Financial guidance, targets and dividend policy

Financial guidance for 2024 (13 February 2024)

Adjusted EBITDA in 2024 is expected to be on a similar or higher level than in 2023 (EUR 92.3 million).

Wholesalers’ stock levels have stabilised, and the lower interest rates support the expectations of a gradual market activity improvement. Strong margin management actions, which will continue in 2024, provide confidence in the guidance for the Group. However, increased geopolitical risks and high overall uncertainties can have an impact on Purmo Group’s core markets.

The strategy acceleration programme, Accelerate PG, performs ahead of plan and further underpins Purmo Group’s outlook for 2024. As a result, the company updates the programme’s target. The cumulative targeted adjusted EBITDA run-rate improvements will be EUR 50 million (previously: above EUR 40 million), which are expected to be reached by the end of 2024. The programme also targets cumulative net working capital improvements of EUR 45 million by the end of 2024 (previously: more than EUR 30 million).

Long-term financial targets

  • Growth:
    Purmo Group targets organic net sales growth in excess of market growth. In addition, Purmo Group aims for notable inorganic growth through acquisitions.
  • Profitability:
    Purmo Group targets an adjusted EBITDA margin above 15% in the medium- to long-term.
  • Leverage:
    The leverage ratio is targeted not to exceed 3.0x, measured as interest-bearing net debt / Adjusted EBITDA on a rolling twelve-month basis. However, leverage may temporarily exceed the target level, for example in conjunction with acquisitions or restructuring actions.

Dividend policy

  • Purmo Group’s aim is to distribute at least 40% of annual net profit as dividends or return of capital, intended to be paid out after considering earnings trends for the group, its financial position and future growth potential.
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