Nilörngruppen (NIL) Q2 2024 earnings summary

Executive summary

• Order income rose 24% in Q2 to MSEK 208, driven by a rebound in outdoor and sports brands, and 13% to MSEK 441 for H1, as predicted in Q1.

• Sales increased 40% year-over-year to SEK 262 million in Q2, and 12% to MSEK 504 for H1, with minimal currency effects.

• Operating profit doubled to SEK 24.8 million in Q2 (margin 9.8%) and reached MSEK 48.1 for H1 (margin 9.5%).

• Net profit doubled year-over-year in Q2 to MSEK 18.7, with EPS at SEK 1.64 in Q2 and SEK 3.11 for H1.

• Accumulated order income up 13% and sales up 12% year-over-year.

Financial highlights

• Gross margin increased to 44.1% in Q2 (from 41.6%), with Q2 operating margin at 9.8%, nearing the 10% target.

• Net cash position of SEK 18 million, or MSEK 18.7 excluding IFRS 16 effects, a significant improvement from SEK -28 million last year.

• Cash flow from operating activities was MSEK 31.5 in Q2, aided by normalized inventory and receivables.

• Personnel costs increased due to more employees, salary increases, and higher bonuses linked to performance.

• Tax rate for the quarter was 24%, with a full-year estimate of 23-24%.

Outlook and guidance

• Strong order income in Q2 is expected to positively impact Q3 and Q4, especially in outdoor and sports segments.

• Ongoing investments in digital solutions (Nilörn:CONNECT) and new production capacity in Vietnam, Bangladesh, and Portugal are expected to support future growth.

• Luxury segment shows softer growth, but no major volatility expected.

• Financial targets remain: growth of at least 7% and operating margin of at least 10%.