NewPrinces (NWL) Q2 2024 earnings summary

Executive summary

• Revenue declined 10.4% year-over-year to €370.1M in H1 2024, mainly due to deflation and lower average selling prices across key business units.

• EBITDA rose 2% to €39.3M, with margin improving to 10.6% from 9.3% year-over-year, driven by cost management and better purchasing conditions.

• Net income increased 11% to €10M (adjusted), and free cash flow was strong at €28.5M, with EBITDA to FCF conversion at 74%.

• Net debt (excluding IFRS 16) reduced to €1.5M from €29.5M; including IFRS 16, net debt was €42.6M, down from €74.3M.

• Princes acquisition completed in late July 2024, marking a major expansion phase and immediate focus on integration and synergies.

Financial highlights

• Dairy segment grew 13.4% (driven by volume and price), while pasta, bakery, and special products saw declines.

• EBIT was stable on an adjusted basis, with only a slight decrease year-over-year.

• Free cash flow conversion from EBITDA reached 74%.

• Return on sales, ROI, and ROCE all improved year-over-year.

• Net working capital improved by almost €13M, with NWC at -€37.6M at period end.

Outlook and guidance

• Sales expected to remain stable, with growth from new product launches and synergies from Princes acquisition.

• Margins anticipated to improve further, with EBITDA margin for the rolling 12 months at a record high.

• Second half of 2024 expected to benefit from a less challenging comparison base and increased promotional activity.

• No material cash outflows or seasonality effects expected to impact net debt projections.

• Integration with Princes progressing well, with focus on working capital optimization and procurement synergies.