Relais Group Plc Interim Review January-March 2024 (unaudited): continued strong and profitable growth
Relais Group Plc
Stock Exchange Release 8 May 2024, 9:00 a.m. EEST
This release is a summary of Relais Group's Interim Review January-March 2024. The full report is attached to this release and is available on our website at https://relais.fi/en/investors/.
JANUARY-MARCH 2024 IN BRIEF
- Net sales totalled EUR 82.8 million (January-March 2023: 69.0), change +20%
- Comparable EBITA was EUR 9.7 (7.6) million, change +27%
- Comparable EBITA margin was 11.7 (11.0) %
- Earnings per share, basic was EUR 0.21 (0.16)
- Net cash flow from operations was EUR 4.6 (11.0) million
- At comparable EUR/SEK exchange rates, EBITA would have been approximately EUR 0.0 (0.4) million higher than reported *)
*) The EUR/SEK impact has been calculated by converting the SEK denominated EBITA of the Swedish entities to EUR with the reporting period average EUR/SEK rate as well as the comparison period average EUR/SEK rate and comparing these two (translation difference).
2024 OUTLOOK AND LONG-TERM FINANCIAL TARGET
Relais Group does not provide a numeric guidance for the financial year 2024. The company has a long-term financial target, according to which it aims to reach a proforma EBITA of EUR 50 million by the end of the year 2025.
KEY FIGURES
| (EUR 1,000 unless stated otherwise) | 1–3/2024 | 1–3/2023 | Change | 12 months rolling | Change | 1–12/2023 |
| Net sales | 82,756 | 68,950 | +20% | 298,058 | +5% | 284,252 |
| Gross profit | 38,192 | 32,087 | +19% | 135,029 | +5% | 128,923 |
| Gross margin | 46.2% | 46.5% | 45.3% | 45.4% | ||
| Comparable EBITA | 9,686 | 7,619 | +27% | 30,918 | +7% | 28,851 |
| Comparable EBITA margin | 11.7% | 11.0% | 10.4% | 10.1% | ||
| Operating profit | 8,962 | 6,641 | +35% | 27,467 | +9% | 25,147 |
| Profit for the period | 3,884 | 2,938 | +32% | 14,685 | +7% | 13,739 |
| Earnings per share, basic | 0.21 | 0.16 | +32% | 0.81 | +7% | 0.76 |
| Cash flow from operations | 4,637 | 10,975 | -58% | 24,260 | -21% | 30,621 |
| Net working capital | 68,757 | 59,411 | +16% | 76,413 | +14% | 67,068 |
| Net working capital turnover |
4.4 | 4.4 | 0% | 4.8 | +1% | 4.7 |
| Interest-bearing net debt | 144,586 | 143,292 | +1% | 152,304 | +1% | 151,010 |
| Net Debt to EBITDA, LTM | 3.15 | 3.69 | -15% | 2.92 | -16% | 3.47 |
| Equity ratio | 34.5% | 32.9% | 35.1% | 33.6% | ||
| Return on equity | 14.0% | 11.2% | 12.6% | 12.8% | ||
| Return on capital employed | 16.7% | 11.2% | 11.3% | 10.0% |
The change percentages in the tables have been calculated on exact figures before the amounts were rounded to millions of euros.
CEO ARNI EKHOLM COMMENTS THE FIRST QUARTER OF 2024
Strong and profitable growth continued
“The first quarter of 2024 was characterized by strong growth of both net sales and EBITA. Net sales of the Group grew by 20%. Organic growth was 12%. EBITA grew 28% compared with last year. The growth was supported by the exceptionally cold weather prevalent in Northern Europe in January-February, and the effect of acquisitions carried out during 2023.
The sales growth was especially strong in our Technical Wholesale and Products business, which grew by 28%. Organic growth was 16% and the rest of the growth came from the acquired companies Adita, AutoMateriell and Nordic Lift. The cold weather contributed to a steep increase in sales of especially electrical spare parts and equipment, which are sensitive to very low temperatures. The sales growth was strong both in Finland and in the Scandinavian market and the gross profit percentage remained on a stable level.
