ITAB Shop Concept (ITAB) Q4 2024 earnings summary

Executive summary

• Net sales grew 7% in 2024 to SEK 6,585m, with operating profit just over SEK 500m and an adjusted EBIT margin of 7.7%, supported by improved profitability and operational efficiency.

• Completed the transformative acquisition of HMY in January 2025, doubling group size and creating the largest sector group in Europe, with significant synergies expected.

• Integration of HMY is a top priority, focusing on operational efficiency, customer continuity, and immediate synergy realization, with full effects targeted by 2027.

• Most geographic markets saw growth, especially Northern, Central, and Eastern Europe, while the UK was more challenging and Southern Europe improved towards year-end.

• No dividend proposed for 2024 to prioritize debt reduction and financial flexibility post-acquisition.

Financial highlights

• Full-year net sales up 7% to SEK 6,585m, with Q4 sales up 11% year-over-year to SEK 1,771m, driven by grocery, DIY, and fashion sectors.

• Adjusted EBIT for 2024 increased 17% to SEK 507m, with a margin of 7.7%; Q4 adjusted EBIT was SEK 106m, margin 6%.

• Operating cash flow for 2024 was SEK 624m, with a cash conversion rate of 88%, above the 80% target.

• Net debt (excluding leases) improved to SEK -969m at year-end, supported by a directed share issue for the HMY acquisition.

• Non-recurring costs of SEK -48m in 2024, mainly related to the HMY acquisition and sale of the Chinese subsidiary.

Outlook and guidance

• HMY integration expected to deliver MEUR 30 in annual synergies by 2027, enhancing EBITDA margins and profit per share.

• Focus remains on operational efficiencies, sales efforts, and capital efficiency improvements, with Q1 2025 to include HMY results from February and March.

• Financial targets: 4–8% annual sales growth, 7–9% EBIT margin, >80% cash conversion; 2024 outcomes: 8% sales growth, 7.0% EBIT margin, 88% cash conversion.

• Market remains cautious, but positive sales momentum and synergy realization are expected to support future growth.