How are energy investors positioned?
Aramex Group reported a 3% year-on-year revenue growth in Q3 2025, despite facing a challenging European used car market. The company’s adjusted EBITDA guidance was revised to approximately €65 million, building on its last twelve months EBITDA of $54.55 million. Following the earnings release, Aramex’s stock experienced volatility, closing at $5.33, a 6% drop from the previous session. Recent trading saw a 3.38% rebound, indicating mixed investor sentiment. According to InvestingPro analysis, the stock’s RSI suggests oversold conditions, potentially presenting an opportunity for value investors.
Key Takeaways
- Aramex’s Q3 2025 revenue grew by 3% year-on-year.
- B2C sales increased by 3%, while refurbished volumes fell by 2%.
- Adjusted EBITDA guidance revised to close to €65 million.
- Stock price fluctuated, closing down 6% post-earnings but rebounding by 3.38%.
Company Performance
Aramex Group demonstrated resilience in Q3 2025, achieving a 3% increase in revenue despite a 6% contraction in the European used car market. The company managed to outpace the market with a 2% growth in retail volume, leveraging its unique vertical integration model and strong digital platform, which attracted 70 million annual visits. However, the decrease in refurbished B2C volumes and macroeconomic uncertainties posed challenges.
Financial Highlights
- Revenue: €591.2 million, a 3% increase year-on-year.
- B2C sales: Up 3%.
- B2B revenues: Increased by 2%.
- Services revenues: Grew by 6%.
Market Reaction
Post-earnings, Aramex’s stock fell by 6%, closing at $5.33. This decline reflected investor concerns over the dip in refurbished B2C volumes and macroeconomic pressures. However, the stock later rebounded by 3.38%, suggesting that some investors regained confidence in the company’s strategic direction and revised guidance.
Outlook & Guidance
Looking ahead, Aramex has revised its guidance for FY 2025, anticipating mid-single-digit growth in refurbished car volumes and total B2C volumes. The company remains focused on profitable, sustainable growth, with continued investments in digital platforms and AI. While the company maintains a solid current ratio of 1.24 and healthy Altman Z-Score of 4.56, its gross profit margin of 9.81% suggests room for operational improvement. For comprehensive analysis of Aramex’s financial health and growth prospects, access the detailed Pro Research Report available exclusively on InvestingPro.
Executive Commentary
Guillaume Paoli, Co-Founder and Co-CEO, emphasized the company’s disciplined approach to growth, stating, "We are not interested in dilutive growth." He reaffirmed Aramex’s long-term ambition to become the European leader in used car mobility, highlighting opportunities for disciplined purchasing.
Risks and Challenges
- European market contraction: A 6% decrease in the used car market impacts overall demand.
- Macroeconomic uncertainty: Affects consumer purchasing power and may influence future sales.
- Refurbished volume decline: A 2% drop in B2C refurbished volumes could impact future revenue.
- Geographic performance variations: Different regions show significant performance discrepancies.
- Stellantis ownership uncertainty: Potential changes in ownership could affect strategic direction.
Q&A
During the earnings call, analysts inquired about Aramex’s UK market strategy following a founder’s exit and the company’s internal marketplace strategy. The management addressed performance challenges in Austria and Italy and expressed confidence in maintaining strategic focus despite ownership uncertainties.
Full transcript - Aramis SAS (ARAMI) Q3 2025:
Alan, Conference Coordinator: Welcome to the Aramex Group Q3 twenty twenty five conference call. My name is Alan, and I will be your coordinator for today’s event. Please note this call is being recorded and for the duration, your lines will be on listen only. However, you will have the opportunity to ask questions at the end. This can be done by pressing star one on your telephone keypad.
I will now hand you over to your host, Fabian Girouf, to begin today’s conference. Thank you.
Fabienne Giroux, Chief Financial Officer, Aramex Group: Good morning, everyone. Thank you for joining us today for Aramees Group’s Q3 twenty twenty five revenues presentation. I’m Fabienne Giroux, Chief Financial Officer of the Group. And today with me to comment on this Q3 performance, Guillaume Paoli, Co Founder and Co CEO of the company. Before starting the usual reminders, this conference is recorded, accessible both over the phone and Internet.
