Unaudited consolidated interim accounts for the second quarter and first six months of 2025
Segments (EURm) Q2/25 Q2/24 Change 6m/25 6m/24 Change
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Supermarkets 155.7 150.3 3.6% 304.0 296.7 2.5%
Department stores 25.7 25.4 1.0% 48.4 49.4 -2.0%
Cars 45.1 54.1 -16.6% 82.5 98.9 -16.7%
Security 4.4 5.7 -24.1% 9.0 10.3 -12.8%
Real Estate 1.9 1.8 9.5% 3.9 3.4 12.6%
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Total sales 232.8 237.3 -1.9% 447.8 458.8 -2.4%
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Supermarkets 3.4 5.2 -35.0% 4.0 6.2 -34.9%
Department stores 0.0 0.2 -100.0% -1.7 -1.0 68.1%
Cars 1.6 3.3 -51.3% 2.3 5.6 -58.7%
Security -0.3 0.0 -747.6% -0.4 -0.1 324.0%
Real Estate 2.4 1.7 39.0% 4.6 3.9 17.6%
IFRS 16 -0.5 -0.6 -16.6% -1.0 -1.0 -2.6%
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Total profit before tax 6.6 9.9 -32.7% 7.9 13.7 -42.1%
-----------------------------------------------------------------------------
The Group's unaudited consolidated sales revenue for the second quarter of 2025
amounted to 232.8 million euros, representing a year-on-year decrease of 1.9%.
Sales revenue for the first half of the year totalled 447.8 million euros,
declining by 2.4% compared to the result for the first half of 2024, when sales
revenue stood at 458.8 million euros. The Group's unaudited consolidated profit
before tax for the second quarter of 2025 was 6.6 million euros, which was
32.7% lower than the profit recorded for the comparable period of the previous
year. The Group's profit before tax for the first six months of 2025 was 7.9
million euros, falling short of the result for the comparable period by 5.8
million euros. Net profit for the first half of the year was 0.1 million euros,
which includes a negative tax impact of 2.5 million euros due to the increase in
income tax rates.
The second quarter and the entire first half of the year continued to be
characterised by a challenging economic environment shaped by an unstable
international political situation as well as domestic tax increases and cautious
consumer spending. The Group's sales revenue in Estonia was notably affected by
the car tax introduced at the beginning of the year, which resulted in a 40%
decline in the new car market volume in Estonia during the first half of the
year compared to the same period last year. Nevertheless, the decline in sales
revenue for the Group's car segment companies operating in Estonia was limited
to approximately one third. Overall, the car segment's sales revenue for the
six-month period fell short of the previous year's level by 16.7%, as the
negative impact was offset by stronger results from subsidiaries in Latvia and
Lithuania. Consequently, the Group's total sales revenue also remained slightly
below the previous year's level, although the sales revenue of the Selver
supermarkets segment continued to grow, building on the momentum from the first
quarter, and the sales revenue of the department stores segment also rose
slightly above the previous year's figure. Growth in these segments was
supported by successful marketing and promotional campaigns. The real estate
segment also contributed to the increase in non-group sales revenue and was the
only segment to achieve profit growth. The decline in revenue for the security
segment resulted from the seasonal fluctuation in the volume of security
equipment projects. The additional business areas acquired in the security
segment in 2024, along with the other business segments, generated stable sales
revenue.
The Group's segments were able to maintain their gross margin at a level
comparable to that of the previous year, thanks to skilful inventory planning
and well-considered campaign management. However, the decline in gross profit
resulting from lower revenue, the increase in staff costs, and the payment of
corporate income tax at a higher rate in the first half of the year brought the
Group's half-year profit to its lowest level in recent years, although the
EBITDA for the first half of the year was the fourth highest on record,
exceeding the result for the comparable period in 2021. A decrease in EURIBOR
rates provided relief of 0.8 million euros in finance costs from interest on
bank loans and leases compared to the previous year, but the additional interest
expense arising from the revised IFRS 16 calculation added 0.6 million euros,
which almost entirely offset the positive impact of the interest rate reduction.
