Husqvarna (HUSQ) Q2 2024 earnings summary

Executive summary

• Organic sales declined by 6% in Q2 2024, mainly due to weak macroeconomic conditions, cautious consumer spending, and unfavorable weather, especially impacting Gardena's Watering business and North American Construction sales.

• Strong growth achieved in professional robotic lawnmowers, battery-driven consumer products, and parts and accessories, with professional robotics driven by CEORA and new boundary wire-free models.

• Stable gross margin maintained, supported by cost savings, product mix improvements, and planned exits from low-margin petrol products.

• Cash flow remained strong, driven by a continued reduction in inventory levels, down SEK 3.2 billion (18%) year-over-year.

• Ongoing investments and strategic focus on robotics, battery, pro solutions, and Watering, with accelerated cost-saving initiatives.

Financial highlights

• Net sales in Q2 2024 were SEK 15,430m, down 6% organically and 9% reported year-over-year; operating income was SEK 1,906m (12.4% margin), down from SEK 2,313m.

• Direct operating cash flow reached SEK 3,917m in Q2, supported by lower inventory levels.

• Cost savings of SEK 215m in Q2 and SEK 400m year-to-date.

• Robotics and battery products accounted for 20% of group sales on a 12-month rolling basis.

• Electrified motorized products now represent 44% of the total motorized range.

Outlook and guidance

• Continued focus on cost savings and operational efficiency, with further acceleration of the cost savings program to mitigate ongoing weak market dynamics.

• No dramatic change in price development expected; promotional activities and campaigns to continue in H2 to stimulate sales.

• Inventory levels in trade are normal to slightly above average; further inventory reduction planned.

• Macroeconomic and consumer sentiment expected to remain unchanged in the short term; improved weather could support sales in Q3, but outlook remains cautious.

• Solid product pipeline for 2025, especially in robotics and battery-powered products.