Refine Group (REFINE) Q3 2024 earnings summary

Executive summary

• Achieved positive adjusted EBITDA of 0.6 MSEK in Q3 2024, up from -2.7 MSEK year-over-year, reflecting operational improvements and cost control.

• Net sales for Q3 2024 were 58.6 MSEK, down from 73.9 MSEK due to fewer active subsidiaries after divestments.

• Net result for Q3 improved to -19.2 MSEK from -24.7 MSEK year-over-year; EPS at -0.29 SEK.

• For the nine months, net sales were stable at 192.3 MSEK (192.1 MSEK prior year), with adjusted EBITDA at 0.1 MSEK (-7.0 MSEK prior year).

• Operational subsidiaries showed improved rolling 12-month EBITDA, driven by margin expansion and strategic initiatives.

Financial highlights

• Q3 gross margin at 41% (down from 48% prior year, affected by one-time items in 2023); adjusted for these, underlying margin strengthened.

• Q3 adjusted EBITDA margin at 1% (up from -4%); EBITA at 0.3 MSEK (9.3 MSEK prior year, which included a 12.5 MSEK one-off gain).

• Q3 EBIT at -16.3 MSEK (-6.8 MSEK prior year), impacted by goodwill amortization and a 7.1 MSEK goodwill write-down for Mandyskin.

• Cash flow for Q3 was -10.8 MSEK (-31.2 MSEK prior year); cash at period end was 8.2 MSEK.

• Equity at period end was 195.0 MSEK (478.6 MSEK prior year), mainly due to goodwill write-downs.

Outlook and guidance

• Market conditions remain challenging but are expected to gradually improve, with focus shifting to organic growth as the environment stabilizes.

• Digital Services segment anticipates continued demand recovery as clients resume digitalization projects.

• Folkhemmet expects further margin and sales improvements after closing an unprofitable store in 2025.