Epiroc Aktiebolag: Epiroc interim report Q3 2024

• Orders received increased 8% to MSEK 15 520 (14 360). The organic increase was 6%.
  • Large orders amounted to MSEK 1 400 (1 000).
• Revenues increased 5% to MSEK 15 699 (14 997). The organic increase was 3%.
• Operating profit amounted to MSEK 3 277 (3 260), including items affecting comparabilitynof MSEK 191 (-12)*. The operating margin was 20.9% (21.7).
• The adjusted operating profit was MSEK 3 086 (3 272), corresponding to an adjusted operating margin of 19.7% (21.8).
• Basic earnings per share were SEK 1.92 (1.85).
• Operating cash flow was MSEK 1 789 (1 889).
• Net debt/EBITDA ratio was 0.97 (0.49).
• The acquisitions of ASI Mining (remaining shares) and ACB+ were completed.

CEO comments

Strong mining demand
In the third quarter, orders received increased 8% to MSEK 15 520 (14 360), corresponding to an organic growth of 6%. The demand from mining customers was strong and several large mining equipment orders were won. In total, large orders were record-high at MSEK 1 400 (1 000), contributing to an organic order growth for equipment of 11%. For construction, as anticipated, demand remained weak, especially for attachments, where orders slowed further in the United States.

In the near term, we expect that the underlying mining demand, both for equipment and aftermarket, will remain at a high level, while demand from construction customers is expected to remain weak.

Revenues and profitability
Our revenues increased 5% to SEK 15.7 billion, driven by organic growth in Equipment & Service and by acquisitions in Tools & Attachments. Our EBIT increased slightly to MSEK 3 277 (3 260) and included items affecting comparability of MSEK 191 (-12).

The adjusted operating margin, EBIT, was 19.7% (21.8). The lower margin compared to the previous year is mainly explained by mix effects within Equipment & Service, where we have stronger revenue growth in equipment than in the traditional service business, as well as dilution from the acquisition of Stanley Infrastructure. On a Group level, the dilution from acquisitions was -1.3 percentage points.

Sequentially, efficiency measures have yielded results, and the organic contribution to the margin was positive. The workforce was reduced by 450 in the quarter and by 1 000 year-to-date for comparable units. Several efficiency measures are ongoing, including the consolidation of sites in the United States.

Cash flow and working capital
Operating cash flow was MSEK 1 789 and the net working capital was MSEK 24 395. Sequentially, the net working capital was reduced with MSEK 650, driven mainly by lower inventory, which was reduced by MSEK 1 171.

Strategy for resilient, recurring and profitable growth
In September, in conjunction with the world's largest mining exhibit, MINExpo, we hosted our Capital Markets Day. The main purpose of the event was to provide insight into how Epiroc is positioned for profitable, resilient growth in an ever-changing world. We provided updates on the progress of our financial and sustainability goals. Within safety, both when it comes to our offering and our own improvements, we have seen particularly good progress. We shared details of our market-leading position in electrification and automation, which includes more than 600 electric vehicles and 3 100 vehicles with our safety and mixed fleet automation solutions.

Innovation highlights at the MINExpo
At MINExpo in Las Vegas, with over 44 000 guests from 126 countries, we showcased many of our groundbreaking innovations. One innovation that attracted significant interest was the large-capacity Minetruck MT66 S eDrive, a hybrid with both an electric drivetrain and a powerful diesel engine. Epiroc aims to remain in the forefront of a rapidly changing industry by offering the most effective solutions within automation, electrification and digitalization.

Passionate people create exceptional things
During my visit at MINExpo, I had the pleasure to interact with many customers and it is clear that our approach to partnership is highly valued. I applaud the efforts of our passionate employees to provide our customers with solutions that make their operations safer, more productive and more energy efficient, while at the same time strengthening Epiroc for the future.

Helena Hedblom
President and CEO

Please find the full report in the attached pdf. Additional financial documents are found on Epiroc's Financial publications page. The report presentation that will be held starting at 10.00 CEST can be followed via this link:https://ir.financialhearings.com/epiroc-q3-report-2024/register

Epiroc's powerful and reliable PowerROC T45 tophammer drill rig

For more information please contact:
Karin Larsson, Vice President Investor Relations and Media
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[e-mail]
Alexander Apell, IR Controller
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[e-mail]
Ola Kinnander, Media Relations Manager
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This information is information that Epiroc AB is obliged to make public pursuant to the EU Market Abuse Regulation and the Securities Markets Act. The information was submitted for publication, through the agency of the contact persons above, at 08.00 CEST on October 25, 2024.

Epiroc is a global productivity partner for mining and infrastructure customers, and accelerates the transformation toward a sustainable society. With ground-breaking technology, Epiroc develops and provides innovative and safe equipment, such as drill rigs, rock excavation and construction equipment and tools for surface and underground applications. The company also offers world-class service and other aftermarket support as well as solutions for automation, digitalization and electrification. Epiroc is based in Stockholm, Sweden, had revenues of more than SEK 60 billion in 2023, and has around 19 000 passionate employees supporting and collaborating with customers in around 150 countries. Learn more at www.epirocgroup.com.