Verkkokauppa.com (VERK) Q1 2025 earnings summary

Executive summary

• Revenue grew 2.4% year-over-year to €110.5 million, driven by e-commerce, B2B, and international expansion, with strong performance in Entertainment and IT categories.

• Net result turned positive at €2.0 million (from -€1.0 million), and EBIT rose to €3.2 million (from -€0.4 million), reflecting operational efficiency and cost reductions.

• Online sales increased 3.9%, B2B sales rose 7.0%, and own brands' revenue grew 36.2%, now 6.7% of total revenue.

• Fast delivery services expanded, now covering over 40% of Finland's population and accounting for over 20% of online orders; NPS for one-hour deliveries at 84.

• Strategy execution advanced with international sales up 38%, supported by new partnerships including Amazon in Sweden.

Financial highlights

• Gross margin improved to 18.8% (from 17.3%), with gross profit at €20.8 million, driven by inventory management and pricing strategies.

• EBITDA rose to €4.9 million (4.4% margin) from €1.3 million (1.2% margin) year-over-year.

• Operating and personnel expenses decreased year-over-year; personnel count at period end was 595 (down from 644).

• Cash at hand was €19.6 million at period end; operating cash flow was -€14.7 million, mainly due to working capital changes.

• Equity ratio improved to 17.9% (from 16.7%); gearing at 82.5%.

Outlook and guidance

• Revenue and comparable EBIT/operating result for 2025 expected to grow year-over-year; guidance unchanged.

• First half expected to remain tough due to low consumer confidence, with improvement anticipated in the second half as purchasing power increases.

• Business remains seasonal, with Q4 being critical for revenue and profit.

• Long-term targets: >5% annual revenue growth, >5% operating margin by 2028, fixed costs <10% of revenue, and 60-80% of net profit paid as dividends.