Harm Reduction Group (NOHARM) Q2 2024 earnings summary

Executive summary

• Q2 2024 was financially challenging due to delayed deliveries, higher costs, and a major write-down after a prior-year theft.

• Leadership transition: Marius Arnesen moved from CEO to CFO, with Petter Strömberg appointed as new CEO.

• Strategic focus on B2B expansion, cost optimization, and U.S. market entry following the Aroma King Global deal.

• Balance sheet strengthened by reduced supplier debt and increased equity.

Financial highlights

• Net sales for Q2 2024: 36,156 KSEK (down from 40,355 KSEK in Q2 2023).

• EBITDA: -12,024 KSEK (Q2 2023: -1,280 KSEK); EBIT: -16,392 KSEK (Q2 2023: -5,673 KSEK).

• Net loss: -19,899 KSEK (Q2 2023: -6,848 KSEK); EPS: -0.08 SEK (Q2 2023: -0.04 SEK).

• Cash at period end: 2,391 KSEK (Q2 2023: 2,657 KSEK).

• Gross margin for H1 2024: 31.79% (H1 2023: 44.49%).

Outlook and guidance

• Organizational changes expected to impact results from Q3, with main effects in Q4 2024.

• Targeting positive cash flow in Q4 2024 through increased sales and marketing efforts.

• Aroma King Global deal strengthens balance sheet and opens U.S. market opportunities.

• Cost optimization measures already showing positive effects; further improvements planned.