A replay will be made available on the company’s website at www.aramis.group. Slideshow is available on the website for download. Let me also remind you that today’s presentation contains forward looking statements and that future results may differ materially from the statements or projections made on today’s call. In particular, the risk factors that could affect those statements are described in our 2024 Universal Registration Document filed with the French Financial Markets Authority. This presentation will be, of course, followed by the usual Q and A session.
Finally, I remind you that RMEs Group has a non calendar fiscal year with annual results closing at the September. As a consequence, the Q3 twenty twenty five revenues we are going to report today refer to the calendar period from 04/01/2025 to 06/30/2025. I now leave the floor to Guillaume that will drive you through the main business and market highlights. Guillaume, please go ahead.
Guillaume Paoli, Co-Founder and Co-CEO, Aramex Group: Thank you, Fabienne. Good morning, everyone, and thank you for being with us today. Well, it has been a more challenging quarter for the European used car market, which contracted by 6%, we’re now on Slide two. Despite this headwind, RMS Group delivered a plus two growth in retail volumes, representing an eight point outperformance versus the market. Customer satisfaction, which is the core purpose of our group and key to long term profitable growth, reached a new record high with an NPS of 75, thanks to our 2,400 plus highly committed and engaged team members.
These results are a combination of uneven performance across our geographies, with external factors playing in, local operational challenges, and also deliberate choice to improve here and there unit profitability to ensure healthy growth going forward. Finally, we’re continuing to execute our profitable growth strategy as shared last November during our Capital Market Day, built on strategic pillars. We are converging on our operating system, leveling up performance progressively across our geographies. We are leveraging our European scale, bringing new benefits to customers and creating value for the group. And we are raising the bar, improving our model from sourcing to delivery.
Together, these pillars are helping us navigate a more volatile market environment while preparing the group for a long term success. On slide number four now, let’s begin with the broader market context. The European used car market for vehicles slide number four, please, operator. The European, used car market for vehicles under eight years declined by 6% year on year in q three. This is a result of continued macroeconomic uncertainty and pressure on consumer purchasing power.
Despite this, we grew our B2C volumes. This is due to the resilience that comes from our flexible integrated vertical model, which allows us to adjust quickly to shift in supply and demand. Also, our focus on short stock turn ensures that we can maintain a healthy margin structure. So while the context is somewhat difficult, our fundamentals are strong and our outlook remained constructive for the quarter ahead. Moving to slide number five, please.
Let’s now zoom in on our performance. In slide number five, please. Okay. I understand there’s a kind of lag. Okay.
Sorry about that. In q three, our retail volumes rose by 2%, an eight point outperformance. This is absolutely not a one off. Over the past three years, Hermes Group has consistently outperformed its reference market, both in terms of volume and revenue. This is made possible by our integrated model.
As I said, we have diversified sourcing channels giving us a steady supply of cars even when others face shortages. Our refurbishment center operate at industrial scale and enable us to turn around cars quickly and cost effectively. Our digital platform attract more than 70,000,000 visits per year, enabling us to serve customers at scale. All this results in tangible growth. We delivered over 29,000 cars to product customers in q three.
We are not only gaining market share. We are doing so in a way that is disciplined and margin aware with a long term focus on customer satisfaction. On slide number six, RMS Group achieved a plus 3% year on year revenue growth despite this adverse market context I was discussing. Customer satisfaction reached a historic high with a net promoter score of 75. So our investments in experience, quality, and transparency are paying off.
At the same time, our employee engagement measured through employee net promoter scores remains high at 52, well above industry benchmarks. This dual satisfaction is not coincidental. It results from our unique threefold model with a vertical integration, a proper proprietary operating system, and a high performance culture, customer centric with embedded lean principles and local empowerment. And I’ll now hand the floor over to Fabienne to for more details on the top line results.
