Strong ending to 2020 results in full year net sales growth of 63% and 27% adjusted EBITA margin

4 February 2021

Following issuance and subsequent listing of the SEK 1.1 billion senior secured bond to finance the acquisition of Poster Store AB (“Poster Store”), the Board of Desenio Group AB (publ) (the “Company” or “Desenio”) hereby publishes the following trading update ahead of the publication of the Company’s year-end report 2020 (which will be published on or around 12 February 2021). As a result of Desenio Group AB’s recent acquisition of Poster Store, the trading update includes certain consolidated pro forma financial figures including Poster Store.

Selected preliminary financials for the period Jan-Dec 2020

• Net sales
  • Desenio Group AB: Net sales of SEK 981m (corresponding to growth of 63%)
  • Pro forma: Net sales of SEK 1,291m
• EBITDA
  • Desenio Group AB:
    • EBITDA SEK 255m (corresponding to EBITDA margin of 26%)
    • Adjusted EBITDA of SEK 269m (margin of 27%)
  • Pro forma:
    • Adjusted EBITDA of SEK 341m (margin of 26%)
• EBITA
  • Desenio Group AB:
    • EBITA of SEK 254m (corresponding to EBITA margin of 26%)
    • Adjusted EBITA of SEK 267m (margin of 27%)
  • Pro forma:
    • Adjusted EBITA of SEK 340m (margin of 26%)

The adjusted EBITDA and adjusted EBITA figures exclude transaction costs of SEK 4m and warehouse relocation costs of SEK 9m (in total adjustments of SEK 13m) in the period.

The Company ended 2020 with a net debt of SEK 632m (which includes the earn-out to the sellers of Poster Store of approximately SEK 210m), corresponding to a net debt to adjusted EBITDA of 1.9x on pro forma basis. The Company expects to resolve a dividend payment amounting to approximately SEK 290m to Desenio’s current shareholders during the first quarter of 2021.

Financial targets

Desenio has reviewed its strategic ambitions and financial targets in connection with the integration work following the closing of the Poster Store acquisition, as outlined below:

• In the medium term, the Company's goal is to achieve and annual organic sales growth of around 30% and potentially further supplemented by impact from add-on acquisitions. The goal is to grow net sales by approximately 35-40% during 2021. In the long term, Desenio's goal is to achieve sales growth in line or slightly above the online market.

• Desenio expects that the annual synergies from the acquisition of Poster Store in the medium term will exceed SEK 50 million. In 2021, about half of the medium-term synergies are expected to materialise.
• Desenio's goal is to maintain an adjusted EBITA margin of approximately 25% in the medium term. In 2021, a slight improvement is expected compared with the previous year's adjusted EBITA margin as a result of current expectations for materialisation of synergies, slightly offset by higher sales growth (compared to the medium term target). Desenio expects to increase the adjusted EBITA margin over time in connection with the Company achieving economies of scale through continued net sales growth and the generation of synergies related to the integration of Poster Store. In the long term, the EBITA margin is expected to approach 30%.

The Company’s financial targets set forth above constitute forward looking information that is subject to considerable uncertainty. The financial targets are based upon a number of assumptions relating to, among others, the development of the Company’s industry, business, results of operations and financial condition. The Company’s business, results of operations and financial condition, and the development of the industry and the macroeconomic environment in which the Company operates, may differ materially from, and be more negative than, those assumed by the Company when preparing the financial targets set out above. As a result, the Company’s ability to reach these financial targets is subject to uncertainties and contingencies, some of which are beyond its control, and no assurance can be given that the Company will be able to reach these targets or that the Company’s financial condition or results of operations will not be materially different from these financial targets.Selected quarterly information for Desenio

The information contained in this trading update is based solely on preliminary internal information used by management and is based on assumptions that are subject to inherent uncertainties. The Company’s actual consolidated financial results may differ from its preliminary results for the twelve months ended 31 December 2020 and remain subject to the Company’s normal review process, which has not been completed. You are cautioned that the foregoing information has not been audited or reviewed by the Company’s independent auditors.

As previously communicated, the Company and its major shareholders are considering various strategic alternatives for the Group’s future development, which may include both organic and inorganic growth initiatives, as well as offers to new investor(s). 

For further information, please contact:

Fredrik Palm, CEO

fredrik.palm@deseniogroup.com, +46 70 080 76 37

Petter Blid, Interim CFO

petter.blid@deseniogroup.com, +46 70 741 22 88

The information in this press release is such that Desenio Group AB (publ) must disclose pursuant to the EU Market Abuse Regulation. The information was submitted for publication, through the agency of the contact person set out above, on 4 February 2021, at 08:00 CET.

About Desenio

Desenio is Europe’s premier online store for art prints and frames, shipping to more than 35 countries worldwide. Our business idea is simple: on-trend and attractive wall art should be available to everyone. In 2020 we acquired Poster Store, creating a group with 220 employees and over SEK 1 billion in revenue. Working from our headquarters in Stockholm, Sweden, we are on a mission to help people worldwide create beautiful homes through affordable wall art. Desenio is backed by Verdane, a specialist growth equity investment firm that partners with ambitious Northern European tech-enabled businesses. For more information, please visit www.desenio.com.