Talgo (TLGO) Q3 2024 earnings summary

Executive summary

• Magyar Vagon's takeover bid for 100% of shares was rejected by the Spanish Government; SIDENOR is now considering an acquisition.

• Delivery of 23 Renfe VHS trains began in April 2024, supporting revenue growth alongside maintenance projects.

• Commercial momentum is strong, improving Talgo's positioning in key European rail markets.

Financial highlights

• Revenues for 9M-2024 reached €497.8m, up from €470.3m in 9M-2023, driven by manufacturing for DB and DSB.

• EBITDA for 9M-2024 was €57.7m (11.6% margin), down from €62.6m (13.3%) in 9M-2023.

• Net income for 9M-2024 was €6.7m, impacted by high financial expenses.

• Order backlog at Q3-2024 stood at €4.0bn, with €228m in new orders during the period.

• Book-to-bill ratio for 9M-2024 was 0.7x.

Outlook and guidance

• Revenue guidance for FY-2024 slightly adjusted to reflect manufacturing cycles; activity expected to remain high.

• EBITDA margin for FY-2024 expected at approximately 11.5%.

• Net Financial Debt to EBITDA expected to peak at 4.0-5.0x in FY-2024, then stabilize below 3.5x in FY-2025.

• Dividend payment for 2024 is pending definition.