Kjell Group (KJELL) Q1 2025 earnings summary

Executive summary

• Net sales declined 5.1% year-over-year to SEK 561.3 million, with comparable growth at -5.4% due to weak market conditions and lower customer traffic, partially offset by higher sales per purchase.

• Gross profit fell 4.7% to SEK 236.1 million, but gross margin improved to 42.1% from 41.9% as operational measures took effect.

• Adjusted EBITA improved to SEK -2.3 million from SEK -5.6 million, with margin at -0.4% versus -0.9% last year.

• Net loss narrowed to SEK -20.7 million from SEK -21.7 million year-over-year.

• Rights issue secured SEK 199.1 million in new capital, fully subscribed, strengthening the balance sheet and supporting future investments.

Financial highlights

• Gross margin increased by 0.2 percentage points to 42.1% despite lower sales.

• Adjusted EBITA margin improved by 0.5 percentage points to -0.4% year-over-year.

• Cash flow from operating activities was SEK 8.6 million, up from SEK -5 million in Q1 2024.

• Financial net debt increased by SEK 28 million year-over-year; net debt/EBITDA rose to 4.7x from 3.7x.

• Equity ratio was 41.5%, slightly down from 41.9% last year.

Outlook and guidance

• Management expects improved net debt ratio in coming quarters due to the rights issue.

• Continued investment in logistics and digitalization, with automated warehouse project on track and automation expected to complete by year-end.

• Focus remains on profitability, operational efficiency, and adapting to uncertain consumer behavior.

• Investments prioritized to strengthen operational capacity and long-term competitiveness amid continued market uncertainty.

• Market recovery and operational improvements targeted to drive future profitability.