Börsiteade

Pealkiri

Unaudited consolidated interim accounts for the fourth quarter and twelve months of 2024

Teade

Segments (EURm)              Q4/24 Q4/23  yoy   12m/24 12m/23   yoy
----------------------------------------------------------------------
 Supermarkets                 164.1 165.0 -0.5%   610.4  620.2  -1.6%

 Department stores             33.2  34.9 -4.7%   104.2  110.5  -5.7%

 Cars                          51.2  45.7 12.0%   200.8  194.4  3.3%

 Security segment               6.0   5.3 13.5%    21.9   15.7  39.6%

 Real Estate                    2.1   1.7 23.7%     7.3    6.6  10.8%
----------------------------------------------------------------------
 Total sales                  256.6 252.6  1.6%   944.6  947.3  -0.3%
----------------------------------------------------------------------


 Supermarkets                   4.6   7.4 -38.2%   16.0   20.0 -19.8%

 Department stores              1.8   1.9 -7.2%    -0.3    1.6 -120.7%

 Cars                           2.3   1.9 18.5%    11.1   13.3 -16.1%

 Security segment              -0.1  -0.2 -70.5%    0.2   -0.1 -423.9%

 Real Estate                    5.5   2.8 97.2%    11.1   10.4  6.0%

 IFRS 16                       -0.8  -0.7 17.4%    -2.6   -2.2  16.8%
----------------------------------------------------------------------
 Total profit/loss before tax  13.2  13.1  1.0%    35.5   43.0 -17.5%
----------------------------------------------------------------------

The Group's consolidated unaudited sales revenue for the fourth quarter of 2024
was  256.6 million  euros,  exceeding  the  previous year's revenue by 1.6%. The
unaudited  sales revenue for  the entire year  of 2024 amounted to 944.6 million
euros,  representing a decline of 0.3% compared to 2023, when sales revenue also
totalled  947.3 million euros. The Group's consolidated unaudited pre-tax profit
for  the fourth quarter of 2024 was  13.2 million euros, marking a 1.0% increase
compared  to the same period in the  previous year. The pre-tax profit for 2024
was 35.5 million euros, a decrease of 17.5% compared to the previous year.

The fourth quarter has traditionally been the most active period for the Group's
economic  activities. Despite the continued  decline in Estonia's retail sector,
the  Group managed to increase its revenue in the final quarter of 2024 compared
to the same period in the previous year. As anticipated, the Estonian car dealer
in  the Group's  automotive segment  benefited from  a car  purchase boom in the
fourth  quarter, driven by the announcement of  the Estonian car tax set to take
effect  in  2025. Unlike  competitors,  the  Group avoided deep discounts, which
contributed  to an increase in the automotive segment's profit during the fourth
quarter.  The security  segment demonstrated  sound sales  growth throughout the
reporting year, continuing its strong organic performance in the fourth quarter,
when  the impact of a companies acquired in the first half of 2023 no longer had
any  comparison  effect.  The  prolonged  cooling  of  the  Estonian economy has
influenced  consumers to increasingly prefer  discounted products, which has put
pressure  on the margins  of retail segments,  resulting in a  slight decline in
margins  in the final quarter of 2024 compared to the previous year. The Group's
operating expenses remained broadly stable. Marketing costs, driven by increased
campaign  volumes,  and  IT  expenses  related  to automation initiatives showed
higher  growth  rates.  Continued  process  efficiency  improvements have helped
maintain  control over labour  costs, which grew  by 3.2% in the fourth quarter,
while  the  average  number  of  employees  increased  by  2.0%. Net  profit was
negatively  impacted by the gradual effect of higher loan interest rates and the
revaluation   of   deferred   tax  liabilities  under  international  accounting
standards.  Fourth-quarter profit was positively  influenced by an extraordinary
gain  of  2.1 million  euros  from  the  sale  of two non-core properties in the
Group's real estate segment in Latvia.

In  the fourth quarter  of 2024, Viking Motors,  the Estonian car  dealer in the
Group's  car segment, completed  a new KIA  flagship showroom in  Peetri, on the
outskirts  of  Tallinn.  Construction  of  a  body  shop  adjacent to the Peetri
showroom  is ongoing. At the  end of the reporting  year, a new KIA showroom was
opened  in the Bikernieku area of Riga to better serve customers in that part of
the  city. In Lithuania, work continued in collaboration with TKM Lietuva UAB on
the  construction of  a new  KIA-Shkoda multi-brand  showroom in Vilnius. Earlier
development  activities in  the reporting  year included  the opening of two new
Selver  stores. In  August, a  new Selver  store was  launched in  Rocca al Mare
Shopping  Centre in Tallinn, followed by the opening of another in Tartu's Raadi
district  in September. In the department store segment, a new Toidumaailm (Food
World)  was opened in  the Tartu department  store in August,  offering the best
selection  of food products  in Southern Estonia.  Development of a new e-store,
closely  integrated  with  the  physical  stores,  also  continued.  The Partner
Kuukaart  Instalment and Hire Purchase options are now available in the e-store,
providing flexible payment solutions. The department store segment also expanded
and  updated  the  I.L.U.  store  in  the  Lõunakeskus  shopping centre to a new
concept.  In the real estate segment, a logistics centre in Maardu was completed
and became operational at the end of September. The construction cost of the new
logistics  centre was 20 million euros, and it enhances the Group's supply chain
management and logistics services.

