This is not an interim report in accordance with IAS 34. The company complies with the semi-annual reports required by the Securities Markets Act and normally publishes business reports for the first three and first nine months of the year, which present key information describing the company's financial development.
Uncertain market impacted first quarter – operational efficiency in focus
Unaudited financials presented below:
September 2022-November 2022 "Q1 2023" (comparable figures in parenthesis 9/2021-11/2021):
- Net sales decreased 5.2% to
EUR 25.8 million (EUR 27.2 million ). Organic net sales decreased by 19.0%. Constant currency net sales decreased 3.4%. -
Adjusted EBITDA decreased 111% to
EUR -0.2 million (EUR 2.0 million ) with an adjusted EBITDA margin of -0.9% (7.4%). -
Adjusted EBITA decreased 122.9% to
EUR -0.4 million (EUR 1.9 million ) with an adjusted EBITA margin of -1.7% (6.8%). -
Adjusted operating profit was
EUR -0.9 million (EUR 1.5 million ) with a margin of -3.6% (5.4%).
Outlook for financial year 2023 (outlook unchanged)
The market continues to be uncertain. The accelerating inflation and the overall economic environment have decreased consumer confidence. These factors reduce predictability.
CEO Jarkko Ämmälä:
The net sales and EBITDA of the first quarter fell slightly short of our targets. Net sales decreased by 5.2% and organic net sales by 19.0%. The EBITDA margin was negative 1.4%. These were influenced by several factors, such as continued market uncertainty and weakened consumer demand, which resulted in dealers further reducing their inventory levels. The lower profitability was a result of postponed sales and deliveries, write-down of inventory, credit losses and effects of exchange rates. Still, the sales margin improved slightly from Q4 2022 as a result of a better product sales mix and price increase measures.
In
The effects of the ongoing cost saving program did not yet materialise in the first quarter. The benefits of the program will be realised mainly during the third and fourth quarters. To address the tough market environment, we will continue our program with the aim of improving profitability. Despite the soft first quarter, we believe that the market will gradually recover during 2023 and combined with our own efficiency measures, we keep our full year guidance unchanged.
Key figures and ratios | Q1 2023 (9/2022- 11/2022) | Q1 2022 (9/2021-11/2021) | FY 2022 |
Net sales | 25,751 | 27,154 | 123,991 |
Net sales growth, % | -5.2 | 73.0 | 61.5 |
Constant currency net sales growth, % | -3.4 | 70.2 | 61.9 |
Organic net sales growth, % | -19.0 | 32.2 | 15.7 |
EBITDA | -357 | -31 | 7,383 |
EBITDA margin, % | -1.4 | -0.1 | 6.0 |
Items affecting comparability, EBITDA* | 135 | 2,051 | 2,074 |
Adjusted EBITDA | -222 | 2,020 | 9,457 |
Adjusted EBITDA margin, % | -0.9 | 7.4 | 7.6 |
EBITA | -561 | -195 | 6,652 |
EBITA margin, % | -2.2 | -0.7 | 5.4 |
Adjusted EBITA | -426 | 1,856 | 8,726 |
Adjusted EBITA margin, % | -1.7 | 6.8 | 7.0 |
Operating profit | -1,060 | -586 | 4,904 |
Operating profit margin, % | -4.1 | -2.2 | 4.0 |
Adjusted operating profit | -924 | -1,465 | 6,978 |
Adjusted operating profit margin, % | -3.6 | 5.4 | 5.6 |
Earnings per share, basic, EUR | -0.06 | -0.07 | 0.08 |
Earnings per share, diluted, EUR | -0.06 | -0.07 | 0.08 |
Number of outstanding shares at the end of the period, basic | 25,454,574 | 25,454,574 | 25,454,574 |
Number of outstanding shares at the end of the period, diluted | 25,454,574 | 25,454,574 | 25 454 574 |
Weighted average number of shares, basic | 25,454,574 | 25,454,574 | 25 454 574 |
Weighted average number of shares, diluted | 25,454,574 | 25,454,574 | 25,454,574 |
Investments in tangible and intangible assets excluding acquisitions | 413 | 40 | 915 |
Net debt | 50,398 | 27,627 | 44,571 |
Net working capital | 62,108 | 41,080 | 57,718 |
Operating free cash flows | -4,972 | -7,480 | -1,818 |
*) Items affecting comparability:
IPO costs of
Cost saving program costs of
Operational key figures | Q1 2023 (9/2022- 11/2022) | Q1 2022 (9/2021-11/2021) | FY 2022 |
Number of brands | 484 | 300 | 496 |
Share of own brand sales, % of total | 19.1 | 21.7 | 20.7 |
Share of online sales, % of total | 19.4 | 25.8 | 25.2 |
Equity ratio, % | 28.8 | 36.1 | 33.4 |
Full-time equivalent employees, average* | 214 | 171 | 193 |
*) Including seasonal employees
Net sales, EUR thousand | Q1 2023 (9/2022- 11/2022) | Q1 2022 (9/2021-11/2021) | FY 2022 |
Nordics | 16,005 | 16,428 | 76,362 |
Rest of | 9,746 | 10,727 | 47,629 |
Total | 25,751 | 27,154 | 123,991 |
Net sales
The share of online channel sales of total net sales amounted to 19.4% in Q1 2023 and 25.8% in Q1 2022. The decrease was attributable to lower share of online channel sales in the acquired companies.
The share of own brand sales of the total net sales amounted to 19.1% in Q1 2023 and 21.7% in Q1 2022.
Profitability
Duell’s EBITA declined to
Balance sheet and cash flow
Duell’s net cash flow from financing activities Q1 2023 was
The covenants for loans from financial institutions relate to net debt to EBITDA (Leverage) and the share of net debt of equity (Gearing). The conditions for the covenants were exceptionally not met at financial year-end due to cash tied into inventory. A waiver was received from the bank conditions for the loans remaining. The financing agreement with the bank will be renewed during the second quarter. This will include a review of covenants and other conditions. The company has launched a net working capital optimisation project and a cost saving program to improve the capital structure and profitability of the company.
Significant events during the reporting period
The company announced to start change negotiations in Finnish companies on
Significant events after review period
The Board decided in its organisational meeting held after Annual General Meeting on
Medium-term financial targets (3-5 years) (Targets unchanged)
Growth: net sales in the range of
Profitability: adjusted EBITA margin of at least 13% in the medium-term.
Leverage: net debt to adjusted EBITDA ratio in the range of 2-3. Leverage may temporarily exceed the target range (for example, in conjunction with acquisitions).
Financial reporting and Annual General Meetings in 2023
Business reports for financial year 2023
- September 2022-February 2023 including second quarter:
Wednesday, April 5, 2023 -
September 2022-May 2023 including third quarter:
Thursday, July 6, 2023 -
September 2022-August 2023 including fourth quarter:
Thursday, November 9, 2023
The Annual General Meeting is scheduled for
Further information
Jarkko Ämmälä, CEO
+358 50 056 5149
jarkko.ammala@duell.eumailto:
Pellervo Hämäläinen, IR
+358 40 674 5257
pellervo.hamalainen@duell.eu
Certified Advisor
Attachments
Duell Corporation September 2022-November 2022 Financial Report.pdf
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