BHG Group (BHG) Q1 2025 earnings summary

Executive summary

• Net sales grew 9.7% year-over-year to SEK 2,204 million, with organic growth of 8.2%, and all three business units delivered sales and profitability improvements for the second consecutive quarter.

• Adjusted EBIT improved to SEK 21.2 million from a small loss last year, with net profit reaching SEK 29.5 million, driven by top-line growth and cost control.

• Strategic focus shifted from restructuring to profitable growth, emphasizing market share, cost control, and customer satisfaction.

• Sweden was the main growth driver, with strong performance also in Germany and Norway.

• The company completed the sale of IP-Agency, resolving a major dispute and strengthening liquidity.

Financial highlights

• Net sales reached SEK 2,204 million, up 9.7% year-over-year, with organic growth of 8.2%.

• Adjusted EBIT reached SEK 21.2 million, corresponding to a 1.0% EBIT margin, a SEK 22 million improvement over last year.

• Cash flow from operating activities was -SEK 103.1 million, reflecting seasonal inventory build-up.

• Net debt at quarter-end was SEK 1,282.3 million, with net debt/EBITDA at 3.92x.

• Unutilized credit facilities amounted to SEK 600 million at period end.

Outlook and guidance

• Gradual market recovery is expected in 2025, led by Sweden, but with increased uncertainty due to geopolitical, tariff, and macroeconomic risks.

• Tactical focus remains on growth, market share, cost leverage, and consumer focus.

• Management is confident in further profitability and leverage improvements as seasonal cash flow strengthens in Q2.

• Long-term targets include organic growth above the addressable market, adjusted EBIT margin returning to 5% and improving to 7%, and net debt/EBITDA below 2.5x.

• Short-term focus on strengthening the balance sheet, with future cash flow to be reinvested in growth and dividends once targets are met.