Fabienne Giroux, Chief Financial Officer, Aramex Group: Thank you, Guillaume. I’m now on slide eight for more details on the revenues by segment. Overall, our B2C sales are up by three percent versus last year in Q3. B2C refurbished volumes decreased by 2%, resulting from a combination of adverse factors during this quarter. An overall context of market slowdown in Q3, as explained by Guillaume earlier, our decision to prioritize unit profitability of our growth, particularly in The UK and in Italy, temporary challenges in Spain and Austria.
We will explain in more details both country specific in the next slides. The referral growth has also been slowed down in France and in Belgium by the dynamism of the pre registered segment, which grew by 22% in the third quarter, above our expectations. This strong pre registered growth demonstrates the group know how in seizing the opportunities in the specific market segment and despite adverse market conditions. B2B revenues increased by 2%. The B2B segment activity, which had been decreasing in the past two years, is now slightly growing again, driven by the volume of vehicles purchased from private customer as we are further developing this sourcing channel in several countries.
Finally, revenues from services increased by 6%, driven by the B2C volume growth and the increased penetration of financial services versus last year’s Q3 from 42% to 44%. I’m now on page nine to take a closer look at the revenues by country. During Q3, we had significantly divergent growth rates from one country to the other. In France, revenues were up by 11% in Q3, in a market declining by 5%. This growth is based on solid foundations all along the value chain from sourcing to sales.
France has intensified the rollout of its point of sale with four new locations opened in the fiscal year. In Belgium, volumes increased by 10%, driven by both refurbished and pre registered segments. This growth was also supported by the sales of cars coming from other countries of the Group through the internal marketplace that the Group continues to roll out and improve. In Spain, volumes decreased by 11% versus 18% growth rate generated in the previous quarter as a result of two factors. First, we had a Q2 Q3 phasing effect this year versus previous year due to Easter period that was moved from Q2 to Q3 and has a specific impact in Spain.
Second, the business is still impacted by the October twenty twenty four floods in Spain, which delayed by several months the opening of our refurbishment centre in Valencia. Now that the reconditioning centre was finally opened in 05/05/2025, we experienced a more positive dynamic towards the end of the quarter. UK slowed down from 15% growth rate in H1 to 4% in Q3. And Austrian’s volumes decreased by 27% year on year. We will cover specifically these two specific situations in the next two slides.
And finally, in Italy, B2C volumes went down by 11%. However, if we include the deliveries to the other countries, the volumes are still growing by 17% year on year. We have continued to improve the unit economics during the quarter in order to set sound basis for future growth. Page 10, let me deep dive on Austria before handing it over to Guillaume for The UK. In Austria, volumes in Q3 went down by 27% for two reasons: first, because 2024 was a non normative year, as Austria benefited from non recurring deals that boosted our growth in this year, but have not been reconducted in fiscal year 2025.
Second, because 2025 is clearly a transition year where first, our new management team is ramping up after the departure of the founder, still deeply involved into business operations until January 2025. And second, because our sourcing channels are being dediversified, as the country was heavily relying on a limited number of significant suppliers, creating variability in the sourcing performance. In the last six months, the sourcing has been consistently diversified, and the country will carry on in the next few months with, among other things, the development of C2B activities. You can see here on the graph that despite those very specific syncop circumstances, Austria over the last two years has still been growing at a 9% average rate at Q3. And now, I hand it over to Guillaume to dig deeper into the context in The UK.
Thank you, Fabienne. We are now on slide 11, going to take a closer look at our UK business. The UK has been growing at 20% in fiscal year twenty four and fifteen percent in fiscal year twenty five h one, but without generating significant additional EBITDA for two main reasons. First, unit margins are clearly below what we can achieve elsewhere within the group. And second, this growth has been partially made through unproductive marketing investments.
In the coming months, we will focus our efforts on the quality of our sourcing,
Guillaume Paoli, Co-Founder and Co-CEO, Aramex Group: which is a key component of the business, probably the most important part of the business. We want to progressively eliminate our lowest margin sourcing channels and substantially accelerate the development of the most profitable sourcing channel such as part exchange. The quality of our pricing, we continue investing in our tools and our teams, to improve the selection of car and improve also our pricing and repricing discipline. We also intend to better rationalize our marketing expenses. We will cut some of the low value generating channels while concentrating and focusing our efforts on the most profitable one.
