Kamux Corporation's Half Year Financial Report for January 1--June 30, 2024: Revenue decreased and adjusted operating profit decreased significantly, a weak Q2 in Sweden

Kamux Corporation, Half Year Financial Report, 16.8.2024 at 9:00

ESPOO, Finland, Aug. 16, 2024 /PRNewswire/ -- Kamux Corporation's Half Year Financial Report for January 1—June 30, 2024: Revenue decreased and adjusted operating profit decreased significantly, a weak Q2 in Sweden.

This is a summary of Kamux Corporation's Half Year Financial Report for January 1—June 30, 2024. The complete report is attached to this release and is also available at the company website at www.kamux.com.

The figures in parentheses refer to the comparison period, i.e., the same period in the previous year, unless stated otherwise.

April–June in brief

• Revenue decreased by -0.9% and was EUR 252.6 million (255.0)
• Gross profit decreased by -6.1% to EUR 24.7 million (26.3), or 9.8% (10.3) of revenue
• Adjusted operating profit (EBIT) decreased by -41.3% to EUR 2.7 million (4.5), or 1.1% (1.8) of revenue
• Operating profit (EBIT) decreased by -45.9% and was EUR 2.1 million (3.9), or 0.8% (1.5) of revenue
• The number of cars sold decreased by -1.0% to 17,037 cars (17,215)
• Like-for-like showroom revenue decreased by -5.7% (2.9)
• Basic and diluted earnings per share were EUR 0.00 (0.06)

January–June in brief

• Revenue increased by 3.2%, totaling EUR 493.4 million (478.1)
• Gross profit increased by 4.3% to EUR 49.0 million (47.0), or 9.9% (9.8) of revenue
• Adjusted operating profit (EBIT) remained at the previous year's level and was EUR 5.4 million (5.4), or 1.1% (1.1) of revenue
• Operating profit (EBIT) decreased by -1.8% to EUR 4.4 million (4.5), or 0.9% (0.9) of revenue
• The number of cars sold increased by 2.0% to 33,174 cars (32,539)
• Like-for-like showroom revenue growth was 0.1% (-2.4)
• Basic and diluted earnings per share were EUR 0.03 (0.06)

Key Figures

CEO Tapio Pajuharju:

"Despite the somewhat favorable development of the used car demand in all our operating countries, the second quarter was challenging for Kamux. The difficult sourcing market, and in particular the challenges in Sweden, were reflected in our revenue and profitability.

In Finland, the market slowed down in June, yet in Sweden and Germany, the market momentum remained mainly favorable throughout the quarter. The car sourcing market became increasingly difficult throughout the period in all of our operating countries, and we did not fully succeed in acquiring enough cars matching the demand. At Kamux, the good sales momentum continued in Germany, where the number of cars sold increased by almost 20%. In Finland, the number of cars sold remained at the same level as in the comparison period, and in Sweden the number of cars decreased substantially.

In Sweden, the second quarter had a good start, but June in particular was a major disappointment. We did not proceed in onboarding the new sellers as quickly as we had planned, and in addition, while the corrective actions related to previously detected misconduct have progressed as planned, they have required more effort and resources than expected. During August, it became evident that implementing the corrective actions has taken a toll and in order to speed up the commercial recovery, we needed to make a change in Kamux Sweden's leadership. However, we believe that we will have a well-performing team in Sweden later this year and that all corrective actions will be completed gradually towards the end of the year. However, the challenge in Sweden has turned out to be bigger than previously estimated.

In Finland, we fell slightly below market development due to the challenged sourcing market in passenger cars. We have elected to maintain solid profitability, and we did succeed relatively well in maintaining our margin per sold car even in the substantially tightened sourcing market.

At the group level, the number of cars sold in the second quarter fell one percent below the comparison period due to the negative development in Sweden. The group's revenue also fell by one percent, as the revenue growth in Finland and Germany was not high enough to offset the decrease in Sweden. In Finland, revenue grew mainly due to the slightly higher average price of cars sold. In Germany, revenue grew with the volume of cars sold, but on the other hand the average price of cars sold decreased as a result of the planned change in our offering. In Sweden, the average price of sold cars was lower than in the comparison period.

Gross profit decreased compared to the comparison period due to the negative development in Sweden. In Germany, gross profit developed favorably. In all our operating countries, gross profit was impacted by maintenance expenses which increased due to inflation. Sales of integrated services, especially Kamux Plus, developed favorably. Adjusted operating profit for the second quarter decreased compared to the comparison period and was EUR 2.7 million (EUR 4.5 million). Operating cash flow for January–June was EUR -14.2 million (EUR -16.2 million).

