Release Date: September 05, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Quest Holdings SA (FRA:9IVA, Financial) reported a robust second quarter, recovering from a weak first quarter.
- Total revenues for the first half of 2024 reached EUR620 million, a 14% increase compared to 2023.
- EBITDA for the first half of 2024 amounted to EUR41.6 million, a 6.7% increase year-over-year.
- The IT services sector saw a 17% increase in sales and a 7.5% growth in EBT.
- Quest Holdings SA (FRA:9IVA) has a strong cash position with over EUR300 million in cash and available credit lines, allowing for continued growth investments.
Negative Points
- Lower gross margins on Apple products due to a new wholesaling distribution agreement negatively impacted EBITDA and EBIT.
- The absence of last year's government support for Clima devices affected earnings.
- Increased depreciation and higher Euribor rates led to higher working capital needs, particularly for Info Quest Greece and Romania.
- Net debt increased to EUR28.2 million compared to EUR17 million at the end of 2023.
- The commercial activity segment saw an 8% decrease in EBT year-over-year, mainly due to increased interest rates, lower margins, and higher depreciations.
Q & A Highlights
Q: How did the summer sales perform in various commercial sectors like technology, and what drove the Q2 EBITDA margin improvement in commercial activities?
A: Summer sales were not booming but showed better trends compared to the beginning of the year, outperforming the market. The Q2 EBITDA margin improvement was driven by better-than-expected performance despite lower margins from Apple products and the absence of government subsidies for Clima devices.
Q: Can you elaborate on the lower margin for Uni Systems in Q2 despite strong top-line performance?
A: The lower margin was due to the nature of projects executed this year, which included a significant portion of hardware with lower gross margins. This was not related to the renewal of major contracts.
Q: What caused the extraordinary EBITDA margin for ACS in Q2, and can this be expected to continue?
A: The superior EBITDA margin was due to improved sales, including a boost from election-related projects. ACS's heavy investment in infrastructure allows for better cost efficiency, and future e-commerce growth could further improve margins.
Q: With your expansion plans in Romania, should we expect higher working capital needs and net debt levels for the full year?
A: Yes, net debt is expected to be higher than 2023, likely in the range of EUR40 million to EUR50 million, due to increased business activity and investments.
Q: Will the higher net debt levels affect your dividend policy?
A: It's too early to provide a solid answer, but we don't anticipate it affecting the dividend policy significantly.
Q: Are there any plans for further solar project acquisitions to increase your capacity beyond 40 megawatts?
A: Currently, we are cautious about new investments in the energy sector due to delays in grid connections. We will maintain our 40 megawatts capacity for now.
Q: Can you provide more details on the expected CapEx of EUR25 million to EUR30 million for the second half of the year?
A: The CapEx is mainly driven by ACS and includes placeholders for potential small-sized buyouts. This estimate is for the whole year, including the EUR12 million already spent in the first half.
Q: How do you see the margins for the Clima sector evolving?
A: We expect margins to improve gradually as we move forward, with the Clima sector developing at a fast pace, particularly for the Gree company.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
