Kesko Oyj Class A · OMXHEX:KESKOA
Kesko Oyj Class A — Non-Deal Roadshow (2025)
70 slides from Kesko Oyj Class A's roadshow presentation, May 13, 2025
Slide 1: Kesko seeks growth in all its three business divisions
KESKO INVESTOR PRESENTATION KESKO SEEKS GROWTH IN ALL ITS THREE BUSINESS DIVISIONS Q1 2025
Slide 2: Kesko today
KESKO TODAY KEY FINANCIALS Leading trading sector ~39,000 employees in the Net sales, € million Q1/2025 11,988.3 2024 11,920.1 #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 Operating prof
Slide 3: Kesko segment key figures
KESKO SEGMENT KEY FIGURES NET SALES OPERATING PROFIT Car trade Car trade Grocery trade €70.8m B2C-sales 5.7% €1,237m Sales to Grocery trade €6,353m ~18% K-retailers €428.3 Building and ~45% 6.7% Building and technical technical trade trade €646.2m €4,421m €11,781m €11,988m €11,988m 5.4% B2B-sales €1
Slide 4: 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 5: Strong position in Finnish food trade yielding good results
GROCERY TRADE STRONG POSITION IN FINNISH FOOD TRADE YIELDING GOOD RESULTS 5
Slide 6: Grocery trade division in brief
GROCERY TRADE GROCERY TRADE DIVISION IN BRIEF 33.7% MARKET 1,100 stores 6,300 SHARE IN employees The leading foodservice Almost 800 K Group grocery 2024 provider in Finland (NIELSEN) stores offer online grocery services 860 49,1% market share K-retailers NET SALES 2024 2023 2022 KCM non-food 6,124.7
Slide 7: Grocery trade: target to maintain good profitability and gain market share
GROCERY TRADE: TARGET TO MAINTAIN GOOD PROFITABILITY AND GAIN MARKET SHARE KEY ACTIONS: • STRENGTHENING STORE SPECIFIC BUSINESS IDEAS: INVESTMENTS WILL HAVE A SLIGHT EFFECT ON Focusing on strengthening chosen competitive advantages PROFITABILITY. and raising the level of stores. • DEVELOPING STORE S
Slide 8: Grocery trade division: grocery store business
GROCERY TRADE DIVISION GROCERY STORE BUSINESS In brief: Market and market shares: Operates in Finland, business comprises three grocery store Total Finnish grocery trade market €21–22 billion; chains with some 1,100 stores across the country operated by Kesko the second biggest operator with a marke
Slide 9: Kesko and K-retailers
KESKO AND K-RETAILERS Wholesale, product strategy Chain agreement, chain steering KESKO Services and business support Store concepts Chain selections, wholesale Steering retail prices and campaigns K-RETAILERS Responsible purchasing channels, Ensure customer satisfaction, results and purchasing alli
Slide 10: Grocery trade division: foodservice business
GROCERY TRADE DIVISION FOODSERVICE BUSINESS In brief: Market and market share: Operates in Finland, business comprises Kespro’s foodservice Total Finnish foodservice market €2.5 billion; wholesale with 13 cash-and-carry outlets and online sales Kespro the market leader with a market share representi
Slide 11: Grocery trade store site investment focus on growth centres
GROCERY TRADE GROCERY TRADE STORE SITE INVESTMENT FOCUS ON GROWTH CENTRES Emphasising hypermarkets and other larger units • Urbanisation is expected to accelerate in Finland • Long-term store site investment programme to ensure Kesko’s competitiveness and market share development • During up-coming
Slide 12: New urban hypermarkets to be opened in Finnish growth centres
NEW URBAN HYPERMARKETS TO BE OPENED IN GROCERY TRADE FINNISH GROWTH CENTRES Several new growth centre hypermarkets in pipeline • New K-Citymarket in a shopping centre in Lempäälä near Tampere in 2025 • New K-Citymarket in Lahti city centre in autumn 2025, replacing K-Citymarket Paavola • New K-Citym
Slide 13: A good result in a challenging economic cycle
BUILDING AND TECHNICAL TRADE A GOOD RESULT IN A CHALLENGING ECONOMIC CYCLE 13
