Gold prices steady ahead of Fed decision; weekly weakness noted
Elektroimportoren, a key player in the electrical installation materials market, reported its Q1 2025 earnings with a notable 13.1% year-over-year increase in revenue, reaching $396 million. Despite a net loss of $8 million, the company showed improvement from the previous year’s $11 million loss. The stock price, however, declined by 1.89% to $13.25 following the earnings announcement. According to InvestingPro analysis, the company appears undervalued based on its Fair Value calculations, with strong financial health metrics including a healthy current ratio of 1.53 and impressive returns of 33.3% over the past year.
Key Takeaways
- Revenue increased by 13.1% year-over-year to $396 million.
- EBITDA surged by 50% to $36 million compared to last year.
- Stock price fell by 1.89% post-earnings announcement.
- Strong growth in EV charger sales, particularly in Sweden.
- Net profit improved, narrowing the loss to $8 million.
Company Performance
Elektroimportoren’s performance in Q1 2025 highlighted its resilience in a challenging market environment. The company’s revenue growth was driven by strong sales across both B2B and B2C segments, with a notable 13.5% increase in B2C sales. The Swedish market, in particular, showed significant improvement, contributing to the company’s positive EBITDA in the region for the first time.
Financial Highlights
- Revenue: $396 million, up 13.1% year-over-year.
- EBITDA: $36 million, a 50% increase from the previous year.
- Gross Margin: Increased to 36% from 34.7% last year.
- Net Profit: Improved to a loss of $8 million from a $11 million loss.
Outlook & Guidance
The company expressed cautious optimism for the next 3-6 months, anticipating continued market uncertainty. Elektroimportoren expects to achieve cost savings from the integration of its SpotOn acquisition in the second half of the year. The company is also negotiating the opening of three new stores in 2025, further expanding its footprint.
Executive Commentary
Andreas Nis, CEO of Elektroimportoren, remarked, "Q1 is the third consecutive quarter with year-on-year increased sales, increased gross margin, and increased profits." He also highlighted the company’s progress in Sweden, stating, "We are happy that step by step we’re making solid progress towards profitability in Sweden."
Risks and Challenges
- Market Uncertainty: Continued low consumer confidence could impact sales growth.
- Currency Fluctuations: A small derivatives loss of $6 million was reported due to currency movements.
- Expansion Risks: New store openings and integration of acquisitions may present operational challenges.
- Competitive Pressure: Maintaining market share in a competitive landscape remains a priority.
Elektroimportoren’s Q1 2025 results reflect both the potential and challenges the company faces in a dynamic market. While revenue growth and improved margins are positive indicators, the decline in stock price suggests investors remain cautious about future prospects amid broader economic uncertainties. For a comprehensive understanding of Elektroimportoren’s position and potential, InvestingPro subscribers can access detailed financial health scores, valuation metrics, and expert analysis through the exclusive Pro Research Report, part of the coverage of over 1,400 stocks.
Full transcript - Elektroimportoren As (ELIMP) Q1 2025:
Webcast Moderator: Good morning, and welcome to the Q1 webcast of Elektri and Pohterne. Presenting today will be CEO, Andreas Nis and CFO, Jorgen Wist. If you have any questions, please use the written Q and A function during the presentation, and management will address these at the end of their presentation. And with that, I will leave the word to Andreas and Jurgen.
Andreas Nis, CEO, Elektri and Pohterne: Thank you for that, Mona, Katrin, and good morning, everyone, and thank you for dialing in. I will start with running you through an operational summary of the first quarter, and then Jurgen will give you some more detail on the financials, and we’ll finish off with an outlook for the coming months and a q and a session. We’re happy to report that q one is the third consecutive quarter with year on year increased sales, increased gross margin, and increased profits. Sales growth is consistent across countries, customer segments, and major product categories. However, the quarter started a bit slow with January having single digit growth.
But then in February, sales picked up and helped by a new store opening and Easter falling in April. This year sales grew with double digits in March. We had a strong ease increase in visitors, and that’s the main reason for the sales growth. But the general price increase that we made in January and improved category management was also helping sales to grow. This has also impacted our gross margin in a positive way compared to last year.
