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• Net Sales Q4: Decreased by 2.8% to EUR 205 million.

• Full Year Net Sales: Declined by 4.7% to EUR 692 million.

• Gross Margin Improvement: Increased by 250 basis points for wine and 270 basis points for spirits.

• Comparable EBITDA Q4: Increased by 6.7% to EUR 28.9 million, or 14.1% of net sales.

• Full Year Comparable EBITDA: Increased by 1%, with a margin of 10% of net sales.

• Net Interest Rate Debt: Decreased to EUR 122 million from EUR 138 million last year.

• Leverage: Reduced from 2.0x to 1.8x.

• Cash Flow from Operations: Ended at EUR 33 million for the full year.

• Inventory Levels: Decreased to EUR 139 million from EUR 144 million last year.

• Dividend Proposal: EUR 0.22 per share, same as last year.

• Warning! GuruFocus has detected 6 Warning Signs with FRA:28Q.

Release Date: February 12, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Anora Group PLC (FRA:28Q) reported a significant improvement in gross margins for both wine and spirits, with a 250 basis point increase for wine and 270 basis points for spirits.

• The company successfully managed operational expenses, resulting in a flattish or slightly declining OpEx, contributing to an improved comparable EBITDA margin.

• The wine segment regained market leadership in Finland, particularly in the grocery channel, due to successful innovation in up to 8% ABV wines.

• Anora Group PLC (FRA:28Q) demonstrated strong cash flow management, with a notable reduction in net interest rate debt and improved liquidity position.

• The company has implemented effective hedging strategies and a Center of Excellence program, leading to more stable COGS and improved operational efficiency.

Negative Points

• Net sales declined by 4.7% for the full year, primarily due to lower volumes in wine and spirits and lower sales prices in the industrial segment.

• The spirits segment faced challenges with a 5% decline in net sales, impacted by the termination of a cognac contract and regulatory changes in Finland.

• Anora Group PLC (FRA:28Q) experienced partner losses in the wine segment, affecting net sales and requiring efforts to regain positive net gain-loss balance.

• Inventory write-downs and impairments were necessary due to operational disturbances and ERP integration challenges, impacting financial results.

• The international business segment showed flat net revenue growth, falling short of expectations as a growth engine for the company.

Q & A Highlights

Q: Can you provide more details on the guidance for 2025, including sales trends, gross margin, and fixed costs? A: Stein Eriksen, CFO, mentioned that while he wouldn't go into all the details, he is confident that Anora will meet the guidance range of EUR 70-75 million for 2025. The company has contingency plans in place to ensure profitability even if the market conditions are challenging.