Tokmanni Group Corporation’s Financial Statement Bulletin 2023: Revenue increased by 39.0% and comparable EBIT by 29.3% in the fourth quarter

Tokmanni Group Corporation        Financial Statement Bulletin        22 March 2024 at 8:00 am

FOURTH QUARTER 2023 HIGHLIGHTS

• Tokmanni Group revenue grew by 39.0% (1.5 %) and was EUR 471.2 million (339.0)
• Like-for-like revenue increased by 1.0% (-1.0%)
• Comparable gross profit totalled EUR 172.0 million (119.5) with the comparable gross margin being 36.5% (35.2%)
• Comparable EBIT amounted to EUR 46.2 million (35.8), representing 9.8% of revenue (10.5%)
• Cash flow from operating activities amounted to EUR 116.5 million (92.2)
• Earnings per share, diluted was EUR 0.44 (0.41)

JANUARY-DECEMBER 2023 HIGHLIGHTS

• Tokmanni Group completed the acquisition of Dollarstore on 1 August 2023
• Tokmanni Group revenue grew by 19.2% (2.3%) and was EUR 1,392.7 million (1,168.0)
• Like-for-like revenue increased by 1.1% (-0.7%)
• Comparable gross profit totalled EUR 489.5 million (398.0) with the comparable gross margin being 35.2% (34.1%)
• Comparable EBIT amounted to EUR 98.8 million (85.8), representing 7.1% of revenue (7.3%)
• Cash flow from operating activities amounted to EUR 220.2 million (86.3)
• Earnings per share, diluted was EUR 0.92 (1.00)

NEW FINANCIAL REPORTING STRUCTURE

Tokmanni Group has changed its segment reporting due to the Dollarstore acquisition. From the fourth quarter of 2023, Tokmanni Group has two reportable segments, Tokmanni and Dollarstore. Tokmanni segment includes the Tokmanni, Miny, Click Shoes and Shoe House stores, as well as the Tokmanni and Click Shoes online stores. Click Shoes’ and Shoe House’s financials have been included in Tokmanni Group financials starting from 1 March 2023. Dollarstore segment consists of the Dollarstore and Bigdollar stores. Dollarstore financials have been included in Tokmanni Group financials starting from 1 August 2023. Tokmanni Group refers to the whole group.

DIVIDEND PROPOSAL

Tokmanni’s Board of Directors proposes to the Annual General Meeting a dividend of maximum EUR 0.76 per share, which would be paid in two instalments.

TOKMANNI’S OUTLOOK FOR 2024

In 2024, Tokmanni Group expects its revenue to be EUR 1,660–1,760 million. Comparable EBIT is expected to be EUR 110–130 million.

TOKMANNI GROUP’S PRESIDENT AND CEO MIKA RAUTIAINEN
Tokmanni Group became the leading discount retailer in the Nordics

Tokmanni Group’s acquisitions completed in 2023 made it a very significant year in the Group's success story. With the Dollarstore acquisition, Tokmanni Group became the leading discount retail chain in the Nordics. Good progress has been made in the realization of the synergy targets related to the acquisition. By the end of the year, we reached approximately EUR 2.4 million in annual synergies. The acquisitions of Click Shoes and Catmandoo enabled us to significantly strengthen our apparel offering in the Finnish market. The integrations of all acquisitions progressed as planned during 2023.

The reduction of disposable income was clearly reflected in customers’ purchasing behaviour in 2023. Store visits and shopping basket contents were considered very carefully, especially in non-grocery products. In the final quarter, sales growth in Finland, Sweden and Denmark was satisfactory considering the market conditions, and the Group’s revenue increased by 39.0% to EUR 471.2 million mainly driven by the Dollarstore acquisition.

Tokmanni segment’s revenue for the fourth quarter was EUR 351.5 million. The growth was driven by the Click Shoes acquisition and a good start to the quarter. Like-for-like revenue grew by 0.6%. Comparable EBIT was EUR 36.1 million (36.0). The level of EBIT was supported in part by excellent control of fixed costs.

Dollarstore segment’s revenue for the fourth quarter was EUR 119.8 million. Like-for-like revenue grew by 2.1% in local currencies. Dollarstore’s strong price image is working well in the Swedish market also when consumer purchasing power weakens. Dollarstore’s comparable EBIT amounted to EUR 10.7 million. The EBIT development was supported by sales growth and improvement in the gross profit.

In 2023, inventory control and increasing the efficiency of the supply chain received particular attention. The total value of Tokmanni Group’s inventories was EUR 342.9 million (281.3). Thanks to successful measures taken, the value of the Tokmanni segment’s inventories decreased to EUR 248.8 million (281.3) at the end of the year. Dollarstore’s inventories amounted to EUR 94.1 million. Our successful measures to control inventory levels contributed to the increase in the Group’s cash flow from operating activities. The Group’s cash flow from operating activities in 2023 amounted to EUR 220.2 million (86.3).

At our Capital Markets Day held in February 2024, we presented our updated strategy and targets. Strengthening customer confidence and loyalty continue to be at the heart of everything we do. We will continue to work systematically to develop our operations.

