Bulten (BULTEN) Q2 2024 earnings summary

Executive summary

• Q2 2024 net sales increased by 3.5% year-over-year to SEK 1,466 million, with strong performance in automotive suppliers and other industries, and expansion in Asia and Europe.

• EBIT margin improved to 5.1% (SEK 74 million), up from 3.5% in Q2 2023, though still below Q1 and full-year targets.

• The acquisition and expansion of Exim contributed positively, and TensionCam secured its first business win, supporting technology development.

• Sustainability initiatives advanced through a three-year agreement with FNsteel for scrap-based steel, supporting Scope 3 emission targets.

• A new organizational structure and leadership were implemented to drive efficiency and future growth.

Financial highlights

• Adjusted earnings per share for Q2 were SEK 1.64, down from SEK 1.82 last year; adjusted EPS was SEK 1.64, down from SEK 2.20.

• Cash flow from operating activities in Q2 was SEK 107 million, up from SEK 46 million in Q2 2023.

• Net debt as of June 30, 2024, was SEK 1,338 million, compared to SEK 812 million a year earlier; equity/assets ratio at 39.0% (45.9%).

• Adjusted return on capital employed at 8.4% (R12M: 8.2%).

• Net working capital as a percentage of 12-month sales at 16.3%, below the 20%-25% guideline.

Outlook and guidance

• Market outlook for 2024 is flat, with demand from automotive customers expected to remain good but slightly lower for the rest of the year.

• Focus remains on improving profitability, stabilizing European operations, and enhancing efficiency and productivity.

• Distribution business and new customer groups, including consumer electronics, present significant growth opportunities.