(BFM Bourse) – The smart road specialist has published 2023 results that are down in terms of profitability. The prospects revealed by Lacroix were also warmly welcomed by investors.
Unlike the Paris Stock Exchange which is timidly returning to an upward trend, the lights are clearly red for Lacroix. The specialist in road management equipment saw its shares plunge by 8.1% to 23.90 euros around 2:10 p.m. this Wednesday, April 3.
Investors sanction the content of Lacroix’s annual accounts but also the perspectives formulated by the Nantes electronics group founded in 1936. The latter is present in all connected equipment in intelligent road infrastructures (signalling, traffic management …), public lighting, management of water infrastructure (water towers, wastewater treatment plants) and even heat networks.
Declining profitability
However, the level of activity revealed by Lacroix is in line with the forecasts announced by the group. In 2023, Lacroix’s turnover stood at 761.2 million euros, in line with the target set by the group, which aimed for a level of revenue above 750 million euros. Activity was up 7.5% (+7.2% at constant exchange rate).
The company was able to count on the dynamism of its “city” activities, which include public lighting, traffic management and road safety, and of its “environment” division, which brings together the supply of equipment dedicated to the management of water and energy infrastructure. This good performance of these two activities over the past year made it possible to offset a slowdown in the “electronics” activity due to a more complex market environment in the second half.
But profitability did not follow. Over the entire financial year, Lacroix’s current gross operating profit (Ebitda) fell by 6.1% year-on-year to stand at 41.6 million euros, compared to 44.3 million euros. euros a year ago. The corresponding margin has declined to 5.5% in 2023 compared to 6.3% in 2022.
Lacroix attributes this decline to the difficulties of its North American subsidiary, Lacroix Electronics North America, for which exceptional inventory discrepancies totaling 3.1 million euros were recorded. Excluding these exceptional items, the current Ebitda margin would have reached 6.5%, Lacroix would like to point out.
A little further down in the accounts, the group’s current operating profit is down 17.8% to reach 17.8 million euros in 2023. Here too, the corresponding margin is down to 2.3% in 2023. , compared to 3.1% the previous year.
The group’s net profit collapsed to 4.3 million euros, compared to 11.9 million euros in 2022, weighed down by financial charges which amounted to 8.5 million euros in 2023.
Disappointing forecasts
In terms of prospects, visibility is not good for Lacroix, which says it expects a “contrasted” year 2024 for some of its markets. The group admits to suffering from low visibility in the HBAS (home and building automation systems) and automotive segments.
In this context, the company plans to achieve a turnover of more than 710 million euros in 2024, a slight increase compared to its 2023 level (excluding signaling), i.e. 702 million euros. The revenue target announced for the current year excludes the signaling activity because the group recently concluded an agreement to sell its historic road sign division to the American investment company AIAC.
The current Ebitda margin is expected to exceed its 2023 level, in a range of 5.5% to 6.5%.
In the longer term, Lacroix intends to reach 800 million euros in turnover in 2025. Achieving this level of income is however conditional “on a more favorable evolution of demand on the automobile and HBAS markets and on the completion of an external growth operation. The group still hopes to generate a current Ebitda margin representing around 9% of its revenues.
However, “realistic”, Lacroix nevertheless believes that this objective will be “difficult to achieve from 2025” but remains “fully confident in its ability to reach this new milestone in the medium term”.
Sabrina Sadgui – ©2024 BFM Bourse
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