Mildef Group (MILDEF) Q2 2024 earnings summary

Executive summary

• Q2 2024 saw a 43% year-over-year increase in order intake to SEK 407 million, net sales grew 4.4% to SEK 302 million, and gross margin improved to 51.1%, with a record order backlog of SEK 1.45 billion supporting future growth.

• EBITDA margin for Q2 was reported at 17.8%, with adjusted EBITDA of SEK 53.6 million, while operating cash flow reached SEK 20.3 million, marking the third consecutive quarter of positive flow.

• Strategic contracts included SEK 69 million via Handheld, SEK 52 million from BAE Systems Bofors, and a SEK 53 million Estonian defense deal, alongside a UK technology acquisition to expand the product portfolio.

• Investments in expanded integration capacity in Stockholm and new management appointments, including Magnus Hagman as VP Nordics, position the company for future growth.

• Positive operating cash flow and a strong balance sheet provide flexibility for growth and investments.

Financial highlights

• Net sales for Q2 were SEK 302 million, up 4.4% year-over-year, with order intake at SEK 407 million, up 43% year-over-year.

• Q2 adjusted EBITDA was SEK 53.6 million (margin 17.8%), and net profit was SEK 23.3 million.

• Gross margin improved to 51.1% from 50.1% in Q2 2023.

• Operating cash flow for H1 improved to SEK 41.1 million from SEK 24.5 million year-over-year.

• Equity at period end was SEK 840 million, with an equity/assets ratio of 56%.

Outlook and guidance

• Full impact of increased European defense spending is expected from 2025 onward, with long-term demand anticipated to remain strong.

• Focus areas for 2024 include capturing market growth, geographic expansion, timely deliveries, enhanced offerings, and improved cash flow.

• Strategic investments and acquisitions are expected to support long-term growth and market expansion.