Dr. Hönle (HNL) Q3 2024 earnings summary

Executive summary

• Revenue for the first nine months fell 9.6% year-over-year to €72.1 million, mainly due to weak demand in machinery and equipment manufacturing, especially in printing applications.

• Operating loss (EBIT) improved significantly to €0.1 million from a €6.8 million loss in the prior year, which was impacted by non-recurring effects from discontinued product lines.

• Consolidated net loss narrowed to €0.95 million from €6.5 million year-over-year, with EPS improving to -€0.17 from -€1.09.

Financial highlights

• Gross profit increased 17.3% year-over-year to €45.5 million, reflecting normalization of cost of materials after prior-year write-offs.

• Personnel expenses ratio rose to 41.4% (PY: 36.7%) due to lower revenues.

• Net cash from operating activities rose sharply to €2.65 million from €0.97 million year-over-year.

• Cash and cash equivalents declined by €2.62 million in the period.

Outlook and guidance

• Management expects revenue of approximately €100 million and a positive operating profit (EBIT) for the full year 2023/24.

• Anticipates growth in adhesives for electronics packaging and medical technology, and expects profits in the Adhesives segment to increase disproportionately in coming years.

• Revenue and earnings are also expected to rise in the Glass & Lamps segment.