Embellence Group (EMBELL) Q4 2025 earnings summary

Executive summary

• Q4 2025 delivered stable results with 1% organic sales growth, but total sales declined 3% due to significant currency headwinds and tough prior-year comparables.

• Strategic focus remained on D2C, international sales, and hospitality channels, with ongoing investments in organization, digital platforms, and go-to-market models.

• Management changes at Cole & Son and commercial initiatives aim to address underperformance and set up for long-term growth, with a new Managing Director starting May 2026.

• Gross margin improved to 61.8% in Q4 and 61.6% for the year, driven by mix, pricing, and efficiency.

• Strategic initiatives in technology and market presence are beginning to yield results.

Financial highlights

• Q4 net sales were SEK 195 million, down 3% year-over-year, with organic growth of 1% and negative currency impact of -4%.

• Q4 EBITDA/EBITA was SEK 26 million (13.2% margin), down from SEK 28 million, impacted by FX and strategic investments.

• Full-year EBITDA/EBITA was SEK 108 million (14.1% margin), down from SEK 112 million.

• Operating cash flow in Q4 was SEK 42 million, up from SEK 39 million; full-year operating cash flow was SEK 91 million, down from SEK 113 million.

• Dividend proposed at SEK 1.50 per share, up from SEK 1.25, corresponding to 51% of net profit.

Outlook and guidance

• Strong SEK expected to continue negatively impacting top and bottom line, especially in Q1 2026.

• D2C channel expected to contribute over half of total growth in the next three years.

• CapEx guidance for 2026 is around SEK 20 million, with investments normalizing to about 2% of net sales after 2026.

• Continued focus on D2C acceleration, international expansion, and hospitality channel growth.

• The company is prepared for further acquisitions, supported by a stable organization and financial position.