Metair Investments (MTA) H2 2024 earnings summary

Executive summary

• Navigated a challenging year marked by external pressures on OEM production, increased imports, port infrastructure issues, and hyperinflation in Turkey impacting Mutlu.

• Successfully exited Mutlu, reducing exposure to high-risk environments and improving the debt profile.

• Acquired AutoZone, shifting strategic focus toward aftermarket sales and reducing reliance on OEMs.

• Achieved a turnaround at Hesto, moving from a significant loss to profitability.

• Strengthened management team, shifting from a holding to an operating company structure with new verticals focused on manufacturing and aftermarket parts.

Financial highlights

• Revenue from continuing operations declined 2% year-over-year to ZAR 11.8 billion.

• EBITDA decreased 8% to ZAR 844 million, impacted by ZAR 41 million in restructuring costs.

• EBIT from continuing operations rose 28% to ZAR 603 million, but operational EBIT (excluding capital items) fell 20% to ZAR 504 million.

• Net profit from continuing operations was ZAR 282 million, up from ZAR 55 million in the prior year.

• Headline earnings per share declined to ZAR 0.89.

• Free cash flow improved to ZAR 776 million from ZAR 306 million.

• Net asset value per share dropped to ZAR 13.88, mainly due to the Mutlu loss.

Outlook and guidance

• No major volume increases expected from automotive OEM customers over the next two years; budgeting is based on 2022 levels with some upside.

• Aftermarket segment, especially AutoZone, is expected to drive growth and risk diversification.

• AutoZone is on track for recovery, with expectations to exceed breakeven in 2025.

• Focus remains on cost reduction, operational resizing, and maximizing free cash flow and EBITDA.

• Sub-Saharan Africa expansion is a strategic priority, leveraging battery and aftermarket businesses.