SPIE (SPIE) Q2 2024 earnings summary

Executive summary

• Achieved record H1 2024 revenue of €4,705 million, up 14.4% year-over-year, with 5.8% organic growth and 8.3% from acquisitions, notably in Germany.

• EBITA/EBITDA rose 20.7% to €266 million, with margin up 30 bps to 5.6% of revenue, and all segments improved margins.

• Germany became the largest contributor by revenue and EBITA, reflecting strong organic growth and successful M&A.

• Robust M&A activity included four acquisitions in Germany and one in France, expanding presence in telecom, energy, and nuclear sectors.

• MSCI ESG rating upgraded to A, reflecting progress in decarbonization, governance, and sustainability.

Financial highlights

• Adjusted net income increased 28.9% to €158 million; reported net income was €57 million, impacted by non-cash items.

• Free cash flow improved by nearly €100 million year-over-year, with H1 2024 at -€211 million due to high acquisition spend and working capital seasonality.

• Leverage ratio (excl. IFRS 16) rose slightly to 2.4x, reflecting self-financed M&A activity.

• 77% of debt at fixed rate, with no major maturities before June 2026 and a stable weighted cost of 3.4%.

• Liquidity above €1 billion, including €346 million cash and €700 million undrawn RCF, with RCF extended to 2029.

Outlook and guidance

• 2024 EBITA/EBITDA margin guidance raised to at least 7% of revenue, a minimum 30 bps improvement over 2023.

• Organic growth expected to remain positive in H2, but at a slower pace than H1.

• Dynamic bolt-on M&A strategy to continue, with focus on disciplined integration and financial leverage.

• Dividend payout policy maintained at approximately 40% of adjusted net income.