ITAB Group (ITAB) Q4 2024 earnings summary

Executive summary

• Net sales grew 7% year-over-year to SEK 6,585 million in 2024, with operating profit (excluding non-recurring items) up 17% to SEK 507 million and an operating margin of 7.7%, in line with long-term targets.

• Completed the transformative acquisition of HMY for MEUR 320 on January 31, 2025, doubling the group’s size and expanding its European footprint, with significant synergies expected.

• Focused on operational efficiency, customer continuity, and integration with HMY, with immediate synergy realization and full effects targeted by 2027.

• No dividend proposed for 2024 to prioritize debt reduction and financial stability post-acquisition.

• Most geographic markets reported growth, especially Northern, Central, and Eastern Europe, while the UK was more challenging and Southern Europe improved towards year-end.

Financial highlights

• Q4 2024 net sales rose 11% year-over-year to SEK 1,771 million, with full-year net sales up 7% and adjusted EBIT margin at 7.7%.

• Q4 adjusted EBIT was SEK 106 million (margin 6%), while Q4 operating profit was SEK 79 million, impacted by SEK -27 million in non-recurring items.

• Operating cash flow for 2024 was SEK 624 million, with a cash conversion rate of 88%.

• Earnings per share for 2024 rose 11% to SEK 1.38; full-year profit after tax increased 10% to SEK 320 million.

• Non-recurring costs of SEK -48 million for the year, mainly related to the HMY acquisition.

Outlook and guidance

• Integration of HMY is expected to deliver MEUR 30 in annual synergies by 2027, enhancing EBITDA margins and profit per share.

• Focus remains on operational efficiency, capital efficiency, and strengthening the order book.

• Market remains cautious, with some regions and sectors more optimistic; discount retailers remain resilient.

• No change to the financial target of a 7%-9% operating margin over the business cycle.

• Q1 2025 will include HMY results from February and March, with more detailed consolidated figures to be provided.