Q2 2025 Thule Group AB Earnings Call Transcript
Key Points
- Thule Group AB (THUPY) reported a 16% increase in total sales in reported currency, reaching SEK3.4 billion, marking the biggest quarter in terms of sales in the company's history.
- The company achieved a gross margin increase of close to 2 percentage points, driven by the Quad Lock acquisition, which has a higher gross margin.
- Cash flow from operations was strong at almost SEK800 million, with a successful inventory reduction target on track.
- Thule Group AB (THUPY) received significant recognition for product design, including 10 new Red Dot awards and winning the ADAC car seat test in Europe.
- The company is making strategic investments, such as the extension and automation of its warehouse in Poland, expected to generate annual savings of SEK100 million from 2028.
- Organic growth was modest at 1.5% for the quarter, with North America experiencing a 3% decline in sales.
- The EBIT margin decreased by 2 percentage points due to higher costs associated with driving growth in a challenging market.
- The Bags business experienced a significant decline, with organic net sales dropping by 21%, primarily due to cautious retailer inventory management in North America.
- The RV Products category continues to face challenges, with a decline in sales to the OE channel, although offset by growth in the aftermarket channel.
- The company faces ongoing market challenges, particularly in North America, with cautious consumer and retailer behavior impacting sales.
Thank you very much. Welcome, everybody, to today's call. I'm also, as usual, joined by Toby Lawton, our CFO. We will talk to the presentation, and it is later on available on our IR website as always. So starting off with the summary on page 2. This quarter is a quarter where we're growing even though the market is still tough, growing a bit more than in Q1 and total sales in reported currency amounted to SEK3.4 billion.
That's 16% more than last year, excluding the currency effects. We continued to see a weak market, both on the retail and the consumer side and particularly so in North America. On a positive note, it's not getting worse, but it is still tough, and we'll get back to that. Organic growth was small, plus 1.5% in the quarter. Europe is up 4% and North America is down 3%, which we are, of course, not happy about, but it's a big improvement versus the development in the first quarter, which we'll speak more about later.
Quite significant currency effect in the quarter of almost 6% negative, takes
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