TCM Group (TCM) Q2 2024 earnings summary

Executive summary

• Organic sales grew 5% in Q2 2024, with B2C sales up over 25% and B2B sales declining due to a weak project market.

• Revenue rose 30% year-on-year to DKK 332.2 million, driven by strong B2C performance and the inclusion of AUBO.

• Two new AUBO-branded stores opened in Denmark, bringing the total to 113 branded stores in Denmark and Norway.

• Denmark accounted for 80% of group revenue, with 14.7% year-on-year growth and 5.6% organic growth.

• Gross margin improved to 21.5% from 20.2%, supported by higher-margin B2C sales and AUBO integration.

Financial highlights

• Q2 revenue was DKK 332.2 million, up 30% year-on-year; adjusted EBIT reached DKK 28 million (margin 8.4%).

• Gross margin improved to 21.5% from 20.2% last year.

• Free cash flow was DKK 25.8 million, a significant improvement from DKK -2 million last year; cash conversion reached 95%.

• Net working capital ratio improved to -1.3% from -0.1% last year.

• Leverage ratio was 3.20, with net debt at DKK 326 million.

Outlook and guidance

• Full-year 2024 net revenue guidance raised to DKK 1,125–1,200 million (previously DKK 1,000–1,150 million).

• Adjusted EBIT guidance increased to DKK 70–90 million, including a DKK 3–5 million positive effect from AUBO acquisition adjustments.

• High-end guidance depends on continued strong B2C growth and a rebound in B2B; low-end reflects ongoing B2B weakness.

• Project sales expected to continue declining in H2 2024, with recovery not anticipated until well into 2025.

• Revenue classification change reduces reported revenue by DKK 20–25 million annually; historical figures restated.