Kesko Oyj Class A · OMXHEX:KESKOA
Kesko Oyj Class A — Investor Presentation (May 2025)
30 slides from Kesko Oyj Class A's investor presentation, May 15, 2025
Slide 1: A Good Performance From All Divisions
A GOOD PERFORMANCE FROM ALL DIVISIONS Anu Hämäläinen, CFO Jarkko Karjalainen, Vice President, Group Treasury and M&A 15 May 2025 1
Slide 2: Kesko and K-Group Today
KESKO AND K-GROUP TODAY Leading trading sector ~39,000 employees in the #1 company in Northern Europe with retail and B2B sales of nearly €15bn whole K Group,1,800 stores, 3 divisions, comprehensive digital services in 8 countries Sustainability at the Market cap over €8bn core of the strategy with
Slide 3: Good Performance Despite Challenging Economic Cycle
GOOD PERFORMANCE DESPITE CHALLENGING ECONOMIC CYCLE NET SALES OPERATING PROFIT € million € million 11,920 11,988 12,000 12 000 11,809 11,784 815.2 11,300 800 775.5 Profit guidance 11 000 11,000 640-740 712.0 10,243 700 10,000 10 000 650.1 646.2 600 9,000 9 000 568.0 500 8,000 8 000 7,000 7 000 400 2
Slide 4: Kesko Key Figures
KESKO KEY FIGURES NET SALES OPERATING PROFIT Car trade Car trade €1,237m Grocery trade €70.8m €6,353m 5.7% Grocery trade €428.3m Building and 6.7% technical trade Building and technical trade €646.2m €4,421m €11,988m 5.4% €174.0m 3.9% 4 Figures for Q1/2025 rolling 12 months, division figures includi
Slide 5: Kesko Growth Strategy
KESKO GROWTH STRATEGY THE LEADING AND MOST ATTRACTIVE TRADING SECTOR VISION GROWTH COMPANY IN NORTHERN EUROPE STRATEGIC DELIVERING STRENGTHENING BUILDING A FOCUSED INCREASING TARGETS PROFITABLE GROWTH MARKET POSITION B2C AND B2B CUSTOMER VALUE BUSINESS PORTFOLIO COMPETITIVE OPERATIONAL OMNICHANNEL K
Slide 6: Grocery Trade: Aiming to Gain Market Share Profitably
GROCERY TRADE GROCERY TRADE: AIMING TO GAIN MARKET SHARE PROFITABLY FOCUS AREAS: INVESTMENTS IN PRICE AND STORE SITES WILL • STRENGTHENING STORE SPECIFIC BUSINESS IDEAS: HAVE A SLIGHT EFFECT ON GROCERY TRADE Focusing on strengthening chosen competitive advantages and PROFITABILITY IN UPCOMING YEARS
Slide 7: Market Share Turnaround in Grocery Trade: Quality x Price x Network
MARKET SHARE TURNAROUND IN GROCERY TRADE: QUALITY x PRICE x NETWORK IMPROVING QUALITY: IMPLEMENTING PRICE PROGRAMME: INVESTMENTS IN NETWORK: • Further refining store-specific • Continuously affordable products: • 2024–2025: 30 new store openings, business ideas prices cut on 1,200 everyday staples 9
Slide 8: Building and Technical Trade: Securing Profitability and Cash Flow
BUILDING AND TECHNICAL TRADE BUILDING AND TECHNICAL TRADE: FOCUSING ON SECURING PROFITABILITY AND GENERATING CASH FLOW FOCUS AREAS: • FINLAND: Continuing growth and winning over market share THE LONG-TERM STRATEGIC TARGET OF A • SWEDEN AND NORWAY: Stabilising and improving 6-8% OPERATING MARGIN IS S
Slide 9: Sales of K-Rauta Finland and Onninen Finland
SALES OF K-RAUTA FINLAND AND ONNINEN FINLAND Retail and B2B sales 9
Slide 10: Building and Technical Trade Long-Term EBIT-% Target Intact
BUILDING AND TECHNICAL TRADE BUILDING AND TECHNICAL TRADE LONG-TERM EBIT-% TARGET INTACT EBIT-% Target Kesko 6-8% 8 6 7.1% Kesko 4 Kesko 3.9% 2 2.4% 0 Time 2018 2021, 2022 2024 10
Slide 11: Car Trade: Performing Better Than the Market in All Businesses
CAR TRADE CAR TRADE: FOCUSING ON PERFORMING BETTER THAN THE MARKET IN ALL BUSINESSES KEY ACTIONS: K-AUTO, NET SALES • CONTINUING WITH GROWTH STRATEGY: Major turnaround and continuous development establish a robust foundation for the next strategy period. • MAINTAINING THE BALANCED BUSINESS PORTFOLIO
Slide 12: Kesko's Financial Targets Intact
KESKO’S FINANCIAL TARGETS INTACT TARGET Q1/2025 OPERATING MARGIN, OVER 6% COMPARABLE 5.4% RETURN ON CAPITAL OVER 14.5% 11.0% EMPLOYED, COMPARABLE, % INTEREST-BEARING NET DEBT/EBITDA, AT MAXIMUM 2.5 1.6 EXCLUDING IFRS 16 IMPACT 12
Slide 13: Sustainability Is Integrated Into Our Business
SUSTAINABILITY IS INTEGRATED INTO OUR BUSINESS SUSTAINABILITY STRATEGY VISION EXECUTION BY THE BUSINESS DIVISIONS We enable sustainable choices for our customers and Grocery trade drive change throughout the value chain Building and technical trade Car trade FOCUS AREAS Climate and nature PROGRESS M
Slide 14: Financials
FINANCIALS 14