The Group's staff costs increased by 5.2%, while the total number of employees
rose by 0.3%. One measure to optimise staff costs is the improvement of the
supply chain in cooperation with the Group's logistics centre, which also helps
to boost the internal efficiency of trading processes. The updated KIA Sportage,
which is among the Group's most popular models, has reached the Baltic market,
supporting the recovery of the car segment. A positive impact is also being
provided by the growing demand for electric and hybrid vehicles, with the model
range set to expand in the coming months with the addition of the new KIA EV4
and the electric van PV5.
In the first quarter of 2025, renovation works were carried out on two floors of
the Children's World department in the Kaubamaja Tallinn store, and in March the
completely redesigned Children's World was opened. The addition of new brands
and a lifestyle-based layout attracted a significant number of new customers to
the Children's World in March. In the department stores segment, development
work commenced to upgrade the I.L.U. e-store to a new platform and quality
standard, with completion scheduled for the third quarter. The Group's
Lithuanian real estate company is continuing with the construction of a new KIA
and Shkoda showroom and service centre in Vilnius, aimed at supporting the
expansion of the Group's car segment in the Lithuanian market. Preparatory work
has begun in Estonia for the construction of a new bodywork workshop adjacent to
the Peetri car dealership. Several store renovation projects have also been
initiated this year, with the aim of aligning the buildings with current
business needs and increasing their energy efficiency. In the second half of
this year, the renovation of Jõgeva Selver is planned, in addition to
preparations already underway for the development of the new Pärnu Papiniidu
Selver, scheduled to open in 2026, and the expansion of Laulasmaa Selver.
Preparatory activities are ongoing for the refurbishment of the Kaubamaja
Tallinn department store. The development is based on the winning entry "City
Break" from the architectural competition held in cooperation with the City of
Tallinn and the Union of Estonian Architects. To realise the project, it has
been agreed with the City of Tallinn that a new detailed planning procedure will
be carried out. The developers and the City of Tallinn have agreed that the
detailed planning procedure will be prioritised and implemented with minimal
time expenditure in accordance with the statutory deadlines.
Selver supermarkets
The consolidated sales revenue of the Selver supermarkets segment for the second
quarter of 2025 amounted to 155.7 million euros, representing an increase of
3.6% compared to the same period of the previous year. The consolidated sales
revenue for the six-month period totalled 304.0 million euros, marking a 2.5%
growth year on year. The average monthly sales revenue from goods per square
metre of selling space in the second quarter of 2025 was 0.41 thousand euros,
increasing by 0.9% in total and by 2.2% for comparable stores. The average
monthly sales revenue from goods per square metre of selling space for the first
six months of 2025 was 0.4 thousand euros both in total and for comparable
stores. The figure was the same for the corresponding period of the previous
year. The growth in sales area efficiency in the second quarter brought the
sales area efficiency for the first half of 2025 back to the level recorded in
2024. A total of 22.1 million purchases were made in stores during the first
half of 2025, which is 1.8% more than in the corresponding period of the
previous year.
The profit before tax and net profit for the second quarter of 2025 were both
3.4 million euros, which is 1.8 million euros less than in the base period. The
consolidated profit before tax for the supermarkets segment for the first six
months of 2025 was 4.0 million euros, falling short of the comparative base by
2.2 million euros. The net profit for the six-month period was 3.5 million
euros, declining by 1.1 million euros compared to the previous year. The
difference between net profit and profit before tax is attributable to income
tax paid on dividends - this year, income tax on dividends was 1.0 million euros
lower than in the previous year. The comparative figures do not include the data
for the Raadi and Rocca al Mare Selver stores opened in the third quarter of
2024 but do include the data for the Maardu Selver, which was closed in February
this year.
The sales performance of Selver in the second quarter has been affected by the
general situation in the Estonian retail market, the weakened purchasing power
of customers and more subdued seasonal goods sales due to cooler weather
conditions. The volume of sales in food and convenience stores continues to
decline, reflecting consumer behaviour trends across the sector. The VAT
increase to be implemented from July will further erode already low consumer
confidence. The prices of food and production inputs continue to rise, driven by
both global and local factors, and it is impossible for retailers to avoid
passing these increases on to end prices.
