Ladies and gentlemen, thank you for standing by. Welcome, and thank you for joining the Half-Year 2024-2025 Results of Novem Group, which will be presented by CEO Markus Wittmann and CFO Benjamin Retzer. Throughout today's recorded presentation, all participants will be in listen-only mode. The presentation will be followed by a question and answer session. If you would like to ask a question, you may press Star followed by 1 on your touchtone telephone. Please press the Star key followed by 0 for operator assistance. I would now like to turn the conference over to Markus Wittmann. Please go ahead, sir.
Thank you very much, and good afternoon, ladies and gentlemen, to Novem's half-year report. The revenue in Q2 was EUR 139.4 million, representing a decrease of 18.9% compared to last year. This decline is attributed to an ongoing low demand. Market conditions remain challenging, particularly in Europe and Asia. The top line was significantly impacted by extended holidays in Asia and partially by technical issues at a major OEM. Additionally to that, Hurricane Helene had an indirect effect to two customers to us, and two customers had to shut down their production. The low revenue has had a substantial impact on our Adjusted EBIT , which stands at EUR 12 million, equating to 8.6%. We continue to counteract these challenges with cost management, production optimizations, and customer compensation payment.
Despite the adverse conditions, we have successfully entered the van market for the first time, and we see further opportunities in this luxury MPV segment. Nevertheless, the short-term outlook remains challenging because of low and volatile call-offs, and at the moment, there is no change in the visible range. I'd like to continue with Q2 financial highlights. As said, our revenue for Q2 2024-25 ends up with EUR 139.5 million, compared to last year's EUR 171.9 million. Ended up with an Adjusted EBIT at EUR 12 million and 8.6%, compared to last year's 10.4%. Free cash flow stood at EUR 3.5 million, and it ended up with a net leverage 1.9 times Adjusted EBIT compared to last year's 1.4.
Going ahead with half year highlights, our revenue EUR 279.5 million, compared to last year's EUR 347.1 million. Adjusted EBIT EUR 26.2 million, and the margin ends up with 9.4%, compared to last year 10.9%. Free cash flow EUR 0.6 million, and net leverage, as said already in Q2, 1.9x. Yeah, and that's it. I'd like to hand over to Benjamin for the detailed financial report. Benjamin?
Thank you very much, Markus. I would also like to take this opportunity to welcome you as the new CFO of the Novem Group to today's half year results presentation, and together, we will go through all the details of the group results, starting with the revenue development. Total revenue of EUR 139.4 million in quarter two decreased by EUR 32.5 million or 18.9% in comparison to last year. In terms of Series, the revenue of EUR 119.5 million was a little bit below prior year by EUR 30.1 million or 20.1%. This drop in Series business was, and this is no big surprise, related to the ongoing weak customer call-offs, especially in Europe and Asia.
In addition, and, as already heard by Markus, top line was adversely hit by pulling forward customer plant holidays in China into September as part of the Golden Week, partly due to the technical actions at a major OEM to absorb that integrated braking system issue. Furthermore, and now looking into the Americas region, Hurricane Helene led to production downtime, in total, five working days for several customers in the U.S. and resulted in further sales setbacks. FX effects had also a certain negative impact, and would have been by EUR 2.5 million or 1.8% higher. Revenue Tooling of EUR 19.9 million declined by minus EUR 2.4 million, or minus 10.9% against prior year, mainly driven by a different project phasing.
On a twelve-month basis, total revenue recorded at EUR 567.9 million, and therefore this decreased by -5.4% compared to last quarter. In summary, we are far from satisfied with this picture, but for the time being, it suggests that this is the current level we can reach in terms of the top line. This development is of course also visible in the Adjusted EBIT , both in absolute terms and percentage-wise, which came out at EUR 12.0 million or 8.6% for quarter two. On a year-to-date basis, we see an Adjusted EBIT margin of 9.4%, which is still a solid margin level, given the fact that the turnover has reduced by roughly -20% on a year-on-year comparison.
