Kid (KID) Q2 2024 earnings summary

Executive summary

• Achieved fourth consecutive quarter of double-digit growth, with Q2 revenue reaching NOK 797.8 million, up 10.2% year-over-year, driven by category and omni-channel development, store refurbishments, relocations, and new store openings.

• EBITDA increased by NOK 34.9 million to NOK 201.5 million, with EPS at 1.19, and gross margin improved by 1.0 percentage point to 63.2%.

• Customer loyalty program reached 3.2 million members, up 10.4% year-over-year, including 1.5 million in Norway.

• Online sales accounted for 12.1% of total revenues, with new categories and the Extended concept contributing to both new and existing assortment sales.

• Store portfolio expanded with multiple new stores and projects, and contracts signed for further expansion in Norway, Sweden, and Finland.

Financial highlights

• Q2 EBITDA increased 20.9% to NOK 201.5 million, with EBITDA margin at 25.2% and EPS at 1.19.

• Gross margin reached a record 63.2%, up one percentage point year-over-year.

• Group revenues grew 10.2% (10.6% constant currency), with like-for-like growth of 9.2%.

• Net profit increased to NOK 48.4 million from NOK 36.4 million in Q2 2023.

• Cash flow from operations was NOK 111.2 million, impacted by planned inventory build-up.

Outlook and guidance

• H2 2024 expected to face tougher comparables due to strong prior-year growth from anniversary campaigns.

• Seven new store projects planned for late 2024 and 2025, with three Extended stores opening before Black Friday.

• Monitoring shipping delays and freight situation, but no significant negative impact expected for Q4.

• European e-commerce pilot to launch in H2 2025, with limited investment and risk, including a German-language site and an English-language site for other countries.

• Warehouse project in Sweden progressing as planned, with operations expected to commence mid-2025.