The financial results for the second quarter of 2025 were impacted by the
decline in sales volumes and a decrease in the gross margin on the sale of goods
due to a higher proportion of campaign products. This year's operating cost base
has increased due to one-off expenses related to new stores and the closure of
the Maardu store. However, the Group has successfully managed the pressure from
rising input prices for various services and materials and optimised expenditure
levels, enabling operational efficiency ratios to be maintained at the same
level as last year. Pressure on wage costs and the slower growth of sales
revenue relative to wage growth have resulted in a slight decline in labour
efficiency.
Selver plans to renovate the Jõgeva Selver in the second half of this year. As
part of the renovation, the store's sales area will be expanded and more
environmentally sustainable solutions will be implemented. Across the segment,
continued focus remains on the product assortment and the optimisation of
processes. To adapt even better to changed customer demand, Selver added the
Scandinavian white-label brand First Price to its assortment in the first half
of the year, which is available exclusively at Selver and Delice. The First
Price range represents affordable pricing and reliable Scandinavian quality and
broadens the selection of the most competitively priced everyday products. In
2025, full use will be made of the logistics centre established in Maardu in
2024 within the supply chain. There will also be a continued focus on increasing
activity on the Bolt Market and Wolt platforms and on developing the Selver e-
store. At the beginning of this year, Selver's e-store was chosen as the
public's favourite grocery and convenience goods shop in a public vote organised
by the Estonian E-Commerce Association. In April, Selver joined the 'For a
Violence-Free Life' initiative, led by the President Kaljulaid Foundation, which
unites employers in taking action against domestic violence. In 2026, one new
store is planned to be opened - the Papiniidu Selver in Pärnu - and the
Laulasmaa Selver in Harjumaa will be expanded and renovated. Preparatory
activities for both projects have already commenced.
The supermarkets segment continues to operate responsibly and with a commitment
to sustainability, with the aim of continuously improving its activities to
reduce environmental impact. To increase environmental sustainability, a new
waste collection system has been developed and introduced to raise the
proportion of waste that is recycled, thereby reducing the environmental impact
of our operations. In our refrigeration systems, we have begun to introduce more
environmentally friendly refrigerants with very low global warming potential,
helping to reduce our carbon footprint. For Kulinaaria's production, packaging
and its use remain a key area of focus. In product development, alongside
maintaining high product quality, significant attention is given to reducing the
salt, sugar and fat content of products.
Department stores
The sales revenue of the department stores segment for the second quarter of
2025 amounted to 25.7 million euros, representing a 1.0% increase compared to
the corresponding period of the previous year. No profit was generated in the
second quarter, resulting in a shortfall of 0.2 million euros compared to the
result for the corresponding period of the previous year. The six-month sales
revenue totalled 48.4 million euros, which is 2.0% lower than for the same
period last year. The department stores segment recorded a pre-tax loss of 1.7
million euros for the first six months of 2025, which is 0.7 million euros
weaker than the result for the previous year.
The average sales revenue of the department stores per square metre of selling
space for the six-month period was 0.30 thousand euros per month, down 1.8% year
on year. The cooling economic climate continued for the second consecutive
quarter, with various campaigns performing well as a result. The Spring
'Osturalli' campaign proved highly successful, marking the second best result in
the campaign's history and contributing positively to the second quarter's sales
revenue. Unfortunately, neither a milder winter nor one of the coldest summers
have had the expected effect on seasonal goods sales. On the other hand,
Kaubamaja's stock situation is better than in the previous year, which meant
there was no need for extensive discounting. In grocery retail, a product range
that stands out from competitors has continued to attract new loyal customers to
Toidumaailm stores, with sales results exceeding expectations. In the early
months of the year, renovation works were carried out on two floors of the
Tallinna Lastemaailm department, and in March the fully renewed department with
a new concept was opened. New brands and lifestyle-based displays were
introduced, generating lively interest among customers. Exclusive special
collections available only at Kaubamaja have also attracted positive attention
and performed well - including the anniversary collection in collaboration with
Lilli Jahilo and the Konges Slojd children's collection, available exclusively
in Estonia at Kaubamaja. In the first half of the year, customer interest in the
e-store grew significantly compared to the previous period, with growth figures
in the double digits.
