Ontex Group NV (ONXXF): Q2 2024 Earnings Call Highlights Strong Revenue Growth and Improved Profitability
Wednesday, Oct 9, 2024 3:35 pm ET
1min read Ontex Group NV (ONXXF), a leading international developer and producer of personal care products, recently reported its Q2 2024 earnings, showcasing strong revenue growth and improved profitability. The company's solid performance was driven by a combination of factors, including volume growth, operational efficiencies, and cost transformation initiatives.
Ontex's revenue for the second quarter of 2024 grew by 2% on a like-for-like basis, with volume growth and mix effects contributing 5%. This growth was particularly notable in North America and selected product categories. Despite a 3% decrease in prices, the company's revenue remained robust, reflecting the strength of its underlying business.
The company's adjusted EBITDA margin rose to 12.5% in Q2 2024, up 2.8 percentage points year on year. This improvement was driven by operational efficiency savings of 5% from the company's cost transformation program, which more than offset the price decrease. Volume growth and mix improvement contributed an additional €5 million to adjusted EBITDA. Lower raw material costs also played a significant role in offsetting inflation impacts on other operating and SG&A costs.
Ontex's cost transformation program has been a key driver of its improved profitability and competitiveness. The program delivered solid efficiency gains, strengthening the company's bottom line and enabling it to grow its business in North America and strengthen it in Europe. The company's CEO, Gustavo Calvo Paz, expressed confidence in delivering a strong year, highlighting the consistent delivery of strategic milestones and the sustainable innovation pipeline.
Ontex's revised full-year outlook reflects the strong performance in the first half of 2024. The company now expects revenue to grow in a range of 4% to 5% like for like, up from its previous guidance of low-single-digit growth. The adjusted EBITDA margin is expected to reach 12%, up from the previously guided range of 11% to 12%. Free cash flow is projected to be higher than €20 million, an improvement from the previous year. The leverage ratio is expected to reduce further to below 2.5x by year-end, down from the previously guided target of below 2.8x.
In conclusion, Ontex Group NV's Q2 2024 earnings call highlighted the company's strong revenue growth and improved profitability. The company's performance was driven by volume growth, operational efficiencies, and cost transformation initiatives. With a revised full-year outlook that reflects the solid delivery in the first half of 2024, Ontex is well-positioned to continue its growth trajectory and strengthen its competitive position in the personal care products market.
Ontex's revenue for the second quarter of 2024 grew by 2% on a like-for-like basis, with volume growth and mix effects contributing 5%. This growth was particularly notable in North America and selected product categories. Despite a 3% decrease in prices, the company's revenue remained robust, reflecting the strength of its underlying business.
The company's adjusted EBITDA margin rose to 12.5% in Q2 2024, up 2.8 percentage points year on year. This improvement was driven by operational efficiency savings of 5% from the company's cost transformation program, which more than offset the price decrease. Volume growth and mix improvement contributed an additional €5 million to adjusted EBITDA. Lower raw material costs also played a significant role in offsetting inflation impacts on other operating and SG&A costs.
Ontex's cost transformation program has been a key driver of its improved profitability and competitiveness. The program delivered solid efficiency gains, strengthening the company's bottom line and enabling it to grow its business in North America and strengthen it in Europe. The company's CEO, Gustavo Calvo Paz, expressed confidence in delivering a strong year, highlighting the consistent delivery of strategic milestones and the sustainable innovation pipeline.
Ontex's revised full-year outlook reflects the strong performance in the first half of 2024. The company now expects revenue to grow in a range of 4% to 5% like for like, up from its previous guidance of low-single-digit growth. The adjusted EBITDA margin is expected to reach 12%, up from the previously guided range of 11% to 12%. Free cash flow is projected to be higher than €20 million, an improvement from the previous year. The leverage ratio is expected to reduce further to below 2.5x by year-end, down from the previously guided target of below 2.8x.
In conclusion, Ontex Group NV's Q2 2024 earnings call highlighted the company's strong revenue growth and improved profitability. The company's performance was driven by volume growth, operational efficiencies, and cost transformation initiatives. With a revised full-year outlook that reflects the solid delivery in the first half of 2024, Ontex is well-positioned to continue its growth trajectory and strengthen its competitive position in the personal care products market.