Fiskars Oyj Abp · OMXHEX:FSKRS
Fiskars Oyj Abp — Q3 2024 Earnings Presentation
37 slides from Fiskars Oyj Abp's earnings presentation, Oct 24, 2024
Slide 1: Q3 2024 & Strategic update
-ISKARS GROUP iA Q3 2024 & Strategi
Slide 2: Key messages
Key messages ANOTHER SOLID STRATEGY AND ”BRANDS FIRST” GUIDANCE FOR 2024 QUARTER IN TOUGH GROWTH APPROACH FOR UNCHANGED: MARKET: FUNDAMENTALS SPEED & IMPACT: C O M P A R A BL E E B I T IMPROVED DELIVERING: SEPARATING EXPECTED TO BE PROFITABILITY IN THE B U S I N E SS A R E A S SLIGHTLY ABOVE DESPITE
Slide 3: Agenda
Agenda 1. Q3 2024 2. Strategic update 3. Q&A 3 OCTOBER 24, 2024 Ⓒ FISKARS GROUP
Slide 4: Interim Report Q3 2024
Interim Report Q3 2024 ANOTHER SOLID QUARTER – IMPROVED PROFITABILITY DESPITE LOWER VOLUMES 4 OCTOBER 24, 2024 Ⓒ FISKARS GROUP JANUARY-SEPTEMBER 2024
Slide 5: Q3 2024 Group key figures
Q3 2024 Group key figures: Improved profitability GROSS MARGIN despite lower volumes, all-time high Q3 gross margin % 48.1 Q3/2023: 47.2 R E P O R T E D N E T S AL E S , E U R m C O M PAR AB L E E B I T ( E U R m ) AN D C O M PAR AB L E E B I T M AR G I N , % FREE CASH FLOW EURm -16.9 +6.1% EURm % *
Slide 6: Q3 comparable EBIT improved to EUR 24.3m
Q3 comparable EBIT improved to EUR 24.3m. YTD secured through strong performance management; savings of over EUR 30m offset by low volumes Q 3 AN D Y T D S E P Y T D S E P 2 0 2 4 E B I T E X C L . I AC B R I D G E , E U R m C O M PAR AB L E E B I T, E U R m -4.1 -4.1 (-6%) 80 -6.9 72.6 72.6 -1.1 71
Slide 7: BA Vita Q3 results
BA Vita Q3: Comparable net sales decreased, Royal Copenhagen and Moomin Arabia delivering growth REPORTED NET SALES, +16.5% COMPARABLE EBIT (EURm) AND EURm COMPARABLE EBIT MARGIN, % • Reported net sales increased *-10.1% through the acquisition of Georg EURm % Jensen 140 139 24.5 24.6 140 134 25 18.
Slide 8: BA Fiskars Q3 results
BA Fiskars Q3: Comparable EBIT increased despite lower volumes, growth in Germany and the Nordics REPORTED NET SALES, COMPARABLE EBIT (EURm) AND • Comparable net sales decreased due EURm COMPARABLE EBIT MARGIN, % to softness in sell-out EURm % • Growth in Germany driven by 160 155 157 -4.5% 30 20 st
Slide 9: Q3 Free Cash Flow EUR -16.9 million
Q3 Free Cash Flow EUR -16.9 million mainly due to phasing of trade payables Quarterly Free Cash Flow (EURm) Q3 Free Cash Flow (EURm) EURm EURm 2024 vs. LY 100 -70 200 EBITDA 20.1 - 9.8 78 75 150 Non-cash adjustments 7.5 + 7.5 53 49 100 Cash Flow from operations 27.6 - 2.4 50 39 42 Change in inventor
Slide 10: Net Debt / EBITDA slightly up to 2.8x
Net Debt / EBITDA slightly up to 2.8x ahead of seasonally strongest cash flow quarter Capital Employed (EURm) Financing (EURm) Sep-24 Sep-23 Dec-23 Sep-24 Sep-23 Dec-23 GW and other intangible 594 506 592 Equity 751 802 824 PPE and biological assets 220 1 98 21 4 Interest-bearing debt 430 386 423 Ca
Slide 11: Financial targets tracking
Challenging operating environment reflected in sales and EBIT targets F I N AN C I AL TAR G E T S T R AC K I N G LTM LAST KPI TARGET 2021 2022 2023 Q3 2024 3 YEARS NET Organic, FX neutral Mid-Single- CAGR. SALES Digit growth +14.2% +1.7% -9.7% -4.4% -3.2% Mid-teen EBIT margin (excl. EBIT IAC) by end
Slide 12: SG&A efficiency programs completed; new structure to drive efficiency
SG&A efficiency programs announced in 2023 completed; further Supply Chain savings still expected. New structure to drive further efficiency Efficiency improvement programs The new structure enables further saving announced in Jan and Sept 2023 completed: through simplification: • YTD savings over E
Slide 13: Strategic update
Strategic update 13 OCTOBER 24, 2024 Ⓒ FISKARS GROUP
Slide 14: Business area drivers and performance management
Our strong, yet BA specific business drivers, and rigorous performance management soften the impact of current market BUSINESS AREA FISKARS (Net sales, LTM: EUR 550m) BUSINESS AREA VITA (Net sales, LTM: EUR 610m) CHANNELS BY NET SALES CHANNELS BY NET SALES • A market leader in • Unique portfolio of
Slide 15: Market update - China
Market update - China: Solid fundamentals driving Xiao Zhan, Chinese actor and Wedgwood’s Global Brand Ambassador performance despite market slowdown Market attractive despite We have recent slowdown strong fundamentals in place Slowdown, at the moment • Benefiting from brand desire – • Double-digit
Slide 16: Market update – U.S.