The sales revenue of OÜ TKM Beauty Eesti, which operates the I.L.U. cosmetics
stores, was 1.9 million euros for the second quarter of 2025, declining by 2.9%
compared to the same period in 2024. The second-quarter loss was 0.1 million
euros, which is 0.1 million euros lower than the result for the comparable
period in 2024. The sales revenue for the first half of 2025 was 3.7 million
euros, down 4.8% year on year. The loss for the first half of 2025 was 0.1
million euros, which is 0.2 million euros lower than for the same period in
2024. Overall consumer confidence remained low and continued to impact sales
performance. Despite several successful campaigns that maintained customer
footfall at the same level as in the previous period, meeting sales targets on
regular days remains a challenge. Customers now plan their visits to shopping
centres and their purchases carefully, paying particular attention to the timing
of promotional campaigns.
Car trade
The sales revenue of the car segment for the second quarter of 2025 amounted to
45.1 million euros, which was 16.6% lower than in the same period of the
previous year. The pre-tax profit for the second quarter of 2025 was 1.6 million
euros, which was 1.7 million euros weaker than the profit for the same period
last year. The segment's sales revenue for the first six months totalled 82.5
million euros, representing a 16.7% decrease compared to the same period of the
previous year. The pre-tax profit for the first half of the year was 2.3 million
euros, falling short of last year's result by 3.3 million euros. In the second
quarter, 1,403 new vehicles were sold. A total of 2,433 new vehicles were sold
in the first half of the year, which was 23.3% fewer than in the previous year.
The sales revenue of the car segment was significantly affected by the car tax
introduced in Estonia at the beginning of the year, which led to a 40% reduction
in the volume of the new car market in Estonia in the first half of the year
compared to the same period last year. Nevertheless, the decline in sales
revenue for the Group's Estonian car businesses was limited to approximately one
third. Overall, the car segment's six-month sales revenue was down 16.7% year on
year, with the negative impact offset by stronger performance from the Group's
Latvian and Lithuanian subsidiaries. Despite the decline in the Estonian market,
the Group's pan-Baltic business model enables the diversification of risks and
helps maintain the car segment's profitability, although KIA sales have been
more modest while awaiting new models. The updated KIA Sportage, which is among
the Group's most popular models, has now arrived on the Baltic market and is
supporting the recovery of the car segment. Further positive momentum is being
provided by the growing demand for electric and hybrid vehicles, with the model
range to be expanded in the coming months with the new KIA EV4 and the electric
van PV5.
Construction of the KIA-Shkoda multi-brand dealership in Vilnius, Lithuania, is
progressing as planned. In Estonia, Viking Motors' new flagship KIA sales and
service centre opened its doors at the beginning of the year on the outskirts of
Tallinn in Peetri. Work has also commenced on the construction of a body repair
workshop adjacent to the Peetri dealership.
Security segment
The non-group sales revenue of the security segment for the second quarter of
2025 amounted to 4.4 million euros, declining by 24.1% compared to the same
period of the previous year. The pre-tax loss for the segment in the second
quarter totalled 0.3 million euros, which was 0.3 million euros weaker than in
the same period last year. The non-group sales revenue for the security segment
for the first half of 2025 was 9.0 million euros, decreasing by 12.8% year on
year. The pre-tax loss for the first six months of the segment was 0.4 million
euros, 0.3 million euros weaker than for the same period last year.
Following last year's exceptionally strong growth base of 63%, the second
quarter of this year was considerably weaker. The negative impact of the
economic environment has increasingly affected all areas of activity through
clients, reflected in both a reduction in volumes and pressure on profit
margins. Managing the continued rise in input costs remains a challenge. The
results in the security technology projects field fell the most, mainly due to
seasonal fluctuations in project volumes. On the positive side, the technical
surveillance portfolio continued to grow. The company remains focused on
improving efficiency and increasing sales activity.
Real estate
The non-group sales revenue of the real estate segment for the second quarter of
2025 amounted to 1.9 million euros, representing an increase of 9.5% compared to
the same period of the previous year. The non-group sales revenue for the first
six months was 3.9 million euros, rising by 12.6% year on year. The pre-tax
profit for the segment in the second quarter totalled 2.4 million euros, an
increase of 39.0% compared to the reference period. The pre-tax profit for the
first six months of 2025 was 4.6 million euros, up by 17.6%.