Slide 14: Building and technical trade in brief
BUILDING AND TECHNICAL TRADE BUILDING AND TECHNICAL TRADE IN BRIEF NET SALES Leading operator in building and B2B trade accounts for more 80% technical trade in Northern Europe than 80% of net sales Onninen Baltic countries Customer segments: Technical professionals, professional builders and consum
Slide 15: Focusing on securing profitability and generating cash flow
BUILDING AND TECHNICAL TRADE BUILDING AND TECHNICAL TRADE: FOCUSING ON SECURING PROFITABILITY AND GENERATING CASH FLOW KEY ACTIONS: • FINLAND: Continuing growth and winning market share. THE LONG-TERM STRATEGIC TARGET OF 6-8 % EBIT MARGIN IS STILL VALID. • SWEDEN AND NORWAY: Stabilising and improvin
Slide 16: Building and technical trade: technical trade
BUILDING AND TECHNICAL TRADE TECHNICAL TRADE In brief: Market and market shares: Operates in 8 countries. Kesko subsidiary Onninen offers Total market (est.) for 8 countries (incl. Denmark) technical wholesale products and services (offering varies €22 bn; Kesko’s market shares Finland 44% (market l
Slide 17: Building and home improvement
BUILDING AND TECHNICAL TRADE BUILDING AND HOME IMPROVEMENT In brief: Market and market shares: Operates in 8 countries; offers products and services for Total market (est.) for 8 countries€25 bn; Kesko’s building, renovation, garden, interior decoration and home market shares Finland 52% (market lea
Slide 18: Acquisitions have played a significant role in international growth
ACQUISITIONS HAVE PLAYED A SIGNIFICANT ROLE IN INTERNATIONAL GROWTH 4/2016 6-7/2018 1/2019 3/2020 08/2021 4/2022 3/2023 1/2024 Suomen Reinin Liha Sørbø Trelast MIAB Kungälvs Trä Djurbergs Zenitec Sweden Davidsen A/S Lähikauppa and Kalatukku and Tau & Jørpel €18 million €33 million Järnhandel €13 mil
Slide 19: Recent entry to Denmark an important strategic step
BUILDING AND TECHNICAL TRADE RECENT ENTRY TO DENMARK AN IMPORTANT STRATEGIC STEP • Kesko has a consistent strategy in building and technical trade: to consolidate the market in Northern Europe and to be among the leading players in B2B business in each country • The Danish market is not yet consolid
Slide 20: Market share in Danish builders' merchant set to rise via acquisitions
BUILDING AND TECHNICAL TRADE MARKET SHARE IN DANISH BUILDERS’ MERCHANT SET TO RISE FROM ~10% TO ~20% VIA ACQUISITIONS DAVIDSEN ACQUISITIONS ANNOUNCED ON 14 AUGUST 2024 KESKO SUBSIDIARY AS OF 1 FEB. 2024 TØMMERGAARDEN A/S* Kesko acquired 90% of the previously family-owned Davidsen Koncernen Company:
Slide 21: Technical trade – opportunities for further growth outside Finland
BUILDING AND TECHNICAL TRADE TECHNICAL TRADE – OPPORTUNITIES FOR FURTHER GROWTH OUTSIDE FINLAND Total market size ~€22 billion Technical trade Retail market (€bn) 2.9 Technical trade Market share 19% Retail market (€bn) 2.5 Market share of current Market share (2024) 44% 39%* operating market (2024)
Slide 22: Building and home improvement – further possibilities outside Finland
BUILDING AND TECHNICAL TRADE BUILDING AND HOME IMPROVEMENT – STILL FURTHER POSSIBILITIES ESPECIALLY OUTSIDE FINLAND Total market size ~€18 billion Professional Consumers builders Professional Consumers Retail market (€bn) 3.1 1.7 builders Market share (2024) 12% Retail market (€bn) 1.6 0.9 Market sh
Slide 23: Strong focus on B2B trade in building and home improvement in Finland
STRONG FOCUS ON B2B TRADE IN BUILDING AND HOME IMPROVEMENT TRADE ALSO IN FINLAND Breakdown of K-Rauta Finland’s sales by customer segments B2B sales B2C sales, project customers B2C sales, occational customers 18% 22% 60% DIRECT DELIVERIES TO INDUSTRY 23 B2C-project customers purchase typically e.g.
