Fabryki Mebli FORTE (FTE) Q2 2024 earnings summary

Executive summary

• Sales revenue increased 0.7% year-over-year to PLN 478.9 million for April–September 2024, with net profit of PLN 2.0 million versus a loss of PLN 70.2 million last year.

• Gross margin improved to 33.4% from 30.2% year-over-year, driven by cost optimization and additional income from CO2 emission allowance sales.

• Export sales comprised 66.9% of furniture and other sales, with German-speaking countries accounting for 50.4% of this segment.

• Chipboard sales rose 80.6% year-over-year, now 15.5% of total sales.

Financial highlights

• EBIT reached PLN 13.9 million, up from a loss of PLN 11.9 million year-over-year; EBITDA was PLN 41.9 million, up from PLN 15.5 million.

• Net cash flow from operating activities was PLN 43.6 million, down from PLN 52.9 million year-over-year.

• Total assets increased to PLN 1.48 billion from PLN 1.44 billion at March 2024; equity stable at PLN 907.5 million.

• Net profit margin was 0.42% versus -14.7% last year; ROE at 0.22%, ROA at 0.14%.

Outlook and guidance

• Management expects continued low demand in Western Europe, especially Germany, and ongoing cost optimization to support profitability.

• Focus remains on expanding sales channels, new product lines, and leveraging own photovoltaic farms to reduce energy costs.

• Risks include market recession, raw material price and availability, and exchange rate volatility.