As a side note, we have indicated that we have found an agreement to purchase the remaining 40% of Car Supermarkets founder at a fixed price of 30,000,000, £30, UK pounds, in line with our assumption in h one twenty twenty five financial books. At this occasion, I would like to warmly fill Wilkinson, the founder, for the collaboration that we had during the last four years. Now let’s move on on slide number 13. Let let let us now step back and summarize. Well, the macro environment has begun tougher than we anticipated at the at the start of the year.
Demand in the used car market is down across Europe, and our six geographies are facing different local realities. In this context, we’re adapting country by country, dealing with operational issues that are weighing in on volumes and profitability. But we are staying disciplined. The environment is more volatile. Yes.
And we see that we have a long term upside. But the second half of the year will be a little more modest than the first. Our priority remains unchanged, profitable growth and keep improving our operational model. And to conclude, let’s go now on slide number 14. Let’s review our updated guidance for fiscal year twenty five, which we announced on July 7, in line with the Q3 trends.
We now accept mid single digit growth in refurbished car volumes, mid single digit growth in total b to c volumes, previously it was high single digit, and adjusted EBITDA close to 65,000,000, previously was above 65,000,000, and an unchanged target of continued and progressive improvement in operational working capital measured in days of revenue. This guidance reflects short term headwinds, but also our ability to remain on course. We we are investing in the right priorities, brands, teams, digital platform, AI, to enhance customer experience and team efficiency. And we are managing with discipline, keeping SG and A under control, improving stock turns, and optimizing capital use. Our long term ambition is unchanged to build the European leader for used car mobility, both profitable and sustainable.
We thank you very much for your attention and for your continued support. And we can now move on to q and a. We’ll be happy to take your questions.
Alan, Conference Coordinator: Thank you.
Guillaume Paoli, Co-Founder and Co-CEO, Aramex Group: You.
Alan, Conference Coordinator: We will take our first question from Christophe Scherbang, Bernstein. Your line is open. Please go ahead.
Christophe Scherbang, Analyst, Bernstein: Yes. Good morning, Guillaume. Good morning, Fabienne. Two questions from my side. The first one is on The UK market.
You’re announcing the buyout of the minorities in Motor Depots. In the past, we’ve seen that such situation were creating a loss of momentum. So are you concerned that’s going to to happen in The UK? And what can you do to avoid what we saw in other markets? That’s the first question.
And the second one was on the internal marketplace. Can you update on the the extent to which this is a big part of your of your setup? What is the share of the internal marketplace in the supply of France, UK, Belgium, etcetera? That would be super helpful. Thank you.
Guillaume Paoli, Co-Founder and Co-CEO, Aramex Group: Thank you, Christophe. Thank you for your questions. So regarding The UK, I would say that typically after the departure of a of of a founder, it’s true that there is a managerial transition that that can give some, you know, turbulence regarding regarding the operation as we have seen in Austria. In this case, the founder was not really involved in day to day operations, so we don’t anticipate managerial turbulence. But as Fabienne has explained, we really want to improve the unit profitability in The UK.
We see a lot of opportunities to buy in a more disciplined way to understand better what what we’re doing in purchasing and pricing with better tools, better know how, and we’re sharing group expertise. This
Fabienne Giroux, Chief Financial Officer, Aramex Group: is going to take some time.
Guillaume Paoli, Co-Founder and Co-CEO, Aramex Group: But so so the the slowing of growth that we we we see in The UK is more or less unrelated with departure of the founder. So long story short, you’re right. Usually, we see some turbulence. In this case, we don’t anticipate that, but we are working hard with the team to to improve this unit profitability and so so as to resume as soon as possible. And I won’t put a time stamp on that.
Growth in The UK, which is the market where we have the probably one of the markets we have the most potential. As you know, it’s the largest market in Europe. Long long answer. And then on the internal marketplace, thank you for your question. As I said during the h one, we are not, disclosing any figures.
