Stabilus Reports Decrease in Profit Amid Revenue Growth

Stabilus recently released its fiscal 2024 report revealing a significant drop in profit despite a revenue increase. The company anticipates a mixed outlook for fiscal 2025 with expected challenges in profit margins and ongoing costs from acquisitions.

Date: 09-12-2024

AI Rating: 5

In the recent report, Stabilus (SIUAF) disclosed that its fiscal 2024 profit fell to 72.0 million euros from 103.3 million euros in the previous year. This substantial decline in profit is primarily attributed to depreciation and amortization related to the acquisition of Destaco, along with increased interest expenses and higher taxes following special effects in fiscal 2023. Such a significant decrease in profit may raise concerns among investors as it indicates cost pressures that could affect future performance.

Adjusted operating profit or adjusted EBIT showed a slight decrease to 157.1 million euros compared to 158.4 million euros last year, which reflects a relatively stable operational performance despite the profit drop. However, the adjusted EBIT margin also declined from 13.0% to 12.0%, a change that suggests growing inefficiencies or rising costs impacting profitability.

On a positive note, the company did report a notable increase in fiscal 2024 revenue, which rose 7.5% to 1.31 billion euros. This growth is attributed to the first-time consolidation of Destaco in the second half of fiscal 2024, suggesting that the acquisition may provide benefits in terms of revenue generation.

Looking ahead, Stabilus has projected revenue for fiscal 2025 to be between 1.3 billion euros and 1.45 billion euros, indicating a growth outlook that aligns with FY2024 performance but may face challenges with margin expectations of 11% to 13%. This forecast can create uncertainty for investors as the anticipated EBIT margin suggests that profitability may continue to face headwinds due to ongoing costs.

Moreover, the proposed dividend of 1.15 euros per share may be viewed positively by investors seeking income, although the company's ability to maintain or grow dividends could be influenced by the profit declines observed in fiscal 2024.

Stocks: SIUAF