VRG (VRG) Q4 2024 earnings summary

Executive summary

• Achieved strong 4Q24 results despite challenging market, with double-digit revenue growth in both apparel and jewellery segments, and significant EBIT improvement year-over-year.

• Network optimization and focus on core categories drove profitability, while jewellery sales remained robust despite weaker watch demand.

• Online sales grew, with internet share of group revenues at 14.1% for 2024, and continued investment in e-commerce and marketing automation.

Financial highlights

• 4Q24 group revenues reached PLN 444.6m, up 10.5% YoY; apparel segment up 8.8% YoY, jewellery segment up 11.8% YoY.

• Gross profit on sales in 4Q24 was PLN 254.7m (+16.5% YoY), with margin at 57.3% (+2.9pp YoY).

• EBIT for 4Q24 was PLN 70.6m under IFRS16 (+59.1% YoY), and PLN 68.1m under IAS17 (+65.2% YoY).

• Net profit for 4Q24 was PLN 47.2m, down 5.4% YoY, mainly due to lower FX gains and higher interest costs.

• EBITDA for 4Q24 was PLN 105.2m (+35.8% YoY), with margin at 23.7% (+4.4pp YoY).

Outlook and guidance

• 2025 targets include revenue growth in both segments, improved gross margin, and cost control.

• Focus on brand repositioning (Vistula), marketing campaigns (Bytom), and product innovation (Wólczanka, W.KRUK).

• Continued floorspace optimization: apparel segment to decrease by 8%, jewellery segment to increase by 12% in 2025.

• Planned capex for 2025 at c. PLN 41m, with ongoing store renovations and network expansion in Hungary.