Matrix IT (MTRX) Q2 2024 earnings summary

Executive summary

• Achieved record organic growth in sales, gross profit, operating profit, EBITDA, and net income in Q2 and H1 2024, despite ongoing war and global economic challenges.

• Maintained market leadership for 19 years, with strong visibility from mega-projects and technology leadership across key categories.

• US operations expected to return to growth in upcoming quarters following completion of large projects and new contract wins.

• Plans to close several M&A deals in 2024 to accelerate growth and expand value offerings.

• Continued strong cash flow from operations and quarterly dividend distributions.

Financial highlights

• H1 2024 sales reached NIS 2.78 billion, up 8.1% year-over-year; Q2 sales were NIS 1.33 billion, up 3.6%.

• H1 2024 gross profit was NIS 408.9 million (14.7% margin), up 9.4%; Q2 gross profit was NIS 201.8 million (15.1% margin), up 9%.

• H1 2024 operating profit grew 11.5% to NIS 221.9 million (8% margin); Q2 operating profit up 13.9% to NIS 111.3 million (8.3% margin).

• H1 2024 net income rose 12.8% to NIS 144.5 million (5.2% margin); Q2 net income up 16.4% to NIS 73.1 million (5.5% margin).

• Adjusted EBITDA for H1 2024 was NIS 249 million (8.9% margin), up 8.1%; Q2 2024 up 8.5% to NIS 125 million.

Outlook and guidance

• Growth in sales and profits expected to continue, with new US contracts and M&A activity anticipated to drive further expansion.

• Management notes significant uncertainty due to ongoing war and potential escalation.