Lindex Group’s Interim Report 1 January–31 March 2025
Lindex Group’s first quarter impacted by weakened consumer confidence and logistical challenges – Stockmann division’s adjusted operating result improved
LINDEX GROUP plc, Interim report 29.4.2025 at 8.30 EEST
Lindex Group’s Interim Report 1 January–31 March 2025
Lindex Group’s first quarter impacted by weakened consumer confidence and logistical challenges – Stockmann division’s adjusted operating result improved
January–March 2025:
- Lindex Group’s revenue was EUR 186.0 (192.8) million. The revenue declined by 3.0% in local currencies.
- The revenue of both divisions was negatively impacted by weakened consumer confidence and continued fashion market volatility. In addition, the comparison period was longer due to the leap day, which affected the revenue.
- The Lindex division’s revenue was EUR 126.3 (130.6) million. The revenue declined by 3.3% and by 2.5% in local currencies, which was partly affected by temporary supply delays related to the extensive ramp-up process of the new omnichannel distribution centre.
- The Stockmann division’s revenue decreased by 3.9% to EUR 59.8 (62.2) million mainly due to decrease in fashion category sales.
- The Group’s gross margin improved to 57.4% (56.3).
- The Group’s adjusted operating result decreased to EUR -8.7 (-6.5) million.
- The Lindex division’s adjusted operating result decreased to EUR -0.3 (4.2) million due to decrease in revenue and higher operating costs.
- The Stockmann division’s adjusted operating result improved to EUR -7.3 (-9.4) million due to successful cost efficiency measures. - Operating result decreased to EUR -9.5 (-7.6) million.
- Net result decreased to EUR -20.2 (-15.4) million.
- Basic earnings per share were EUR -0.13 (-0.10).
- Diluted earnings per share were EUR -0.12 (-0.10).
Guidance for 2025:
In 2025, Lindex Group expects its revenue to increase by 0−4% in local currencies compared to 2024. The Group’s adjusted operating result is estimated to be EUR 70−90 million. Foreign exchange rate fluctuations may have a significant effect on the adjusted operating result.
Market outlook for 2025:
The macroeconomic situation on Lindex Group’s main markets is estimated to remain challenging, especially during the first half of the year. Continuing geopolitical uncertainty, together with the increased risks for global trade disturbances, may have a negative impact on the economic recovery. Despite the already lowered interest rates and decreased inflation, the GDP (Gross Domestic Product) growth forecasts for the first half of 2025 are moderate due to relatively weak consumer confidence. Towards the latter part of the year, economic growth might accelerate in case interest rates continue to decline and inflation remains stable. Increasing purchasing power of households may gradually start supporting favourable development of consumer demand. However, the situation may vary between the Group’s markets. Disruptions in supply chains and international logistics during the year cannot be excluded.
CEO Susanne Ehnbåge:
During the first quarter, Lindex Group made good progress in executing the strategic initiatives to accelerate the future growth and value creation of the company. In the Lindex division, we continued the extensive ramp-up and transition phase of the new omnichannel distribution centre which enables us to execute our long-term growth plans and future-proof our logistics operations. In addition, the important digital transformation efforts of the Lindex division progressed well with ongoing enhancements of customer-facing touchpoints and enhanced internal capabilities. The number of active customers increased for both divisions, and the Lindex division continued to expand its international presence by, for example, launching a new Lindex Kids store in London.
In the Stockmann division, the efforts to improve operational and organisational efficiency paid off and the division's first quarter result improved, marking the fourth consecutive quarter of improvement. At the same time, we continued developing Stockmann’s strategic omnichannel approach, making the interaction of digital and physical channels as seamless as possible for our customers. We entered new concession partnerships to complement and elevate our own offering with new unique products, services and experiences.
Lindex Group’s revenue amounted to EUR 186.0 (192.8) in the first quarter. The revenue of both divisions was negatively impacted by weakened consumer confidence, and fashion market remained volatile. In addition, the comparison period was longer due to the leap day, which affected the revenue of both divisions. The Lindex division’s revenue also decreased due to the temporary supply delays related to the extensive ramp-up process of the new omnichannel distribution centre. In addition, the continued longer lead times of international logistics affected product availability in the Lindex stores and online. The Group’s adjusted operating result decreased to EUR -8.7 (-6.5) million, due to lower revenue in both divisions and higher operating costs in the Lindex division.
As mentioned above, our first quarter performance was impacted by the market environment that remained challenging. The continued geopolitical tensions and risks of unexpected changes in global trade policies increased uncertainty in our key markets and weakened the consumer confidence during the quarter. The consumer behaviour remained cautious, and on some markets, we saw a decrease both in employment expectations and in retail trade sales.
I am very pleased with all the achievements made during the first quarter but at the same time, we cannot be satisfied with our financial result, even though the underlying reasons affecting the result have been analysed, and corrective measures are under way.
When it comes to our restructuring programme, all confirmed undisputed debts have been paid and we have only one disputed claim left. A constructive and fair conclusion to the long restructuring process would be of significant mutual benefit to both our shareholders and Lindex Group. The strategic assessment, targeting to crystallise shareholder value by refocusing the Group's business on Lindex, is ongoing. Lindex Group’s Board of Directors continues to investigate strategic alternatives for the Stockmann department store business and as earlier communicated, the Board expects to finalise the assessment by the end of June 2025.
