Relais Group Plc
Stock Exchange Release 7 March 2024, 9:00 a.m. EET


This release is a summary of Relais Group's Financial Statement Review 1 January-31 December 2023. The full release is attached to this release and is available on our website at https://relais.fi/en/investors/.

Highest annual net sales and EBITA in the history of Relais Group.

OCTOBER-DECEMBER 2023 IN BRIEF

  • Net sales totalled EUR 80.9 million (October-December 2022: 75.2), change +8%
  • EBITA was EUR 7.8 (6.2) million, change +25%
  • Comparable EBITA was EUR 7.8 (7.9) million, change -2%
  • Comparable EBITA margin was 9.6 (10.6) %
  • Comparable earnings per share excluding amortisation of acquisitions (undiluted), basic was EUR 0.39 (0.35) *)
  • Net cash flow from operations was EUR 8.4 (17.2) million
  • At comparable EUR/SEK exchange rates, EBITA would have been approximately EUR 0.2 (0.2) million higher than reported **)
  • One acquisition was made with annual net sales of approximately EUR 2 million
  • The Board of Directors proposes a dividend of EUR 0.44 (0.40) per share to be paid for 2023 in two equal instalments in April and November 2024

JANUARY-DECEMBER 2023 IN BRIEF

  • Net sales totalled EUR 284.3 million (January-December 2022: 260.7), change +9%
  • EBITA was EUR 28.6 (23.0) million, change +24%
  • Comparable EBITA was EUR 28.9 (25.8) million, change +12%
  • Comparable EBITA margin was 10.1 (9.9) %
  • Comparable earnings per share excluding amortisation of acquisitions (undiluted), basic was EUR 0.96 (0.90) *)
  • Net cash flow from operations was EUR 30.6 (28.8) million
  • At comparable EUR/SEK exchange rates, EBITA would have been approximately EUR 1.5 (0.7) million higher than reported **)
  • Four acquisitions were made with a total annual net sales of approximately EUR 25 million

*) The average undiluted number of shares October-December 2023: 18,132,258 (October-December 2022: 18,132,308), January-December 2023: 18,132,258 (January-December 2022: 18,051,682).

**) 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).

Unless stated otherwise, figures in parentheses refer to the corresponding period of the previous year.

The change percentages in the tables have been calculated on exact figures before the amounts were rounded to millions of euros.

