"Vesuvius Full Year 2024 Earnings: EPS Misses Expectations"

Ladies and Gentlemen, buckle up! We're diving headfirst into the earnings report of Vesuvius PLC (FRA:V4S) for the full year 2024, and it's a wild ride. The company reported a 22.7% drop in profit before tax, and the headline EPS came in at 43.3p, a 2.1% increase on a constant currency basis. But here's the kicker: the EPS missed expectations, and the market is not happy about it. Let's break it down!

First things first, the revenue. It declined by 1.8% on an underlying basis. OUCH! That's a tough pill to swallow, especially when you consider the significant market declines in the Foundry division. The Foundry division faced a 29% decline in trading profits and a 230 basis point reduction in return on sales to 7.4%. That's a double whammy, folks!

But it's not all doom and gloom. Vesuvius has some bright spots. The Steel division performed well, with a 110 basis point improvement in return on sales to 11.4%. And the company launched 32 new products in 2024, a 50% increase from 2023. That's innovation, folks! And innovation is the name of the game in this market.

Now, let's talk about the dividend. The total dividend for the year increased by 2.2% to 23.5p per share. That's a solid increase, and it shows that Vesuvius is committed to returning value to shareholders. But let's not forget about the EPS miss. The market hates uncertainty, and this EPS miss is a big question mark hanging over the company.

So, what's next for Vesuvius? The company is targeting return on sales of at least 12.5% by 2027 and cumulative GBP400 million free cash flow by 2027. That's a bold target, and it shows that Vesuvius is confident in its ability to turn things around. But can they do it? That's the million-pound question.

The market is cautious, and so should you be. Vesuvius is facing headwinds, and the EPS miss is a red flag. But the company has a strong track record of innovation and a commitment to returning value to shareholders. So, what do you do? Do you buy the dip, or do you stay on the sidelines? That's up to you, but one thing is for sure: Vesuvius is a company to watch in 2025.