Swedencare (SECARE) Q4 2025 earnings summary

Executive summary

• Q4 2025 delivered 11% organic growth, with double-digit gains in key brands like NaturVet (33%) and ProDen PlaqueOff (17%), but profitability declined due to one-off costs, higher marketing spend, and inventory write-offs.

• Organizational improvements and enhanced cost controls have been implemented to address Q4 issues and improve profitability in 2026.

• Online, pet retail, and branded vet sales grew strongly, while contract manufacturing, especially in liquid dermatology, was soft.

• Major product launches and marketing campaigns, particularly for NaturVet and Walmart, drove sales but also increased costs.

• The board proposed a dividend increase to 0.28 SEK per share.

Financial highlights

• Q4 2025 revenue reached SEK 682.3 million, up 3% (11% organic), with a negative 12% currency impact and 4% acquired growth.

• Full-year 2025 net revenue was SEK 2.7 billion, up from SEK 2.5 billion, with 9% organic growth.

• Operational gross margin for Q4 was 56.8%, impacted by inventory write-offs and low-margin display campaigns.

• Operational EBITDA for Q4 was SEK 108.6 million (15.9% margin), down 25% year-over-year; full-year EBITDA was SEK 511 million (19% margin).

• Net debt to EBITDA rose to 2.9 at year-end, impacted by acquisitions and lower EBITDA.

• Cash conversion was 41% for the quarter, with significant tax payments affecting operating cash flow.

Outlook and guidance

• Expectation of improved profitability and gross margins in 2026 as one-off costs subside and cost controls take effect.

• New financial targets: annual double-digit organic growth, operational EBITDA margin above 26% midterm, and net debt/EBITDA below 2.0 long-term.

• Marketing spend will align more closely with sales growth, avoiding mismatches seen in Q4.

• Pharma segment and online sales, especially on Amazon, are expected to be key growth and margin drivers.

• Continued investments in manufacturing and expansion into Big Box retail and online channels are expected to drive future growth.