Blue Cap AG: Noticeable margin improvement in the third quarter 2024
_Group revenue after nine months at EUR 195.3 million (previous year: EUR 209.0 million)
_Adjusted EBITDA rises by almost 20% to EUR 19.0 million (previous year: EUR 15.9 million)
_Adjusted EBITDA margin increases significantly to 9.5% after nine months (previous year: 7.6%), reaching 11.8% in the third quarter
_Recent sales of nokra and Neschen with attractive returns
_New 2024 forecast already adjusted to future continuing operations: Group revenue of EUR 200-220 million and an improved adjusted EBITDA margin of 9.5-10.5%
Munich, October 23, 2024 Blue Cap AG ("Blue Cap") reports a solid third quarter of 2024 with a significant increase in profitability. This was achieved despite ongoing challenging economic conditions. At the end of September and beginning of October, Blue Cap announced the sale of its portfolio companies nokra and Neschen. Both exits were realized with attractive returns on invested capital (ROIC) and sales proceeds exceeding their respective last net asset value evaluations. These exits represent key milestones in Blue Cap's M&A strategy implementation. All subsequent key figures refer to both the future continuing operations(1) and the discontinued operations involving Neschen and nokra.
Nine-month figures with improved operating results >br< In the first nine months of 2024, Blue Cap achieved group revenue of EUR 195.3 million, below the previous year's level (EUR 209.0 million). At the same time, the operating result (Adjusted EBITDA(2)) improved significantly to EUR 19.0 million (previous year: EUR 15.9 million), of which EUR 7.8 million was attributed to the third quarter (Q3 2023: EUR 4.4 million). This improvement reflects in particular the successes of the transformation at Neschen and very favorable order development at con-pearl. As a result, the adjusted EBITDA margin for the first nine months increased to 9.5% (previous year: 7.6%) and from 7.0% to 11.8% in the reporting quarter.
The net debt ratio (including lease liabilities) was 2.0 years, well below the comparable figure from the previous year (September 30, 2023: 3.0 years) and clearly within the target range of under 3.5 years.
Overview of key group figures*
| EUR m | Q3 2024 | Q3 2023 | 9M 2024 | 9M 2023 |
|---|---|---|---|---|
| Revenue | 66.1 | 63.7 | 195.3 | 209.0 |
| Adjusted EBITDA | 7.8 | 4.4 | 19.0 | 15.9 |
| Adjusted EBITDA margin in % | 11.8% | 7.0% | 9.5% | 7.6% |
*Key group figures including Neschen and nokra
con-pearl with strong contribution to group results
The Plastics segment continued its dynamic development from the first half of the year, achieving noticeable gains in both revenue and earnings. The main driver of this upward trend was the portfolio company con-pearl, which also benefited in the third quarter from a very strong order situation in the logistics sector, particularly in the USA. H+E also performed very well, slightly exceeding expectations in the persistently challenging automotive sector environment.
The Adhesives & Coatings segment's revenue was nearly at the previous year’s level, but the segment was able to significantly improve its earnings. This improvement is mainly due to the successful transformation of Neschen, which resulted in a marked increase in earnings. In contrast, Planatol continued to experience a significant drop in demand in the third quarter, with revenue for the first nine months falling slightly below the already weak prior year’s level.
In the Business Services segment, key figures for the first nine months were noticeably behind the previous year’s period. Both HY-LINE and Transline were more severely impacted than expected by the difficult economic environment and declining orders. The development at HY-LINE, in particular, put significant pressure on the segment’s results. Both companies missed their targets due to declining revenues.
The minority stake in Inheco has shown improvement in all key figures following the completion of transformation measures in the first half of 2024. The continued focus on operational improvements and productivity, combined with solid order intake in line with expectations, provides a good foundation for a return to a profitable growth trajectory.
Overview of segment key figures*
| EUR m | 9M 2024 | 9M 2023 | Changes in % or in basis points (bps) |
|---|---|---|---|
| Plastics | |||
| Revenue | 82.9 | 71.8 | 15.3% |
| Adjusted EBITDA | 12.9 | 7.9 | 63.6% |
| Adjusted EBITDA margin in % | 15.3% | 11.0% | >100 bps |
| Adhesives & Coatings | |||
| Revenue | 62.1 | 63.4 | -3.6% |
| Adjusted EBITDA | 6.0 | 2.9 | >100% |
| Adjusted EBITDA margin in % | 9.5% | 4.7% | >100 bps |
| Business Services | |||
| Revenue | 49.3 | 71.4 | -30.9% |
| Adjusted EBITDA | 1.9 | 6.2 | -69.5% |
| Adjusted EBITDA margin in % | 3.8% | 8.6% | >100 bps |
Note: Rounding differences are possible
*Key group figures including Neschen
2024 forecast with increased EBITDA margin and adjusted for continued operations
Considering the mentioned divestitures and the expected business developments, the Executive Board adjusted its forecast for the full year 2024 on October 7, 2024. In addition to the required exclusion of the discontinued operations nokra and Neschen in accordance with IFRS guidelines, this adjustment is reflected in a higher than originally anticipated Adjusted EBITDA margin and a slightly lower revenue forecast. For the 2024 fiscal year (excluding Neschen and nokra), the Executive Board now expects group revenue in the range of EUR 200-220 million (previously EUR 270-290 million) and an Adjusted EBITDA margin of 9.5-10.5% (previously 8.5-9.5%).
Important note
In light of the published figures, a virtual conference call with the Executive Board of Blue Cap AG will take place today at 2:00 PM. You can register via the link below. The presentation will be available after the call on our website at https://www.blue-cap.de/investor-relations/praesentationen/.
(1) Due to the sale of nokra (September 30, 2024) in Q3 and Neschen (October 7, 2024) in Q4 2024, the contributions of these companies will be consolidated as discontinued operations for both the current year and the previous year, in accordance with IFRS standards. Consequently, all other portfolio companies will be classified as continuing operations. The figures presented in this press release, including those for the prior-year periods, have not yet factored in this exclusion at the current time. However, the forecast for the full year 2024 already accounts for only the continuing operations, excluding nokra and Neschen.
(2) Adjustments: Adjusted for extraordinary, out-of-period and other effects from reorganization measures and one-off effects