What we’ve
Fabienne Giroux, Chief Financial Officer, Aramex Group: said that if you combine the internal marketplace and
Guillaume Paoli, Co-Founder and Co-CEO, Aramex Group: the external marketplace, we are still below double digit of our total sales. But we believe this is a this is a very important asset for us as we are the only ones, to my knowledge, to be able to share cars between geographies. And this is more complex than it seems. So for the moment, it’s still not very large in the total mix. But what you have to understand is that we are sharing cars that have a typically lower term, more expensive cars, more specific cars, cars that we know that this in this geography or that geography, it takes a longer time to to to turn.
So even though right now the volumes are not huge, it it really helps us to maintain our stock turns quick as we are anticipating, and and and and we’re not sharing the whole of our inventory, actually. We’re sharing the the cars that we know take a little long longer to to to to to retail. And we are still not yet the routes are not open between all the different countries. So long story short, still growing. The combination of marketplace is below 10% of the volume, but we see that as an asset and a unique asset for us going forward, enabling us to to improve our gross profit per unit as there are sometimes, there are some margin opportunities and maintaining our stock turns quite fast.
Christophe Scherbang, Analyst, Bernstein: Thank you.
Alan, Conference Coordinator: We will take our next question from Alexander Ravdi, Kepler Cheuvreux. Your line is open. Please go ahead.
Alexander Ravdi, Analyst, Kepler Cheuvreux: Yes, good morning. Thanks for taking the questions. I have two quick questions, please. The first one on the average selling price of the pre registered segment. I see it’s up 6%.
Is this just a result of mix as you sometimes point out? Or are there any other factors at play here? Second question on more strategically on Italy. I understand it remains an attractive sourcing market and it was made at a financial bargain. But does it make sense for you to stay if there is no significant improvement?
Do you have any internal KPIs or a time line that you maybe could share with us on the trade off of staying versus exiting the market? Maybe a last one, I’m thinking about it. As I speak, you mentioned that there won’t be any change in terms of strategy from Stellantis following the departure of Yibdoroviar, but do you expect maybe any change in their stance regarding the ownership of your shares or or not? Thank you.
Guillaume Paoli, Co-Founder and Co-CEO, Aramex Group: Thank you, Eixon. I’ll take the two last ones. I’ll let Fabienne with the first one. I’m not sure there is a lot of two comments. But regarding I I did not say there will be not a change of strategy at Ceylon.
There is a new boss, a new exec team. They are going probably to evolve on their overall strategy. But as of now, I’m not speaking of used car and our reason. I’m seeing those are the overall strategy, okay, which is not our concern today. Regarding used car, it’s still important part of the business.
It’s very connects to to the new car business. As you know, having some kind of control on used car is very important for the new car business. So if you ask me, is there a little more uncertainty on what Stellantis will do regarding RMS? Probably, yes, more than six months ago. But as of now, we are buying a lot of cars from them.
Over 10% of our supply comes from Cenaltese with very good condition. We have very good relationship with the people that we work with. We have freestanding members in our board, and we have no sign and no I have no sign of of any changing. So we’ll we’ll see going forward. But as of now, there is there is no change.
Regarding Italy, to be very clear, we are not happy at all with the way as of the performance of the subsidiary of the last two years, and we have entered a few months ago a few weeks ago, a very much more aggressive management of of Italy. Our chief revenue officer for the group, Alejandro Gassermela, is there very often, every week. The head of strategy is supporting locally in the Italian. So and we are seeing now already after a few weeks, few months, some significant progress. So I hope, I expect we’ll have some good news for the q four to tell you at the at the FY.
I’ve always believed that and it’s not just a belief. I I see a few competitors that that we know locally that there is a good business to be made in Italy. So it is more an execution problem. So we will get back to you, hopefully, with some good news at the q four. We see some some positive sign.
It’s too early to give you to give you cap KPI, Alexandre. And on the last point, I’ll let maybe Fabien answer it.
Fabienne Giroux, Chief Financial Officer, Aramex Group: Yeah. Alexandre, on the on the last point on the average selling price of the of the prereg. Well so, yes, I confirm it’s really mainly a mix impact, a mix effect. You know that on this market, are being opportunistic. What we want is to select the best cars for our for our customers.