The growth in sales revenue in the first half of the year was largely supported
by the addition of rental income from the logistics centre that commenced
operations at the end of last year. The logistics centre has been leased to a
non-group entity. At the beginning of the year, a new tenant, the Vapiano
restaurant, opened in the Viimsi Centre, which boosted the centre's footfall.
Sales revenue declined in the Latvian real estate company due to the sale of the
Rezekne and Ogre commercial properties to non-group entities at the end of last
year and the sale of the Kuldiga and Salaspils properties at the beginning of
this year. The results for the reference period included the loss on the sale of
the Punane Selver building, which was sold in April 2024. The segment's profit
growth was supported by lower borrowing costs.
The Lithuanian real estate company commenced construction last year of a new KIA
and Shkoda dealership and service building in Vilnius. In Estonia, work has begun
on the construction of a body repair workshop next to the KIA sales and service
centre in Peetri. In addition, several store renovation projects are being
prepared with the aim of modernising the buildings to meet current business
needs, including improving energy efficiency.
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
In thousands of euros?
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30.06.2025 31.12.2024
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ASSETS
-------------------------------------------------------------------------
Current assets
Cash and cash equivalents 20,820 45,454
Trade and other receivables 20,230 30,310
Inventories 98,321 97,091
-------------------------------------------------------------------------
Total current assets 139,371 172,855
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Non-current assets
Long-term receivables and prepayments 234 235
Investments in associates 1,851 1,733
Investment property 76,629 81,284
Property, plant and equipment 423,513 424,794
Intangible assets 26,226 25,785
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Total non-current assets 528,453 533,831
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TOTAL ASSETS 667,824 706,686
-------------------------------------------------------------------------
-------------------------------------------------------------------------
LIABILITIES AND EQUITY
-------------------------------------------------------------------------
Current liabilities
Borrowings 25,686 44,436
Trade and other payables 101,425 110,997
-------------------------------------------------------------------------
Total current liabilities 127,111 155,433
-------------------------------------------------------------------------
Non-current liabilities
Borrowings 295,811 279,958
Trade and other payables 1,305 1,285
Deferred tax liabilities 7,939 7,939
Provisions for other liabilities and charges 516 543
-------------------------------------------------------------------------
Total non-current liabilities 305,571 289,725
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TOTAL LIABILITIES 432,682 445,158
-------------------------------------------------------------------------
Equity
Share capital 16,292 16,292
Statutory reserve capital 2,603 2,603
Revaluation reserve 110,812 112,167
Retained earnings 105,435 130,466
-------------------------------------------------------------------------
TOTAL EQUITY 235,142 261,528
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TOTAL LIABILITIES AND EQUITY 667,824 706,686
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CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
In thousands of euros
-----------------------------------------------------------------------------
6 months
II quarter 2025 II quarter 2024 6 months 2025 2024
-----------------------------------------------------------------------------
Revenue 232,846 237,323 447,780 458,826
Other operating
income 292 341 621 550
Cost of merchandise -168,625 -171,511 -325,049 -333,601
Service expenses -15,102 -14,956 -30,853 -30,218
Staff costs -29,218 -27,398 -57,521 -54,692
Depreciation,
amortisation and
impairment losses -10,607 -10,467 -21,373 -21,077
Other expenses -208 -458 -576 -790
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Operating profit 9,378 12,874 13,029 18,998
-----------------------------------------------------------------------------
Finance income 75 76 354 329
Finance costs -2,877 -3,142 -5,586 -5,790
Finance income on
shares of associates
accounted for using
the equity method 62 61 118 133
Profit before tax 6,638 9,869 7,915 13,670
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Income tax expense -1 -1 -7,827 -5,313
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NET PROFIT FOR THE
FINANCIAL YEAR 6,637 9,868 88 8,357
-----------------------------------------------------------------------------
Other comprehensive
income:
Items that will not
be subsequently
reclassified to
profit or loss
-----------------------------------------------------------------------------
Other comprehensive
income for the
financial year 0 0 0 0
-----------------------------------------------------------------------------
TOTAL COMPREHENSIVE
INCOME FOR THE
FINANCIAL YEAR 6,637 9,868 88 8,357
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Basic and diluted
earnings per share
(euros) 0,16 0.24 0,00 0.21
Raul Puusepp
Chairman of the Board
Phone +372 731 5000