Bureau Veritas SA (BVRDF) Full Year 2024 Results Earnings Call Transcript

2025-02-25 13:01:47 ET

Bureau Veritas SA (BVRDF)

Full Year 2024 Results Earnings Conference Call

February 25, 2025 9:00 AM ET

Company Participants

Hinda Gharbi – Chief Executive Officer

François Chabas - Chief Financial Officer

Conference Call Participants

Sylvia Barker – JPMorgan

Annelies Vermeulen – Morgan Stanley

Suhasini Varanasi – Goldman Sachs

Pablo Cuadrado – Kepler

Karl Green – RBC

Presentation

Operator

Hello and welcome to the Bureau Veritas Full Year 2024 Results. My name is Caroline, and I will be your coordinator for today's event. Please note, this call is being recorded and for the duration of the call your lines will be on listen-only mode. However, you will have an opportunity to ask questions at the end of the call. [Operator Instructions] Today's conference, we have Hinda Gharbi, the CEO; and François Chabas, the CFO and Executive VP.

I will now hand over the call to your host, Hinda Gharbi, the CEO, to begin today's conference. Thank you.

Hinda Gharbi

Thank you. Thank you, Caroline. Good morning, good afternoon and good evening to everyone. Welcome to the full year 2024 results on the webcast or on the call. I'm joined by François Chabas, our Group CFO. In the past year, Bureau Veritas delivered on its strategic commitments, demonstrating a strong performance of the top line, the margins, earnings per share and cash. I'm delighted to report that we have exceeded all the objectives we set for 2024 showing predictability in our execution while navigating a complex macro environment. This robust financial and operational execution is fully aligned with the objectives set out in our LEAP | 28 strategy.

These results show the excellence and dedication of our global teams in action I would like to thank all my colleagues around the world for their contributions to these results and for their superior engagement to Bureau Veritas' mission. We ended the year with Bureau Veritas' inclusion in the CAC Stock Index as one of France's highest-valued companies. This milestone is a recognition of the group's consistent operational delivery and performance and denotes confidence in our future outlook.

Our financial highlights for the year: a revenue of €6.2 billion, up 6.4% on a reported basis and 10.2% organically with 9.6% organic growth in quarter four. Growth was driven by high volumes and dynamic pricing and was steady throughout the year. Adjusted operating profit increased by 7.1% year-on-year to €996 million, generating a margin of 16%, up 11 basis points year-on-year and up 38 basis points at constant currency. Our adjusted EPS is up 8.7% to €1.38 and by 17% at constant currency. Free cash flow totaled €843 million, representing 13.5% of our revenue and growing 27.9% year-on-year. This is a record high and reflects our disciplined capital allocation and our rigorous working capital management. As a result, we are committed to shareholders' returns and will propose a cash dividend of €0.90 per share, up 8.4% year-on-year and corresponding to an unchanged payout ratio of 65%.

Turning now to our CSR commitments. In 2024, we continued to roll out our new CSR plants to meet our new LEAP | 28 strategy targets. In June 2024, for the first time, we presented the group's climate strategy at our Annual General Shareholders Meeting, reinforcing Bureau Veritas' position as a leader in sustainability within our industry. Our performance this year is as follows. In health and safety, our ongoing prevention programs further reduced our accident rate versus last year. On decarbonization, we reduced our Scope 1 and 2 emissions by 10% year-on-year. This is in line with our size-based target initiative targets for the year. For gender diversity, we still have a way to go, and we are reassessing our programs. I'm pleased to report that we have improved all our non-financial ratings in 2024, and this year, we've been included in the Carbon Disclosure Project, A list.

Back to the financial results for the year. We recorded broad-based growth across all business lines and regions and benefited from very strong growth in sustainability, energy, decarbonization and cyber. Over 50% of the portfolio delivered high single-digit or double-digit organic growth. From a geographical perspective, all regions performed well. The fastest growth was recorded in the Middle East and Africa, supported by Buildings & Infrastructure and energy projects in the Middle East. The Americas grew double-digit buoyed by the momentum around energy and data centers. In our mature Europe business, we delivered 5.6% organic growth, benefiting from a strong reoccurring revenue that is underpinned by regulations and accredited activities....

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