Nelly Group (NELLY) Q4 2023 earnings summary

Executive summary

• Q4 was the third consecutive profitable quarter, with operating profit of SEK 24.0m and profit after tax of SEK 19.7m despite lower revenue.

• FY 2023 operating profit recovered to SEK 10.9m from a SEK 56.1m loss; lower costs and stronger gross margin offset the revenue decline.

Financial highlights

• Q4 net revenue was SEK 301.6m, down 22.1% YoY; gross profit was SEK 150.9m versus SEK 159.3m.

• Q4 operating profit was SEK 24.0m versus a SEK 1.8m loss; operating margin was 8.0% versus -0.5%.

• Q4 profit after tax was SEK 19.7m versus a SEK 7.9m loss; EPS was SEK 0.66 versus SEK -0.44.

• FY net revenue was SEK 1,060.8m, down 18.3%; operating profit was SEK 10.9m versus a SEK 56.1m loss.

• FY profit after tax was SEK -1.5m versus SEK -71.7m; operating cash flow was SEK 59.3m versus SEK -65.0m.

Outlook and guidance

• 2024 transformation work is set to accelerate, including system-landscape changes and new supplier partnerships for personalization and customer inspiration.

• Priorities include improving assortment and price points, deepening collaboration with selected external brands, and improving traffic and conversion.

• Disciplined cost control remains necessary to support long-term profitability.