LU-VE Q4 Results: Sales Rise 1% YoY, Backlog Grows 12%

LU-VE Spa reported Q4 2024 product revenues of EUR148.2 million, up 1.0% YoY and 5.9% QoQ. Annual sales were EUR581.0 million, down 4.3% from the same period last year. However, excluding the heat pump business, annual sales show an increase of 2.5%. The order backlog as of December 31, 2024, reached EUR174.2 million, a 12% growth from the same period in 2023. LU-VE's stock is down 0.7% at EUR27.50 per share.

Introduction:
LU-VE Spa, an Italian-based company specializing in the design, production, and marketing of heat exchangers, reported its financial results for the fourth quarter of 2024 and the full year. The company's stock experienced a slight decline following the release of the earnings report [1]. In this article, we will analyze LU-VE Spa's financial performance during the quarter and the year, as well as discuss the factors contributing to the company's revenue decline.

Q4 2024 Financial Performance:
LU-VE Spa reported product revenues of EUR148.2 million for the fourth quarter of 2024, marking a 1.0% year-over-year (YoY) increase and a 5.9% quarter-over-quarter (QoQ) growth [2]. The company's EBITDA for the quarter was EUR19.6 million, up from EUR19.2 million in the same period the previous year. Despite the revenue growth, LU-VE Spa's net financial position remained negative at EUR137.1 million, compared to negative EUR126.3 million as of December 31, 2023.

Annual Financial Performance:
For the full year, LU-VE Spa reported annual sales of EUR581.0 million, which represented a 4.3% decline compared to the same period in 2023. However, when excluding the heat pump business, annual sales showed an increase of 2.5% [2]. The company's order backlog as of December 31, 2024, reached EUR174.2 million, marking a 12% growth from the same period in 2023 [2].

Factors Contributing to Revenue Decline:
The decline in LU-VE Spa's annual revenues can be attributed to several factors. First, the company's net financial position remained negative, which may have impacted its ability to invest in growth opportunities or pay off debt [1]. Second, the ongoing subsidiary merger, which was approved by the board of directors and the subsidiaries' boards in April 2024 [1], may have caused some disruption to the company's operations.

Conclusion:
In summary, LU-VE Spa reported mixed financial results for the fourth quarter of 2024 and the full year. While the company experienced revenue growth during the quarter and an increase in its order backlog, annual revenues declined, and the net financial position remained negative. The ongoing subsidiary merger may have contributed to the disruption in the company's operations, but it is expected to bring operational efficiencies and cost savings in the future.

References:
[1] Alliance News. (2024, April 26). LU-VE profit rises but revenues fall, subsidiary merger approved. https://www.marketscreener.com/quote/stock/LU-VE-S-P-A-22619643/news/LU-VE-profit-rises-but-revenues-fall-subsidiary-merger-approved-46705418/
[2] LU-VE Group. (n.d.). Investor Relations. https://investor.luvegroup.com/en/