Speedy AD – 2024 Q4 cons. review – Outstanding performance, but likely reaching a plateau

Q4 Consolidated Results

• Revenues in Q4 2024 marked a 13% increase to BGN 519mln. The rise in sales was driven by the growth in domestic parcel deliveries as well as the growth in deliveries to and from Greece, with the Romanian market showing signs of slowdown. Domestic sales grew 12.6% to BGN 265.6mln, while international markets gained 12.5% to BGN 242mln.
• The number of transported shipments was 80.9 million, 1% more than the previous year. The price hike was below the inflation rate and this way the company hopes to stay competitive and allow for future increase in sales.
• OPEX increased by 14.4% YoY to BGN 475mln. The largest contributors are the expenses for external services and personnel services, which represent 85% of OPEX. External services expanded by 13.7% to reach BGN 290mln. Within that, the amount for subcontractors is 86.8% of external services, amounting to BGN 251.6mln. This is the account that is most directly related to the greater revenues as it is incurred per shipment and is fundamental to the growth in Greece and Romania.
• Personnel expense increased by 19.1% to BGN 116.8mln. The increased personnel expenses are part of the salary indexations in line with the overall macro environment. The investments in automation and employee productivity have compensated to a large degree the growth in this account.
• Amortization increased 13.5% due to the increased investments. This resulted in EBIT dropping 2.5% to BGN 44mln and EBITDA increasing 4.6% to over BGN 84.6mln.
• The profitability margins decreased, however. EBITDA margin dropped down to 16.3% from 17.6% last year. Net Profit margin dropped from 8.6% to 6.8% and Net Profit dropped 10.5% to BGN 35.3mln. The main reason are the abovementioned increases in external services and personnel expense.
• To a great degree it is understood that the company will be reaping benefits from process and cost optimizations at a decreased rate and that they will reach market saturation soon considering their competition. Their dividend yield currently is 2.88% and it would be hard to increase it considering the amount of cash left after operations. Which means that the only alternative for them would be to look for other markets one way or another in the next couple of years. On the other hand, the introduction of staff-less delivery premises by some parcel delivery companies and thus save on personnel cost might be a way to postpone the need for that with a couple of years.

Full report can be accessed here.