New Wave Group (NEWA) Q3 2025 earnings summary

Executive summary

• Q3 2025 net sales increased by 8.3% in local currencies, with 4.1% organic growth and 4.2% from acquisitions, despite a weak market environment and significant currency effects.

• Operating profit for Q3 was SEK 253 million, negatively impacted by a SEK 66 million non-recurring PPP loan repayment in the U.S., but underlying performance remained strong.

• Gross profit margin reached a record 51.1% in Q3, attributed to favorable product mix and limited discounting, though some sources report 50.0%.

• Cotton Classic (Austria) was consolidated from September, strengthening the group's position in Germany and contributing to employee growth and segment results.

• All regions grew in local currencies, with North America remaining the largest market.

Financial highlights

• Q3 net sales: SEK 2,390 million, up 3.6% year-over-year; rolling 12-month sales at SEK 9,702 million.

• Gross margin: 51.1% in Q3 (some sources: 50.0%), highest on record.

• Operating profit: SEK 253 million, with SEK 66 million in one-off U.S. costs; adjusted operating profit was SEK 318 million.

• Net result for Q3: SEK 166 million, down from SEK 204 million year-over-year.

• Cash flow from operations was -SEK 249 million, mainly due to increased inventory and investments.

Outlook and guidance

• Management expects further growth if retail, especially sports retail, improves, but a market turnaround is still several quarters away.

• Cotton Classic is expected to gradually improve margins, but rapid changes are not anticipated.

• Investments in automation, systems, and new markets are ongoing, with a goal to surpass SEK 10 billion in sales soon.

• The company maintains a long-term growth target of 10-20% per year, with 5-10% organic growth and a 20% operating margin.

• New warehouse in Dublin and a new production facility in Texas are expected to support future growth.