Slide 24: 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 24
Slide 25: Good result in car trade
CAR TRADE GOOD RESULT IN CAR TRADE 25
Slide 26: Car trade in brief
CAR TRADE CAR TRADE IN BRIEF K-Auto is the leading and most interesting automotive company in Finland 2024 2023 2022 Importing and sales of attractive and high-quality new cars. Net sales, € million 1,209 1,262 1,125 Operating profit*, € million 69 83 64 Significant multi-brand used car sales in Fin
Slide 27: Focusing on performing better than the market in all businesses
CAR TRADE CAR TRADE: FOCUSING ON PERFORMING BETTER THAN THE MARKET IN ALL BUSINESSES KEY ACTIONS: • CONTINUING WITH GROWTH STRATEGY: SOLID EBIT DEVELOPMENT Major turnaround and continuous development establish a robust foundation for the next strategy period. #1 IN BRAND AWARENESS AND PREFERENCE • M
Slide 28: Car trade
CAR TRADE In brief: Market and market shares: Operates in Finland. The whole value chain - imports and sells Total first registrations of new cars incl. vans in Finland Volkswagen Group car brands, sells used cars, and offers car- approx. 74,000 in 2024, of which Kesko’s K-Auto accounted related ser
Slide 29: Other strategic themes
OTHER STRATEGIC THEMES 29
Slide 30: Kesko is affected by various megatrends
KESKO IS AFFECTED BY VARIOUS MEGATRENDS INTEREST RATES & INFLATION URBANISATION CLIMATE CHANGE & GREEN TRANSITION • Weak FOCUS : consumer and business confidence • Migration to growth centres • Energy efficiency and energy infrastructure investments • Higher cost of capital • Substantial infra and b
Slide 31: 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 31
Slide 32: Kesko strategy summary 2024-2026
KESKO STRATEGY SUMMARY 2024-2026 # The portfolio will most likely stay as is during 2024-2026. The focus is on maintaining and further developing current businesses. # Targeting growth and profitability improvement as outlook strengthens in construction in 2025-2026. # In grocery trade, focusing on
Slide 33: 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 34: Focus areas and key actions
FOCUS AREAS AND KEY ACTIONS WE ENABLE SUSTAINABLE CHOICES FOR OUR CUSTOMERS AND DRIVE CHANGE THROUGHOUT THE VALUE CHAIN CLIMATE AND NATURE VALUE CHAIN OUR PEOPLE GOOD GOVERNANCE Reduce emissions in the value chain Ensure sustainability in the value Increase the safety and wellbeing of Commit to the
Slide 35: Kesko listed in sustainability indices
KESKO LISTED IN SUSTAINABILITY INDICES Sustainability indices are key tools for investors to assess the ESG level of corporations. Dow Jones Best-in-Class Indices (World and Europe) v Kesko is the only company in the world to have been on the Global 100 list every year since it was launched in 2005.
Slide 36: Forerunner in trading sector digitalisation
FORERUNNER IN TRADING SECTOR DIGITALISATION Using digitalisation to improve customer experience and make operations more efficient Online and digital sales Data and analytics at the core Digitalisation of stores and Digitalisation increases growing forcefully of business operations processes proceed
Slide 37: Sales via digital channels €2.2 billion
SALES VIA DIGITAL CHANNELS €2.2 BILLION 5 % 1% 2% 11% 42% 44% K-ruoka.fi (online grocery) Kespro (foodservice) Onninen Building and home improvement Car trade Sportstrade 37 Q1 2025, rolling 12 months, excl. VAT
Slide 38: Dividend
DIVIDEND Dividend for 2024: €0.90/ share, paid in four instalments. Kesko's dividend policy: In the long-term, Kesko aims to distribute a steadily growing dividend of some 60-100% of its comparable earnings per share, taking into account the company’s financial position and strategy. 1.54 1,5 1.43 1
Slide 39: Number of shareholders has grown
NUMBER OF SHAREHOLDERS HAS GROWN ~115,000 REGISTERED SHAREHOLDERS BALANCED OWNERSHIP STRUCTURE 116 000 106 000 26,0 % 33,2 % 96 000 86 000 7,5 % 76 000 66 000 33,3 % 56 000 46 000 Nominee-registered, foreign ownership 36 000 Finnish institutions 07 07 07 07 07 07 01/19 04 04 04 04 04 01 01/21 01/20
Slide 40: Stable performance during the slowest quarter of the year
KESKO INTERIM REPORT Q1/2025 STABLE PERFORMANCE DURING THE SLOWEST QUARTER OF THE YEAR
Slide 41: 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 42: Net sales
NET SALES €+68 million € million € million rolling 12 months 42
Slide 43: 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 43 Comparable figures
