Viva Wine Group (VIVA) Q1 2025 & M&A Announcement earnings summary

Executive summary

• Achieved 14 consecutive quarters of increased market share in the Nordics, reaching a record 23%, despite a 1% decline in net sales due to Easter timing.

• Gross margin improved to 21.2% from 19.1% year-over-year, driven by price adjustments and product mix.

• Adjusted EBITA margin decreased to 5.5% from 6.3% last year, reflecting lower sales and increased OpEx for strategic investments.

• Announced acquisition of Delta Wines for EUR 57 million, expanding presence into 8 countries and strengthening B2B capabilities.

• Delta Wines is a leading distributor in the Netherlands, with 2024 net revenue of EUR 186 million and an adjusted EBITDA margin of 6.8%.

Financial highlights

• Net sales declined by 1% year-over-year to SEK 895 million; organic growth rate was -0.9%.

• Gross margin rose to 21.2%, up more than 2 percentage points from prior year.

• Adjusted EBITA margin fell to 5.5% from 6.3% last year.

• Net debt/EBITDA improved to 1.3x, expected to temporarily exceed 3x post-acquisition.

• Cash flow from operations impacted by seasonal inventory build-up for Easter.

Outlook and guidance

• Gross margins in the Nordics expected to remain strong, with potential positive currency effects later in the year.

• OpEx as a percentage of sales guided to be in line with 2023 for the full year, with Q1 higher due to seasonality and strategic investments.

• No significant price increases expected; focus remains on maintaining strong gross margins.

• Board to review financial targets following Delta Wines acquisition.

• Acquisition expected to be EPS accretive from completion, with substantial synergy potential.