Slide 15: Summary of Q1/2025
SUMMARY OF Q1/2025 • Net sales increased, comparable operating profit decreased Q1/2025 Q1/2024 • Grocery trade: net sales and profit down as anticipated due to the timing of Easter and price programme implementation Net sales, € million 2,827.7 2,759.5 • Building and technical trade: sales picked u
Slide 16: Net Sales
NET SALES €+68 million € million € million rolling 12 months 16
Slide 17: Operating Profit
OPERATING PROFIT €-3.9 million € million € million rolling 12 months Operating Operating 3.6% 5.8% 6.7% 5.6% 3.4% 5.5% 5.4% margin margin 17 Comparable figures
Slide 18: Return on Capital Employed
RETURN ON CAPITAL EMPLOYED % rolling 12 months 18 Comparable figures
Slide 19: Financial Position
FINANCIAL POSITION Seasonal increase in working capital impacted cash flow Q1/2025 Q1/2024 • Factors impacting cash flow from operating activities Cash flow from operating activities, € million -24.5 112.6 • Building and technical trade: preparing for upcoming high season Liquid assets, € million 14
Slide 20: Capital Expenditure
CAPITAL EXPENDITURE Main CAPEX: Roslev acquisition, Onnela logistics centre and investments in store sites Q1/2025 Q1/2024 Store sites, € million 66.2 111.3 Acquisitions, € million 34.8 170.0 IT, € million 3.1 3.6 Other investments, € million 33.9 44.2 Total, € million 138.0 329.0 20
Slide 21: Executing Plans to Strengthen Store Site Network
EXECUTING PLANS TO STRENGTHEN STORE SITE NETWORK • Investments in the store network continue, impact set to become visible especially towards the end of the 2024-2026 strategy period. The investments take into consideration migration within Finland, and focus will be on growth centres. • Kesko inves
Slide 22: Expanding to the Danish Building and Home Improvement Market
EXPANDING TO THE DANISH BUILDING AND HOME IMPROVEMENT MARKET • Kesko acquired 90% of the previously family-owned TØMMERGAARDEN A/S* Davidsen A/S on 31 Jan. 2024. Davidsen is one of the biggest building and home improvement trade operators in Denmark, ROSLEV and focuses especially on B2B customers TR
Slide 23: Onnela Logistics Centre – Biggest Construction Project in Kesko's History
ONNELA LOGISTICS CENTRE – THE BIGGEST CONSTRUCTION PROJECT IN KESKO’S HISTORY • The Onnela logistics centre in Hyvinkää, Finland will serve both Onninen's technical trade and K-Auto's spare parts business; implementation in stages from Q3/2025 onwards • A major investment in future growth: once the
Slide 24: Expenses
EXPENSES Expenses up mainly due to acquisitions Q1/2025 Q1/2024 Fixed costs, € million 529.6 507.1 - Employee benefit expenses, € million 223.1 204.8 - Other expenses, € million 165.3 162.8 - Depreciation, € million 141.2 139.4 Cost ratio, % 18.7 18.4 24 Figures excluding items affecting comparabili
Slide 25: Focus on Operational Efficiency
FOCUS ON OPERATIONAL EFFICIENCY OPERATING EXPENSES COST RATIO, ROLLING 12 MONTHS, % Q1 2025, rolling 12 months Depreciations 18,0 27.0% Personnel expenses 40.8% 17,5 17,0 16,5 €2,099m 16,0 Other operating costs 15,5 7.1% 15,0 Q1/2019 Q4/2019 Q2/2019 Q3/2019 Q1/2020 Q4/2020 Q1/2021 Q4/2021 Q1/2022 Q4
Slide 26: Debt Maturity
DEBT MATURITY DEBT MATURITY AS AT 31 MARCH 2025 (€ million) Instruments in use: • Debt to financial institutions, term loans to Kesko represent the 2 majority of the “Debt to financial institutions” (in 2025 150M€, in M€ 491,7 2026 420M€, in 2027 50M€ and in 2031 150M€) 474,6 • Kesko Bond 2030: 300M
Slide 27: Profit Guidance and Outlook for 2025 Unchanged
PROFIT GUIDANCE AND OUTLOOK FOR 2025 UNCHANGED 27
Slide 28: Profit Guidance for 2025
PROFIT GUIDANCE FOR 2025 Kesko Group’s profit guidance is given for the year 2025, in comparison with the year 2024. Kesko’s operating environment is estimated to improve in 2025, but to still remain somewhat challenging. Kesko’s comparable operating profit is estimated to improve in 2025. Kesko est
Slide 29: Outlook for 2025
OUTLOOK FOR 2025 In grocery trade, B2C trade and the foodservice market are estimated to remain stable. In 2025, the comparable operating margin for the grocery trade division is estimated to stay clearly above 6% despite the investments in price and the store site network in accordance with Kesko’s
Slide 30: Al
Al