Compared to quarter one, in which an Adjusted EBIT margin of 10.1% was reported, the margin dilution to 8.6% was also influenced by a less profitable project business in this quarter, as a double-digit Adjusted EBIT margin was achieved in the core business at a level comparable to last financial year. Cost reduction developed favorably, but nonetheless, to a lower extent than the revenue decline, which burned the Adjusted EBIT and also diluted the margin. We were for sure seeing positive effects of the restructuring measures introduced in previous year, but on the other hand, we were hampered by the fact that we have not been able to reduce personnel costs as quickly as sales have fallen, in order to achieve a certain level of productivity appropriate to the low sales volume.
In addition, Adjusted EBIT was once again negatively impacted by an unfavorable product mix, as well as model changes. In return, the bottom line was secured and protected by customer compensations in the amount of a mid-single digit million number, and we are quite confident to increase this figure further. Here, we can see the Free Cash Flow performance. Despite the improvement against last quarter, the Free Cash Flow of EUR 3.6 million in quarter two fell short of last year by EUR -18.6 million or -83.8%, which is mainly due to the negative development of cash flow from operating activities, which came out at EUR 6.9 million and accounted considerably below prior year by EUR -17.8 million.
Key driver for this were reduced provisions, EUR -8.3 million, increased inventories, with negative effect of EUR -8.1 million, and lower trade payables by EUR -6.8 million. The decrease in provision was mainly related to prior years' restructuring costs in Bergamo, as well as tax payments in Germany, as the payment backlog due to tax suspensions related to the Corona time, has now been settled. Lower trade payables were mainly driven by the lower volume, and for the increased inventories, a couple of reasons, needs to be mentioned here. Firstly, as already heard, due to the hurricane and the associated production downtime, shipments were discontinued at short notice. S econdly, but mainly, tooling were built up.
Cash outflow from investing activities of EUR -3.3 million stood above prior year's number of EUR -2.4 million, due to lower interest received also and mainly volume driven. Capital expenditure of EUR 4.5 million kept the level of previous year, and most of it was invested in the operations in Querétaro, with an amount of EUR 2.9 million, also in line with previous quarter. In total, investments were made of around EUR 3.0 million, especially for the ramp up of the acquired business with a major US EV manufacturer. Based on that already mentioned poor top line, the CapEx ratio rose from 2.7% last year to 3.3% this year.
Overall, last 12 months, CapEx of EUR 17.7 million developed almost unchanged to the Q1 of 2024/25, with also an amount of EUR 17.7 million. In terms of working capital, total working capital accounted slightly above last year, at 139.3 million, compared to 136.3 million in prior year, with a deviation of -EUR 3.0 million, and stemmed from different factors and developments. On the one hand side, lower trade payables, EUR -13.6 million, and a higher tooling net result, also EUR -9.5 million. On the other side, lower trade receivables, effect of EUR 15.2 million, and a lower stock level, also with a positive effect of EUR 5.4 million.
The decline in trade payables was mainly attributable to lower volume, and the lower trade receivables, mainly due to top line. With regards to the higher tooling net amount, this can be understood as an indicator for future series business or new platforms to come. Again, in particular, in relation to the aforementioned business with the U.S. EV manufacturer. Therefore, looking at the pure trade working capital, so to say, without tooling net and contract assets, it developed so far favorable from EUR 56.0 million to EUR 49.0 million on a year-on-year basis. H aving a further look at our capital structure, the gross financial debt of EUR 301.9 million increased considerably by EUR 13.2 million in comparison to the same reporting date last year.
As previously reported, the increase was mainly driven by a significant rise in lease liabilities to EUR 51.9 million, which is a change of EUR 12.7 million on a year-on-year basis, due to the renewal of lease contracts, in particular at our premise in Mexico in quarter three last year. The cash position came in at a very robust number of EUR 132.4 million, supported by EUR 40.3 million from a non-recourse factoring program. Therefore, the net financial debt stood at EUR 169.5 million, and showed a steep increase compared to prior year, with an amount of EUR 152.2 million.
The Net Leverage Ratio, as already heard, of 1.9 times Adjusted EBITDA, remained at a higher level than previous year, with one point four, but still within a corridor that allowed us to maintain the actual margin spread. Looking into our operating segments, it needs to be noted that the Americas region remained the backbone of the group, accounting for more than half of the total revenue, with again an increase in turnover, while both Europe and Asia declined, as already heard, and similar to last quarter.
