Genomma Lab Internacional (LABB) Q4 2024 earnings summary

Executive summary

• Net sales grew 32.4% in Q4 and 13% for the full year 2024, with strong performance in Mexico, Argentina, Brazil, the U.S., Colombia, and Central America, aided by favorable FX and a recovery in Argentina.

• EBITDA margin expanded to 24% in Q4 and 23.3% for the year, with EBITDA up 55% in Q4 and 26% for the year, driven by productivity gains and cost containment.

• Net income for 2024 was MXN 2.137 billion, a 97% increase year-over-year, with EPS doubling to MXN 2.14, supported by a 20 million share cancellation.

• 68% of sales maintained or gained market share, and 85% of sales outpaced inflation.

• Free cash flow hit a record MXN 2.793 billion, up 35% year-over-year, converting 15% of net sales into cash.

Financial highlights

• Consolidated net sales for 2024 reached MXN 18.607 billion, up 13% year-over-year; Q4 net sales were MXN 4.666 billion, up 32%.

• Q4 EBITDA was MXN 1.122 billion (+55% YoY, margin 24%); FY EBITDA was MXN 4.330 billion (+25.7% YoY, margin 23.3%).

• Q4 net income was MXN 473.5 million; FY net income was MXN 2.137 billion (+97% YoY).

• EPS doubled to MXN 2.14, supported by higher income and a 20 million share cancellation.

• Free cash flow for FY 2024: MXN 2.793 billion (+35.5% YoY), converting 15% of net sales into cash.

Outlook and guidance

• Expectation to sustain an average 24% EBITDA margin, with a range of 24%-25% by year-end.

• Plans to reinvest productivity savings to strengthen core brands and pursue a cost savings target of MXN 1.8 billion by 2027.

• Suerox inventories expected to decrease after temporary build-up for high season.

• Continued quarterly dividend payments intended.

• Reinvestment of excess margin from productivity gains will not affect margin targets.