Puuilo H1 2025 slides: Double-digit growth and ambitious expansion strategy to 2030

Introduction & Market Context

Finnish discount retailer Puuilo Oyj (HEL:PUUILO) presented its half-year financial results on September 11, 2025, showcasing continued strong performance and unveiling an ambitious long-term strategy. The company’s stock responded positively to the announcement, rising 8.77% to €13.45 per share.

Puuilo, known for its broad assortment of over 30,000 SKUs and "always low prices" positioning, has maintained its growth trajectory despite concerns about consumer purchasing power and changing behaviors in the retail landscape.

Quarterly Performance Highlights

For Q2/2025 (May-July 2025), Puuilo reported net sales of €135.8 million, representing a 13.2% increase compared to the same period last year. Like-for-like store sales grew by 1.3%, while online store sales increased by 2.4%. The company’s gross margin improved to 38.2%, up from 37.6% in Q2/2024, primarily driven by the significant growth in private label products.

As shown in the following chart of quarterly net sales development:

Adjusted EBITA for Q2 reached €28.2 million, a 13.7% increase year-over-year, resulting in an adjusted EBITA margin of 20.8%. The company attributes this profitability improvement to strong sales growth, favorable gross margin development, and effective cost control.

The EBITA development over recent quarters demonstrates consistent growth:

For the first half of 2025 (February-July), Puuilo’s performance was equally impressive, with net sales increasing by 15.2% to €225.0 million. Like-for-like store sales grew by 3.4%, while online sales jumped by 8.4%. The H1 adjusted EBITA increased by 18.1% to €39.0 million, representing a margin of 17.3%.

The key financial metrics for H1/2025 are summarized in the following slide:

Puuilo’s operating free cash flow for H1 was €51.8 million, a substantial increase from €33.9 million in the same period last year. This strong cash generation has helped maintain a healthy financial position, with net debt to adjusted EBITDA ratio at 1.2x, or just 0.2x excluding IFRS 16 impact.

The company’s cash flow development is illustrated below:

Expansion Strategy

Puuilo has continued its store expansion strategy, opening five new locations during H1/2025: Varkaus, Savonlinna, Lohja, Mäntsälä, and Jyväskylä Keljo. The company plans to open two more stores (Iisalmi and Heinola) by the end of 2025, bringing the total to 56 stores.

For 2026, Puuilo has already announced plans for new stores in Hollola and Espoo Espoonlahti, as well as the relocation of its Vantaa Virkamies store to Vantaa Tammisto.

The company highlighted that 50% of its current 54 stores are less than five years old, indicating significant potential for like-for-like growth as these locations mature. According to Puuilo, new stores typically become EBITDA profitable after just 1-2 months of operation, with an average payback time of approximately 19 months.

New Long-Term Strategy 2026-2030

A key highlight of the presentation was the unveiling of Puuilo’s new long-term strategy for 2026-2030. The company aims to grow its store network to more than 100 locations, with potential for over 90 stores in Finland alone.

The strategy also includes plans for organic international expansion, starting with Sweden as a pilot market. This international growth is expected to support long-term growth beyond the strategy period.

The company’s strategic priorities and financial targets are outlined in the following slide:

Puuilo’s financial targets for the 2026-2030 period include:

• Net sales CAGR of over 10%, targeting more than €800 million by the end of FY2030
• Adjusted EBITA margin of over 17%, targeting more than €136 million by the end of FY2030
• Profit distribution of at least 80% of net income
• Net debt to adjusted EBITDA ratio below 2.5x

The company plans to achieve these targets through several strategic initiatives, including:

• Single-digit like-for-like sales growth by developing its concept and product categories
• Maintaining and improving profitability through private label growth and cost control
• Enhancing its omnichannel customer experience
• Focusing on sustainability as a responsible retailer

The financial projections for the strategy period are illustrated in the following chart:

Forward-Looking Statements

For the full financial year 2025, Puuilo reiterated its previous guidance, forecasting net sales of €425-455 million and adjusted EBITA of €70-80 million. The company acknowledged some uncertainty related to changes in consumer purchasing power and behavior, as well as potential impacts from geopolitical crises and international tensions on product availability and prices.

Puuilo’s management emphasized the company’s capital-efficient business model, which has allowed it to consistently distribute at least 80% of net income as dividends since its IPO in 2021. The company plans to continue focusing on strategic business reinvestments in new store openings, assortment expansion (particularly private labels), and productivity enhancements.

With its strong financial performance, ambitious expansion plans, and clear long-term strategy, Puuilo appears well-positioned to continue its growth trajectory through 2030, despite potential economic uncertainties in the retail sector.

Full presentation:

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