The sourcing market for used cars tightened in all our operating countries. Sales of new cars have been slow, and as a consequence the number of used cars entering the market is lower. At the same time, the market dynamics and competition have also changed, as many dealers who previously focused on new cars have invested noticeably more in used cars than before. In Sweden, the situation was further complicated due to the low exchange rate of the Swedish krona. This has made Sweden an attractive sourcing market for many eurozone countries.

During the past quarter, we have continued the dedicated and systematic implementation of our omnichannel strategy by upgrading our showrooms and web presence to match our concept, especially in Finland, but also in Sweden and Germany. We have also made several changes to our showroom network. On top of this, we decided to accelerate the measures defined in our strategy to improve the productivity and profitability of our operations. With the measures initiated during the second quarter, we target approximately EUR 5.0–7.0 million in annualized savings by the end of 2025. The measures are divided into two parts: In the first part, we will standardize indirect purchases, such as maintenance, washing, repairs and spare parts, and combine volumes. The second part includes the streamlining of the showroom network and own processes and organization. At the same time, we will continue to invest in growth, particularly by developing our webstore and showroom network.

Customer satisfaction is an important metric for us. The Net Promoter Score (NPS), where our long-term target is 60, decreased slightly in the second quarter and was 49 (51 in Q1) at the group level – still a very good level within the car industry. During the fall, we will continue actions dedicated to improving customer experience as well as upgrading our showrooms to match our concept. Due to the changes in the sourcing market, we are also accelerating our international sourcing activities and the standardization of car processing in order to get them ready for sale quicker, as well as to reduce costs.

I would like to once again express my warm thanks to all Kamux employees for their good work in a challenging market. I would also like to thank our customers and partners for their trust."

Outlook for the year 2024 (unchanged)

Kamux expects its adjusted operating profit for 2024 to exceed its 2023 adjusted operating profit, which was EUR 18.0 million.

Significant events after the reporting period

On August 13, 2024, Kamux announced that Andy Rietschel, Kamux Sweden's Managing Director and a member of the Group Management Team, leaves Kamux. The resignation was effective immediately. Aino Hökeberg, Kamux's Chief Marketing and Concept Officer and a member of the Group Management Team, acts as the interim Managing Director of Kamux Sweden.

On August 9, 2024, Kamux announced that Marjo Nurmi, the Group's Chief People and Sustainability Officer and a member of the Group Management Team, has decided to become an entrepreneur and will leave Kamux. She will continue in her current position and as a member of the Group Management Team until September 30, 2024.

On July 5, 2024, Kamux announced that Vesa Uotila, the Group's Chief Business Development Officer and a member of the Group Management Team, had decided to leave Kamux in order to join private equity investor Sponsor Capital as a partner. He continued as Chief Business Development Officer and a member of the Group Management Team until August 7, 2024, and he will serve as an advisor to the company until the end of 2024.

Kamux Corporation's financial reporting in 2024

The publication schedule for Kamux Corporation's financial reporting in 2024 is as follows:

• Interim Report for January—September 2024  November 8, 2024

News conference

News conference for investors, analysts and media will be held today, Friday, August 16, 2024, at Sanomatalo, Flik Studio Eliel, 1st floor, Töölönlahdenkatu 2, Helsinki at 11:00 EEST. CEO Tapio Pajuharju and CFO Jukka Havia will present the Half Year Report.

The conference can be followed as a live webcast at https://kamux.videosync.fi/q2-2024

Participation by conference call:

You can access the teleconference by registering on the link below. After the registration you will be provided phone numbers and a conference ID to access the conference. If you wish to ask a question, please dial *5 on your telephone keypad to enter the queue.

https://palvelu.flik.fi/teleconference/?id=50049836

For more information, please contact:
CEO Tapio Pajuharju, tel. +358 50 577 4200
CFO Jukka Havia, tel. +358 50 355 3757
Head of Communications & IR Katariina Hietaranta, tel. +358 50 557 6765

Kamux Corporation
Communications

Kamux is a retail chain specialized in preowned cars and related integrated services that has grown rapidly. Kamux combines online shopping with an extensive showroom network to provide its customers with a great service experience anytime, anywhere. In addition to digital channels, the company has a total of 74 car showrooms in Finland, Sweden and Germany. Since its founding in Hämeenlinna, Finland, in 2003 the company has sold over 500,000 used cars, 68,257 of which were sold in 2023. Kamux's revenue in 2023 was EUR 1,002 million and its average number of employees was 885 in terms of full-time equivalent employees. Kamux Corporation is listed on Nasdaq Helsinki Ltd. For more information, please visit www.kamux.com 

This information was brought to you by Cision http://news.cision.com

https://news.cision.com/kamux/r/kamux-corporation-s-half-year-financial-report-for-january-1-june-30--2024--revenue-decreased-and-ad,c4025073

The following files are available for download: