FLSmidth Achieves Record Profitability in 2024 Annual Summary
FLSmidth 2024 Annual Report Highlights Major Achievements
On February 20, 2025, FLSmidth’s Board of Directors approved the Annual Report for 2024, showcasing significant improvements in profitability and outlining the progress made towards key transformation efforts.
Major Highlights from 2024 include:
- Increased Mining Service order intake by 2% from the previous year, indicating sustained stability in the mining service market.
- Enhanced underlying profitability with a Mining Adjusted EBITA margin of 13.1%.
- A 22% drop in Cement order intake attributed to recent divestments and a strategic pruning of the product portfolio.
- Successful execution of strategic initiatives led to a Cement Adjusted EBITA margin of 9.1%.
- The Group EBITA margin reached 9.8%, with a net result of DKK 1,030 million, marking the highest performance in over a decade.
- Strong cash flow performance resulted in DKK 640 million from operations.
- Continued commitment to sustainability goals, with advancements on all science-based targets.
Group CEO Mikko Keto shared, "This year’s report reflects the meaningful strides we’ve made in refining our strategic direction, optimizing operations, and boosting efficiency. Our efforts delivered remarkable gains in both the Mining and Cement sectors. Notably, we have effectively reduced the backlog of Non-Core Activities by 94% since its inception. These achievements highlight the dedication of our team, and we can proudly face the future as we embark on our continued transformation towards consistent performance and excellence in business."
Quarterly Results Overview
Performance in Q4 2024:
The Mining order intake showed an increase of 11% compared to Q4 2023. Service orders surged by 14%, reflecting robust activities in spare parts, upgrades, and consumables. Product orders climbed by 3%, indicating positive market trends.
In contrast, the Cement sector experienced a 13% decrease in order intake, primarily due to divestments. Despite these challenges, service orders only dipped by 11%, while product orders witnessed an 18% decline.
The Non-Core Activities (NCA) segment showcased substantial reductions in order backlog, decreasing by around DKK 192 million to reach DKK 211 million by the end of Q4 2024.
Group Financial Performance
The overall Group order intake rose by 5% compared to Q4 2023. The service intake increased by 8%, primarily influenced by growth in Mining, while product orders reflected a slight decrease due to lower demand in the Cement sector.
Insight into Financial Figures
Mining revenue declined by 7% year-over-year, while service revenue increased by 12%. The overall gross profit rose to DKK 1,308 million, translating to a gross margin of 31.3%. Adjusted EBITA margins improved significantly to 14.0% while overall EBITA margins stood at 12.9%.
Financial Outlook for 2025
The financial guidance for 2025 reflects ongoing improvements stemming from business transformation initiatives. Demand in Mining services is anticipated to remain stable, while the Mining Products segment is projected to face challenges amidst potential market softness.
In Cement, the short-term outlook remains clouded due to macroeconomic uncertainties, affecting revenue projections. Overall, FLSmidth expects to continue benefiting from simplification efforts as well as from strategic growth initiatives implemented in its core business sectors.
FSLmidth's Dedication to Sustainability
FLSmidth maintains its ambitious sustainability goals through MissionZero, targeting zero emissions in both the mining and cement industries by 2030. The company actively pursues verified Science-Based Targets to enhance its sustainability performance worldwide.
Frequently Asked Questions
What were FLSmidth's major achievements in 2024?
FLSmidth highlighted increased order intakes in mining services, improved profitability margins, and significant advancements in sustainability initiatives.
How did the company's financial performance fare in Q4 2024?
FLSmidth saw an 11% increase in mining order intake and a gross profit increase to DKK 1,308 million, with improved EBITA margins.
What is the outlook for FLSmidth in 2025?
The company expects stable mining service demand but anticipates some softness in mining products, with Cement facing macroeconomic challenges.
How does FLSmidth aim for sustainability?
FLSmidth is committed to achieving zero emissions in its operations by 2030, focusing on validated science-based targets to enhance its sustainability efforts.
Who can be contacted for investor relations inquiries?
Investors can reach out to Andreas Holkjær at +45 24 85 03 84 or Jannick Denholt at +45 21 69 66 57 for inquiries regarding investor relations.
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