Slides
Page 1
1 Year - end Report Q4 2024 1 January – 31 December Friday, February 14, 2025
Page 2
2 Clein Johansson Ullenvik Group President & CEO Irene Wisenborn Bellander CFO Presenters
Page 3
AGENDA • This is Alligo • Highlights Q4 2024 • Update – presentation of Corema & Batterilagret • Financials • Summary and outlook • Q&A
Page 4
4 Alligo – a leading player in workwear, personal protection, tools and supplies in the Nordic region 218 Stores* 9,333 MSEK Revenue* 2,522 Employees* *FY 2024 Revenue per geographic area 2024 55%28% 17% SE NO FI EBITA per geographic area 2024 76% 17% 7% SE NO FI Revenue per brand category 2024 18% 82% Own brands External brands Main concept brands:
Page 5
AGENDA • This is Alligo • Highlights Q4 2024 • Update – presentation of Corema & Batterilagret • Financials • Summary and outlook • Q&A
Page 6
6 Q4 2024 business conditions Market situation • Continued weak market - Several customer segments - Stable demand in Oil & Gas industry in Norway • Cautiously positive market signals - Not reflected in sales - Signs of recovery Finland Proactive management • Driving sales • Growth by acquisitions • Cost reductions • Reducing inventories • Price adjustments - Sensitive categories Delivery capacity • Good and stable in Sweden and Finland • Vestby performance stabilized Macroeconomic factors • Continued economic uncertainty in the business cycle • Geopolitical turbulence
Page 7
7 Q4 2024 in brief – Continued weak market, several initiatives for the future Revenue +2.0% Continued slowdown in the market, Oil & Gas remains stable Organic growth -3.0% Acquisition- driven growth of 6.8 % Operating cash flow 438 MSEK (526) Adjusted EBITA 214 MSEK (308) Weak volumes, unfavourable customer mix Adjusted EBITA margin 8.3% (12.1) Gross margin 41.1% (43.4)
Page 8
8 Q4 2024 highlights Acquisitions • Batterilagret is Alligo’s largest acquisition so far • Strengthens the existing battery business • Completed Feb. 5, 2025 Sustainability • Climate targets for scope 1, 2 and 3 sent to Science Based Targets initiative for validation • Great progress in Dagens Industri’s sustainability ranking Operations • Initiated a project to improve the weak profitability in Finland. • Preparation for the change of business system in Norway • Preparation for the launch of ReCare
Page 9
AGENDA • This is Alligo • Highlights Q4 2024 • Update – presentation of Corema & Batterilagret • Financials • Summary and outlook • Q&A
Page 10
10 Acquisition Product category Date signing Annual revenue (MSEK)* Employees Stores Hämeen TeollisuuspalveluOy Industrial Components/Tools/Workwear/ Protective Equipment April 2024 87 18 1 Riihimäen TeollisuuspalveluOy Industrial Components/Tools/Workwear/ Protective Equipment April 2024 82 24 4 Wiklunds i Bollnäs AB Tools/Workwear/Protective Equipment May 2024 28 6 1 New Promotion Sverige AB (70%) Profile Clothing/Product Media June 2024 44 6 1 Workwear AS Tools/Workwear/ Protective Equipment June 2024 27 9 2 T.BrantestigSvetsmaskinservice AB Welding June 2024 26 8 1 Aktiebolaget Sundholm Welding Welding June 2024 23 6 2 Corema Svets & Industriprodukter AB** Welding/Fastening Oct 2024 155 25 2 Svenska Batterilagret AB Batteries Dec 2024 275 90 27 747 192 41 2024 – signed nine acquisitions, adding ≈750 MSEK in annual revenues ...as well as 200 employees and 42 stores * Currency rate: EUR 11.6 NOK 1.0 ** Including the subsidiaries Corema Fasteners AB and Corema Sundsvall AB
Page 11
11 A full-service supplier of welding, industrial products and fasteners: • Annual turnover of SEK 155 million with good profitability • Operations in Gothenburg and Sundsvall • 25 employees • Has a strong fastening offering • Well-established customer base in the manufacturing sector. Corema Svets & Industriprodukter AB
Page 12
12 A leading battery specialist in Sweden and Alligo's largest acquisition to date: • Significantly strengthens the Group's offering in batteries and battery accessories • Annual turnover of SEK 275 million with strong profitability • 27 stores across Sweden, head office in Kungälv • Around 90 employees • Example of product areas: ̶ Car batteries and start boosters ̶ Lithium batteries for tools and recreational boats ̶ Solar panels for caravans and camper vans • B2C and B2B customers – SME companies Svenska Batterilagret AB
