Profoto (PRFO) Q1 2025 earnings summary

Executive summary

• Net sales for Q1 2025 declined by 4% to SEK 164 million, with organic growth at -5%, mainly due to a significant drop in US demand and sales.

• EBIT fell to SEK 17 million (margin 10%), down from SEK 34 million (20% margin) last year, impacted by higher costs and negative currency effects.

• The board withdrew the 2024 dividend proposal, shifting focus to a share buyback program for up to 10% of shares until the 2026 AGM.

• The company launched its first LED product, L1600D, targeting the cinema and TV production market, with positive initial reception.

• Profit for the period was SEK 3 million, a sharp decline from SEK 27 million a year earlier.

Financial highlights

• EBIT margin for Q1 2025 was 10% (10.4% adjusted), down from 20% (20.1%) last year; underlying EBIT margin adjusted for currency effects was around 15%.

• LTM net sales were SEK 724 million, down 1% year-over-year; adjusted EBIT LTM SEK 135 million, down 19%.

• Earnings per share were SEK 0.08, down from SEK 0.66 year-over-year.

• Net debt/EBITDA LTM was 1.02, indicating a healthy financial position.

• Return on capital employed was 25.4% (28.9% in Q1 2024); return on equity LTM was 25.8%.

Outlook and guidance

• Cost base to be reduced by approximately 20%, targeting SEK 60–80 million in annualized savings and SEK 30 million EBIT improvement, with full impact expected in H2 2025.

• R&D spend to be optimized and reduced to around 10% of sales as product range matures, targeting this by end of 2025.

• Price increases planned in the US to offset new tariffs and protect margins.

• Short-term focus is on product launches and sales and marketing to drive top-line growth.

• Cost reduction effects expected to be visible after summer, with full impact by year-end.