Verkkokauppa.com (VERK) Q4 2024 earnings summary

Executive summary

• Q4 saw significant profitability improvement despite persistently low consumer confidence and weak demand, especially in discretionary categories, with strategic actions driving margin gains.

• Revenue declined 6.9% year-over-year to EUR 140.2 million in Q4 and 7.0% to EUR 467.8 million for the full year, mainly due to lower demand in TVs, mobiles, and gaming.

• Gross margin improved to 16.6% in Q4 (up 1.3 pp YoY), driven by commercial negotiations and inventory management.

• Own brands and fast delivery services outperformed, with own brand sales up nearly 20% and fast delivery sales up 18–20%.

• No dividend proposed for 2024 due to a negative net result.

Financial highlights

• Q4 revenue: EUR 140.2 million (-6.9% YoY); full-year revenue: EUR 467.8 million (-7.0% YoY).

• Q4 gross margin: 16.6% (up from 15.3%); Q4 comparable EBIT: EUR 3.8 million (2.7% margin); Q4 net result: EUR 2.6 million, EPS EUR 0.06.

• Full-year gross profit: EUR 75.8 million (16.2% margin); full-year comparable EBIT: EUR 1.8 million (0.4% margin); net result: EUR -0.8 million, EPS EUR -0.02.

• Cash flow from operations in Q4: EUR 21.1 million (up 19% YoY); cash at hand: EUR 35.6 million; inventory reduced to EUR 51 million, down nearly 20% YoY.

• Cost efficiency and reorganization led to a 9% reduction in comparable fixed costs and annual personnel cost savings of EUR 2.5 million.

Outlook and guidance

• Revenue and comparable operating result are expected to increase in 2025, but guidance is subject to uncertainties in consumer purchasing power and behavior.

• Market demand is expected to remain cautious in H1 2025, with improvement anticipated in H2 as purchasing power increases.