Q2 2024 Kesko Oyj Earnings Call Transcript
Key Points
- Kesko Oyj (KKOYF) reported a strong cash flow from operating activities, reaching EUR309 million, thanks to improved working capital management.
- The company successfully integrated the Davidsen acquisition, contributing positively to net sales in the building and technical trade division.
- Online grocery sales continued to grow robustly, increasing by 13.5% and accounting for 4.1% of K Group's grocery sales.
- Kesko Oyj (KKOYF) expanded its grocery store offerings by adding nearly 450 wine products and 100 stronger beer products, enhancing customer convenience.
- The company maintained a strong financial position with a net debt to EBITDA ratio of 1.1, despite increased investments in logistics and grocery trade store networks.
- Net sales and profit decreased across all divisions, with a notable decline in the car trade division due to weak market demand for new cars.
- The building and technical trade division faced profitability challenges due to a weak construction cycle, although the decline was slower than in Q1.
- Grocery trade net sales were down, impacted by increased store site costs and a decline in non-food sales at K-Citymarkets.
- Kesko Oyj (KKOYF) experienced a decrease in return on capital employed across all divisions as earnings declined.
- The company's guidance for 2024 was adjusted, with the high end of the comparable operating profit range reduced from EUR700 million to EUR680 million, reflecting ongoing market challenges.
Dear are all warmly welcome virtually to sunny Helsinki, and thank you for tuning in for Kesko's Q2 2024 release call. Our agenda today is the following CEO and President, Jorma Rauhala, will give first the Q2 presentation.
We have here together with us, our business division presidents Ari Akseli for Grocery Trade; Sami Kiiski for Building and Technical Trade and Johanna Ali, for Car Trade; as well as CFO, Anu Hämäläinen. After Jorma's presentation, it's time for questions both by phone and via chat function.
All the materials related to Q2 can be found at our webpage kesko.fi under investors. My name is Hanna Jaakkola. I work as IR Director at Kesko. I will be at your service after the presentation for your questions and discussions.
But now, Jorma, the virtual stage is yours. Please.
Thank you, Hanna. Ladies and gentlemen, welcome also on my behalf to this
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