant FX and 6.1% at current rates, driven by strong organic and M&A growth, especially in Americas and APAC, despite a soft European market.

• Achieved high single-digit revenue growth in Q3 and 9M 2024, outperforming the market despite a challenging comparison base and soft European demand.

• Net profit as reported was €104.2 million, slightly above last year, while recurring net profit declined to €107.4 million due to higher depreciation, amortization, and financial expenses.

• Strategic focus on transforming the U.S. network to direct retail, expanding to 400 stores, and accelerating M&A, especially in France, Germany, U.S., and China.

• Investments in marketing and audiologist capacity in Europe, particularly France, to prepare for expected market normalization and growth in 2025.

Financial highlights

• Q3 2024 revenues were €567.6 million, up 8% at constant FX and 6.8% at current rates; recurring EBITDA €115 million (20.3% margin), down 40bps YoY.

• Nine-month revenues up 6.1% at current FX and 8% at constant FX to €1.75 billion; recurring EBITDA €412.2 million (23.6% margin), up 10bps YoY.

• Q3 recurring net profit was €17.5 million (margin 3.1%), down from €23.5 million, reflecting higher depreciation, amortization, and financial expenses.

• Free cash flow for 9M 2024 was €50.6 million, down from €68.8 million in 2023, impacted by higher lease liabilities, financial expenses, and working capital absorption.

• Net financial debt increased to €1,068.3 million (leverage 1.78x), mainly due to acquisitions and shareholder returns.

Outlook and guidance

• Expects high single-digit revenue growth for full year 2024 at constant FX, with M&A contributing at least 3%.

• Recurring EBITDA margin for 2024 expected broadly in line with 2023, despite lower operating leverage and higher marketing investments.

• Anticipates European market normalization in Q4 and continued US growth; expects to outpace reference market.

• Medium-term outlook remains optimistic for sustainable growth in sales and profitability.

• Anticipates double-digit market growth in France in 2025, with Q2 as the inflection point.