Avolta welcomes 7th consecutive quarter of strong growth in Q3
Avolta has marked its 7th consecutive quarter of strong growth in Q3, as it continues to execute its Destination 2027 strategy. The company's latest report confirmed its medium-term targets and the cancellation of approximately 6.1 million treasury shares (4% of issued share capital) in 2024 in line with its reinforced shareholder focused capital allocation policy.
Avolta revealed consolidated turnover of CHF10,371 million and core turnover of CHF10,172 million (US$11,743 million), up +8.4% year-on-year reported and +6.6% on an organic basis. Core turnover excludes fuel sales from the motorway business.
Core EBITDA in the first nine months of 2024 increased by +13.2% to CHF1,012 million (US$1,169 million), with EBITDA margin up 40 basis points to 9.9%.
Avolta said it remains confident in delivering its outlook and confirms its Destination 2027 targets: growing the business organically and through bolt-on acquisitions, expanding profitability and cash generation.
The focus on shareholder value is reflected in Avolta's reinforced capital allocation policy, which will return excess cash to shareholders via dividends and potential share buybacks over the coming years.
Xavier Rossinyol, CEO of Avolta, stated, “We are very pleased with our strong trading performance over the peak summer months which underscores our confidence in Avolta’s outlook for 2024 and the years beyond in line with our Destination 2027 strategy.
“Consistent with our strategy of traveler centricity, we have recently announced Club Avolta, a unique loyalty program available in all our locations worldwide.
Rossinyol said by capitalizing on its global platform, Avolta has “a clear focus to grow the business organically expanding our profitability and cash generation, while targeting leverage of 1.5x to 2.0x”. “This focus on shareholder value is reflected in our reinforced capital allocation policy, according to which we will return excess cash to shareholders via dividends and potential share buybacks over the coming years,” he added. “This starts with the cancellation of 4% of outstanding shares in 2024.”
Nine months 2024 financial highlights
Avolta’s 9M CORE EBITDA came in at CHF1,012 million with an EBITDA margin of 9.9%, +40bps YoY. For Q3, the EBITDA margin was 11.6%, driven by commercial performance and productivity increases.
The combined group’s financial net debt stood at CHF2,617 million as at end-September 2024.
In October, Avolta refinanced its revolving credit facility (RCF), extending it by two years (through to 2029). Avolta anticipates interest expense savings of approximately CHF 10 million per annum.
Key operational highlights
Avolta’s key strategic growth projects are advancing as planned. Strengthening its local partnership with Mass Transit Railway (MTR) in Hong Kong, the company has entered into an agreement to acquire 100% of Free Duty at an accretive multiple, extending its presence to six locations, reaching an additional 150 million travelers, and significantly expanding its footprint in Hong Kong. This regional acquisition, which is subject to customary conditions precedent to closing, accelerates the execution of Avolta’s Destination 2027 strategy in the APAC region, driving continuous revenue growth with attractive margins.
Avolta launched Club Avolta in October, a pioneering loyalty program that brings together duty-free, duty-paid, convenience, F&B, brands, airports, airlines, hotels, and more across Avolta’s 5,100 outlets worldwide.
Regional performance in Q3 2024 is detailed in the following graphs.
