TKM Grupp (TKM1T) Q3 2024 earnings summary

Executive summary

• Sales revenue for Q3 2024 was €229.1m, down 2.1% year-over-year; 9M 2024 revenue was €687.9m, down 1.0% year-over-year.

• Net profit for Q3 2024 was €8.6m, a 23.1% decrease year-over-year; 9M 2024 net profit was €16.9m, down 31.1% year-over-year.

• Declines in retail trade volumes and prices continued to impact results, especially in supermarkets and department stores.

• Security segment showed strong growth, while car trade remained resilient despite Baltic market declines.

• Major investments included new store openings, logistics center completion, and sustainability upgrades.

Financial highlights

• Gross profit margin for Q3 2024 was 27.5% (up 1.2% year-over-year); 9M 2024 margin was 27.4% (up 0.5%).

• EBITDA for Q3 2024 was €22.6m (down 5.8%); 9M 2024 EBITDA was €62.6m (down 6.5%).

• Operating profit for Q3 2024 was €11.9m (down 12.0%); 9M 2024 operating profit was €30.9m (down 14.7%).

• Earnings per share for Q3 2024 was €0.21 (down 23.1%); 9M 2024 EPS was €0.42 (down 31.1%).

• Cash and cash equivalents at 30.09.2024 were €12.8m, down from €42.1m at year-end 2023.

Outlook and guidance

• Management expects continued pressure on consumer spending due to economic uncertainty and upcoming tax increases.

• Inflation is forecasted to remain between 3.5% and 4% in 2024 and the next two years, with tax hikes accelerating price growth.

• Car tax and security tax laws in Estonia are expected to impact consumer confidence and corporate profits in 2025.