DKSH (DKSH) H1 2024 earnings summary

Executive summary

• Net sales grew 3.3% at constant exchange rates to CHF 5.4–5.6 billion in H1 2024, despite FX headwinds and a reported decline of 3.2% year-over-year.

• Core EBIT increased by 8.2% at CER to CHF 163.6 million, with margin expanding by 10 bps to 3.0%.

• Free cash flow reached CHF 160.8 million, with a cash conversion rate of 136%.

• Ordinary dividend increased for the 11th consecutive year to CHF 2.25 per share, totaling CHF 146.1 million.

• Continued focus on high-margin business, portfolio expansion, and targeted M&A, with two bolt-on acquisitions completed in H1 2024.

Financial highlights

• Core profit after tax rose 16.7% year-over-year to CHF 118.2 million; profit after tax increased 7.2% to CHF 114.8 million.

• Organic net sales growth was 2.3%, with M&A contributing 1%.

• FX impact on net sales was -6.5%, with some easing expected in H2.

• Net debt reduced to CHF 10.2 million, equity ratio at 32%.

• Cash and cash equivalents decreased to CHF 501.6 million; borrowings reduced to CHF 89.1 million.

Outlook and guidance

• Expects GDP-plus sales growth and core EBIT growth at constant exchange rates for 2024, with further M&A consolidation potential.

• FX headwinds anticipated to ease, with full-year impact of -4% to -5%.

• Tax rate guidance remains at 27%-29%; capex expected at 0.3%-0.4% of net sales.

• No top-up tax exposure expected for 2024 under BEPS Pillar 2.

• Inflation in Asia expected to remain moderate; stimulus in Thailand and China could boost growth.