And in March, we opened store number 30 in Norway, this time in Lillehammer, and both professional and consumer customers have given the store a positive welcome. We’re very happy to see strong revenue and margin growth in Sweden, making our business com making our Swedish business contribute with positive EBITDA for the quarter. Total revenue was at $396,000,000, which is up 46,000,000 from last year and an increase of 13.1%. Like for like growth was at 8.8%, and online sales in Norway grew by 13.2. Sweden as a whole had an increase of 21.1%.
Gross margin is up 1.3% from 34.7 last year to 36% this quarter. Operating expenses is at 105,000,000, which is up 9,000,000 from last year. This is mainly driven by the three more stores that we didn’t have last year. However, the OpEx to sales ratio is down 1% from 27.5 to 26.5. We delivered an EBITDA of 36,000,000, which is up 50% from 24,000,000 last year.
Net profit for the quarter is at minus 8,000,000, which is an increase of 3,000,000 from last year. Looking at our key strategic areas, we continue to focus on being a total provider of electrical installation material delivered through an omnichannel solution by our specialist employees. We support this we support our profitability with the constant product development of our own brands and making sure we’re ready to gain from the coming market opportunities that lies in the electrification of our society. Last but not least, we continue to look for new store openings. And for the quarter, 01/2025, we opened one more store, as I said, in Norway, and we are in negotiations for three more stores with possible openings in 2025.
We have continued with the process of integrating SpotOn back into the operations of Electrumptan, and our specialist position is proven by growth across customer segments and market share increase in B2B, and the fact that 72% of our customers rate us as having employees that are very highly skilled. The number on share of business increased to 35% in Norway and was above 10% in Sweden. We see growth in all major categories, and EV chargers has reentered the top growth position for this quarter. With more than 20% sales growth in Sweden and gross margin growth at almost 30%, We are happy that step by step we’re making solid progress towards profitability in Sweden. In Sweden, we grew sales by 21% and gross margin with 25.
EBITDA is lifted from minus three to plus 1,000,000 for the quarter. And having delivered positive EBITDA also in q four last year, this is the first time we deliver a positive EBITDA in q one, which is usually the weakest quarter of the year. So happy to see that all KPIs are moving in the right direction for Elbitiq. In Norway, visitors to our stores are up 12%. New store opening and our new store opening campaign, and of course, two new stores compared to last year, were the main drivers for this growth.
Average basket had an increase of 1.5%, whilst conversion rate decreased with 1.12, still high 53.7%. B2C sales were up 13.5%, and B2B sales increased with 12.8, giving B2B a 54% share of business in Norway for the quarter. The perception of being a specialist with highly skilled employees is slightly increased to 72%, up from 70% last year. And with that, I’ll hand over to who will take you through the financials.
Jorgen Wist, CFO, Elektri and Pohterne: Thank you, Anders. We start with the revenue, which has increased in both countries and all sales channels during the quarter. This resulted in revenue of million, corresponding to an increase of 13.1 compared to last year. The like for like revenue growth was 8.8% in the quarter. As the Easter was in April compared to March, we had a positive Easter effect of approximately SEK 15,000,000 compared to last year.
Adjusted for the Easter effect, the like for like growth was approximately 5%. The quarter started with a strong performance in our consumer business, while B2B picked up in the second half of the quarter. B2C revenue increased by 13.5%, while B2B revenue increased by 12.8. Online revenue in Norway increased by 13.2% in Q1 compared to last year. The store in LGBT contributed with million in revenue for the quarter, while online revenue in LGBT was NOK29 million.
B2B revenue in Sweden in the quarter is included with NOK9 million. Gross profit for the period was NOK142 million, up from NOK121 million last year. This translated into a gross margin of 36% compared with 34.7% in the same period of 2024. Overall, margins were impacted by improved category and campaign management, such as improved purchase prices, supplier bonuses and price adjustments. In Norway, the gross margin was 37% compared to 36.1% last year.
The margin in Sweden is 26.9% compared to 21.6% last year. Margin on both B2C and B2B continues to increase in Sweden. Operating expenses in sales channels have increased with SEK9 million compared to last year. This is mainly a result of three new stores in Norway and general salary increase. Other operating expenses are in line with last year.
Total operating expenses of NOK105 million is same as in Q1 twenty twenty three, but with four new stores, general cost and salary increases over two years. This efficiency improvement is a result of the cost focus over the last year. OpEx to sales ratio up 26.5% compared to 27.5 last year. The group continues to maintain a rigid cost control, but the comparable will be tougher going forward due to cost savings during the last year. Reported EBITDA for the quarter was SEK36 million, up from SEK24 million last year.
