Q4-23: Improved profitability despite continued market headwind
Sandefjord, 8 February 2024: In the fourth quarter, Komplett group delivered a 30 per cent increase in operating results (EBIT adj.) driven by sustained gross margin progress and good cost control. Despite the difficult market conditions, the group delivered stable sales, while continuing to strengthen its market position.
The group delivered a strong black week and overall solid peak season performance. The progress was mainly driven by the B2C segment, while the B2B and Distribution segments to a larger extent were affected by the soft demand environment. The market in Sweden remained weak, while the conditions in Norway were slightly better yet also challenging towards year-end.
Total operating revenue increased by 1.7 per cent in the fourth quarter of 2023, from NOK 4 657 million to NOK 4 734 million. Adjusted for currency translation effects, revenue declined by 2.3 per cent. The group’s gross margin continued to improve and reached 14.0 per cent in the fourth quarter, corresponding to an increase of 1.2 percentage points from 12.8 per cent in the same period of 2022.
The margin increase in combination with improved cost efficiency in an inflationary environment were the main drivers behind the 30 per cent EBIT adj. improvement, which resulted in an EBIT adj. margin of 1.9 per cent in the fourth quarter, compared with 1.5 per cent in the same quarter of 2022. The group is making good progress on operational measures to safeguard margins and offset operating cost inflation.
As a consequence of the challenging market situation as well as general industry valuation levels in recent periods, the group recognised non-cash impairment charges of NOK 983 million in the fourth quarter, relating to impairment of goodwill and de-risking of the balance sheet. The impairment is in accordance with IFRS recommendations, and in line with generally accepted accounting principles in Norway. It has no cash implication, has no operational consequence and does not alter the outlook of the business nor its strategies.
Moving forward, the group continues its measures to improve its margins, while reinforcing the efforts to counteract the negative effects of general cost inflation on its expenses. Komplett Group is simultaneously continuing efforts to develop its strong brands and to expand market shares, while pursuing the possibilities for growth in related categories, channels and customer groups.
“Throughout the year 2023, we have succeeded with improving our market position, utilising scale benefits and improving service levels while maintaining our industry-leading cost position. Actions to improve operational and financial performance have been combined with new management teams and key recruitments across the group,” says Jaan Ivar Semlitsch, President and CEO of Komplett ASA.
“At the entry of 2024, we expect markets to remain challenging, and, in anticipation of a market recovery, we are continuing to refine our business model and build on our strengths. We remain committed to meeting the high expectations of our customers, improving profitability while retaining our industry-leading cost position and building strong teams,” Semlitsch adds.
The presentation material and report for the fourth quarter of 2023 are attached to this notice.
A presentation of the results will be held by CEO Jaan Ivar Semlitsch and CFO Thomas Røkke at 09:00 CET at the Vika Atrium Auditorium, Munkedamsveien 45, Oslo.
The event will also be made available via a live webcast. Please use the following link to register and view the webcast:
https://channel.royalcast.com/landingpage/hegnarmedia/20240208_3/
Questions will be addressed towards the end of the presentation. A recorded version of the webcast will be available shortly after the webcast has concluded.
For further inquiries, please contact:
Thomas Røkke, CFO
Thomas.Rokke@komplett.com
Kristin Hovland, Head of Communication
Kristin.Hovland@komplett.com
About Komplett ASA
Komplett Group is a leading online-first electronics and IT products retailer, operating in Norway, Sweden and Denmark. Serving customers in the B2C, B2B and distribution markets, the Group is deeply focused on delivering best-in-class customer experience, built through decades of knowhow, expertise and deep customer commitment. Komplett Group operates an efficient and scalable business model that supports cost leadership and enables a competitive product offering.
This information is considered to be inside information pursuant to the EU Market Abuse Regulation (MAR) Article 7 and is subject to the disclosure requirements pursuant to Section 5-12 of the Norwegian Securities Trading Act. This stock exchange announcement was published by Elise Heidenreich, Investor Relations adviser, at the date and time as set out above.