Release Date: July 23, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Global Dominion Access SA (XMAD:DOM, Financial) reported a 5% organic increase in income, demonstrating positive business momentum.
- The company achieved a high operating profitability level, with a 14.9% margin on sales.
- The services segment showed strong performance, contributing 71% to turnover and 62% to the contribution margin.
- The company is optimistic about the second half of the year, expecting significant portfolio growth in renewable projects.
- Strategic focus on more profitable activities has resulted in consistent contribution margins above 12% for three consecutive quarters.
Negative Points
- The company faced challenges in the first half of 2024, with temporary decoupling in operations affecting financial results.
- There was a significant increase in financial expenses, over EUR6.5 million, due to interest rate hikes and payment commitments.
- The 360 project segment experienced a slowdown in activity compared to previous quarters.
- Net debt increased significantly in the first half of the year, raising concerns about financial stability.
- The company is under pressure to meet its strategic plan targets amidst a more demanding market environment.
Q & A Highlights
Q: What kind of growth is expected in the second half of the year, and how does it relate to the strategic plan for 2024-2026?
A: Unidentified Company Representative_2: We expect a significant increase in the project portfolio in the second half, particularly in renewables and projects funded by agencies. We are optimistic about achieving the strategic plan's targets, including a 5% organic growth, despite temporary slowdowns in some projects.
Q: Are the expected divestments planned for the second half of 2024 or 2025, and what is the visibility on net debt by the end of the year?
A: Unidentified Company Representative_2: Divestments are expected in the second half of 2024, particularly in the Dominican Republic. We anticipate a significant contribution to operating cash flow, which should improve the net debt situation by year-end.
Q: Can you provide more details on the CapEx for the year and whether the growth CapEx will continue in the second half?
A: Unidentified Company Representative_1: The growth CapEx of EUR20 million in the first half is expected to be extrapolated for the entire year. We maintain a disciplined approach to CapEx, focusing on strategic investments.
Q: Is there any update on finding an industrial partner in Europe, and could there be different partners for different countries?
A: Unidentified Company Representative_1: We are exploring options for a partner specifically for the Italian portfolio, with three potential candidates. A bilateral focus might be more feasible than a single global partner for all European operations.
Q: Are the forecasts for the 2024-2026 plan maintained despite the challenges in the first half of 2024?
A: Unidentified Company Representative_1: Yes, the forecasts remain steady. We are confident in achieving the goals set for 2024 and beyond, despite the demanding first half.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
