TeraPlast, one of the representatives of the industrial sector in BET index with a market cap of c. EUR 250m, has published its Q1 2024 results. In Q1 2024, Teraplast recorded a revenue increase of 20% YoY, an EBITDA increase of 32%, and a net loss of RON 2.5m due to a mix of factors.

TeraPlast one of the largest PVC processors in the Eastern EU has published its Q1 2024 results. The company managed to show an increase in top-line & EBITDA and surpass the budget targets. The management emphasized it is optimistic about becoming the market leader in Romania. Further, it was noted that the consolidation effect from the acquisition of Palplast will arise in the second quarter.

Quantities evolution by quarter; tons

Source: BVB, InterCapital Research

TeraPlast noted an increase in its top line by 20% in Q1 2024. In Q1 2024, the Company’s EBITDA increased to RON 12m, an increase of 32% YoY, which resulted in the EBITDA margin reaching 6.7% (up 0.6 p.p. YoY). Just as the top line noted a positive development in this quarter, so did Teraplast’s profitability. Overall, the Group noted organic growth in the Installation business line combined with enhanced performance in other segments as well. The installation segment continued to generate the higher share in revenues, amounting to RON 122m (+19% YoY), while the EBITDA margin of this segment amounted to 10%, driven by significant volume growth.

TeraPlast key financials (Q1 2023 vs Q1 2024, RONm)

Source: BVB, InterCapital Research

However, the net result amounted to RON -2.5m, influenced by a mix of factors. Due to seasonality in the first quarter, TeraPlast paid the turnover tax, resulting in an additional cost of RON 1m, while additionally, the company noted a higher depreciation expense of RON 2m generated by the commissioning of new investments along with the non-recurring expense of RON 1m for recent M&A. Nevertheless, bottom line loss is significantly lower than anticipated due to favorable developments in the installation and compounds segment.