Kjell Group (KJELL) Q2 2025 earnings summary

Executive summary

• Net sales declined 10.9% year-over-year to MSEK 529.7 in Q2 2025, mainly due to weak online sales in Denmark and lower footfall in Sweden.

• Gross margin improved to 42.2% from 40.8% year-over-year, reflecting assortment optimization and operational improvements.

• Net loss widened to MSEK -20.9 in Q2, with adjusted EBITA at MSEK -9.2, down from 0.3 last year.

• Operational improvements led to a 10.5% reduction in operating expenses for the quarter.

• Accelerated action programme launched, including a new CEO, warehouse investment, and strategic review of Danish operations.

Financial highlights

• Net sales for H1 2025 fell 8.0% to MSEK 1,091.0; gross profit for Q2 was MSEK 223.7, down 7.7% year-over-year.

• Adjusted EBITA margin was -1.7% in Q2, compared to 0.1% last year.

• Cash flow from operating activities was MSEK -136 in Q2, compared to 13 last year, mainly due to higher inventory and lower sales.

• Financial net debt increased to MSEK 414.3; net debt/LTM adjusted EBITDAaL at 6.1, up from 3.9.

• Items affecting comparability totaled MSEK 0.8 in Q2, down from 4.3 last year.

Outlook and guidance

• Management expects cash flow effects from working capital to reverse and support liquidity in Q3.

• Ongoing action program aims to restore sustainable profitability, focusing on assortment, supplier terms, and cost structure.

• Strategic review of Danish business and further platform improvements are underway, with results expected in H2 2025.

• CEO notes a tough quarter but expresses confidence in future prospects with continued digitalization and consumer focus.