MERCOR AFTER Q3 2024/2025
CHALLENGING THIRD QUARTER AND EXECUTION OF AGREEMENT WITH KINGSPAN GROUP
The MERCOR Group, a leader in the European fire protection market, reported a net profit of PLN 14.5 million for the first nine months of FY 2024/2025 (period from 1 April to 31 December 2024), with revenue amounting to PLN 381.7 million. EBIT for the period was PLN 18.1 million and EBITDA reached PLN 32.0 million. In the three months to 31 December 2024, i.e. the third quarter of the financial year, the Group’s revenue amounted to PLN 131.4 million, with net profit at PLN 3.0 million (PLN 8.1 million when adjusted for one-off items).
In the third quarter of FY 2024/2025, the Mercor Group signed a preliminary agreement to sell its natural smoke exhaust and fire ventilation business to Kingspan Group. The investor would pay a total consideration of PLN 420 million for the shares in the Group’s subsidiaries being divested. However, up to PLN 60 million of this amount would be deferred, contingent upon achieving specified consolidated EBITDA thresholds generated by the demerged business (to be ultimately carried out by the divestment companies) in the 12 months ending 31 March 2026.
“The first nine months of the 2024/2025 financial year were marked by a softer order intake, which I attribute to more challenging market conditions, particularly a slowdown in construction activity. When assessing our net profit performance for the period, it is important to note that its year-on-year change was influenced by a one-off tax refund, including interest, of approximately PLN 10.5 million received in the second quarter of the 2023/2024 financial year. Additionally, in the third quarter of the current financial year, we incurred transaction-related costs of around PLN 5 million associated with an agreement we signed with Kingspan Group,” said Krzysztof Krempeć, President of the Management Board of MERCOR S.A.
“A key milestone for the Group this quarter was the signing of a preliminary agreement with Kingspan Group. The transaction will serve as a catalyst to accelerate our further development by allowing us to implement an investment programme for our retained business divisions and capitalise on new market opportunities. Furthermore, we intend to recommend that a substantial portion of the future transaction proceeds be distributed to shareholders as dividend, in the range of PLN 13–15 per share (excluding the earn-out),” stressed Krzysztof Krempeć.
In the first nine months of FY 2024/2025, the Group’s domestic market revenue accounted for 53.9% of total revenue, reaching PLN 205.8 million. Sales in foreign markets amounted to PLN 175.9 million, representing 46.1% of total revenue.
In December 2024, the Management Board of Mercor S.A. revised its previous approach to consolidating OOO Mercor Proof and resolved to transition from full consolidation to using the equity method for the subsidiary. The first periodic report reflecting this change was the report for the first half of FY 2024/2025, covering the period from 1 April to 30 September 2024, with the historical data restated accordingly. Further details on this change in the consolidation approach were disclosed in Current Report No. 66/2024, dated 30 December 2024.
MERCOR GROUP’S RESULTS FOR THE FIRST NINE MONTHS OF FY 2024/2025
|
PLN ‘000 |
Q1-Q3 2024/25 |
Q1-Q3 2023/24 |
Change |
Q3 2024/25 |
Q3 2023/24 |
Change |
|
|
Revenue |
381,662 |
409,660 |
-6.8% |
131,351 |
133,780 |
-1.8% |
|
|
Foreign sales |
175,890 |
179,510 |
-2.0% |
59,903 |
57,243 |
+4.7% |
|
|
Domestic sales |
205,772 |
230,150 |
-10.6% |
71,448 |
76,537 |
-6.7% |
|
|
Gross profit |
93,086 |
105,872 |
-12.1% |
29,637 |
38,362 |
-22.7% |
|
|
Gross profit margin |
24.4% |
25.8% |
-1.4pp |
22.6% |
28.7% |
-6.1pp |
|
|
EBITDA |
32,027 |
55,319 |
-42.1% |
6,713 |
18,582 |
-63.9% |
|
|
EBITDA margin |
8.4% |
13.5% |
-5.1pp |
5.1% |
13.9% |
-8.8pp |
|
|
EBIT |
18,121 |
41,259 |
-56.1% |
2,083 |
13,745 |
-84.9% |
|
|
EBIT margin |
4.8% |
10.1% |
-5.3pp |
1.6% |
10.3% |
-8.7pp |
|
|
Net profit |
14,517 |
43,678* |
-66.8% |
3,067 |
13,253 |
-76.9% |
|
|
Net profit adjusted for one-off items |
19,543** |
33,164* |
-41.1% |
8,093 |
13,253 |
-38.9% |
|
|
Net profit attributable to owners of the parent |
14,102 |
43,120 |
-67.3% |
2,599 |
13,090 |
-80.2% |
|
|
Net margin |
3.8% |
10.7% |
-6.9pp |
2.3% |
9.9% |
-7.6pp |
*Net profit for the period included the effect of a tax refund with interest of approximately PLN 10.5 million, received in the second quarter of FY 2023/2024.
**Net profit for the period was affected by transaction-related costs of PLN 5.0 million incurred in the third quarter of FY 2024/2025 in connection with the agreement with Kingspan Group.
Healthy level of orders
“In the period from April to December 2025, the Group secured new orders worth about PLN 434.2 million, compared with PLN 445.3 million in the same period a year earlier. The value of new orders received by the Group in January 2025 alone was about PLN 51.5 million, compared with PLN 38 million in the same period last year, an increase of 35.5%, aided by orders in the new fire protection divisions where the Company had just started operations,” said Krzysztof Krempeć, President of the Management Board of MERCOR S.A.