As you can see, both countries and sales channels contribute positively to the increase in EBITDA. The negative effect from other is mainly provisions and non recurring items. EBITDA margin in Q1 was 9%, up from 6.8% last year. Adjusted EBITDA for the quarter was million, up from NOK27 million last year. The improvement is driven by improved gross profit of NOK21 million.
EBITDA, excluding IFRS 16 effects for the quarter, was NOK10 million, up from NOK1 million last year. Net change in cash for the period was minus NOK44 million. Increase in working capital is mainly a result of new store and seasonal movements. Cash flow from investment of NOK7 million are mainly maintenance CapEx and or new store in Lidomar. Cash flow from financing of minus SEK 21,000,000 consists of lease payments.
The IFRS 16 interest expense of SEK 6,000,000 relating to lease payments are included in net financials. As a result of this, we have available cash of SEK 95,000,000 at the end of first quarter. In addition, we have our unused overall facility of SEK 120,000,000. Excluding IFRS 16 effects, net interest bearing debt was SEK 150,000,000 at the end of Q1, which corresponds to 1.9 times the last twelve months and GAAP EBITDA. The loan facilities had a net interest bearing debt EBITDA covenant of four at the end of Q1.
Then I hand over to Andreas again, which will take you through the events after the period and the outlook.
Andreas Nis, CEO, Elektri and Pohterne: Yes. Thank you again. First step of integrating SPOT one hundred percent, as I mentioned, into We’re buying back the 8% we have bought back the 8% of shares previously held by our employees. So Electrum Petroleum is again the sole owner of SpotOn.
We expect the cost savings from this to come through in the second half of the year. On the April 30, we held our annual general annual meeting. Sales in q two so far has been positive. April is, of course, a bit slow by Easter, but otherwise, the positive trends from q one have continued. We have also decided to eliminate to show you, to eliminate the Easter effects, we have reported January to April sales of 515,000,000.
This shows then a growth of 8.3% versus the same period last year. So 8.3% growth then with Easter in both years. We expect the market to continue to be uncertain with continued low consumer confidence. We follow the sales of homes and as we believe this to be one of the most important macroeconomic factors for us. And as of now, we continue to be cautious optimists for the coming three to six months.
Yeah. And with that, we open up for for questions. Can you comment on the performance of the new stores in Norway? Yes. The the new stores in Norway, the the three last we it’s number two in Bergen, it’s and it’s.
All three of them are performing well and as expected. So we we see a similar trend as we have done with with other stores we’ve opened previously. But, of course, out of these, Skagen is is the largest one, and then we have Bargain and then Lilamer. But Lilamer is also the one we we opened last. So but we’re happy with the performance of those stores.
And and, yeah, it seems like they’re trading as as we wanted to. Another question is what was the revenues from EV charges in the quarter, and how does this compare to last year? To be honest, I don’t have it in mind. I I said that EV charges has the largest growth, which is a fact, but I cannot right now recall exactly the gross number, but I I I will my guesstimate is that it was around 40%, which is quite a good growth. But I don’t have the actual number of how much it was.
No more questions? They could give it just half a minute or something to see if there are any more questions. There is one. Could you provide some more details on the derivatives loss of 8,000,000?
Jorgen Wist, CFO, Elektri and Pohterne: It’s it’s 6,000,000, and it’s it’s the result of the of the of the change in in both euro and US dollars. It’s now we are buying derivatives every month, it’s just a just change in in the exchange rate, which is the result of it.
Andreas Nis, CEO, Elektri and Pohterne: How should we think about Sweden going forward? As as we present, Sweden is moving in the right direction. We continue to work with the concept, to work with efficiency, to work with our marketing. And as of now, that that’s where we are. The store is moving in the right direction.
We’re we’re increasing sales quite much both both online and offline. And as we’ve said before, we we just wanna make sure that when we have a profitable business model for the for the store, the new evaluation will be made in terms of of a further store rollout or or not. But that’s that’s what we can say. Monica, if there are no more questions, I think we should wrap this up. Sounds good.
Well, we’d like to thank everyone for listening in. And if you have any questions, you can always reach out to Andreas and Erken. Absolutely. Thank you everyone for calling in. You.
Webcast Moderator: You.
Andreas Nis, CEO, Elektri and Pohterne: Yep. Thank you. Bye.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.