Release Date: August 09, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- CTEK AB (OSTO:CTEK, Financial) reported organic growth of 6% for the first time in 1.5 years.
- The company increased its EBITDA margin by 5.7 percentage points to 7.1%.
- The consumer division experienced a strong growth of 26%, driven by focused sales activities and successful product launches like the CS1 in Australia.
- CTEK AB (OSTO:CTEK) has reduced its net debt ratio to 2 times, down from 3.4 times the previous year.
- The company has successfully launched the CC3 EVSE charger in the UK, receiving positive feedback from customers.
Negative Points
- The EVSE segment in North America is still at very low levels despite slight positive trends.
- The professional division experienced lower volumes, particularly from a major North American customer.
- There is uncertainty in the European market due to interest levels affecting new building projects.
- CTEK AB (OSTO:CTEK) is not providing guidance for future quarters due to market turbulence.
- The company needs to continue focusing on increasing sales and market penetration in various countries.
Q & A Highlights
Q: What are the implications of the reduced R&D spending on new product launches, and is it necessary to launch new products in low voltage and EVSE by 2025?
A: Henrik Fagrenius, President and CEO, explained that the reduction in R&D spending is due to the completion of the CC3 development, which involved external consultants. The company remains committed to innovation and plans to focus more on low voltage development while building up the sales organization.
Q: Is the increased focus on the sales organization within the consumer division aimed at low voltage or both low voltage and EVSE?
A: The consumer division sells both low voltage and EVSE products, but mainly low voltage. The focus is on building the consumer division's sales organization to penetrate more countries, while the EVSE segment for parking operators is already appropriately sized for growth.
Q: Can you provide more details on the strong sales in low voltage, particularly the CS1 in Australia, and whether this trend will continue into Q3?
A: The strong sales trend in low voltage is due to capturing market share and launching new products. While the market itself isn't growing significantly, CTEK is expanding its presence in Europe and globally. The company is working to continue this trend but does not provide specific guidance due to market volatility.
Q: What are the positive trends in EVSE sales in North America and the Nordics, and what drives these trends?
A: In North America, there is a slight uptick from previous weak quarters, though from low levels. In the Nordics and Europe, there is increased market activity despite uncertainties. The positive reception of the CC3 units in the UK is also contributing to these trends.
Q: How do you plan to manage overhead costs, and what is the outlook for R&D expenses following the development of the CC3?
A: Thom Mathisen, CFO, stated that the company has reduced OpEx and plans to maintain stable cost levels while growing the top line. R&D costs will decrease as the CC3 development concludes, with a focus on creating positive cash flow and reducing net cash outflows.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
