Bhg Group Ab · OMXSTO:BHG
Bhg Group Ab — Q4 2023 Earnings Presentation
15 slides from Bhg Group Ab's earnings presentation, Jan 26, 2024
Slide 1: Q4 Report 2023
Today’s presenters Gustaf Öhrn, CEO Jesper Flemme, CFO Q4 REPORT 2023 26 January 2024 1
Slide 2: Q4 2023 – Significant Improvement
Q4 2023 – SIGNIFICANT IMPROVEMENT SALES EARNINGS CASH FLOW Adj. EBIT(SEK) Cash flow from operating Net Sales (SEK) activities (SEK) 2,829m 55m 349m Total: -14.5% Pro-forma organic: -10.6% Organic: -10.6% 1.9% (68M) Growth Adj. EBIT margin • We have continued to gain share in a weak market • Signific
Slide 3: In 2023 we strengthened our balance sheet, improved cash flow and implemented our strategy
In 2023 we have strengthened our Balance Sheet, improved our Cash Flow and implemented our strategy INVENTORY REDUCTION 2023 CASH FLOW 2023 COST REDUCTION 2023 INTREST BEARING LIABILITIES REDUCTION SEK SEK SEK SEK 900m 1,550m 125m* ~1.6Bn Target: 600m +1,656m vs. 2022 Target: 100-150m * Adjusted for
Slide 4: Our fundamental drivers remain in a contracting market
Our fundamental drivers remain in a contracting market We have been in a detracting market since H2 2021 80% Macro-drivers such as housing market turnover, 60% interest rates, electricity price- volatility and 40% inflation have all played major negative roles in consumer spending 20% Our view on th
Slide 5: This is BHG
This is BHG Home Improvement Value Home Premium Living Primarily based on a drop- Value-driven model that focuses Premium position primarily based shipping model with a broad on offering competitive prices on wholesale product range through private label products Active in the Nordics, as well as Ma
Slide 6: Key Focus Areas 2024
KEY FOCUS AREAS 2024 PROFITABILITY CONSOLIDATION EFFICIENCY GROWTH INITIATIVES CUSTOMER CENTRICITY 6
Slide 7: We are taking measures across the line to improve our profitability
We are taking measures across the line to improve our profitability Gross Margin Direct selling costs SG&A Cost leverage Increase In-price through warehousing efficiency through optimization and and Marketing. consolidations, supplier sourcing Leverage size to IT-investments reduce last mile cost an
Slide 8: Moving towards fewer and larger platforms to achieve economies of scale
We are moving towards fewer and larger platforms to achieve economies of scale and to simplify our structure Historical structure Current structure Target structure Do it Yourself Home Improvement e.g Polarpumpen – Bygghemma Hemmy - Vitvaruexperten LSBolagen + Nordiska Fönster - HAFA Byghemma FI con
Slide 9: Actions to increase geographical expansion to ensure future growth
We have been taking actions to increase our geographical expansion to ensure future growth BHG Group Home Improvement Value Home Premium Living 2,829m 1,344m 713m 783m Total: -14.5% Total: -17.1% Total: -26.9% Total: +7.8% Pro-forma organic: -10.6% Pro-forma organic: -17.0% Pro-forma organic: -14.5%
Slide 10: We have fulfilled our commitment on cost-reduction but more needs to be done
We have fulfilled our commitment on cost-reduction but more needs to be done BHG Group Home Improvement Value Home Premium Living 54.8m 12.6m 21.7m 45.3m +24.1m -63.0m +60.1m +34.8m 1.9% 0.9% 3.0% 5.8% +1.0 p.p. -3.7 p.p. +7.0 p.p. +4.3 p.p. Adjusted EBIT Q4 - SEKm 10
Slide 11: EBIT margin bridge 2022 Q4 – 2023 Q4
EBIT margin bridge 2022 Q4 2023 Q4 EBIT margin Q4 '22 0,9% The significant improvement in Gross Margin was primarily driven by Value Home and Premium Living, thanks to an active effort to Product margin normalize the margin structure Inventory handling Another positive driver in the quarter was La
Slide 12: We generated ~SEK 1.6bn in cash flow from operating activities during 2023
We generated ~SEK 1.6bn in cash flow from operating activities during 2023 Significant improvement in cash flow from operating Liquidity mainly driven by cash flow from operating activities compared to last year (Q4 2022: 67.5m) activities Oct-Dec 2023 (SEKm) SEKm 191,1 348,9 1 550,2 (654,4) (1 003,
Slide 13: We have reduced total interest-bearing liabilities by ~SEK 1.6bn during 2023
We have reduced total interest-bearing liabilities by ~SEK 1.6bn during 2023 – reducing risk Net debt Interest-bearing liabilities & Leverage 1,129.7m = 4 500 4,01x 4 000 EBITDAaL LTM 3 500 281.7m 3 000 2 500 We have reduced our total interest-bearing 2 000 liabilities with ~1.6bn 2023 1 500 1 000 A
Slide 14: Summary
SUMMARY Demand has been contracting since Q4 2021 MARKET We expect a challenging market in 2024 We’ve strengthened our balance sheet and cash flow STRENGTHEN FINANCIAL POSITION We’ve significantly reduced our inventory levels Reduced cost run rate We’re well underway on our consolidation journey CON
Slide 15: Q&A
Q&A 15