Kitron: Posts Q4 2023 Results; Solid End to Record Year

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Kitron reported record fourth-quarter sales and strong profitability, with margins consistently reaching the company's long-term target.

Kitron's revenue for the fourth quarter was EUR 199.1 million, compared to 174.6 million last year. Growth was particularly strong within the Electrification and Defence/Aerospace market sectors.

Fourth-quarter operating profit (EBIT) was EUR 18.0 million, compared to 15.9 million last year. EBITDA was EUR 22.8 million, compared to 19.6 million last year.

Profitability expressed as EBIT margin was 9.1 per cent in the fourth quarter, in line with the same quarter last year.

The order backlog ended at EUR 494 million, a decrease of 15 per cent compared to the previous year and a decrease of 2 per cent from the preceding quarter, reflecting European market sentiment. The exception to this trend is Defence/Aerospace, where the order backlog has grown substantially over the past year and electrical grid critical infrastructure, where growth of over 50 per cent is expected this year.

Peter Nilsson, Kitron's CEO, comments:

“In the final quarter of 2023, we continued our streak of growth with record fourth-quarter sales, while also reporting the fifth consecutive quarter of EBIT margins above 9 per cent. Our annual revenue crossed the EUR 775 million mark, reflecting an impressive year-over-year growth of 21 per cent. Looking ahead to 2024, we anticipate stable demand in the first half, with an expectation for it to pick up in the latter half.”

Profit after tax amounted to EUR 12.3 million, compared to 9.8 million in the same quarter the previous year. This corresponds to earnings per share of EUR 0.06, up from 0.05 last year. For the full year 2023, earnings per share were EUR 0.26, up from 0.14 in 2022.

Stable capital efficiency

Operating cash flow in the fourth quarter was EUR 33.4 million, compared to 7.1 million in the fourth quarter of 2022. Full-year operating cash flow was EUR 59.0 million compared to 18.2 million in 2022.

Net working capital was EUR 193.8 million, an increase of 5.5 per cent compared to the same quarter last year. Net working capital as a percentage of revenue was 24.4 per cent compared to 26.1 per cent last year.

Dividend

The board proposes an ordinary dividend of NOK 0.75 per share (NOK 0.50).

Outlook

For 2024, Kitron reiterates the outlook given at the Capital Markets Day in December and expects revenues between EUR 700 and 800 million. Operating profit (EBIT) is expected to be between EUR 60 and 74 million.