OVS (OVS) Q1 2025 earnings summary

Executive summary

• Q1 2024 net sales reached €352.2 million, up 5% year-over-year, with strong growth across all main brands and channels, especially Upim, despite supply chain disruptions and adverse weather.

• Adjusted EBITDA rose 8.1% to €29.7 million, with margin improving to 8.4% from 8.2% in Q1 2023.

• Adjusted profit before tax increased 31.1% to €10.1 million, with operating leverage and stable D&A and interest costs.

• Net cash flow improved by €3.5 million year-over-year, despite €20.6 million in treasury share purchases and €7.8 million in dividends.

• Brand momentum remains strong, with positive like-for-like sales and robust sales momentum into the current period, despite external disruptions.

Financial highlights

• Net sales: €352.2 million (+5% vs. Q1 2023); Adjusted EBITDA: €29.7 million (+8.1%); Adjusted EBIT: €14.2 million (+21.2%).

• EBITDA margin increased to 8.4%; EBIT margin rose to 4.0% from 3.5% year-over-year.

• Trade working capital improved by €18.2 million year-over-year, driven by inventory reduction and higher trade payables.

• Directly operated stores drove a 5.1% sales increase; franchise channel sales grew 3.2% after a prior year decline.

• Trade receivables rose 3% in line with sales; inventory reduced by €5 million due to clearance of previous season stock.

Outlook and guidance

• Sales trend remains robust into Q2 and full-year 2024, with continued sales growth and further gross margin improvement expected as supply chain normalizes.

• 2024 expected to benefit from normalization of product costs and renewed labor contracts with diluted impact over several years.

• Year-to-date sales are up mid-single digits versus 2023; full-year improvement anticipated.