Market update – U.S.: Market headwinds persist, our platform increasingly strong Headwinds persist, Our platform increasingly strong potential for rebound • Low consumer confidence (despite • Fiskars brand market leader in the U.S. strong economic fundamentals) (est. ~20-40% market share depending o
Slide 17: Long-term market dynamics remain attractive
Long-term market dynamics remain attractive POWERFUL STRENGTH OF IMPORTANCE OF LUXURY IS SUSTAINABILITY BRANDS THAT INNOVATION & DIRECT-TO- ATTRACTIVE IS KEY SURROUND THE DESIGN CONSUMER LONG-TERM CONSUMER Truly innovative Integral to buyer’s 6-8% CAGR 58% of consumers 50% of consumers consumer prod
Slide 18: Systematic strategy execution – transformation continues
Systematic strategy execution – transformation continues WE FOCUS ON WINNING: LOGIC Transformation Brands Channels Countries levers making our foundation stronger Commercial excellence Direct-to-Consumer Sharpened portfolio TRANSFORMATION LEVERS logic – clear roles for U.S. each brand China Evolving
Slide 19: Transformation levers strengthen foundation for future growth
Transformation levers strengthen our foundation for future growth GROSS MARGIN HAS SHARE OF DTC SALES HAS CHINA NET SALES HAVE MORE U.S. NET SALES DECLINED IMPROVED CLEARLY GROWN STEADILY THAN TRIPLED FROM 2020 IN 2023* EURm EURm CAGR -4% >49% >50% +5% 404 -7% CAGR +48% 375 374 48.0% 50% 47% 345 46.
Slide 20: Sharpened portfolio logic – clear roles for each brand
Sharpened portfolio logic – clear roles for each brand Maximise Accelerate INVESTMENTS AND RESOURCES potential ALLOCATED TO ENHANCE VALUE CREATION : Winning • Make the big brands bigger Three large • Surround the consumer through luxury brands category expansion • Command high-end positioning* Utili
Slide 21: Systematic approach to M&A – case Georg Jensen
Reshaping our portfolio inorganically: Systematic & disciplined approach to M&A – case Georg Jensen Fiskars Group M&A playbook Identify & Acquire Integrate Operate ▪ Confirmed strategic fit, ▪ Performance in line with business case • Strategy building on complementary strengths Case category expansi
Slide 22: Separating Business Areas into independent companies
Next step of transformation journey: Completing “brands first” approach by separating Business Areas into independent companies 2020: TODAY: APRIL 1, 2025: BAs as product owner, part of BAs as business owner, BAs as operationally independent Group-wide matrix organization P&L accountable companies w
Slide 23: New way of operating enables flexibility and speed
New way of operating enables flexibility and speed of execution, and is a key enabler for future growth End to end control Dedication Transparency and Independent measurability legal entities Full business Accelerate differing More precise target Structural optionality accountability, growth opportu
Slide 24: Brands first approach – case Moomin Arabia
“Brands first” approach as one of the key growth fundamentals – case Moomin Arabia Clear building blocks for growth… Category expansion – Surrounding the consumer with home textiles – In 2020, only ceramics → today approx. 20% textiles Channel expansion – Expanding DTC with 8 new brand stores this y
Slide 25: Key messages
Key messages ANOTHER SOLID STRATEGY AND ”BRANDS FIRST” GUIDANCE FOR 2024 QUARTER IN TOUGH GROWTH APPROACH FOR UNCHANGED: MARKET: FUNDAMENTALS SPEED & IMPACT: C O M P A R A BL E E B I T IMPROVED DELIVERING: SEPARATING EXPECTED TO BE PROFITABILITY IN THE B U S I N E SS A R E A S SLIGHTLY ABOVE DESPITE
