Terveystalo (TTALO) Q2 2024 earnings summary

Executive summary

• Achieved the strongest Q2 in company history, with revenue up 5.5% to €340.1 million and record profitability, led by Healthcare Services' topline and margin growth; Swedish turnaround progressing with full impact expected in 2025.

• Portfolio Businesses showed marked improvement in performance measures, though revenue declined; Sweden and Portfolio Businesses faced revenue declines but profit improvement programs are ongoing.

• Customer satisfaction remained high, with NPS for appointments at 86.4, a record high.

• Full-year 2024 guidance was raised, with adjusted EBITA expected at 11.5–12.5% of revenue.

Financial highlights

• Q2 2024 revenue reached €340.1m, up 5.5% year-over-year; adjusted EBITA €42.5m, up 49.1%; EPS €0.11, up 90.8%.

• H1 2024 revenue grew 4% to €690.4m; H1 adjusted EBITA up 38% to €89.7m.

• Operating cash flow for Q2 was €44.4m, up 71.4% year-over-year; cash flow remained strong and efficiently converted from EBITDA.

• Net debt at end of Q2 was €569.8m (down from €601.7m); net debt/adjusted EBITDA at 2.5.

• Adjusted EBITDA/EBITA margin for Q2 was 12.5%, up 3.7 percentage points year-over-year.

Outlook and guidance

• 2024 revenue expected to grow (2023: €1,286m); adjusted EBITA margin guided at 11.5–12.5% (2023: 9.8%).

• Guidance based on assumptions for inflation, consumer demand, employment, and normal morbidity.

• Sweden's turnaround expected in 2025; revenue expected to decline due to macro weakness.

• VAT increase in Finland not expected to significantly impact 2024 results.

• No material acquisitions or divestments included in guidance; further details and new targets to be shared at Capital Markets Day in December.