Prodways Group (PWG) H1 2024 earnings summary

Executive summary

• Revenue for H1 2024 was €31.1M, down 28% year-over-year, mainly due to changes in accounting, business disposals, and the cessation of the jewellery activity.

• EBITDA margin improved by 4 points sequentially from H2 2023, reaching 8% in H1 2024, though EBITDA was €2.5M, down 47% year-over-year.

• Net income was €1.3M, down from €3.5M in H1 2023, but positive despite lower revenues and profitability challenges in the Products division.

• Positive operational cash flow of €2.5M was maintained, with cash available at €13M and net debt at €3.8M at June-end.

• Measures included ceasing the small jewelry printer activity, selling the Cristal dental lab, and staff reductions to focus on profitable activities.

Financial highlights

• Revenue declined by €12M year-over-year, with €6.3M due to IFRS 15 reclassification and €4.3M to business disposals.

• EBITDA margin was 8% for H1 2024, up 4 points from H2 2023 but down from 11% in H1 2023.

• Operating income was €1.2M, down 76% year-over-year.

• CapEx was limited to €600,000 for the semester.

• Working capital requirements increased by €1.4M due to Software seasonality.

Outlook and guidance

• Revenue growth of +1% to +5% on a comparable basis and higher EBITDA margin targeted for 2024, with stronger results expected in H2.

• Cost reduction plan of €4–5M over 2024–2025 is on track, with savings split roughly equally between the two years.

• Headcount reduced by about 100 since end of 2023, expected to improve EBITDA margin by €3M annually.