Fabryka Farb i Lakierów Sniezka (SKA) Q1 2025 earnings summary

Executive summary

• Q1 2025 sales revenues reached PLN 172.2 million, nearly flat year-over-year, with net profit up 2.4% to PLN 10.8 million and EBIT up 0.8% to PLN 17.1 million.

• Performance was impacted by ongoing geopolitical instability, especially the war in Ukraine, and weak industry conditions in Central and Eastern Europe.

• Poland remains the largest market (74.6% of revenues), with sales up 3.3% y/y, while Hungary and Ukraine saw declines of 17.9% and 1.3% respectively.

• Administrative costs rose 2.3% y/y, mainly due to higher wages.

Financial highlights

• Net profit: PLN 10.8 million (+2.4% y/y); EBIT: PLN 17.1 million (+0.8% y/y); EBITDA: PLN 26.6 million (+1.2% y/y).

• Net profit attributable to parent shareholders: PLN 10.6 million (+6.8% y/y).

• Gross margin improved to 49.5% (from 48.4%); EBIT margin 9.9%; EBITDA margin 15.5%; net margin 6.3%.

• Total assets: PLN 811.4 million (-6.2% y/y); equity: PLN 403.9 million (+5.8% y/y); net debt/EBITDA: 1.58 (down from 1.88).

• Cash and cash equivalents: PLN 27.1 million (-51% y/y); negative cash flow from operations: PLN -14.3 million.

Outlook and guidance

• Management does not provide forecasts due to macroeconomic uncertainty and the ongoing war in Ukraine.

• Strategic goals for 2028: PLN 1.1 billion in consolidated net revenues, 18% EBITDA margin, and >20% market share in Poland, Hungary, and Ukraine.

• Key risks include demand volatility, raw material prices, currency fluctuations, and energy costs.