After the reporting period, we held our first Annual General Meeting as Lindex Group plc. I would like to express my sincere thanks to the shareholders for attending the meeting and sharing your insights and comments both during and after the meeting. I also want to sincerely thank our personnel, customers, shareholders and partners for their commitment, trust and cooperation. I am excited to continue our journey together with you and make the year 2025 a year successful one for all of us.
KEY FIGURES
|
|
1–3 |
1–3 |
1–12 |
|
Revenue, EUR mill. |
186.0 |
192.8 |
940.1 |
|
Revenue growth, % |
-3.5 |
-2.8 |
-1.2 |
|
Local currency revenue growth, % |
-3.0 |
-3.2 |
-1.3 |
|
Digital share of revenue, % |
19.3 |
18.8 |
18.1 |
|
Digital revenue growth in local currencies, % |
0.9 |
2.4 |
6.3 |
|
Gross profit, EUR mill. |
106.8 |
108.5 |
547.9 |
|
Gross margin, % |
57.4 |
56.3 |
58.3 |
|
Adjusted operating result, EUR mill. |
-8.7 |
-6.5 |
74.9 |
|
Adjusted operating margin, % |
-4.7 |
-3.3 |
8.0 |
|
Operating result, EUR mill. |
-9.5 |
-7.6 |
60.9 |
|
Operating margin, % |
-5.1 |
-3.9 |
6.5 |
|
Net result for the period, EUR mill. |
-20.2 |
-15.4 |
13.2 |
|
Net debt excluding IFRS 16 items, EUR mill. |
31.9 |
-10.6 |
-31.8 |
|
Equity ratio, % |
30.1 |
28.2 |
30.0 |
|
Equity ratio (excluding IFRS 16 items), % |
62.6 |
60.5 |
61.9 |
|
Inventories, EUR mill. |
202.6 |
179.7 |
169.6 |
|
Operating free cash flow, EUR mill. |
-57.4 |
-39.2 |
20.3 |
|
Capital expenditure, EUR mill. |
6.8 |
6.8 |
45.7 |
|
EPS, basic, EUR |
-0.13 |
-0.10 |
0.08 |
|
EPS, diluted, EUR |
-0.12 |
-0.10 |
0.08 |
|
Number of employees, average |
5 740 |
5 947 |
5 746 |
ITEMS AFFECTING COMPARABILITY (IAC)
|
EUR million |
1–3 |
1–3 |
1–12 |
|
Operating result |
-9.5 |
-7.6 |
60.9 |
|
Adjustments to operating result |
|
|
|
|
Costs related to restructuring programme and other disputes |
0.1 |
2.8 |
10.9 |
|
Costs related to strategic projects and structural changes |
0.7 |
2.8 |
7.5 |
|
Insurance claim settlement for losses related to COVID-19 |
|
-4.5 |
-4.4 |
|
Adjusted operating result |
-8.7 |
-6.5 |
74.9 |
STRATEGY
Lindex Group’s two divisions, Lindex and Stockmann, have their own strategies targeting sustainable and profitable growth. The divisions share the view that customer centricity, an omnichannel approach and strong brands are key strategic factors in building future growth. Lindex Group has ambitious sustainability targets, and sustainability is a central part of the Group’s operations.
The Lindex division’s strategy builds on Lindex’s purpose of empowering and inspiring women everywhere. The division’s three strategic must-win areas are to accelerate growth, transform into a sustainable business, and decouple cost from growth. The Stockmann division’s customer-centric strategy builds on Stockmann’s purpose of being a marketplace for a good life. The Stockmann division has four strategic must-win areas, which are to elevate offering by increasing focus on premium and luxury, grow and leverage loyal customer base, optimise omnichannel performance and improve operational efficiency.
Both divisions are committed to Lindex Group’s science-based climate target to reduce greenhouse gas emissions from its own operations and value chain by 42% by 2030 compared to the year 2022. The Science Based Targets initiative (SBTi) has validated and approved the Group’s climate target.
In September 2023, Lindex Group’s Board of Directors initiated a strategic assessment aiming to crystallise shareholder value by refocusing the Group's business on Lindex. As part of the investigation of strategic alternatives for Stockmann’s department stores business, the Board is evaluating the best environment for developing the business in the future. These options include increasing the business’ independence within the Group, considering possible ownership changes or strategic partnerships, or continuing under the current structure. The assessment is expected to be finalised during the first half of 2025. The Group will provide an update on the assessment if, and when, appropriate.
Interim Report
This company announcement is a summary of the Lindex Group’s Interim Report 1 January – 31 March 2025 and includes the most relevant information of the report. The complete report is attached to this release as a pdf file and is also available on the company's website lindex-group.com.
Webcast for analysts and the media
A media and analyst briefing will be held in English as a live webcast today, on 29 April 2025 at 10:00 a.m. EEST. The event can be followed via this link. The recording and presentation material will be available on the company's website after the event.
LINDEX GROUP plc
Susanne Ehnbåge
CEO
Further information:
Susanne Ehnbåge, CEO
Henrik Henriksson, CFO
Contact via Lindex Group’s MediaDesk [email protected], tel. +358 50 389 0011
Marja-Leena Dahlskog, Head of Communications & IR, tel. + 358 50 502 0060
Distribution:
Nasdaq Helsinki
Principal media