SEB (SK) Q3 2024 TU earnings summary

Executive summary

• Nine-month 2024 sales reached €5,725m, up 5.6% like-for-like, with Q3 sales at €1,985m, up 4% like-for-like year-over-year.

• Operating Result from Activity (ORfA) for nine months was €444m, up 14% year-over-year, with Q3 ORfA at €200m, down 4% due to a high comparison base in Professional.

• Consumer segment drove growth, especially in Europe and North America, while Professional faced a sharp decline due to last year's exceptional large deals.

• The group maintains confidence in meeting full-year guidance of ~5% organic sales growth and operating margin close to 10%.

Financial highlights

• Organic growth for nine months was 5.6%, with a negative currency effect of -3.0% and scope effect of +0.9%; Q3 organic growth was 4.0%.

• Consumer business grew 6.6% like-for-like over nine months, accelerating to 8.1% in Q3; Professional business declined 22% like-for-like in Q3.

• Net financial debt as of 30 September 2024 was €2,480m, up from €2,278m a year earlier, reflecting inventory build, Red Sea crisis, share buybacks, and acquisitions.

• ORfA margin for nine months improved by 80 basis points year-over-year to 7.8%; Q3 margin at 10.1%, down 80 bps from Q3 2023.

Outlook and guidance

• Full-year 2024 guidance maintained: organic sales growth around 5%, operating margin close to 10%.

• Expectation of strong Q4 cash flow to reduce net debt.

• Professional segment to face continued tough comps in Q4 and early 2025, but long-term prospects remain positive.