Slide 1: Q2 Report 2023
Q2 Report 2023 20 July 2023 Gustaf Öhrn, President and CEO Jesper Flemme, CFO 20 July 2023 1
Slide 2: Today's presenters
Today’s presenters Gustaf Öhrn President and CEO Jesper Flemme CFO 20 July 2023 2
Slide 3: This is BHG
This is BHG Back in 2012, we started our journey to disrupt and reinvent retail. Since then, we’ve evolved through organic initiatives and ~35 acquisitions to a decentralised group of ~20 businesses in three BUs and a small central office with centres of excellence Home Improvement Value Home Premiu
Slide 4: Select financial highlights – Q2 2023
Select financial highlights – Q2 2023 Sales Earnings Cash flow Cash flow from operating Net Sales (SEK) Adj. EBIT(SEK) activities (SEK) 3,482m 98m 767m Total: -10.9% Pro-forma organic: -10.7% Organic: -10.8% 2.8% (Q2 2022: -162m) Growth Adj. EBIT margin • Gaining share in a weak market • Cash flow f
Slide 5: We expect market to be soft rest of 2023 and into 2024
We expect market to be soft rest of 2023 and into 2024 BHG organic growth, Y-on-Y development Exceptional growth Contracting market 42% 36% 37% 32% 20% 22% 15% 14% 8% 9% 6% 2% 1% -5% -4% -8% -11% -17% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 19 19 19 19 20 20 20 20 21 21 21 21 22 22 22
Slide 6: Key focus areas and actions right now
Key focus areas and actions right now • Cost reduction target of SEK 150-200m (organizational and warehousing costs) Improve • Simplify structure by consolidations and closings of businesses and store footprint profitability • Investing in tech to facilitate future consolidations and reduce costs •
Slide 7: We have reduced inventory by SEK 827m since Q2 2022
We have reduced inventory by SEK 827m since Q2 2022 Continued reduction last 4 quarters BHG inventory level SEK 827m reduction (SEKm) vs. Q2 2022 3 177 (excluding write-down) 2 940 2 705 2 483 2 384 Including SEK 375m 1 974 write-down Q1 Q2 Q3 Q4 Q1 Q2 22 22 22 22 23 23 • SEK 410m reduction in inven
Slide 8: Strategic priorities across the group to take us back to pre-pandemic levels
Strategic priorities across the group to take us back to pre- pandemic levels of profit and cash flow Customer • Seamless and personalized customer experience throughout buying journey, leveraging analytics centricity and AI capabilities for enhanced personalization and customer insights • Implement
Slide 9: Key strategic and operational priorities per BU
Key strategic and operational priorities per BU Home Improvement Value Home Premium Living • Consolidate entities into • Reduce inventory, optimise • Drive geographic expansion fewer and larger platforms to warehousing and scale down in Nordic Nest increase competitiveness fixed costs including stor
Slide 10: Q2 profitability is a step in the right direction but more needs to be done
Q2 profitability is a step in the right direction but more needs to be done We have taken share in a weak market EBIT margin supported by solid product margin and improved inventory handling costs Net sales (SEKm) Adjusted EBIT (SEK) Adjusted EBIT margin -10.9% Pro-forma organic growth: -10.7% 4.2%
Slide 11: EBIT margin bridge 2022 Q2 – 2023 Q2
EBIT margin bridge 2022 Q2 2023 Q2 EBIT margin Q2 '22 4,2% • Increase in product margin from increase in sale of private label, with higher margin, mix effects and Product margin increase in postage income from customers Inventory handling • Lower inventory handling cost – impact from cost saving
Slide 12: Extremely strong cash flow in the second quarter
Extremely strong cash flow in the second quarter Significant improvement in cash flow from operating Liquidity mainly driven by cash flow from operating activities compared to last year (Q2 2022: -162m) activities Apr-Jun 2023 (SEKm) SEKm Including translation 667,2 766,8 977,6 (234,3) differences (
Slide 13: Significant improvement in our financial position
Significant improvement in our financial position Overview of financial position • Reduced net debt on the back of SEKm 30 June 2023 31 Dec 2022 Δ substantial improvement in cash flow Interest bearing liabilities 4,077.9 4,141.1 (63.2) • Announced sale of 20.1% in Furniture1 Cash and cash equivalent
Slide 14: Q2 Summary
Q2 Summary EBIT SEK 98m – Significant improvement from weak Q1 Improved profitability and strong cashflow Cash flow from operating activities SEK 767m – Improvement of SEK 929m from last year We expect the market to remain challenging rest of 2023 and into 2024 Prioritizing cash flow and pro
Slide 15: Q&A
Q&A 20 July 2023 15
Slide 16: iS Ly
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Slide 17: We make living easy
WE MAKE LIVING EASY