Musti Group plc Interim Report 7 November 2024 at 8:30 a.m. EET
Musti Group plc Interim Report 1 October 2023 - 30 September 2024
Musti remains resilient, growing the number of customers
July - September 2024
- Group net sales totaled EUR 111.5 (110.4) million, an increase of 1.0% (8.4%).
- Like-for-like sales decreased by 0.9%.
- Adjusted EBITDA was EUR 16.5 (20.6) million.
- Adjusted EBITDA margin was 14.8% (18.7%).
- Adjusted EBITA was EUR 7.8 (12.6) million.
- Adjusted EBITA margin was 7.0% (11.4%).
- Net cash flow from operating activities was EUR 19.9 (29.0) million.
- Operating profit was EUR 5.8 (10.7) million.
- Profit for the period totaled EUR 2.8 (7.4) million.
- Earnings per share, basic was EUR 0.09 (0.22).
- Number of stores grew to 351 (342).
- Total number of customers grew to 1,861 thousand (1,806 thousand).
October 2023 - September 2024
- Group net sales totaled EUR 438.4 (425.7) million, an increase of 3.0% (8.9%).
- Like-for-like sales growth was 1.1%.
- Adjusted EBITDA was EUR 64.4 (73.6) million.
- Adjusted EBITDA margin was 14.7% (17.3%).
- Adjusted EBITA was EUR 30.6 (42.6) million.
- Adjusted EBITA margin was 7.0% (10.0%).
- Net cash flow from operating activities was EUR 39.4 (79.6) million (including impact of non-recurring items EUR 13.9 million).
- Operating profit was EUR 11.8 (37.8) million.
- Profit for the period totaled EUR 3.7 (26.5) million.
- Earnings per share, basic was EUR 0.11 (0.79)
The figures in parentheses refer to the comparison period, i.e., the same period in the previous year, unless stated otherwise. The Group's previous financial year was 1 October - 30 September and the current financial year is 1 October - 31 December, because the financial year has been changed. Consequently, the Group publishes an interim report for Q4 instead of a financial statements review, which will be published on 11 February 2025.
Key figures
EUR million or as indicated | 7-9/2024 | 7-9/2023 | Change % | 10/2023-9/2024 | 10/2022-9/2023 | Change % |
Net sales | 111.5 | 110.4 | 1.0% | 438.4 | 425.7 | 3.0% |
Net sales growth, % | 1.0% | 8.4% | 3.0% | 8.9% | ||
LFL sales growth, % | -0.9% | 10.0% | 1.1% | 9.5% | ||
LFL store sales growth, % | -3.9% | 7.1% | -1.7% | 6.7% | ||
Online share, % | 24.5% | 22.5% | 24.5% | 23.0% | ||
Gross margin, % | 43.2% | 46.0% | 44.1% | 45.7% | ||
EBITDA | 16.0 | 20.1 | -20.5% | 51.4 | 74.6 | -31.1% |
EBITDA margin, % | 14.3% | 18.2% | 11.7% | 17.5% | ||
Adjusted EBITDA | 16.5 | 20.6 | -19.8% | 64.4 | 73.6 | -12.5% |
Adjusted EBITDA margin, % | 14.8% | 18.7% | 14.7% | 17.3% | ||
EBITA | 7.3 | 12.1 | -39.8% | 17.6 | 43.6 | -59.7% |
EBITA margin, % | 6.5% | 11.0% | 4.0% | 10.2% | ||
Adjusted EBITA | 7.8 | 12.6 | -37.9% | 30.6 | 42.6 | -28.2% |
Adjusted EBITA margin, % | 7.0% | 11.4% | 7.0% | 10.0% | ||
Operating profit | 5.8 | 10.7 | -45.6% | 11.8 | 37.8 | -68.9% |
Operating profit margin, % | 5.2% | 9.7% | 2.7% | 8.9% | ||
Profit/loss for the period | 2.8 | 7.4 | -61.5% | 3.7 | 26.5 | -86.2% |
Earnings per share, basic, EUR | 0.09 | 0.22 | -61.5% | 0.11 | 0.79 | -86.3% |
Net cash flow from operating activities | 19.9 | 29.0 | -31.6% | 39.4 | 79.6 | -50.5% |
Investments in tangible and intangible assets | 2.8 | 2.8 | -1.9% | 14.4 | 11.9 | 21.5% |
Net debt / LTM adjusted EBITDA | 2.4 | 1.9 | 27.6% | 2.4 | 1.9 | 27.6% |
Number of loyal customers, thousands | 1,861 | 1,806 | 3.0% | 1,861 | 1,806 | 3.0% |
Number of stores at the end of the period | 351 | 342 | 2.6% | 351 | 342 | 2.6% |
of which directly operated | 346 | 330 | 4.8% | 346 | 330 | 4.8% |
"Musti continues to grow customers and market share in a tough Nordic consumer environment highlighting that our integrated stores, online and services format remains relevant and resilient.Further, we are confident that our investments in both current and new markets will continue to extend our market share gains" - David Rönnberg, Musti Group CEO
Group net sales increased by 1.0% to EUR 111.5 (EUR 110.4) million. The increase was largely due to solid online sales. Like-for-like sales growth, which is calculated in local currencies, was -0.9% (10.0%). Sweden and Norway continued to perform strongly during the quarter, while Finland was impacted by lower consumer confidence.
