Maisons du Monde (MDM) Q3 2024 TU earnings summary

Executive summary

• Q3 2024 sales declined 15.3% year-over-year (14.3% like-for-like), impacted by macroeconomic volatility, supply chain disruptions, and extensive store renovations.

• September showed improvement with like-for-like sales down 9.4%, and excluding stores under renovation, retail sales were down 7.3%.

• Transformation plan "Inspire Everyday" is progressing, focusing on price reductions, assortment streamlining, cost savings, and customer engagement.

• Store network modernization continues, with 20 renovations completed and 41 ongoing; first affiliate partner store opened, aiming for 400 stores by 2026 with 30% affiliates/franchisees.

• New loyalty program and omnichannel initiatives, including a Web TV platform, launched to boost customer engagement and brand visibility.

Financial highlights

• Q3 2024 sales: €213.5 million, down 15.3% year-over-year; like-for-like down 14.3%.

• 9M 2024 sales: €704.7m, down 11.4% year-over-year; GMV €805.4m, down 10.1%.

• Furniture sales declined 6.4% to €101.6m, showing more resilience than decoration, which dropped 22.1% to €112.0m.

• Online sales accounted for 28.3% of Q3 sales, with marketplace growth in Italy and Spain.

• Net negative impact of €13–14.2 million from comparable stores and €4.1 million from store openings/closures.

Outlook and guidance

• Q4 store renovation impact expected to be much less significant than Q3, as most works will be completed by end of October.

• €45 million cost savings for 2024 on track, targeting €85 million by 2026.

• Capex/sales ratio targeted at 3% by 2026; working capital optimization of about one month over three years.

• Focus on driving sales during peak season and maintaining financial discipline to deliver positive free cash flow by year-end.

• Management expects transformation benefits to become more visible in future quarters.