Page 13
AGENDA • This is Alligo • Highlights Q4 2024 • Update – Sales initiatives and Alligo’s welding offer • Financials • Summary and outlook • Q&A
Page 14
14 • Revenue increased by 2.0 % ̶ Organic growth of -3.0 % ̶ Acquisition-driven growth of 6.8 % ̶ Negative FX -0.2%, one less trading day (-1.5) • Decreased contribution margin ̶ Decreased supplier bonus and negative mix effects • Adjusted EBITA decreased by 94 MSEK ̶ Weak volumes, negative customer segment, and size mix ̶ EBITA acquisitions 26 MSEK ̶ Cost savings • Items affecting comparability related to cost- saving initiatives • Financial net -40 MSEK (-34) ̶ whereof -23 MSEK (-24) related to bank financing costs ̶ Q4 average interest rate 4.2% (5.1) - STIBOR Acquisition driven growth counteracts weak organic sales – Decreased contribution margin due to negative mix effects and decreased supplier bonus Revenues and EBITA Highlights Q4 2024 MSEK 2024 Okt-Dec ∆, % 2023 Okt-Dec 2024 Jan-Dec ∆, % 2023 Jan-Dec Revenue 2,589 2.0 2,538 9,333 0.0 9,335 Adjusted EBITA 214 -30.5 308 601 -27.3 827 Amortisation -17 -14 -63 -59 Items affecting comparability -19 -16 -33 -20 Operating profit 178 278 505 748 Gross margin, % 41.1 43.4 40.7 41.4 Adjusted EBITA margin,% 8.3 12.1 6.4 8.9
Page 15
15 EBITA bridge Q4 EBITA bridge 2024 1 16 26 Gross profit Other operating income Personnel costs Depreciation, amortisation Other operating expenses Acquisitions EBITA Q4 2024 -100 214 EBITA Q4 2023 308 -27 -10 6 44 Gross profit Other operating income Personnel costs Depreciation, amortisation Other operating expenses Acquisitions EBITA 2024 -194 601 0 EBITA 2023 827 -24 -58 • Weaker volumes, decreased supplier bonuses, and adverse mix effects explain the decreased gross profit. • Other operating income decreased due to a reduction in marketing contributions. • Cost savings have offset the impact of salary increases and other effects of inflation. • Increased depreciation/ amortization driven by right-of-use assets. Highlights Q4 2024 The decline in EBITA was caused by weak sales and lower gross margin – Results from acquisitions and cost -savings counteract
Page 16
16 SALES PER CHANNEL ≈ 56% (62%) Store channel(SME) 26% (24%) Direct sales incl web 18% (14%) Non-integrated business Sweden Norway Finland SALE OF OWN BRANDS 78% (76%) External Brands 22% (24%) Own brands SALES PER CHANNEL 2% (0%) Non- integrated business 48% (47%) Store channel (SME) 50% (53%) Direct sales incl web SALE OF OWN BRANDS 84% (83%) External Brands 16% (17%) Own brands SALES PER CHANNEL 23% (22%) Store channel (SME) 57% (64%) Direct sales incl web SALE OF OWN BRANDS 89% (90%) External Brands 11% (10%) Own brands 20% (14%) Non-integrated business Decreased share of own brands and SME customers in Sweden – Both integrated and non -integrated companies
Page 17
17 Deteriorated contribution margin in all countries – Continued negative customer segment and size mix but an improvement in SE in Q4 Sweden Norway Finland Store channel/SME Own brands Customer segment mix Price adjustments Standard assortment Mix Group GM% -0.2 p.p Mix Group GM% -0.5 p.p Mix Group GM% -0.4 p.p Mix Group GM% -0.4 p.p Acquisitions
Page 18
18 Focus on boosting sales activities, as well as increasing share of SME and own brands Sweden Norway Finland • Revenue increased by 11.1% - Slight recovery in the market - Acquisitions +15% and -1 WD • EBITA increased by 2 MSEK - Declining volumes - Acquisitions +11 MSEK • Revenue increased by 4.3% - Continued strong market in Oil & Gas, Negative FX - Acquisitions +2% and -1 WD • EBITA decreased by -23 MSEK - Decreased margins customer mix, supplier bonus and price pressure - Logistic coordination Vestby - Acquisitions +1 MSEK • Revenue decreased by -1.6% - Continued weak market - Acquisitions +6% and -1 WD • EBITA decreased by -72 MSEK - Declining volumes - Decreased margins - customer mix, supplier bonus - Acquisitions 14 MSEK, cost reductions Organic growth: Adj. EBITA margin: Q4 -9% Q4 10.9% (15.4) YTD -6% YTD 8.7% (11.4) Decreased EBITA in all countries – Negative organic growth and unfavourable customer segment and size mix – acquisitions counteract 0 5 10 15 20 0 500 1 000 1 500 2 000 Q4 2022 Q4 2023 Q4 2024 MSEK Revenue, MSEK Acquired growth Adj.EBITA% 0 2 4 6 8 10 0 200 400 600 800 Q4 2022 Q4 2023 Q4 2024 MSEK Revenue, MSEK Acquired growth Adj.EBITA% 0 2 4 6 8 0 100 200 300 400 500 Q4 2022 Q4 2023 Q4 2024 MSEK Revenue, MSEK Acquired growth Adj.EBITA% Organic growth: Adj. EBITA margin: Q4 +3% Q4 4.7% (8.2) YTD +3% YTD 3.9% (6.1) Organic growth: Adj. EBITA margin: Q4 -4% Q4 3.8% (3.8) YTD -9% YTD 2.4% (3.6)