Online sales increased by 9,6% to EUR 27.3 million (EUR 24.9 million). Like-for-like online sales growth was 9.4% (20.7%). Store sales decreased by 1.0% to EUR 82.4 million (EUR 83.3 million). We added one directly operated store during the quarter to our network. Like-for-like store sales growth was -3.9% (7.1%). Online sales accounted for 24.5% (22.5%) of total net sales.
We continued to make targeted short-term investments in price and campaign. As a result, Gross margin decreased to 43.2% (46.0%) and Group adjusted EBITDA decreased by 19.8% to EUR 16.5 million (EUR 20.6 million). We expect gross margin to rebound to long term levels in the medium term.
The economic outlook for the Nordic consumer is still uncertain which impacts Musti. We believe that the long-term market trend of pet parenting continues despite the temporarily soft demand during the past year. Our expectation, based on recent data, is that the market is rebounding to the long-term trend and that the overall economy will pick up latest in 2025. Our fundamentals and competitive advantage remain strong, our customer base is continuing to grow, and we are prepared for the next growth cycle.
Musti continues its growth focus. Post quarter end we announced the planned acquisition of Pet City, completion expected before the end of 2024. Pet City operates pet stores and clinics in all Baltic countries, and we see that there is great potential for its further expansion and growth. Welcome to our new Pet City team members!
For Musti this will be the first acquisition as a part of Sonae group and geographically the natural direction to expand. With the acquisition of Pet City, Musti will strengthen its footprint as the market leader in Northern Europe working to deliver great service, advise and value to pets and pet parents in six countries.
To our team members - on behalf of our pet parents, our shareholders, our Board, our Group management team and myself, thank you for all you have achieved in a challenging environment. Our hard work and dedication is delivering market share gains for which we can all be pleased.
David Rönnberg,
CEO
Financial targets
Following its review in April 2024, the Board of Directors of Musti Group Plc decided to withdraw the company's long-term financial targets, updated by the Board of Directors on 3 May 2021. With the new majority owner, Musti Group is now in a new strategic phase with need to focus on sustainable growth to create value to its pet parent customers, owners and other stakeholders. In addition, the Board of Directors resolved to amend the company's dividend policy as follows: The company's net profit shall be used towards financing the company's growth and investments, and the company does not expect to distribute dividends. The Board of Directors may however assess dividend distribution annually.
Webcast for analysts and media
A webcast for the analysts and media will be arranged on 7 November 2024 at 14:00 EET via Teams. To register in advance, please send an email to ir@mustigroup.com. The event will be held in English. The report will be presented by CEO David Rönnberg and CFO Robert Berglund.
Helsinki 7 November 2024
Board of Directors
The information in this Interim Report is unaudited.
Further Information:
David Rönnberg, CEO, tel. +46 70 896 6552
Robert Berglund, CFO, tel. +358 50 534 8657
Distribution:
Nasdaq Helsinki
Principal media
www.mustigroup.com
Musti Group in brief
Musti makes the life of pets and their owners easier, safer and more fun. We are the leading Nordic pet care company, and we operate an omnichannel business model to cater for the needs of pets and their owners across Finland, Sweden and Norway. We offer a wide, curated assortment of pet products. We also provide pet care services such as grooming, training and veterinary services in selected locations.
Musti Group's net sales were EUR 426 million in the financial year 2023. At the end of the financial year 2023, the company had 1,643 employees, 1.5 million loyal customers and 342 stores.
