Ladies and gentlemen, welcome to Vantiva Full Year 2024 Estimated Operational Results Conference Call, chaired by Tim O'Loughlin, CEO, and Lars Ihlen, CFO. At this time, all participants are in listen mode only. Later, we'll conduct a question and answer session. If you'd like to register questions, please press one on your telephone keypad. Just to remind you, this conference is being recorded. We would like to inform you that this event is also available live on our Vantiva website with a synchronized slideshow. During this conference call, statements could be made that constitute forward-looking statements based on management's current expectations and beliefs and are subject to a number of risks and uncertainties that could cause actual results to differ materially from the future results expressed, forecasted, or implied by such forward-looking statements.
For a more complete list of descriptions of such risks and uncertainties, refer to Vantiva's filing with the French authority, the Autorité des marchés financiers. Before I hand over to Tim, I would like to add one thing. The financial data for the year ended December 31, 2024, presented in this presentation are estimated financial data. These estimated financial data have been prepared according to an accounting and consolidation process similar to that usually used for the preparation of consolidated financial statements. The accounting basis used for this estimate is consistent with the method applied by Vantiva and described in the consolidated financial statement. However, all annual closing procedures are not completed. These estimated financial data have been examined by the Board of Directors of Vantiva and are currently being audited.
The financial statements closing by the Board of Directors is scheduled for March 13, 2025, and the result of the year will be published the same day. Now, Tim, I hand over the call to you.
Good afternoon, everyone. Thanks for being here today. It's a privilege to present our 2024 estimated results. I'm happy to share that we've met our financial targets for the third year in a row and are making big strides relative to our strategy. Beyond the hard work of our incredible team in delivering on our customer commitments, two major events stand out: the successful integration of Home Networks and the sale of our Supply Chain Solutions business. Let's take a closer look at what we've accomplished over 2024. One of the biggest wins this year was integrating the Home Networks business, which was well underway by the end of 2024. Nearly all the transition service agreements are closed out, and the business systems have transitioned successfully. The integration of all the organizations is well underway.
The process went smoothly and on time, proving once again that we really know how to make acquisitions work. At the same time, we've been finalizing the sale of our optical disc replication business, SCS. With this sale, divestiture, Vantiva is now fully focused on connectivity. This allows us to put all of our resources into what we do best, helping consumers and businesses stay connected in smarter and faster ways. Even though we hit our financial targets, the year was not without its challenges. The first half was soft, with some of our biggest clients holding back and adjusting their inventory levels. As expected, things picked up in the second half thanks to new product launches and strong partnerships. We also started the year with a higher cost structure due to carrying costs from both Connected Home and Home Networks.
By staying disciplined and focused on efficiency, we brought those costs down significantly, making the company leaner, faster, and ultimately stronger. I'm pleased to confirm that the synergies from the Home Networks acquisition should reach at least EUR 200 million by 2026, just as we announced back in Q3. Of course, we will continue to look for new ways to improve our operations to serve customers. Externally, the broader market faced some headwinds, particularly with customers tightening their capital expenditure. However, certain DOCSIS customers, fiber customers, and some 5G fixed access wireless customers remain strong growth areas for the company.
We've made great strides in several areas, including deploying Wi-Fi 7 technology across multiple platforms, developing a whole new generation of set-top boxes that will help us secure future video business, and doing some early work with operators on AI-driven solutions for our gateways and set-top boxes that will help those customers increase revenues and potentially cut operational costs. We also won two Tier 1 awards on fixed wireless access. This was a major goal for the company and a big milestone for Vantiva. We continue to make progress on our sustainability efforts. We're completely committed to reducing our environmental impact and are on track to meet our short and midterm goals. This year, we raised our ambition to net zero by 2040. Our customers are also more focused than ever on energy efficiency and recyclability, and we're making sure our products meet these expectations.
Our hard work has been paying off, and we once again received the Gold EcoVadis label, placing us among the top 3% in the industry. Now let's turn to the numbers on the next slide. With the sale of SCS, we're now reporting our results without this business, which is classified as a discontinued operation. Revenue reached EUR 1.87 billion, up 19.3% year- over- year, thanks largely to the integration of the Home Networks business. Adjusted EBITDA came in at EUR 104 million, a 6.8% increase. Our EBITDA margin was 5.8%. While benefiting from non-recurring synergies related to component supply, it has been slightly lower than last year due to the slow start and the initial cost structure challenges. The good news is that our second-half margin doubled to exceed 7%, reflecting the impact of our cost-saving measures.
Most importantly, our free cash flow after financing and tax but before restructuring in 2024 was positive at EUR 33 million, a EUR 73 million improvement over last year. A big part of this success came from better working capital management as we aligned Home Networks commercial terms with that of our organic Connected Home business. Next slide. This brings me to a key point. When you look here at this slide, we have met all of our financial targets for 2024, both in our current structure and in our previous structure before the SCS spinoff. We are consistently delivering on our guidance and commitments. On the next slide, we look at the Home Networks integration, and it was a real success. We met all of our milestones on time and are on track to deliver at least EUR 200 million in synergies by 2026.
When we look ahead to 2025, we know that there are some uncertainties in the marketplace around global trade and tariff policies, and we're always managing and monitoring the pace at which our customers adopt next-generation products. Given these factors, we expect 2025 revenues to be roughly in line with 2024. However, with our continued focus on cost control, we're targeting an Adjusted EBITDA of more than EUR 150 million and a positive free cash flow after financing, tax, and restructuring. With that, I'll hand it over to Lars, who will take you through the numbers in more detail. Thank you.
