Railcare Group (RAIL) Q2 2024 earnings summary

Executive summary

• Net sales for Q2 2024 reached SEK 179.8 million, up 24.3% year-over-year, driven by strong performance in Contracting Sweden and Transport Scandinavia.

• Operating profit (EBIT) for Q2 was SEK 15.8 million, a 6.2% increase, with an operating margin of 8.8% due to lower UK volumes.

• Major reballasting project near Västerås completed, supporting future track replacements.

• Railcare acquired 40% of AC Finance AB, securing access to new environmentally friendly locomotives.

Financial highlights

• Q2 net sales: SEK 179.8 million (144.7), up 24.3% year-over-year; H1 net sales: SEK 309.2 million (255.7), up 20.9%.

• Q2 EBIT: SEK 15.8 million (14.9); H1 EBIT: SEK 29.6 million (28.0).

• Q2 profit: SEK 9.9 million (10.0); H1 profit: SEK 18.9 million (18.7).

• Earnings per share Q2: SEK 0.41 (0.41); H1: SEK 0.78 (0.77).

• Operating margin Q2: 8.8% (10.3%); H1: 9.6% (11.0%).

Outlook and guidance

• Demand for services in Sweden remains strong, with increased maintenance needs and a focus on efficiency.

• UK market faces uncertainty due to flat funding and inflation, likely reducing maintenance volumes.

• Financial targets: SEK 1,000 million net sales and 13% operating margin by 2027.