Elis Confirms 2024 Goals Despite Decline in Hospitality Sector

Elis, a global leader in circular services, reported a 5.5% increase in revenue for the third quarter of 2024. The company experienced a 4.9% organic growth in this quarter, attributed to various commercial initiatives across different countries. This growth is consistent with the 5.3% organic revenue increase recorded in the first nine months of the year.

Despite the overall positive performance, the hospitality sector underperformed in the third quarter, particularly witnessing a noticeable decrease in occupancy rates in France and the United Kingdom. The company indicated that events such as the Olympics and Paralympics had a negative impact on tourism, leading to the cancellation or postponement of many professional events planned in Paris during the summer. The focus of hospitality operators on maintaining high prices at the expense of occupancy rates also contributed to the sector's decline.

On the mergers and acquisitions front, Elis announced its first step into the Asian market by acquiring the cleanroom service provider Wonway in Malaysia on July 1, 2024. Although discussions with two potential partners in the U.S. were terminated in early October for financial discipline reasons, Elis continues to explore numerous small-scale acquisition opportunities in its existing markets.

The company reiterated its full-year financial targets for 2024, expecting organic growth between 5.2% and 5.5%, an adjusted EBITDA margin between 35.2% and 35.5%, and a stable adjusted EBITDA margin of approximately 16% year-on-year. Additionally, it anticipates a net income per share exceeding €1.75 on a fully diluted basis and approximately €340 million in free cash flow. A reduction in the financial leverage ratio by 0.2x is also expected compared to December 31, 2023.