• SYENSQO - Second Quarter 2024 Results

    المصدر: Nasdaq GlobeNewswire / 01 أغسطس 2024 00:00:00   America/Chicago

    SYENSQO SECOND QUARTER 2024 RESULTS

    Brussels, Belgium – August 1, 2024 - 7:00AM CEST

    CONTINUED IMPROVEMENT IN YEAR-ON-YEAR VOLUME MOMENTUM 
    UNDERLYING EBITDA OF €378 MILLION IN LINE WITH EXPECTATIONS, WITH STRONG CASH CONVERSION
    FULL YEAR 2024 OUTLOOK RANGE NARROWED

    Underlying (€ million) Q2 2024 Q2 2023 Q1 2024 YoY change YoY organic QoQ change   H1 2024 H1 2023 YoY change YoY organic
    Net sales 1,708 1,815 1,624 -5.9% -5.1% 5.2%   3,332 3,628 -8.1% -6.7%
    Gross profit 582 635 583 -8.3% - -0.2%   1,165 1,298 -10.2% -
    Gross profit margin 34.1% 35.0% 35.9% -90 bps - -180 bps   35.0% 35.8% -80 bps -
    EBITDA 378 433 363 -12.8% -10.9% 4.1%   740 906 -18.3% -15.8%
    EBITDA margin 22.1% 23.8% 22.3% -170 bps - -20 bps   22.2% 25.0% -280 bps -
    Operating cash flow 43 245 244 -82.3% - n.m.   287 657 -56.3% -
    Op. cash flow excl. €167mn payment to NJDEP 210 245 244 -14.1% - n.m.   454 657 -30.9% -
    Free cash flow -120 13 157 n.m. - n.m.   37 267 -86.2% -
    FCF excl. €167mn payment to NJDEP 47 13 157 n.m. - n.m.   204 267 -23.7% -
    Cash conversion (LTM) 77% 80% 89% -310 bps - n.m.   77% 80% -310 bps -
    Cash conv. (LTM) excl. €167mn payment to NJDEP 88% 80% 89% 800 bps - -70 bps   88% 80% 800 bps -
    ROCE (LTM) 8.8% 13.1% 9.6% -430 bps - -80 bps   8.8% 13.1% -430 bps -

    Highlights

    • Net sales of €1.7 billion increased by 5% sequentially driven by growth in both the Materials and Consumer & Resources segments. On a year-on-year basis, net sales decreased by 5% organically versus Q2 2023, driven by lower prices (5%), most notably in Consumer & Resources and Specialty Polymers. Volumes were flat year-on-year reflecting continued improvement in momentum compared to Q1 2024, most notably in Novecare; strong performance in Composite Materials with 14% year-on-year net sales growth;
    • Underlying EBITDA of €378 million increased by 4% sequentially; 
    • EBITDA margin of 22.1% was approximately flat sequentially, including net pricing impact of €-24 million in the quarter;
    • Underlying net profit of €159 million;
    • Excluding the previously announced €167 million payment to the New Jersey Department of Environmental Protection (NJDEP), Operating cash flow  was €210 million and Free cash flow was €47 million, with cash conversion of 88%; 
    • Balance sheet: net debt of €1.9 billion, in line with expectations, included €154 million in dividend payments, €167 million related to the settlement with NJDEP and €90 million liability recognition related to the share repurchase program; leverage ratio of 1.3x;
    • Decision to rephase investment timeline for North American battery materials by up to two years, aligned with industry demand.

    Dr. Ilham Kadri, CEO

    “We delivered on our outlook for the second quarter, thanks in particular to improved year-on-year volume momentum, most notably in Novecare, as well as discipline on pricing and control of our costs. We also saw another quarter of double digit growth in Composite Materials and continued to generate robust cash flow.

    While we expect to return to year-on-year volume growth in the second half of 2024, we see a slower recovery in certain end markets, as well as ongoing macroeconomic uncertainty. Nevertheless, we remain relentlessly focused on what is within our control, bringing solutions that our customers need, tightly managing our costs and capital expenditure to further improve our operating leverage and returns, which will allow Syensqo to deliver growth and value creation as markets improve.

    2024 Outlook 

    While our second quarter 2024 results benefited from improved volume momentum, we do not expect a broader recovery in overall demand in the second half of the year that would support the higher end of our previous outlook ranges. 

    More specifically, we now expect a slower recovery in a number of end markets impacted by ongoing macroeconomic uncertainty, most notably Automotive, Agro, Industrial and Medical while we expect continued strong growth in the Aerospace and Defence markets.

    For the second half of 2024, we expect to return to year-on-year volume growth, driven by higher volumes in all business units, particularly in Novecare.

    As a result, our full year 2024 outlook is now as follows:

    • Underlying EBITDA to be in the range of €1.4 billion - €1.475 billion; 
    • Capital expenditures to be in the range of €600 - €650 million;
    • Free Cash Flow to be in the range of €400 - €450 million, excluding the previously announced €167 million payment to the New Jersey Department of Environmental Protection, which was made in April 2024    

    Safe harbor

    This press release may contain forward-looking information. Forward-looking statements describe expectations, plans, strategies, goals, future events or intentions. The achievement of forward-looking statements contained in this press release is subject to risks and uncertainties relating to a number of factors, including general economic factors, interest rate and foreign currency exchange rate fluctuations, changing market conditions, product competition, the nature of product development, impact of acquisitions and divestitures, restructurings, products withdrawals, regulatory approval processes, all-in scenario of R&I projects and other unusual items. Consequently, actual results or future events may differ materially from those expressed or implied by such forward-looking statements. Should known or unknown risks or uncertainties materialize, or should our assumptions prove inaccurate, actual results could vary materially from those anticipated. The Company undertakes no obligation to publicly update or revise any forward-looking statements.

    About Syensqo 

    Syensqo is a science company developing groundbreaking solutions that enhance the way we live, work, travel and play. Inspired by the scientific councils which Ernest Solvay initiated in 1911, we bring great minds together to push the limits of science and innovation for the benefit of our customers, with a diverse, global team of more than 13,000 associates. 
    Our solutions contribute to safer, cleaner, and more sustainable products found in homes, food and consumer goods, planes, cars, batteries, smart devices and health care applications. Our innovation power enables us to deliver on the ambition of a circular economy and explore breakthrough technologies that advance humanity.

    Investor Relations Resources

    Contacts

    Investors & Analysts Media 
    Sherief Bakr
    +44 7920 575 989

    Bisser Alexandrov
    +33 607 635 280

    investor.relations@syensqo.com     		Perrine Marchal
    +32 478 32 62 72

    Laetitia Schreiber
    +32 487 74 38 07

    media.relations@syensqo.com     		 

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