Page 19
19 • Lower cash flow from operating activities, primarily due to lower EBITDA. ̶ Reduced inventory levels offset by the higher level of goods in transit (own brands) • Cash flow from investing activities driven by a higher acquisition pace ̶ Lower organic investment – Capex/Depreciation 0,9 • Higher cash flow from financing activities ̶ Higher usage of credit facilities Operating cash flow in Q4 is lower than last year due to lower EBITDA – Q4 is seasonally the strongest quarter Cash flow Highlights Q4 2024 MSEK 2024 Oct-Dec ∆ 2023 Oct-Dec 2024 Jan-Dec ∆ 2023 Jan-Dec Operating activities 438 -88 526 952 -41 993 Investing activities -166 -74 -92 -541 -200 -341 Financing activities 66 188 -122 -117 366 -483 Cash flow 338 26 312 294 125 169 432 417 526 438 0 200 400 600 Q4 2021 Q4 2022 Q4 2023 Q4 2024 Cash flow from operating activities, MSEK
Page 20
20 • Ratio of net operational liabilities to EBITDA (excl. IFRS 16) of 2.4 • Cash and unutilized granted credit facilities of MSEK 1,490 at the end of the period • Equity/assets ratio 44.6 % (excl IFRS 16) • Total sustainability linked facility 2,600 MSEK excl. credit facility 400 MSEK +10 MEUR ̶ Extended facility by 300 MSEK ̶ Maturity March 2027 ̶ Q4 average interest rate 4.2% (5.1) • Financial covenants fulfilled • Continue to invest in organic growth and take advantage of potential good M&A opportunities Increased leverage, but still a solid financial position Overview of the financial position Highlights Q4 MSEK 31 Dec 2024 31 Dec 2023 Non-current interest bearing liabilities 3,121 2,624 Current interest bearing liabilities 452 398 Cash and cash equivalents -670 -382 Financial lease liabilities -1,269 -1,191 Net operational liabilities 1,634 1,449 EBITDA*, LTM 689 914 Net operational liabilities/EBITDA*, ratio 2.4 1.6 * Excl. IFRS 16
Page 21
21 Performance in 2024 in relation to financial targets
Page 22
22 Performance in 2024 in relation to sustainability targets
Page 23
AGENDA • This is Alligo • Highlights Q4 2024 • Update – Sales initiatives and Alligo’s welding offer • Financials • Summary and outlook • Q&A
Page 24
24 • The fourth quarter concluded an unusually challenging year ̶ Decline in sales was less than in the beginning of the year ̶ Signs the market situation is stabilising, albeit at a weak level • Signed nine acquisitions during 2024 – adding 747 MSEK in annual revenue. The two largest: ̶ Corema ̶ Batterilagret • Initiated a project in Finland to improve profitability in the Tools business • Alligo continues to maintain a strong financial position, enabling investments in our own operations and through acquisitions, as well as for dividends Q4 2024 in summary UPPDATERA UPPDATERA
Page 25
25 • Alligo’s market position remains strong • Continued focus on acquisitions in technology areas such as batteries and welding – creating synergies in the integrated business • Build for the future by improving and streamlining existing operations: ̶ Launch of new services and new brands: ReCare – 1832 – Prowell • Continued cost cautiousness Outlook 2025 UPPDATERA
Page 26
26 Q&A
Page 27
27 APPENDIX
Page 28
28 Revenue bridge fourth quarter 2024 Revenue year-on-year Q4 Revenue Q4 2023 Comparable stores in local currency Currency effects Number of working days New stores Other units Revenue Q4 2024 2 538 2 589 +2,0% -3.4% -0.2% -1.5% +6.8% +0.4%
Page 29
29 IFRS 16 effects on cash flow MSEK 2024 Oct-Dec 2023 Oct-Dec 2024 Jan-Dec 2023 Jan-Dec IFRS 16 effects on cash flow from operations 117 121 405 365 IFRS 16 effects on cash flow from financing activities -117 -121 -405 -365