Slide 26: Guidance for 2024 (unchanged)
Guidance for 2024 Assumptions and actions behind the guidance (unchanged) - The operating environment expected to + Savings from the completed efficiency remain challenging and programs expected to impact demand also in Q4 support EBIT Fiskars Corporation expects - Wage inflation to remain comparabl
Slide 27: -ISKARS
-ISKARS GROUP
Slide 28: Celebrating Fiskars' 375-year anniversary
Celebrating Fiskars’ 375-year anniversary on October 31, 2024
Slide 29: Appendix
Appendix 29 OCTOBER 24, 2024 Ⓒ FISKARS GROUP
Slide 30: Transformation levers are making our foundation stronger
Transformation levers are making our foundation stronger for future growth Q3 2024 1-9/2024 Commercial • Gross margin +90 bps and Q3 all-time high at • Gross margin +170 bps excellence 48.1% • Comparable DTC -3%: e-commerce -9%, • Comparable DTC –3%: e-commerce -3%, Direct to own retail network stab
Slide 31: Good continued ESG progress
Good continued ESG progress – supplier target reached and exceeded ENVIRONMENTAL SOCIAL Target May 1-9/2024 Target 2024 At the end 2.8 0 81 1-9/2024 1-9/2024 of 09/2024 77 24% -54% 61% Base year 2021 50% Base year 2017 -60% Target set 2020 60% in 2030 in 2030 in 2024 Measured in connection to the em
Slide 32: Consolidated Q3 and YTD September Key Figures
Consolidated Q3 and YTD September Key Figures Q 3 AN D Y T D 2 0 2 4 P & L K E Y F I G U R E S , E U R m Q 3 AN D Y T D 2 0 2 4 P E R S H AR E K E Y F I G U R E S , E U R Q3 YTD September Q3 YTD September 2024 2023 2024 2023 2024 2023 2024 2023 Net sales 255.9 241.3 819.9 784.0 Comparable Earnings p
Slide 33: Q3 and YTD September Cash flow and change in cash
Q3 and YTD September Cash flow and change in cash Q 3 AN D Y T D C AS H F L O W V S . LY, E U R m Q 3 AN D Y T D C H AN G E I N C AS H V S . LY, E U R m Q3 YTD September Q3 YTD September 2024 vs. LY 2024 vs. LY 2024 vs. LY 2024 vs. LY EBITDA 20.1 - 9.8 68.8 - 44.4 Cash Balance period opening 86.3 +
Slide 34: Georg Jensen Purchase Price Allocation breakdown
Georg Jensen Purchase Price Allocation (“PPA”) breakdown PPA EURm P&L Impacts of PPA (EURm) Comment Purchase Price, Equity (A) 124.7 Net Assets at Book Value 45.4 Q4-23 Q3-24 YTD Sep Q4-24 FY-25 => Fair Value adjs - Brand (trademark) + 61.0 - - - - - Fair Value adjs - Customer relationships + 20.0 -
Slide 35: Fiskars Group's quarterly development – last 3 years
Fiskars Group’s quarterly development – last 3 years NET SALES, EURm COMPARABLE EBIT (EURm) AND EBIT MARGIN, % EURm % +6.1% 60 20 *-7.3% 51.8 18 353 346 50 333 16 319 304 292 293 283 281 14 275 268 40 37.7 256 36.3 241 34.1 33.2 12 32.2 29.7 31.2 30 10 25.1 24.3 23.4 8 20 17.9 19.2 6 4 10 2 0 0 Q3 Q
Slide 36: BA Vita's quarterly development – last 3 years
BA Vita’s quarterly development – last 3 years NET SALES, EURm COMPARABLE EBIT (EURm) AND EBIT MARGIN, % +16.5% *-10.1% EURm % 220 215 40 25 200 35.9 34.7 187 176 31.9 20 180 30 15 160 24.5 24.6 134 140 139 140 126 130 10 121 127 119 20 16.9 120 108 114 14.4 5 100 12.7 10.7 0 80 10 7.8 3.0 -5 60 1.6
Slide 37: BA Fiskars' quarterly development – last 3 years
BA Fiskars’ quarterly development – last 3 years NET SALES, EURm COMPARABLE EBIT (EURm) AND EBIT MARGIN, % EURm % 220 211 50 25 -4.5% 43.5 200 191 *-4.9% 180 40 20 165 167 157 151 153 156 150 160 30.6 29.5 140 30 26.7 15 127 130 24.7 121 115 22.3 120 20 17.7 10 100 15.2 13.6 11.1 80 10 7.4 5 60 2.4