Thule Group AB (THLPF) Q1 2025 Earnings Call Highlights: Strong Revenue Growth Amidst North ...

In This Article:

  • Revenue: SEK2.662 billion, a 10% increase from last year.

  • Organic Growth: 2.9%, with Europe at +0.4% and North America declining by 12.6%.

  • Gross Margin: Increased to 44.8% from 41.2% last year.

  • EBITDA: SEK401 million, compared to SEK412 million last year.

  • EBIT Margin: 15.1%, impacted by earlier phasing of product launch costs.

  • Net Income: SEK266 million for the quarter.

  • Cash Flow from Operations: Negative SEK334 million, influenced by seasonal working capital increase.

  • Net Debt: Increased by SEK185 million, with a net debt to EBITDA ratio of 1.94%.

  • Quad Lock Acquisition: Contributed significantly to gross margin improvement, with over 20% sales momentum.

  • Inventory Reduction Target: Aiming to reduce inventory by SEK200 million in 2025.

Release Date: April 29, 2025

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

Positive Points

  • Thule Group AB (THLPF) reported a 10% increase in total sales compared to the previous year.

  • Gross margin reached an all-time high of 44.8%, driven by the acquisition of Quad Lock and improved product mix.

  • The company continues to see growth from new Thule products and recently launched product categories.

  • Thule Group AB (THLPF) received 7 new design awards in 2025, highlighting its strong product design capabilities.

  • The integration of Quad Lock is progressing well, with over 20% sales momentum and maintained high margins.

Negative Points

  • North American sales declined by 13%, reflecting a weak market exacerbated by recent tariff announcements.

  • Cash flow from operations was negative at SEK334 million, impacted by seasonal working capital increases.

  • The EBIT margin decreased to 15.1% from 17% last year, affected by the earlier phasing of product launch costs.

  • Retailers are cautious, impacting inventory levels and sales, particularly in North America.

  • The company decided to halt the North American car seat project due to a less favorable market outlook.

Q & A Highlights

Q: Could you explain the balance between OpEx and gross margins, considering the company's shift towards higher gross margins and higher OpEx? A: Mattias Ankarberg, CEO: We are pleased with the gross margin development, which has been growing nicely. The increase in SG&A is due to a challenging market and our investment in new product categories. We continue to focus on driving growth, which results in higher gross margins and SG&A, but with a positive net effect. In North America, we are adapting to the market with changes in focus, pricing, and cost management.