HANZA (HANZA) Q3 2024 earnings summary

Executive summary

• Achieved 16% year-over-year net sales growth in Q3 2024 to SEK 1,107 million, mainly from acquisitions, while organic sales declined 4% due to weaker demand.

• Completed a nine-month action program focused on integration, cost control, and operational improvements, including the integration of Orbit One and cost-saving measures.

• Business model centers on manufacturing clusters and advisory (MIG) services, supporting customer supply chain optimization and product development.

• Customer base diversified across evergreen sectors and no single customer exceeds 10% of sales, avoiding low-margin and trend-driven segments.

• Average number of employees in Q3 was 2,238.

Financial highlights

• Q3 net sales: SEK 1,107 million (up 16% year-over-year); organic sales declined 4% after adjusting for currency and acquisitions.

• Q3 operating profit (EBITA): SEK 82 million (margin 7.4%); adjusted EBITA: SEK 74 million (margin 6.7%).

• Rolling twelve-month sales reached SEK 4.6 billion.

• Earnings per share at 0.88, down from 1.21 a year ago; Q3 EPS before dilution was 0.91.

• Positive cash flow of SEK 114 million in Q3, driven by reduced working capital and lower CapEx.

Outlook and guidance

• Financial targets for 2025 remain unchanged: sales target of SEK 6.5 billion and operating margin target of 8%.

• Confident in reaching 8% operating margin in 2025, even without an economic upturn, supported by integration of Orbit One and operational improvements.

• Management expects demand to remain at current levels through 2024, with potential recovery in 2025.

• Margin target seen as more controllable than sales target, which depends on successful expansion.

• No revision to 2025 financial targets anticipated at this stage.