JM (JM) Q2 2024 earnings summary

Executive summary

• Revenue and operating profit declined year-over-year, with H1 2024 revenue at SEK 6,617m (7,598) and operating profit at SEK 329m (676); EPS was SEK 2.40 (7.50).

• Sales and housing starts increased, especially in Sweden and Finland, with 1,555 units sold (842) and 867 housing starts (668), but units in current production fell to 4,914 (6,657).

• Q2 2024 saw improved sales and cash flow, particularly in Sweden, despite a cautious market and ongoing margin pressure from low production, price reductions, and high costs.

• Market conditions remain cautious with high supply and limited consumer buying power, though expectations of interest rate cuts are supporting gradual improvement.

• Sustainability efforts were recognized, including emission reductions and inclusion in the Financial Times' list of top performers.

Financial highlights

• Cash flow from operations improved to SEK -285m (-351) for H1 and SEK 663m (-1,143) for Q2.

• Return on equity dropped to 1.1% (16.4) year-over-year.

• According to IFRS, H1 revenue was SEK 7,432m (8,071) and EPS SEK 3.30 (10.80).

• Equity/assets ratio was 55% (53%), with available liquidity of SEK 3,267m and cash of SEK 417m.

• Interest-bearing net liabilities increased to SEK 2,151m (1,498).

Outlook and guidance

• Market recovery is expected to be gradual, with further improvement tied to additional interest rate cuts and increased consumer buying power.

• Price increases in existing home markets are anticipated to continue in H2 2024, but new production remains exposed to consumer financial strain.

• Customer willingness to sign early contracts has slightly increased in Stockholm.

• The company is adapting to prevailing market conditions and maintains a well-balanced risk profile.