I would like to extend my warmest thanks to our customers and partners and, above all, to all Tokmanni Group’s wonderful employees for the year 2023. Together, we are in an excellent position to continue implementing our strategy and strengthening our position as the leading discount retailer in the Nordics.

Key figures
(Dollarstore included in from 1 August 2023 onwards)	10–12/ 2023	10–12/ 2022	Change %	1–12/ 2023	1–12/ 2022	Change %
Revenue, MEUR	471.2	339.0	39.0%	1,392.7	1,168.0	19.2%
Like-for-like revenue development, %	1.0	-1.0		1.1	-0.7
Customer visit development, %	0.5	0.3		0.7	0.8
Gross profit, MEUR	169.5	117.8	43.9%	486.9	396.8	22.7%
Gross profit, %	36.0	34.7		35.0	34.0
Comparable gross profit, MEUR	172.0	119.5	44.0%	489.5	398.0	23.0%
Comparable gross profit, %	36.5	35.2		35.2	34.1
Operating expenses, MEUR	-96.5	-67.3	43.4%	-301.2	-243.7	23.6%
Comparable operating expenses; MEUR	-96.2	-66.2	45.4%	-298.1	-243.1	22.6%
EBITDA, MEUR	74.4	51.7	43.7%	189.9	157.1	20.8%
EBITDA, %	15.8	15.3		13.6	13.5
Comparable EBITDA, MEUR	77.2	54.5	41.5%	195.6	158.9	23.2%
Comparable EBITDA, %	16.4	16.1		14.0	13.6
Operating profit (EBIT), MEUR	43.4	33.0	31.7%	93.0	84.1	10.7%
Operating profit (EBIT), %	9.2	9.7		6.7	7.2
Comparable EBIT, MEUR	46.2	35.8	29.3%	98.8	85.8	15.2%
Comparable EBIT, %	9.8	10.5		7.1	7.3
Net financial items, MEUR	-10.4	-2.9	255.4%	-24.7	-10.7	129.4%
Capital expenditure, MEUR	17.5	20.5	-14.7%	238.7	54.3	339.8%
Net cash from operating activities, MEUR	116.5	92.2		220.2	86.3
Net debt, MEUR				730.4	383.4
Net debt without lease liabilities, MEUR				165.3	100.4
Net debt / comparable EBITDA *				3.7	2.4
Net debt / comparable EBITDA without lease liabilities *				1.6	1.1
Return on capital employed, %				11.2	12.8
Return on equity, %				22.2	26.9
Equity ratio, %				18.8	31.2
Number of shares, weighted average during the financial period (thousands)	58,825	58,818		58,819	58,815
Diluted number of shares, weighted average during the financial period (thousands)	58,884	58,860		58,878	58,858
Earnings per share, basic (EUR/share)	0.44	0.41		0.92	1.00
Earnings per share, diluted (EUR/share)	0.44	0.41		0.92	1.00
Personnel at the end of the period				6,206	4,241
Personnel on average in the period (FTE)	4,314	3,013		3,706	3,126

* Rolling 12 months comparable EBITDA

Analyst and press conference

Tokmanni Group’s President and CEO Mika Rautiainen and CFO Tapio Arimo will present the report to analysts, investors and media representatives on the publication day at 10:00 am in English (Finnish time).

The live webcast can be accessed via Tokmanni's website at https://ir.tokmanni.fi/en/investors or through the link below. On-demand version of the presentation will be available on the company's website later during the same day.

Webcast link: https://rajucast.tv/en/tokmanni/q4-financial-statements-review-for-2023/

The participants can also join a telephone conference that will be arranged in conjunction with the live webcasts. The participants are asked to dial in 5-10 minutes prior to starting time using the phone number and password below.

Finland: +358 9 2319 5437
Sweden: +46 (0) 8 5052 0424
UK: +44 (0) 33 0551 0200
US: +1 786 697 3501
Password: Tokmanni / 220324

For further information, please contact

Mika Rautiainen, President and CEO, tel. +358 20 728 6061, mika.rautiainen(at)tokmanni.fi
Tapio Arimo, CFO, tel. +358 20 728 7390, tapio.arimo(at)tokmanni.fi
Maarit Mikkonen, Head of IR and Communications, tel. +358 40 562 2282, maarit.mikkonen(at)tokmanni.fi

Tokmanni Group in brief

Tokmanni Group Corporation is one of the leading variety discount retailers in the Nordics. Around 6,600 employees in Finland, Sweden and Denmark make customers’ everyday life and special occasions easier by offering a versatile and up-to-date assortment of nordic and international brand-name products and other high-quality products at prices that are always affordable. With more than 370 Tokmanni, Dollarstore, Bigdollar, Miny, Click Shoes and Shoe House stores and online stores, the Group is always close to its customers. In 2023, Tokmanni Group Corporation’s revenue was EUR 1,393 million and comparable EBIT amounted to EUR 99 million. The Group's shares are listed on Nasdaq Helsinki.

Distribution

Nasdaq Helsinki
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