Humana (HUM) Q3 2024 earnings summary

Executive summary

• Achieved record-high adjusted operating profit of SEK 203 million in Q3 2024, up 16% year-over-year, driven by acquisitions, operational improvements, and contributions from all countries.

• Integration of Team Olivia in Norway is progressing as planned, nearly doubling turnover and significantly contributing to revenue and EBIT.

• Stable performance in Finland, with strong demand in child and youth services and persons with disabilities, despite declining demand in Open Care.

• Positive regulatory developments in Sweden for Personal Assistance, including a proposed 3% price adjustment and potential for wage-related indexation, though the market remains stagnant.

• Focus on consolidation, efficiency, and cost control across the group, with internal governance enhancements and a CEO transition in July.

Financial highlights

• Q3 2024 net revenue reached SEK 2,666 million, up 11% year-over-year, with LTM revenue surpassing SEK 10 billion for the first time.

• Adjusted EBIT of SEK 203 million, up 16% from last year, with a 7.6% margin.

• Organic growth was 1.5% overall, or 5.7% excluding Personal Assistance; organic growth in Norway reached 12%.

• Leverage ratio improved to 3.4x adjusted EBITDA (excl. IFRS 16), and net debt reduced by 4% year-over-year despite acquisitions.

• Operating cash flow in Q3 was SEK 252 million, benefiting from strong EBITDA and significant CapEx in Elderly Care real estate.

Outlook and guidance

• Continued focus on Team Olivia integration, consolidation, cost control, and internal governance expected to yield further improvements.

• Stable margins anticipated in Finland, with growth in target areas offsetting declines in Open Care; divestment of Elderly Care in Finland expected by year-end.

• Ongoing optimisation of service mix and specialisation strategy, with updates and full-year synergies from Team Olivia expected in 2025.

• Expectation of improved conditions in Swedish Personal Assistance with proposed reimbursement increases and potential indexation.