Q1 2025 Haypp Group AB (publ) Earnings Call Transcript
Key Points
- Haypp Group AB (FRA:8QG0) reported a 35% year-on-year growth in nicotine patch volume on a like-for-like basis, indicating strong demand.
- The company achieved a significant increase in gross margin by nearly 4 percentage points to 18%, showcasing the strength of its operating model.
- The US market is experiencing robust growth, with a 40% annual increase, and Haypp Group AB (FRA:8QG0) is well-positioned to capitalize on this trend.
- The infrastructure transformation, including the rollout of European middleware, is on track, enhancing agility and control in a dynamic market environment.
- Haypp Group AB (FRA:8QG0) delivered record-high adjusted EBIT in Q1 2025, reflecting strong financial performance and strategic investments.
- The company faces ongoing legal and regulatory challenges, including cases in San Francisco and potential restrictions in Norway and Spain.
- There is a significant drop in the number of active customers in growth markets, attributed to the lack of Zyn supply and other factors.
- Haypp Group AB (FRA:8QG0) anticipates lower profits in H2 2025 due to planned investments in the US market, impacting short-term earnings.
- The emerging segment is experiencing steep losses, and profitability is contingent on achieving scale and volume.
- The company is not planning to issue dividends over the medium term, opting instead to reinvest surplus cash flows into expansion.
Haypp Group FY 2025. (Operator Instructions)
Now I will hand the conference over to CEO, Gavin O'Dowd; and CFO, Peter Deli. Please go ahead.
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Good morning everyone and welcome to our Q1 2025 conference call. Our CFO, Peter Deli, and I, Gavin O'Dowd, will take you through the results.
Starting with slide 4, I would like to focus on three key aspects of our operational highlights and market conditions.
Beginning first with our nicotine patch, Q1 volume year on year growth of 35% on a like for like basis. The reported growth of 10% is adjusted for spended states, predominantly California, and the larger effect of the US in shortage in the quarter.
I would also like to draw your attention to the material increase in our gross margin. Our business philosophy is built around sharing our economies of scale with our consumers in the form of superior convenience and best value. And despite aggressively moving forward in both areas, Hype was
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