Slide 1: MEKO January – June 2024
MEKO January – June 2024 Pehr Oscarson Christer Johansson August 22, 2024 CEO CFO
Slide 2: Q2 2024 – We continue to build a stronger MEKO
Q2 2024 – WE CONTINUE TO BUILD A STRONGER MEKO Solid organic growth in all markets Robust adjusted EBIT development, while EBIT comparison affected by one-time effects Strong operating cash flow generation Improved financial position – leverage well within the target range Strengthened position in P
Slide 3: Elit Polska – a perfect strategic fit
ELIT POLSKA – A PERFECT STRATEGIC FIT • Large untapped potential in Poland for MEKO • Support our growth strategy • Growing market share from 5% to 8% • Highly complementary business • Reduces future investment needs • No significant impact on MEKO's debt level or Elit Polska branches cash flow Inte
Slide 4: Reorganizations and cost reductions in Denmark
REORGANIZATIONS AND COST REDUCTIONS IN DENMARK • Increased focus on sales and logistics – separate organizations • Improved service level • Increased efficiency with reduced costs • Strong platform in combination with new central warehouse 2025 Fully operational in 2025 4
Slide 5: Modernized and automated warehouse in Finland
MODERNIZED AND AUTOMATED WAREHOUSE IN FINLAND • Sale of central warehouse properties in Finland • Improved to real order estate company handling f ten and service years. level • Improved efficiency and reduced costs • Reformed and optimized organisation • Strong platform for further growth in Fully
Slide 6: Capital markets update with focus on our optimizations
CAPITAL MARKETS UPDATE WITH FOCUS ON OUR OPTIMIZATIONS • Detailed review of the initiative ”Building a Stronger MEKO” • Elaborations on investments in logistics and goods handling • Focus on optimization and efficiency gains across the group • Financial review: MEKO on track to reach financial targe
Slide 7: Expansion in Estonia through acquisition of Automeister
EXPANSION IN ESTONIA THROUGH ACQUISITION OF AUTOMEISTER • Well established wholesaler in Estonia • Acquisition includes Estonia's leading workshop concept Carstop • 14 affiliated workshops across the country • Strengthens MEKO's position and opens for synergies in the Baltics • Announced in July 7
Slide 8: Strong performance in the second quarter
STRONG PERFORMANCE IN THE SECOND QUARTER ▪ Solid sales growth across markets ▪ Robust adjusted EBIT development, while EBIT comparison affected by one-time effects ▪ Strong cash flow from operations, due to improved underlying performance and lower working capital Rolling 2023 SEK M Q2 2024 Q2 2023
Slide 9: Gross margin development in the second quarter
GROSS MARGIN DEVELOPMENT IN THE SECOND QUARTER Gross margin (%) bridge 2023 Q2 to 2024 Q2 43.3 0,2 42.9 0,4 0,3 0,6 • Stable overall development • Earlier price adjustments and positive currency effects offset by sales mix effects • “Other” mainly relates to effect from transfer to the Group´s inven
Slide 10: Improved profitability driven by Scandinavian markets
IMPROVED PROFITABILITY DRIVEN BY SCANDINAVIAN MARKETS Adjusted EBIT (SEK M) bridge 2023 Q2 to 2024 Q2 • Strong profitability improvement in Sweden/Norway as a result of 10 9 20 11 16 357 successful efficiency measures 93 • Improved profitability in Denmark 270 due to higher growth and enhanced gross
Slide 11: Improved operating cash flow cater for lower leverage
IMPROVED OPERATING CASH FLOW CATER FOR LOWER LEVERAGE Operating cash flow H1 2022 to H1 2024 (MSEK) Net debt/EBITDA H1 2022 to H1 2024 (multiple) 984 799 3.1 738 2.9 2.7 2.6 2.5 513 249 H1 2022 H2 2022 H1 2023 H2 2023 H1 2024 H1 2022 H2 2022 H1 2023 H2 2023 H1 2024 • Solid operating cash flow allow
Slide 12: Denmark – improved profitability and stronger sales
DENMARK – IMPROVED PROFITABILITY AND STRONGER SALES • Reported net sales growth of 8 per cent, of which 4 percent organic. Growth driven by higher workshop activity and earlier price adjustments, but development still impacted by tough competition • Improved adjusted EBIT development improved due to
Slide 13: Finland – further initiatives to improve profitability
FINLAND – FURTHER INITIATIVES TO IMPROVE PROFITABILITY • Reported net sales growth of 3 per cent, of which 1 percent organic. 8% Growth burdened by slower market development • Adjusted EBIT lower as a result of lower gross margin, costs related to integration work and a higher cost base due to prope
Slide 14: Poland/the Baltics – solid growth in a competitive market
POLAND/THE BALTICS – SOLID GROWTH IN A COMPETITIVE MARKET • Reported net sales growth of 12 per cent, of which 7 percent organic. Growth impacted by tough price competition and a weaker economy 22 % • Adjusted EBIT development burdened by a lower gross margin and higher costs driven by inflation and
Slide 15: Sweden/Norway – optimization drive higher profitability
SWEDEN/NORWAY – OPTIMIZATION DRIVE HIGHER PROFITABILITY • Reported net sales growth of 9 per cent, of which 6 percent organic. Growth driven by both new customers, and thus higher volumes as well as earlier price adjustments and more working days 39 % • Adjusted EBIT development improved significant
Slide 16: Sørensen og Balchen – strong sales and high margins
SØRENSEN OG BALCHEN – STRONG SALES AND HIGH MARGINS • Reported net sales growth of 14 per cent, of which 10 percent 6% organic. Growth driven by new customer contracts and higher volumes as well as earlier price adjustments and more working days • Adjusted EBIT development improved due to strong sal
Slide 17: Q2 2024 – We continue to build a stronger MEKO
Q2 2024 – WE CONTINUE TO BUILD A STRONGER MEKO Solid organic growth in all markets Robust adjusted EBIT development, while EBIT comparison affected by one-time effects Strong operating cash flow generation Improved financial position – leverage well within the target range Strengthened position in P
Slide 18: Q&A
Q&A 18
Slide 19: We enable mobility - today, tomorrow and in the future
WE ENABLE MOBILITY - TODAY, TOMORROW AND IN THE FUTURE 19
Slide 20: Appendix
APPENDIX 20
Slide 21: Strong group footprint
STRONG GROUP FOOTPRINT Market shares per geography Net sales per geography, 2024Q2 Denmark 28% Number of branches: 48 (24Q1: 48) Number of affiliated workshops: 980 (24Q1: 999) Finland 25% Number of branches: 169 (24Q1: 168) Number of affiliated workshops: 373 (24Q1: 371) Norway 25% Number of branch
Slide 22: Largest owners 2024-06-30
LARGEST OWNERS 2024-06-30 Voting rights and share capitals, % LKQ Corporation 26,6 Swedbank Robur Fonder 10,6 Fjärde AP-fonden 8,7 Unionen 3,5 Eva Fraim Påhlman 3,1 Nordea Funds 3,0 AFA Försäkring 3,0 Didner & Gerge Fonder 2,8 Dimensional Fund Advisors 2,7 Vanguard 2,7 Total 10 largest shareholders
Slide 23: Long term financial targets
LONG TERM FINANCIAL TARGETS Sales growth Adjusted EBIT growth Annual sales growth of at least 5 percent Annual adjusted EBIT growth of at least 10 percent. - through a combination of organic growth and smaller acquisitions, but excluding selective M&A Net debt/EBITDA Dividend policy Net debt/EBITDA