And, of course, there are a lot of by definition, there are a lot of changes in mix from one quarter to to another, but it’s I don’t we don’t see that as a long lasting trend.
Alexander Ravdi, Analyst, Kepler Cheuvreux: That’s super cool.
Alan, Conference Coordinator: Thank you. Now I will hand over the floor back to the host for web questions. Please proceed.
Fabienne Giroux, Chief Financial Officer, Aramex Group: Yeah. So I’ll we don’t see any question right now. Any written question? Do you see any written question operator? Or is there
Guillaume Paoli, Co-Founder and Co-CEO, Aramex Group: anyone Yes. If you can check your team’s chat, please.
Fabienne Giroux, Chief Financial Officer, Aramex Group: Okay. Sorry about that. Okay. Okay. Thank you.
So we have a question about Austria. Can you elaborate on the non normative operations in 2024? Was the sharp increase in sales of pre registered vehicles concentrated at some point in the quarter? What can we expect in Q4? Can you comment on price trends?
So it’s a lot of questions. So, yes, I can elaborate on the on the non normative operations in in 2024. Austria was was operated by by its founder and had some special relationship with some of its suppliers. And it’s true that in 2024, we had some large deals, which are very unusual even in the in the industry. Very large deals with a lot of cars that were purchased at a rather low price.
That’s that’s something that is direct related directly related to the context of the this supplier. And, of course, the context has changed compared to last year, so we did not have these significant deals this year. This year, we are doing a lot of small deals, which is also more probably robust and sustainable for the future. On the sharp increase in sales of preregisters preregistered vehicles, no, it was not concentrated on a specific month or it was not a one off deal that we have observed. In fact, if you look at the trend of preregistered, we had quite probably similar volumes to the previous quarter, so we continue.
Whereas last year, there was a decline during q three. So there is also embedded in in the high growth that we are doing here a positive base effect on the on the preregister of the segment in q three. You had very general question on what can we expect in in q four. So we are not we we have updated our guidance, and you see that we have updated our guidance for the for the for the full year. So if you incorporate the numbers that we are publishing today, you have more or less a bracket on what to expect at q four.
In fact, the the we see that the context are very different from one country to the other. For sure, we will still have the negative base effect, for example, in Austria. It will not change because we had a very high q four last year, a very high q three as well. And so the the negative base effect in in Austria will continue. In some other countries, we see more positive trends.
I said that, for example, for for for Spain, where we have reopened our reconditioning center here, where our point of sale, which was the second biggest point of sales for Spain, has fully reopened and where, of course, we expect a more rapid recovery. So and the last question, I think I addressed it. Can you comment on the price trends? I think that what what we know is that what we see on the preregistered is mainly mix effects. Maybe you want to comment a little bit on the on the refurb.
Guillaume Paoli, Co-Founder and Co-CEO, Aramex Group: On the used car business, we we see there was a slight decrease by 2% of the of the price last quarter, but we expect now more or less a stabilization as as we have said since the Capital Market Day. It’s a lot of offer and demand. We believe it is going to be stable. I don’t know if we have any other questions either on the phone or by k. So thank you all for your attention.
We we I think we are on a even though I understand that this quarter has been a disappointment for us as well. We we would have preferred to to do more growth. But, I mean, this is also the the nature of the business. Sometimes some quarter are are are little less good in terms of growth. We want to build a sustainable business.
Okay? This is why we are working hard, and Fabienne, in particular, and with the teams on unit profitability. We’re not interested in dilutive growth. This is probably the easiest business in the world to to to to to grow losing money. Just you just need to buy cars and sell them more or less at the same price that you bought them.
You’re going to do a lot of growth, but it it’s not good growth. So we’re looking for a sustainable business. We’ve been in this business for twenty four years now. We know this is the right thing to do. So, bear with us.
Thank you for your attention, and speak to you soon. And happy holidays for all the ones
Fabienne Giroux, Chief Financial Officer, Aramex Group: that are taking part of this. Thank you. Thank you.
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