Financial performance in brief:
7-9/2024
· Group net sales in July-September totalled €3,026.6 million (€2,949.1
million); reported net sales grew by 2.6% while comparable net sales were down
by 0.8%.
· Comparable operating profit totalled €201.5 million (€208.1 million)
· Operating profit totalled €202.1 million (€206.6 million)
· Cash flow from operating activities totalled €285.6 million (€394.9 million)
· Comparable earnings per share €0.34 (€0.38); reported earnings per share
€0.35 (€0.37).
1-9/2024
· Group net sales in January-September totalled €8,879.5 million €8,881.8
million); reported net sales were at last year's level, while comparable net
sales were down by 3.5%
· Comparable operating profit totalled €479.3 million (€541.6 million)
· Operating profit totalled €458.5 million (€535.5 million)
· Cash flow from operating activities totalled €707.2 million (€707.1 million)
· Comparable earnings per share €0.80 (€0.97); reported earnings per share
€0.76 (€0.96)
Key performance indicators
7-9/2024 7-9/2023 1-9/2024 1-9/2023 1
-12/2023
Net sales, €
million 3,026.6 2,949.1 8,879.5 8,881.8
11,783.8
Operating
profit, 201.5 208.1 479.3 541.6
712.0
comparable,
€ million
Operating 6.7 7.1 5.4 6.1
6.0
margin,
comparable,
%
Operating
profit, € 202.1 206.6 458.5 535.5
695.4
million
Profit
before tax, 172.1 188.4 399.7 485.3
630.4
comparable,
€ million
Profit
before tax, 172.5 186.8 378.5 479.1
613.5
€
million
Cash flow
from 285.6 394.9 707.2 707.1
1,049.5
operating
activities,
€
million
Capital
expenditure, 109.4 127.5 566.9 520.5
678.9
€
million
Earnings per
share, €, 0.35 0.37 0.76 0.96
1.25
basic and
diluted
Earnings per
share, 0.34 0.38 0.80 0.97
1.28
comparable,
€, basic
7-9/2 7-9/2023 1-9/2024 1-9/2023 1-12/2023
024
Return on capital employed, 11.5 14.1 11.5 14.1 13.4
comparable, %, rolling 12
months
Return on equity, comparable, 16.7 20.2 16.7 20.2 18.5
%, rolling 12 months
In this interim report, the comparable change % in net sales has been calculated
in local currencies and excluding the impact of acquisitions and divestments
completed in 2024 and 2023. The comparable operating profit has been calculated
by deducting items affecting comparability from the reported operating profit.
Profit guidance for 2024 (specified)
Kesko Group's profit guidance is given for the year 2024, in comparison with the
year 2023. Kesko's operating environment is estimated to remain challenging in
2024. Kesko's net sales and operating profit are estimated to remain at a good
level in 2024 despite the challenges in the company's operating environment.
Kesko estimates that its comparable operating profit in 2024 will amount to
€630-680 million. Previously, the comparable operating profit was estimated to
amount to €620-680 million. The profit guidance specification is based on third
-quarter profit development in building and technical trade.
The profit guidance and outlook are based on an estimate of a relatively short
recession in Kesko's operating countries. Key uncertainties impacting Kesko's
outlook are developments in inflation and interest rate levels, and geopolitical
crises and tensions.
Outlook for 2025
Kesko's operating environment is estimated to improve in 2025, and Kesko's
comparable operating profit is also estimated to improve in 2025.
In grocery trade, B2C trade and the foodservice market are estimated to remain
stable. In 2025, the comparable operating margin for the grocery trade division
is estimated to stay clearly above 6% despite the investments in price and the
store site network in accordance with Kesko's strategy for 2024-2026.
In building and technical trade, the cycle is expected to improve in 2025 from
the historically low levels. Profitability in the building and technical trade
division is estimated to improve on 2024.
In car trade, new car orders are expected to stay at a low level in 2025. Demand
for used cars and services is estimated to remain good. Profitability for the
car trade division is estimated to remain at a good level in 2025 despite weak
demand for new cars.
President and CEO Jorma Rauhala:
Kesko's performance in the third quarter of 2024 was good considering the
market, which remained challenging. Our net sales totalled €3,027 million, up by
2.6% year-on-year, while in comparable terms net sales decreased by 0.8%. Our
comparable operating profit totalled €201.5 million, and it was up in both
building and technical trade and grocery trade.
Net sales for the grocery trade division totalled €1,609 million, up by 1.0%,
while the division's comparable operating profit amounted to €118.8 million. K
Group's grocery sales were down by 0.1%, slightly underperforming the market.
Online grocery sales increased by 13.9% thanks in particular to growth in
express deliveries. Kespro's net sales grew by 3.1%, exceeding market growth.
Grocery price inflation slowed down notably and stood at 0.4%. Our customer
flows continued to grow thanks to campaigns, while customers emphasise price.
Our strategy execution in grocery trade is proceeding according to plans,
focusing on strengthening store-specific business ideas, developing our store
site network, and improving our price competitiveness.
In the building and technical trade division, we can see a turn for the better:
result for the division grew for the first time in eight quarters. Sales have
picked up in both building and home improvement trade and technical trade, but
the market remains challenging, The division's net sales totalled €1,128
million, up by 7.4%, or down by 2.2% in comparable terms. Comparable operating
profit for the division totalled €70.1 million, up by €0.2 million. In building
and home improvement trade, net sales increased thanks to sales growth in K
-Rauta Finland and the Davidsen acquisition in Denmark. Operating profit for
Onninen Finland was nearly at last year's level, and sales and profitability for
solar power products have returned to normal levels. In Norway, there have been
logistics-related delays in the Elektroskandia integration process, while
Byggmakker's sales slightly underperformed the market. In Sweden, our increased
focus on B2B trade under the K-Bygg brand has proceeded according to plans.
In the car trade division, both net sales and profit decreased as the market
remained challenging, but profitability stayed at a good level. Market demand
for new cars was muted, but the market for used cars grew slightly. The
division's net sales totalled €295 million and comparable operating profit €17.8
million. New car sales decreased, but when it came to orders for new cars, the
market share of car brands represented by Kesko increased. Our sales growth in
used cars notably outpaced the market. Service sales also increased. In
September, we completed the acquisition of Autotalo Lohja.
Kesko's net sales and operating profit are estimated to remain at a good level
in 2024 despite the challenges in our operating environment. We now specify our
profit guidance and estimate that our comparable operating profit in 2024 will
amount to €630-680 million. We furthermore estimate that Kesko's comparable
operating profit will improve in 2025.
Further information, audioconference and webcast
Further information is available from Anu Hämäläinen, Executive Vice President,
Chief Financial Officer, tel. +358 105 323 713, Hanna Jaakkola, Vice President,
Investor Relations, tel. +358 105 323 540, and Eva Kaukinen, Vice President,
Group Controller, tel. +358 105 322 338. An English-language audio conference on
the results briefing will be held on 30 October 2024 at 9.00 (EET). The audio
conference login is available on Kesko's website at www.kesko.fi. A Finnish
-language webcast of the interim report briefing can be viewed at 10.30 am (EET)
at www.kesko.fi.
Kesko's Financial statements release for January-December 2024 will be published
on 5 February 2025. In addition, Kesko Group's sales figures are published
monthly. News releases and other company information are available on Kesko's
website at www.kesko.fi.
This is a summary of Kesko Corporation's January-September 2024 Q3 interim
financial report. The complete report is attached to this release and also
available at www.kesko.fi/en/investor