DUFRY - Avolta AG (DUFRY) Q4 2024 Earnings Call Transcript

2025-03-12 19:32:07 ET

Avolta AG (DUFRY)

Q4 2024 Earnings Conference Call

March 12, 2025, 09:30 AM ET

Company Participants

Xavier Rossinyol - Chief Executive Officer

Yves Gerster - Chief Financial Officer

Rebecca McClellan - Global, Head Investor Relations

Conference Call Participants

Jon Cox - Kepler Cheuvreux

Gian-Marco Werro - Zürcher Kantonalbank

Laura Bucher - Octavian

Manjari Dhar - RBC

Natasha Bonnet - Morgan Stanley

Joern Iffert - UBS

Jaafar Mestari - BNP Paribas

Tim Barrett - Deutsche Bank

Ali Naqvi - HSBC

Presentation

Xavier Rossinyol

Good morning, good afternoon. Thank you very much for everybody that is here physically in Zurich. Also, thank you for the people on the video call. Today, Yves Gerster, our CFO; myself, Xavier Rossinyol, CEO, we are going to present the full year results for Avolta 2024.

I'm going to go straight to Page 4, where we have the highlights of the year. The total turnover growth at constant exchange rate has been 8.9% last year. Organic growth of 6.3%. If we exclude the effect of Argentina that basically Argentina had especially good 2023 because of exchange rate. If we exclude Argentina, the organic growth on a comparable basis is 7.7% for 2024. Core EBITDA has increased faster than revenues, expanding the EBITDA margin by 40 basis points from 9% in 2023 to 9.4% in 2024.

Equity free cash flow has reached CHF425 million which is a 32% increase and almost 500 basis points of equity free cash flow conversion. All these numbers are in line or ahead of our own expectations and our own outlook. The year 2025 has started also very strong. Organic growth at the end of February is 6%, but we need to remember that last year was a leap year. So you have one extra day of sales in February last year.

If you discount this effect, our organic growth would have been 7.7%, perfectly in line with the exit of last quarter 2024. First quarter '25 will have several seasonality effects, the most important one, Easter. Easter this year is going to be in April. So we will be able to fully analyze the first quarter only at the end of April. This is something that happens every year where Easter moves from March to April.

Second highlight, consistency. We have announced our capital allocation, and we are consistently delivering on that. I'll come to that in more details later but deleveraging again significantly. Our net debt to EBITDA this year has -- last year, 2024 has dropped to 2.1, which is 0.6 improvement with prior year. If you discount the effect of the share buyback, our net debt-to-EBITDA would have been already below 2x at 1.9.

We have canceled in 2024, 4% of our shares as a consequence of the share buyback we did last year and as you know, we already launched a new share buyback program for '25 in January that will be another CHF200 million and we are announcing today also that the Board of Directors will propose to the next General Assembly an increase of the dividend to CHF1 per share, which is an increase of 43%.

So clear focus on shareholders' return. Last, we are also consistently delivering on the commercial and digital transformation. I'll go into more details later on, but both on the physical and the digital spaces and also a strong business development in '24 and good opportunities in '25. Key message of this slide is the strength of our portfolio.

As you know, we are in 70 countries with more than 5,000 points of sales, and it's a very resilient portfolio as a consequence. It's diversified geographically, 51% in EMEA; 32% in North America; LatAm, 12%; APAC, 4%. On business line, it's almost a perfect diversification a one-third duty free, one-third in duty paid, one-third in F&B. Airports remain our main channel with 81% of the sales; motorways, 10%; and other channels that includes cruise lines, ports, railway stations and a few others, 9%. And also a very balanced distribution of the category portfolio.

2024, all the regions contributed positively to the like-for-like and the organic growth, 9.4% in EMEA, 5.6% in North America. If you correct the Argentina effect, 7% in LatAm and 6% -- sorry, 12% like-for-like in Asia Pacific. Last quarter, in like-for-like, very similar once you discount the Argentina effect. Of course, the regions change. And that's an important thing I want to emphasize....

For further details see: