MEKO (MEKO) Q2 2025 earnings summary

Executive summary

• Q2 2025 saw a continued market slowdown and lower demand, leading to declines in sales and profitability across all regions, with intensified competition, especially in Denmark and Poland.

• Net sales for Q2 2025 declined 4% year-over-year to SEK 4,508M, with organic growth at -5% and negative currency effects of 3%.

• A new cost-saving program targeting SEK 100 million in annual savings was launched, with full effect from 2026.

• Strategic investments and upgrades in logistics and ERP systems are nearing completion, expected to drive future efficiency and growth.

• Sustainability strategy advanced with SBTi approval of climate targets, aiming for net zero emissions by 2050.

Financial highlights

• Q2 revenue declined 4% year-over-year to SEK 4,508M, with organic growth at -5% due to lower volumes and adverse FX and working day effects.

• Adjusted EBIT dropped 51% to SEK 175M, while EBIT fell 68% to SEK 91M, reflecting margin compression and competitive pressures.

• Cash flow from operations was SEK 498M, absorbing over SEK 100M in inventory buildup for the new Norway warehouse.

• Gross margin declined to 41.8% from 42.9%, mainly due to price competition and mix effects.

• Items affecting comparability included SEK 33M in ERP costs and SEK 22M in temporary double rents.

Outlook and guidance

• Market conditions remain subdued with no immediate signs of improvement; cost-saving measures are being prioritized over expectations of market recovery.

• Full benefits from cost reductions and efficiency projects are expected from 2026 onward.

• Continued focus on efficiency, exclusive brands, and logistics upgrades to support future profitability.

• CapEx is expected to normalize as major projects conclude.