The poor top line in Europe, with EUR -28.4 million on a year-on-year basis, was mainly attributable to series revenue due to the ongoing weak customer sentiment, as well as the phase-out of larger programs like the EOP of BMW 5 Series and Porsche Panamera, as well as lower revenue of Mercedes-Benz E-Class and S-Class. The reduced revenue in Asia with on a year-on-year comparison in the amount of EUR -7.2 million, predominantly caused by the EOP of the BMW 5 Series and the model change of a Mercedes-Benz E-Class. Whereas the positive development in Americas, +EUR 3 million, was mainly driven by tooling business, while series revenue showed a slight decrease. H ere also, as already heard and mentioned, caused by the downtimes of various major OEMs due to that hurricane.
Again, the same picture when it comes to the Adjusted EBIT , negative performance in Europe and Asia was only partly compensated by a higher profit contribution in Americas. Referring to Europe, the Adjusted EBIT of EUR -6.9 million was again loss-making, caused by significantly lower revenue and therefore volume-related inefficiency, as well as a negative product mix. As already said, cost savings and customer compensation payments helped to mitigate these effects, but only partly. Adjusted EBIT of EUR 17.3 million in Americas outperformed prior year, benefiting from the release of accruals with an amount of EUR 1.3 million, as well as ongoing lower input costs. In Asia, the Adjusted EBIT of EUR 1.6 million developed negatively by EUR 1.0 million, also because of the lower top line in both series and tooling.
So, yeah, this brings us already to the end of today's presentation, or at least slides. To summarize, the short-term adversities, as already highlighted by Markus, remain, and the economic situation has worsened further. A solid order intake in a range of a mid-double-digit million EUR for the first half year, and for sure, the ramp-up of the platform with US EV manufacturer in our Q4, provides a sense of perspective. So, so far, thank you for taking the time to participate in the call, and we are now looking forward to addressing any questions you may have.
Ladies and gentlemen, at this time, we will begin the question and answer session. Anyone who wishes to ask a question may press star, followed by one on the touchtone telephone. If you wish to remove yourself from the question queue, you may press star, followed by two. If you're using speaker equipment today, please lift the handset before making your selections. Anyone with a question may press star and one at this time. Our first question comes from Philippe Piva from Kepler Cheuvreux. Please go ahead.
Hi, good afternoon to everyone. Thanks a lot for taking my call. I will have three questions to pose you. The first one is concerning the profitability for the rest of the year. I f you're expecting to reach a 10% EBIT profitability over the year? The second one is concerning an update on the ongoing talks around the potential delisting, and what could prevent this from happening? And the third one is concerning Tesla. T he Tesla contract, if you're expecting it on the Q4, and what will be the revenue contribution, either this year or from the next year? Thank you a lot.
So, thank you very much, Philippe, for your questions. In terms of your first question, so, at the end of the day, as you know, we do not give any forecast or guidance so far. T o further elaborate here, and as already mentioned and said during the presentation and during the slides, so at the end of the day, we suggest, in terms of revenue, that this is the level right now we see also going forward. A t the end of the day, yeah, nobody can really have a look into the future.
But that's the level in terms of revenue and also in terms of Adjusted EBIT margin, for sure. Also here, no detailed guidance will be given, and as already known so far, but for sure, that's more or less a threshold we can and we will achieve, or we would like to achieve, to have a double-digit margin. T hat's in terms of the first question.
To the second question, delisting, I can tell you for today, by today, there is, there are no news to our talk, as of second of October. A s soon as we have anything new, we will inform you accordingly. And, third-
And in terms of your third question in regards of our contract with that U.S. EV manufacturer, for sure, we are heavily working on the ramp up of that platform. I t is expected that this will then start with beginning of the next calendar year, which is then our Q4. A s I mentioned, this gives us, for sure, a certain sense of perspective, revenue-wise, as well as contribution-wise, that this will support for year end.
Thank you very much. As a reminder, if you wish to register for a question, please press star followed by one. Gentlemen, there are no further questions. Back over to you for any closing remarks.
Okay, then that's it for today. Thank you very much for participating, for listening us, we appreciate it. Yeah, see you next time in February. Yep.
Thank you very much.
Thank you very much, and goodbye.
Good afternoon. Bye.