Q2 2025 Embellence Group AB (publ) Earnings Call Transcript
Key Points
- Embellence Group AB (OSTO:EMBELL) reported increased sales and EBITA, with a gross margin improvement to 61.9%, up 1.8 percentage points from the previous year.
- The company's largest wallpaper brand, Bogota Petto, continued its growth for the second consecutive quarter, driven by strategic focus on product development and marketing.
- The DTC (Direct-to-Consumer) channel experienced double-digit growth, indicating its importance for future expansion.
- Artscape returned to growth as anticipated, strengthening its position in the US market.
- The manufacturing segment delivered record sales, with a 6% increase in net sales, driven by product innovation and quality improvements.
- Exchange rates negatively impacted overall sales by 3%, and this pressure is expected to continue in the coming quarters.
- Some brands, such as Wall and Echo and Papelia, reported declining sales, with challenges in specific markets like Italy and the UK.
- The company faces uncertainty in the North American market due to tariff situations, which could indirectly impact costs for consumers.
- The comparison numbers are becoming tougher, leading to lower percentage growth expectations in some segments.
- The company is undergoing restructuring and platform changes, which may incur additional costs and require time to see positive effects.
Welcome to the Embellence Group Q2 2025 report presentation. (Operator instructions)
Now I will hand the conference over to the speakers. President and CEO Johan Andgren; CFO Karin Lidén. Please go ahead.
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Thank you very much and welcome to Embellence Group's Q2 report. My name is CNY Age, and I am the CEO of the group, and together with me today is Karin Lidén, who is the CEO.
Let's start to look at the business and what we achieved in the second quarter of the year.
During the quarter, we delivered increased sales and EBITA and we increased both our gross margin and our EBITA margin, and we continued our journey towards our long-term financial goals and our focus on delivering profitable growth.
The organic sales growth in the quarter was 4%, but it was negatively affected by exchange rates with 3%. Hence the overall group sales numbers came in at SEK193 million, plus SEK2 million versus past year.
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