Thank you very much, Tim, and good evening to everybody online. If you move to page 11, I will give a bit more details on how we improved the free cash flow after interest and tax before restructuring by EUR 73 million from - 40 to + 33 in 2024. As Tim has mentioned, the EBITDA increased by EUR 7 million versus last year, but due to the slightly higher level of scope we had with integration of CommScope, we had a negative impact on the net CapEx by EUR 14 million. Similarly, we had a very good success on how we realigned our payment terms during the year, and that led to a EUR 100 million improvement in our working capital variance.
The pensions were in line with last year, and we had slightly higher financing costs at EUR 17 million, which was mainly linked to the bridge facility that we put in place in October 2023, and that was fully paid back by August in 2024. Taxes were also slightly higher by EUR 4 million because of the larger scope of entities we are having and the tax that is levied in every country, and this led us to the EUR 33 million result at the end of the year. Move to page 12, we will see how the liquidity and debt situation stood at the end of the year. We ended the year with EUR 30 million cash at hand. We had EUR 64 million available amount on our Wells Fargo credit line as growing EUR 56 million at the end of the year, leaving us a total liquidity of EUR 94 million.
In terms of gross debt, the debt increased to EUR 489 million during the year, and with the cash and the cash equivalents of EUR 30 million, the net debt stood at EUR 459 million at the end of the year. This is what we will present in terms of additional numbers today. We will have a full presentation at the 13th of March with all our, it will be posted on the internet. All the P&L and statements will be posted the 13th of March. With this, we put it over to you for additional questions.
Thank you, Lars. Now we are open for any questions you may have. I remind you that you have to press your number one, star one, sorry, on your telephone keypad. Operator? Are there some questions you want?
Yes. We have just two questions. The first question is from Antoine Leb ourgeois, Bryan, Garnier.
Antoine, go ahead.
Good evening, everyone. I have two questions. The first is on the quarter-on-quarter growth. If I'm not mistaken, I calculate 45% sequential growth in Q4, which is quite strong. How much of this is attributable to a catch-up from last quarter's descriptions? How much is attributable to a market recovery? If the catch-up was significant, would you expect a digestion, I would say, next quarter and maybe softer sequential growth? Secondly, can you provide some insight into your potential exposure to the recently announced potential tariffs in the U.S.? I know the situation is evolving rapidly, but any insight would be very helpful.
Good evening, Antoine, and thanks for your question. I will answer the first one, and then Tim will tackle the tariffs question. As you correctly say, yes, we had a very strong sequential growth from Q3 to Q4. We did mention at the end of the presentation in September or October, it must have been, that we had some supply chain disruptions, mainly linked to the port strikes in the East Coast. They were not that big. They were EUR 15 million-EUR 20 million of impact. They did not really pull too much effort from Q3 into Q4. Most of the growth you saw in Q4 was real customer demand that belonged in the fourth quarter. That means there is no impact of that into Q1 either, and we will present the results in April.
Antoine, thanks for the question. Regarding tariffs, we've been doing a lot of review and modeling with not only our U.S. customers but customers around the world. As you're probably familiar, Vantiva, we specifically partner with large global contract manufacturers like Foxconn, Pegatron, Kinpo, for example. They have access to facilities in varying countries. We have our main manufacturing volume split between two countries in Asia right now outside of China. We're continuing to level load those two facilities as we try to manage the unpredictable potential risk of tariffs. We've even investigated options around expanding some of our manufacturing footprint in Mexico, which right now, based on the current policy projections, does not look quite as favorable. The main strategy by the firm is to leverage those big contract manufacturing partners and use their flexibility.
Thank you, Tim.
Thank you.
Do we have any more questions in line?
Yes. Yes. We have another question from David Cerdan, Kepler.
Good evening. I have a question regarding your competitive landscape. Do you see any changes in your competitive landscape since the merger with CommScope? Secondly, regarding the disposal of the DVD replication business, this has no impact on your synergies objective, i f I'm right, can you confirm this? Thank you.
Okay. I'll take the first part of that question, and Lars can take the DVD replication part of the question. The Home Networks acquisition, if anything, David, has opened up a number of customers to us. There were customers that were in the CommScope Home Networks portfolio that were new to Vantiva that we're now doing business with. Clearly, the competitive environment is aggressive. There are lots of OEMs, both Taiwanese, French, and Korean, that we compete against all the time. We welcome that competition and believe the company is well- positioned to win in many of those contests. I don't think things have dramatically changed since the Home Networks acquisition. If anything, the additional scale has made us more competitive.
Roughly, do you expect this industry to further consolidate? And could you participate, or this is not possible for you?
Yeah. I mean, it's impossible for me to predict that. These vertical segments that we're participating in, they do go through consolidation from time to time. I can't really prognosticate what's going to specifically happen in the OEM space in the upcoming year. I think the uncertainty of the tariff situation and some of the global trade policy just makes it very hard to guess if there will be further consolidation.
Thank you.
Linked to your question on SCS and the synergies, there is no negative impact on the divestment of SCS on our synergies that we have announced. If any, we should have some more savings as we can simplify the way we are working across the rest of the company when we only have one division left, and we can focus on that activity. On the EUR 200 million that Tim mentioned earlier, there is no disinterview on this.
Okay. Thank you very much.
Okay. Thank you, Lars. David, a ny further questions from your side?
At the moment, we don't have any other questions.
Okay. Okay. If no further questions, I'd like to thank everyone for joining the call to review our 2024 earnings and put a special thank you out there to all of my colleagues and team members here at Vantiva for all of the hard work that went into delivering our 2024 results and thank all of our customers and partners for their participation in the good results that we've put out today. Thank you again, everyone.
Thank you, Tim. If you have further questions, do not hesitate to contact me whenever you want. Have a good evening.