The Group saw 7% growth in its Q2 Mining Service order intake, whereas the significant decline in Mining Products order intake reflects market softness. A Mining revenue decline of 13% in the second quarter of 2024 primarily reflects timing of the execution of certain Mining Products orders. The continued progression in Mining profitability is noted with an Adjusted EBITA margin of 13.1%.
FLSmidth's Cement Service order intake growth in core market clusters partly offset impacts from de-risking and divestments. Cement Adjusted EBITA margin of 9.6% in Q2 reflects strong margin execution and lower SG&A costs. The second quarter saw continued progression made against all FLSmidth's Science Based Targets.
FLSmidth's gross profit increased by 5% to DKK 1.579 billion (€211.59mn) in Q2 2024, compared to DKK 1.497 billion (€200.6mn) in Q2 2023. Gross profit for H1 2024 increased by 3% to DKK 2.993 billion (€401.07mn). The corresponding gross margin increased by 7.3%-points to 30.6%. The strong gross margin was driven by good execution on higher-margin orders and lower cost of production partly offset by the cost related to the ongoing exit from FLSmidth's Non-Core Activities segment.
FLSmidth CEO Mikko Keto said: “Our performance in the first half of the year is testament to our continued strong progression across all our key transformation activities, with additional improvements in profitability for both Mining and Cement. We continue to see a stable and healthy service market, whereas the products market remains soft due to persisting hesitation by some customers on larger investment decisions.
"The largely stable cement market continues to provide good opportunities for the Service business, whereas we continue to de-risk the Products business to preserve profitability. Looking ahead, the resilience of our service-oriented business model, our continued focus on business simplification to ensure a cost-efficient operating model and our dedicated focus on strategy execution gives us great confidence that we are well on track to meet our long-term financial ambitions for both Mining and Cement.”
Click here for FLSmidth's interim report for the first half of this year: 5d7d461b-5eb9-4721-b553-1115e6fc96c7 (globenewswire.com)
