- European indices in the green, most looking to close Monday's downward gap
- DE40 with slight gains after closing downward gap
- Rheinmetall - Impressive sales growth of 50% y/y in Q2 2024, with optimistic outlook
- Jenoptik - EBITDA above expectations in Q2 2024, with hopes for a strong second half of the year
Friday's session on European stock markets brings gains for virtually all indices. Germany's DAX is currently up little, only 0.17% intraday. At the same time, France's CAC40 is up 0.35%, and Spain's IBEX35 is up almost 0.60%. The DAX, after closing Monday's gap down yesterday, is looking for further fuel to rise, with the Spanish index testing the 10650 level, the low of last week's Friday session. Germany's Rheinmetall is gaining more than 3% after showing strong results and signing new contracts for the Ukrainian armed forces.
Volatility seen in the broad European market today. Source: xStation5
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Companies included in the DAX index. Source: Bloomberg Finance L.P.
Source: xStation
Company news
Rheinmetall (RHM.DE) reported a nearly 50% increase in sales to €2.23 billion in Q2 2024, confirming preliminary results. Operating profit doubled, and net income came in at €79 million. The company maintains its forecast for annual sales of €10 billion and an operating margin of 14-15%. CEO Armin Papperger expects annual sales growth of about €2 billion in the coming years. Rheinmetall has received an order to supply eight mobile surgical stations to the Ukrainian armed forces, in line with the trend of increased demand for armaments in Europe. Analysts at Morgan Stanley (rating: overweight) described the results as solid, noting strong operating cash flow. Oddo (rating: neutral) noted "relief" related to positive free cash flow.
Q2 2024 RESULTS:
- Sales: €2.23 billion; up nearly 50% y/y
- Operating profit: doubled y/y
- Net profit: €79 million
- Order backlog: up 62% to EUR 48.6 billion in H1
Jenoptik (JEN.DE) reported EBITDA of €56.9 million in the second quarter of 2024, exceeding analysts' average expectations. Revenues in the first half of the year rose 7.1% to €540.8 million. The company maintains its EBITDA margin forecast of 19.5-20% for full-year 2024 and expects revenue growth in the mid-single-digit percentage range. Jenoptik expects orders to be concentrated in the second half of the year. Jenoptik CEO Stefan Traeger notes that demand improved in the second quarter and expects orders to be concentrated in the second half of the year.
Q2 2024 RESULTS:
- EBITDA: €56.9 million; consensus: €55 million
- EBITDA margin: 20% vs. 20.3% y/y; consensus: 19.9%
- Orders taken: EUR 282.4 million; consensus: EUR 264.8 million
Lanxess (LXS.DE) reported an adjusted EBITDA margin of 10.8% in Q2 2024, beating analysts' expectations. Sales fell 5.6% to €1.68 billion, slightly below consensus. The company reaffirmed its 2024 forecast, expecting EBITDA growth of 10-20%. Lanxess expects Q3 EBITDA to be similar to or slightly higher than Q2, with normal seasonality in Q4.
Q2 2024 RESULTS:
- Adjusted EBITDA margin: 10.8% vs. 6% y/y; consensus: 8.85%
- Sales: EUR 1.68 billion, -5.6% y/y; consensus: EUR 1.71 billion
- Adjusted EBITDA: 181
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