Page 30
30 Acquisition Product category Date signing Annual revenue (MSEK)* Employees Stores Kitakone Oy Workwear/Tools April 2023 34 8 1 Topline AB (70%) Workwear/Profile Clothing/Product Media May 2023 60 16 2 TampereenPirkka-Hitsi Oy Welding June 2023 57 13 2 Tore Vagle AS** Industrial Components/Tools/ Dec 2023 38 11 1 Svets och Tillbehör i Sverige AB** Welding/Tools Dec 2023 120 24 1 Svetspartner i Malmö AB** Welding/Tools Dec 2023 25 8 1 334 80 8 2023 – six acquisitions signed, adding 330 MSEK in annual revenues – as well as 80 employees and 8 stores *Currency rate: EUR 11,4, NOK 0,98 ** Completed in Jan 2024
Page 31
31 The origins of Alligo 1963 The mail order company Swedol is established in Tyresö, Sweden. The first physical Swedol store opens. Swedol is listed on Nasdaq Stockholm. Tools is founded in Norway as a part of Bergman & Beving. Bergman & Beving begin an aggressive acquisition strategy that lasts until 2008. 150 companies in Sweden, Norway and Finland are acquired and integrated into the Tools chain. B&B Tools (Bergman & Beving) divests Momentum Group that includes Tools to its shareholders. Momentum Group makes a public offer to buy Swedol with the purpose to integrate the Swedol and Tools stores. Momentum Group changes name to become Alligo AB. Swedol begins store expansion phase with 11 new stores opened between 2006–2008. 1995 1999 2002 2006 2008 2016 2017 2019 2021 2022 1832 Grolls is founded in Stockholm, Sweden. Components & Services (Momentum Group) is distributed to shareholders and separately listed on Nasdaq Stockholm. Swedol acquires Grolls. 2024 Alligo completes the consolidation of the Group’s concept brands to one in each country: Swedol in Sweden and Tools in Norway and Finland.
Page 32
32 Five reasons to invest in Alligo 1 2 3 4 5 Market growth and resilient customer segments Scalable platform a foundation for continued growth Own brands increase competitiveness and profitability Sustainable enterprise an integrated part of the business Leader in the consolidation process on the Nordic markets
Page 33
33 SALES PER CHANNEL 68% (72%) Store channel (SME) 32% (28%) Direct sales incl web Sweden Norway Finland SALE OF OWN BRANDS 74% (72%) External Brands 26% (28%) Own brands SALES PER CHANNEL 49% (47%) Store channel (SME) 51% (53%) Direct sales incl web SALE OF OWN BRANDS 84% (84%) External Brands 16% (16%) Own brands SALES PER CHANNEL 29% (26%) Store channel (SME) 71% (74%) Direct sales incl web SALE OF OWN BRANDS 89% (90%) External Brands 11% (10%) Own brands Decreased share of own brands and SME customers in Sweden FY2024 – Only integrated companies
Page 34
34 Focus on boosting sales activities, as well as increasing share of SME and own brand Sweden Norway Finland • Revenue decreased by -1.8% - Continued weak market, Negative FX - Acquisitions +8% • EBITA decreased by -21 MSEK - Declining volumes - Investments in stores - Acquisitions +14 MSEK • Revenue increased by +2.3% - Continued strong market in Oil & Gas, Negative FX - Acquisitions +2% • EBITA decreased by -56 MSEK - Decreased margins – customer mix, supplier bonus and price pressure - Logistic coordination Vestby - Acquisitions +5 MSEK • Revenue decreased by -0.7% - Continued weak market - Acquisitions +5% • EBITA decreased by -149 MSEK - Declining volumes - Decreased margins - customer mix, supplier bonus - Acquisitions 25 MSEK, cost reductions Organic growth: Adj. EBITA margin: Q4 -9% Q4 10.9% (15.4) YTD -6% YTD 8.7% (11.4) Decreased EBITA in all countries FY2024 – Negative organic growth and unfavourable customer segment and size mix – acquisitions counteract 0 2 4 6 8 10 12 0 1 000 2 000 3 000 4 000 5 000 6 000 2022 2023 2024 MSEK Revenue, MSEK Acquired growth Adj.EBITA% 0 2 4 6 8 10 0 500 1 000 1 500 2 000 2 500 3 000 2022 2023 2024 MSEK Revenue, MSEK Acquired growth Adj.EBITA% 0 2 4 6 8 0 500 1 000 1 500 2 000 2022 2023 2024 MSEK Revenue, MSEK Acquired growth Adj.EBITA% Organic growth: Adj. EBITA margin: Q4 +3% Q4 4.7% (8.2) YTD +3% YTD 3.9% (6.1) Organic growth: Adj. EBITA margin: Q4 -4% Q4 3.8% (3.8) YTD -9% YTD 2.4% (3.6)
Page 35
Read more at alligo.com/en/report/q4-2024