Kesko (KESKOB) Q1 2025 earnings summary

Executive summary

• Net sales for Q1 2025 increased to €2,827.7 million, up 2.5% year-over-year, with comparable net sales up 1.1%; comparable operating profit decreased by 5.5% to €95.6 million due to seasonality and grocery trade impacts.

• Building and technical trade saw sales and profit growth, especially in B2B segments across Finland, Denmark, and Norway, supported by acquisitions in Denmark.

• Car trade delivered higher net sales and profit, with strong new car sales and growth in used car and service sales.

• Major acquisitions in Denmark (Roslev completed, C.F. Petersen & Søn approved, Tømmergaarden pending) are expected to contribute to future growth.

• Performance was stable during the slowest quarter, with segment trends influenced by seasonality and market conditions.

Financial highlights

• Q1 net sales exceeded €2.8 billion, up €68 million year-over-year; operating margin declined to 3.4% from 3.6%.

• Comparable operating profit was €95.6 million; profit before tax was €65.1 million.

• Rolling 12 months net sales reached nearly €12 billion; operating profit €646.2 million (margin 5.4%).

• Earnings per share (basic) fell to €0.13 from €0.16; reported EPS: €0.12.

• Cash flow from operating activities was negative at €-24.5 million, impacted by seasonal working capital needs.

Outlook and guidance

• Profit guidance for 2025 remains unchanged: comparable operating profit expected between €640–740 million.

• Operating environment is expected to improve but remain somewhat challenging; gradual economic recovery anticipated.

• Grocery trade operating margin projected to stay above 6% for 2025 despite price investments.

• Building and technical trade profitability expected to improve as the construction cycle turns.

• Car trade profitability to remain strong despite muted new car demand.