In H1 2024, Končar D&ST recorded revenue growth of 47% YoY, an EBITDA increase of 237%, and a net income of EUR 56.8m, an increase of 2.5x YoY.
Yesterday, Končar D&ST, one of the main subsidiaries of Končar Group released its H1 2024 results. According to the report, Končar D&ST recorded revenue growth of 47% YoY, amounting to EUR 230m. Of this, export revenue amounted to EUR 221.2m, an increase of 57% YoY, and also representing 96.2% of the total sales revenue, an increase of 6.3 p.p. compared to the same period last year. This was to be expected, as Končar Group in general, but Končar D&ST especially has been focused on a lot on export activities with its products across Europe. This is also evident if we look at the Company’s backlog (contracts signed which are still to be fulfilled in the future), which amounted to EUR 800m on 30 June 2024, an increase of 42%, or EUR 237.6m in absolute terms compared to 30 June 2023.
Moving on, operating expenses amounted to EUR 162.3m, an increase of 17%, or EUR 23.6m YoY. Inside the OPEX, we can see that material expenses, the largest expense category has decreased by 4% YoY to EUR 134.8m, mainly due to lower costs of raw materials, which declined by 7% YoY to EUR 118.7m, which was also reflected in the general economy as lower prices of many materials have been recorded with the cooldown of inflation. COGS also declined significantly, by 91% YoY to EUR 0.4m, while on the other hand, other expenses grew by 75% YoY to EUR 15.7m.
As a result of the faster revenue than OPEX growth, EBITDA increased by 237% YoY to EUR 71.4m, implying an EBITDA margin of 31.1%, an increase of 17.5 p.p. YoY. In terms of the net financial result, it amounted to EUR 1m, increasing by over 2.6x YoY, as the financial income increased by 61% YoY due to higher FX gains & higher interest received, while financial expenses increased only slightly, by 7% YoY to EUR 1.1m.
Due to these developments, the net income amounted to EUR 56.8m, increasing by 2.5x YoY, and implying a net income margin of 24.7%, an increase of 14.3 p.p. YoY.
Končar D&ST key financials (H1 2024 vs. H1 2023, EURm)
Source: Končar D&ST, InterCapital Research
In terms of investments, while Končar D&ST does not provide us with exact numbers in the report, the Company did mention that it continues the large investment project “Sustainable SETup”). As part of this project, in the middle of June large construction works were started which are planned to be finished in Q3 2025.