KEY FIGURES

EUR thousand unless stated otherwiseOct-Dec
2023		Restated**Oct-Dec
2022		Jan-Dec
2023		Restated**Jan-Dec
2022
Net sales 80,942 75,185 284,252 260,683
Net sales growth, % 7.7% 2.2% 9.0% 9.6%
Gross profit 35,288 33,670 128,923 117,214
Gross margin, % 43.6% 44.8% 45.4% 45.0%
EBITDA 11,738 10,076 43,542 36,581
EBITDA margin, % 14.5% 13.4% 15.3% 14.0%
Comparable EBITDA 11,746 11,796 43,841 39,414
Comparable EBITDA, % 14.5% 15.7% 15.4% 15.1%
EBITA 7,794 6,216 28,552 23,013
EBITA margin, % 9.6% 8.3% 10.0% 8.8%
Comparable EBITA 7,802 7,936 28,851 25,846
Comparable EBITA, % 9.6% 10.6% 10.1% 9.9%
Operating profit 6,972 5,341 25,147 19,681
Operating profit margin, % 8.6% 7.1% 8.8% 7.5%
Comparable operating profit 6,980 7,061 25,446 22,514
Comparable operating profit, % 8.6% 9.4% 9.0% 8.6%
Profit (loss) for the period 6,304 3,691 13,739 10,032
Profit (loss) for the period margin, % 7.8% 4.9% 4.8% 3.8%
Comparable profit (loss) 6,312 5,411 14,038 12,864
Comparable profit (loss) margin, % 7.8% 7.2% 4.9% 4.9%
Comparable profit (loss) excluding amortisation of acquisitions 7,134 6,286 17,444 16,196
Comparable profit (loss) excluding amortisation of acquisitions margin, % 8.8% 8.4% 6.1% 6.2%
Items affecting comparability included in profit (loss) for the period 8 1,720 299 2,832
Net working capital 67,068 62,551 67,068 62,738
Inventories 74,105 67,804 74,105 67,804
Free cash flow 8,074 16,331 24,013 23,983
Cash conversion 68.8% 162.1% 55.1% 65.6%
Net Debt 151,010 147,239 151,010 147,239
Net Debt excl. leasing Liabilities 87,881 90,056 87,881 90,056
Net Debt to EBITDA, LTM 3.47 4.02 3.47 4.02
Net Debt (excl. Leasing Liabilities) to EBITDA, LTM 2.02 2.46 2.02 2.46
Net gearing 136.5% 141.7% 136.5% 141.7%
Net gearing excl. leasing Liabilities 79.4% 86.7% 79.4% 86.7%
Equity ratio 33.6% 33.2% 33.6% 33.2%
Return on capital employed (ROCE) - - 10.0% 9.4%
Return on equity (ROE) - - 12.8% 9.6%
Return on assets (ROA) - - 8.3% 7.8%
Earnings per share, basic (EUR) 0.35 0.20 0.76 0.56
Earnings per share, diluted (EUR) 0.34 0.20 0.73 0.53
Comparable earnings per share, basic (EUR) 0.35 0.30 0.77 0.71
Comparable earnings per share, diluted (EUR) 0.34 0.29 0.75 0.69
Comparable earnings per share excluding amortisation of acquisitions, basic (EUR) 0.39 0.35 0.96 0.90
Comparable earnings per share excluding amortisation of acquisitions, diluted (EUR) 0.38 0.33 0.93 0.86
Average number of employees 1,082 1,003 1,050 997
Personnel at the end of the period, FTE 1,089 1,009 1,089 1,009

*) The average undiluted number of shares October-December 2023: 18,132,258 (October-December 2022: 18,132,308), January-December 2023: 18,132,258(January-December 2022: 18,051,682). The average diluted number of shares October-December 2023: 18,803,531 (October-December 2022: 18,777,120), January-December 2023: 18,805,601 (January-December 2022: 18,759,556).

**) Relais Group has corrected previously reported consolidated figures relating to IFRS 16 Leases due to the correction of the end date of one lease agreement.

2024 OUTLOOK AND LONG-TERM FINANCIAL TARGET

The Company does not provide a numeric guidance for the financial year 2024. On 2 March 2023, the company issued a revised long-term financial target, according to which the company aims to reach a proforma EBITA of EUR 50 million by the end of the year 2025. Relais considers a profit target to be more relevant in describing the shareholder value creation potential of the Company, as opposed to a net sales target. The previous financial target of the Company was to reach pro forma net sales of EUR 500 million by the end of year 2026.

CEO ARNI EKHOLM COMMENTS THE FINANCIAL YEAR 2023

"During 2023 Relais Group has further strengthened its position as one of the biggest and most profitable growth platforms in the North European vehicle aftermarket. We achieved the highest turnover and EBITA in the history of our Group. Our financial position is solid, and I am pleased that the Board has proposed to raise the dividend to EUR 0.44 per share."

"Fourth quarter: Fourth consecutive quarter of double digit EBITA growth

The last quarter of the year marked our fourth consecutive quarter of double-digit (cumulatively +25%) EBITA growth during 2023. Despite the challenging market conditions our net sales increased in total by 10% with comparable exchange rates and 1% organically. The wholesale market was positive in Sweden, whereas the market conditions in Finland were less favorable. The performance of our Commercial vehicle repair and maintenance business continued to be robust and we strengthened our market position in that sector both in Sweden and Finland.

The sales of vehicle spare parts developed very positively during the quarter (+16% in total and +12% organically with comparable exchange rates). The increase was strong especially in Sweden. The equipment sales were affected positively by the acquired workshop equipment businesses, AutoMateriell and Nordic Lift in Norway.

