Fnac Darty (FNAC) Q3 2024 TU earnings summary

Executive summary

• 9M 2024 revenue reached €5,238 million, up 1.0% reported and down 0.2% like-for-like, with Q3 revenue at €1,849 million, up 0.5% reported and down 0.6% like-for-like.

• Gross margin rate increased by over 100 bps in Q3 and 50 bps over 9M, driven by services and favorable product mix.

• High single-digit growth in services and strong Iberian Peninsula performance offset stable or declining sales in other regions.

• Current operating income target for 2024 raised to exceed €180m, up from previous guidance of at least €171m.

• Strategic acquisition of Unieuro is progressing, aiming to create a leading retail player in Western & Southern Europe, with a 42% premium offered and minimum acceptance threshold lowered.

Financial highlights

• Q3 2024 revenue: €1,849 million (+0.5% reported, -0.6% like-for-like vs Q3 2023).

• 9M 2024 revenue: €5,238 million (+1.0% reported, -0.2% like-for-like vs 9M 2023).

• Gross margin rate up over 100 bps in Q3 and 50 bps over 9M, excluding franchise and scope effects.

• Online sales accounted for 21% of total, with over 50% using click-and-collect.

• Services business posted high single-digit growth, contributing significantly to margin improvement.

Outlook and guidance

• 2024 current operating income guidance raised to exceed €180m, up from at least €171m.

• Cumulative free cash flow for 2021-2024 period maintained at €500m.

• Management remains confident for year-end, citing falling inflation and interest rates as supportive factors.

• Year-end events (anniversaries, Black Friday, Christmas) expected to be decisive for full-year results.