Slide 44: Return on capital employed
RETURN ON CAPITAL EMPLOYED % rolling 12 months 44 Comparable figures
Slide 45: 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 46: 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 46
Slide 47: 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 47 Figures excluding items affecting comparabili
Slide 48: Expected profit impact from the timing of Easter and price investments
GROCERY TRADE Q1 EXPECTED PROFIT IMPACT FROM THE TIMING OF EASTER AND PRICE INVESTMENTS 48
Slide 49: Grocery trade net sales
GROCERY TRADE NET SALES €-29 million € million € million rolling 12 months 49
Slide 50: Grocery trade operating profit
GROCERY TRADE OPERATING PROFIT €-9.7 million € million € million rolling 12 months Operating Operating 5.4% 7.2% 7.4% 7.4% 4.9% margin 6.9% 6.7% margin 50 Comparable figures
Slide 51: Grocery trade highlights in Q1
GROCERY TRADE HIGHLIGHTS IN Q1 • Sales and profit impacted especially by the timing of Easter – the second most important sales season for the division – which fell on April this year and on March in 2024 • K Group grocery sales down by 1.4% • Kespro’s net sales down by 0.5%, exceeding market growth
Slide 52: Aiming for a market share turnaround in grocery trade
AIMING FOR A MARKET SHARE TURNAROUND IN GROCERY TRADE • The decline in K Group’s market share slowed down in 2024 • According to the NielsenIQ Grocery Shop Directory, K Group’s market share in 2024 was 33.7% (2023: 34.3%); market share in online grocery above 40% • Withdrawal from the Neste K chain
Slide 53: 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 54: Pick-up in building and home improvement trade underpinned sales and profit
BUILDING AND TECHNICAL TRADE Q1 PICK-UP IN BUILDING AND HOME IMPROVEMENT TRADE UNDERPINNED SALES AND PROFIT 54
Slide 55: Building and technical trade net sales
BUILDING AND TECHNICAL TRADE NET SALES €+69 million € million € million rolling 12 months 55
Slide 56: Building and technical trade operating profit
BUILDING AND TECHNICAL TRADE OPERATING PROFIT €+4.9 million € million € million rolling 12 months Operating 0.7% 4.7% 6.2% 3.4% 1.1% Operating 3.9% 3.9% margin margin 56 Comparable figures
Slide 57: Building and technical trade highlights in Q1
BUILDING AND TECHNICAL TRADE HIGHLIGHTS IN Q1 • Construction cycle turning, demand has grown stronger especially in building and home improvement trade: Q1/2025 Q1/2024 • Growth in K-Rauta sales in Finland driven by B2B. Especially sales of heavy construction materials Net sales, € million 1,033.1 9
Slide 58: Sales of K-Rauta Finland and Onninen Finland
SALES OF K-RAUTA FINLAND AND ONNINEN FINLAND Retail and B2B sales 58
Slide 59: Byggmakker sales in Norway
BYGGMAKKER SALES IN NORWAY Retail and B2B sales 59
Slide 60: Strong position in different areas of car trade supported profit development
CAR TRADE Q1 STRONG POSITION IN DIFFERENT AREAS OF CAR TRADE SUPPORTED PROFIT DEVELOPMENT 60
Slide 61: Car trade net sales
CAR TRADE NET SALES €+28 million € million € million rolling 12 months 61
Slide 62: Car trade operating profit
CAR TRADE OPERATING PROFIT €+1.5 million € million € million rolling 12 months Operating 5.7% 5.0% 6.0% 5.7% Operating 6.1% 5.7% 5.7% margin margin 62 Comparable figures
Slide 63: Car trade highlights in Q1
CAR TRADE HIGHLIGHTS IN Q1 K-AUTO, NET SALES • Market demand for new cars muted, Q1 first registrations of passenger cars and vans down by 7.0%; first registrations of brands represented by Kesko up by 15.1% in Q1 • Net sales and comparable operating profit grew markedly despite the challenging mark
Slide 64: Profit guidance and outlook for 2025 unchanged
PROFIT GUIDANCE AND OUTLOOK FOR 2025 UNCHANGED 64
Slide 65: 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 66: 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 67: Management and IR contact
MANAGEMENT AND IR CONTACT 67
Slide 68: Kesko Group management board
KESKO GROUP MANAGEMENT BOARD President and CEO Jorma Rauhala EVP, Chief Financial Officer EVP, Human Resources Anu Hämäläinen Matti Mettälä EVP, Brand and Communications EVP, Legal and Sustainability Karoliina Partanen Lasse Luukkainen Grocery trade Building and technical trade Car trade President P
Slide 69: IR contact
IR CONTACT Hanna Jaakkola Vice President, Investor Relations tel.+358 40 5666 070 hanna.jaakkola@kesko.fi
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