The consumer demand for discretionary products remained very weak in Finland during the quarter which had a negative effect on the sales of our vehicle lighting products. This was especially visible in the on-line channels. The sales of lighting products decreased with 8% in the quarter in comparable exchange rates.

Year 2023: Highest turnover and EBITA in the history of the Group

We create value for the shareholders with a strategy combining three elements which reinforce each other: organic growth, acquisitions, and operational excellence.  Our "buy and build" strategy has proven its resilience, and the defensive nature of the growing vehicle aftermarket lays a solid foundation also for future growth.

During the year 2023 we have successfully carried out our strategy in all three areas. Our net sales grew in total by 13% and organically by 5% with constant exchange rates. The growth was especially strong in Sweden, whilst the development in Finland was flat due to local market conditions.

We acquired a total of four companies during last year. The acquisition of Adita in Finland in the first quarter strengthened our wholesale presence in the important Helsinki region. The acquisition of AutoMateriell and Nordic Lift in the third quarter increased our presence in Norway. We now have a strong market position in the Norwegian workshop equipment business with interesting add-on acquisition possibilities. The acquisition of Jyväskylä Truck Center (JTC) in the third quarter increased the customer base of Raskone in the logistically important Jyväskylä region in Finland.

We also started and carried out several initiatives to improve our operational efficiency. We enhanced our pricing policies and procedures in our wholesale operations in Finland and Sweden to defend and improve our gross profit. We managed to improve the capacity utilization of both our commercial vehicle workshop chains, Raskone and STS by implementing determined and disciplined efficiency measures and by investing in our personnel. This combined with the increasing amount of gained fleet customers contributed to a major profit increase in the repair and maintenance business area.

Solid financial position

Our cash conversion ratio has remained on a healthy level also during the past year which contributes to the solid financial position of our Group. I am pleased to announce that the Board has proposed a raised dividend of EUR 0.44 (0.40E) per share to be paid in two equal instalments in April and in November.

The outlook for 2024 is largely dependent on external, macroeconomic and market demand factors. Inflation is still on a relatively high level, the dramatically risen financial expenses for corporates and households are still affecting the purchase power of customers and consumers negatively. Unemployment and layoffs are also increasing in Finland and Sweden. In addition, the weakened Swedish krona against the euro sets pressure on our reported results, as a major part of our business is conducted in the Swedish marketplace. On the other hand, the vehicle aftermarket is defensive by nature and compared to many other businesses it is a sector with less cyclicality. The inventory and resource situation is good, allowing us to meet the customer demand for our products and services. We feel that we are well positioned to continue our growth path in a profitable and sustainable way also during 2024.

I would like to express my warmest thanks to all our over 1,000 professionals, customers, business partners and shareholders for the year 2023."

RESTATEMENT OF FINANCIAL POSITION AND COMPARISON PERIOD

Relais Group has corrected previously reported consolidated figures relating to IFRS 16 Leases due to the correction of the end date of one lease agreement. The correction resulted in changes to the presentation of the financial results and financial position for the comparative periods. The correction and the impact of the correction is presented in Note 11 of the table section of this report. The consolidated balance sheet includes corrected figures for the comparative reporting date 31 December 2022 as well as for 1 January 2022 whereas other corrected consolidated statements and most of the disclosures includes corrected figures for 2022 labelled "Restated".

FINANCIAL CALENDAR FOR 2024

Relais Group Plc's Annual Reporting package 2023, which includes the Annual and Sustainability Review, the Financial Statements, the Report of the Board of Directors, the Corporate Governance Statement and the Remuneration Report, will be published on Monday, 18 March 2024.

The interim reports and the half-year financial report for 2024 will be issued as follows: January-March on Wednesday, 8 May 2024, January-June on Thursday, 15 August 2024 and January-September on Thursday, 7 November 2024.

The Annual General Meeting 2024 is planned to be held on Wednesday, 10 April 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 7 March 2024, at 10:00 a.m. EET. The webcast can be followed at https://relais.videosync.fi/q4-2023.

Presentation material and video will be available on the company's website at https://relais.fi/en/investors/ 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.

www.relais.fi

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