Kjell Group (KJELL) Q3 2024 earnings summary

Executive summary

• Net sales for Q3 2024 were MSEK 624.3, down 4.1% year-over-year; year-to-date net sales increased 0.7% to MSEK 1,810.1.

• Gross profit declined 9.7% to MSEK 252.5, with gross margin at 40.4% versus 43.0% last year.

• Adjusted EBITA fell to MSEK 21.0 (3.4% margin) from MSEK 42.9, and net profit dropped to MSEK 4.2 from MSEK 25.2.

• Year-to-date net profit was MSEK -35.9; EPS was SEK 0.13 for Q3 and SEK -1.15 for Jan–Sep.

• Cash flow from operating activities was MSEK -12.2 in Q3, mainly due to increased inventories.

Financial highlights

• Q3 net sales: MSEK 624.3 (down 4.1% YoY); gross margin: 40.4%.

• Adjusted EBITA margin for Q3 was 3.4%, down from 6.6% last year.

• Cash flow from operating activities was MSEK -12, compared to MSEK 131 in Q3 last year.

• Financial net debt increased by MSEK 48 quarter over quarter to MSEK 428.5; leverage ratio rose to 5.7x LTM Adjusted EBITDAAL.

• Cash and cash equivalents at period end: MSEK 71.8 (down from 196.3 at start of year).

Outlook and guidance

• Management expects the seasonally strongest quarter ahead, with cautious optimism as consumer confidence shows signs of recovery.

• Ongoing focus on efficiency, cost control, and defending market share in a cautious consumer environment.

• Collaboration with EKO supermarket and regulatory changes (EU Common Charger Directive) seen as future opportunities.

• Long-term targets: net sales ≥ SEK 4 billion by 2025, adjusted EBITA margin of 8%, net debt/adjusted EBITDAAL <2.5x, and dividend payout ≥60% of net profit.