Nilörngruppen (NIL) Q2 2025 earnings summary

Executive summary

• Q2 net sales decreased by 10% to SEK 237 million, but adjusted for currency effects, the decline was only 1% year-over-year; order intake was SEK 205 million, stable with strong outdoor segment performance and continued luxury weakness.

• Operating profit for Q2 was SEK 16 million, down from SEK 25.6 million last year; net profit was SEK 10.8 million versus SEK 18.7 million.

• Volatile market conditions persisted, with European clients cautious due to tariffs and uncertainty, and several clients entering administration, impacting results.

• H1 order intake increased by 7% to SEK 471 million, while net sales in SEK decreased by 2% to SEK 496 million; adjusted for currency, sales grew 3%.

• Investments continued in digital product passports, new capacity in Portugal, and expansion in Sri Lanka and Bangladesh.

Financial highlights

• Q2 gross margin improved to 44.8% from 44.1% year-over-year, but operating margin fell to 6.7% (9.8% last year), below the 10%-12% target.

• Accumulated operating profit was SEK 39 million versus SEK 48 million year-over-year.

• Earnings per share in Q2 were SEK 0.95 (1.64); H1 EPS was SEK 2.33 (3.11).

• Net cash at period end was SEK 9.8 million, or SEK 42.8 million excluding IFRS 16 effects.

• Cash flow from operating activities in Q2 was SEK 33.9 million, aided by normalized inventories and receivables.

Outlook and guidance

• Management expects luxury segment weakness to persist through 2025, with recovery anticipated in 2026.

• Market volatility and uncertainty remain, especially due to tariffs and trade barriers with the USA.

• The goal remains to restore operating margin to 10%-12%.

• Continued investments in the U.S. and Bangladesh to capture growth opportunities.

• Focus on profitability, growth, and cost efficiency for the remainder of the year.