Looking at the product group level, sales of spare parts grew 27%. Cold weather boosted sales of especially starter batteries. The equipment product group grew by 83% which is largely coming from the acquired workshop equipment businesses. In addition, the sales of some winter related equipment, such as battery chargers were positively affected by the cold weather. Sales of vehicle lighting products remained on last year’s levels.
The Group’s Commercial Vehicle Repair and Maintenance business also developed positively despite three less working days in March compared to last year. Sales growth was 5%, and gross profit levels were stable compared to last year. The demand for our services continued to grow as especially bigger fleet customers are looking for cost efficiencies in their operations. The resource situation at our workshops remained stable and there were no critical shortages in manpower.
We continued to scan the market for good acquisition opportunities. There are several interesting targets having a good strategic fit with us within the Nordic marketplace. We are on a regular basis contacting various business owners in order to have a healthy M&A pipeline for the coming months and years. After the review period we completed our latest acquisition, in which we acquired Asennustyö M Ahlqvist Oy in Finland. This acquisition is strategically important to our Group company Raskone, as it increases the weight of the commercial vehicle trailer repair business in Raskone’s service portfolio.
Even if the market demand for our products and services are on a stable level, there are still some macroeconomic factors which may potentially affect the markets negatively during the coming quarters. The overall economic development in Finland is poor and there are also some signs of increasing unemployment. The interest rate levels also seem to remain on current levels longer than expected, which has a negative effect on the purchase power of customers and especially consumers. However, the Scandinavian markets seem to suffer less from these macroeconomic trends, and also in Finland we are well positioned to serve our customers in the best possible way despite the market conditions. We feel that we have a good possibility to continue implementing our strategy during 2024.
Finally, I want to thank all our over 1,000 professionals for their dedication and hard work during the first quarter of this year. I also want to thank our customers, shareholders, and business partners for their continued support.”
EVENTS AFTER THE REVIEW PERIOD
- Resolutions of the Annual General Meeting
- Extension to Relais Group Plc's senior term and multicurrency revolving facilities agreement
- Acquisition of all shares in Asennustyö M Ahlqvist Oy
- Juri Viitaniemi appointed Director Compliance, Legal and HR
FINANCIAL CALENDAR FOR 2024
The interim reports and the half-year financial report for 2024 will be issued as follows: January-June on Thursday, 15 August 2024 and January-September on Thursday, 7 November 2024.
INVITATION TO THE WEBCAST
Relais Group's CEO Arni Ekholm and CFO Thomas Ekström will present the result to the media, investors and analysts at a webcast on 8 May 2024, at 10:00 a.m. EEST. The webcast can be followed at https://relais.videosync.fi/q1-2024.
Presentation material and video will be available on the company's website at https://relais.fi/en/
after the event.
Relais Group Plc
Board of Directors
Further information:
Arni Ekholm, CEO
Phone: +358 40 760 3323
E-mail: arni.ekholm@relais.fi
Distribution:
Nasdaq Helsinki
Key Media
www.relais.fi
Relais Group
Relais Group is a leading consolidator and acquisition platform on the vehicle aftermarket in the Nordic and Baltic countries. We have a sector focus in vehicle life cycle enhancement and related services. We also serve as a growth platform for the companies we own.
We are a profitable company seeking strong growth. We carry out targeted acquisitions in line with our growth strategy and want to be an active player in the consolidation of the aftermarket in our area of operation. Our acquisitions are targeted at companies having a good strategic fit with our group companies.
Our net sales in 2023 was EUR 284.3 (2022: 260.7) million. During 2023, we completed a total of four acquisitions. We employ approximately 1,000 professionals in six different countries. The Relais Group share is listed on the Main Market of Nasdaq Helsinki with the stock symbol RELAIS.