At  the end of the reporting period, the number of loyal customers exceeded 744
thousand, an increase of 3.3% over the year. The share of loyal customers in the
Group's turnover was 86.0% (compared to 86.6% in the 2023). The Partner Kuukaart
"buy  now, pay later" payment solutions  were introduced to the department store
e-store at the end of September, received a warm reception and positive feedback
from customers during the fourth quarter. The Instalment option allows customers
to  split their payments into 3 or 6 equal parts with no additional costs, while
the Hire Purchase option allows payments to be spread over up to 36 months.

Selver supermarkets

The  consolidated sales revenue of the supermarket business segment for 2024 was
610.4 million  euros,  a  decrease  of  1.6% compared  to the previous year. The
consolidated  sales  revenue  for  the  fourth  quarter was 164.1 million euros,
remaining  at the previous year's level (a change of -0.5%). The average monthly
sales revenue per square metre of selling space was 0.41 thousand euros in 2024
(compared  to 0.43 thousand euros in 2023) and 0.43 thousand euros in the fourth
quarter  (compared to 0.45 thousand  euros in 2023). For  comparable stores, the
average  monthly  sales  revenue  per  square  metre  of selling space was 0.41
thousand  euros  in  2024 (compared  to  0.44 thousand  euros in 2023) and 0.43
thousand euros in the fourth quarter (compared to 0.45 thousand euros in 2023).
A  total of 44.4 million purchases were made  in stores in 2024, with the number
of transactions remaining at the previous year's level (an increase of 0.4%).

The  pre-tax profit for  the fourth quarter  of 2024 was 4.6 million euros, 2.8
million euros lower than the base period. The consolidated pre-tax profit of the
supermarket  segment for 2024 was 16.0 million  euros, a decrease of 4.0 million
euros  compared to  the previous  year. The  net profit  for 2024 totalled 15.5
million euros, declining by 2.9 million euros compared to the previous year. The
difference between net profit and pre-tax profit arises from the reallocation of
deferred income tax across the Group's business segments.

The  comparison base data is influenced by  the closure of the segment's largest
store,  Järve Selver,  for renovation  in March  2023, as well  as the preceding
clearance sale. Järve Selver reopened to customers in its renovated form in May.
The  base data is also affected by the  opening of Kurna Selver in August 2023,
the  closure of WOW Selver  ABC in January, and  the closure of Punane Selver in
May.  In 2024, two new Selver stores were opened-one at the end of August in the
Rocca  al Mare Shopping Centre in Tallinn and another at the end of September in
Tartu's  Raadi district. The one-off costs  associated with the opening of these
stores have impacted the profit for 2024.

Selver's  sales  performance  has  been  influenced  by the overall state of the
Estonian  retail market, where sales volumes have  been in decline for the third
consecutive year, and consumer confidence remains weak. Low purchasing power and
subdued  consumer confidence  are clearly  reflected in  the food  and essential
goods  segment. In the  first eleven months  of 2024, the sales  revenue of non-
specialised  stores, predominantly selling  food, tobacco, and  alcohol, grew by
0.8%, but  volume  sales  declined  by  approximately 2.5%. Limited additions to
retail  space,  the  closure  of  two  stores, and activities related to pricing
perception  have resulted in slower sales  revenue growth compared to the market
average, while ensuring better volume sales performance within the segment. On a
positive  note,  the  production  volumes  of  the  Central Kitchen, part of the
supermarket  segment, showed strong growth of  nearly 6% in the final quarter of
the  year. Despite a  temporary decline in  production volumes during the summer
months,  annual  production  volume  increased  by  over 2.5%. To boost customer
purchasing  activity, the number of discounts  offered has been increased, and a
"Permanently  Good Prices" initiative was launched, featuring approximately 650
products  at very  competitive prices.  In spring,  a targeted campaign, "Golden
Wednesday,"  was introduced  for customers  of retirement  age, receiving highly
positive  feedback from  the target  group. The  2024 profit has  been primarily
affected  by a decline  in goods turnover  and a reduction  in gross profit from
sales,  driven  by  pricing  initiatives  and  an increased share of promotional
products in shopping baskets. During the reporting period, prices for nearly all
services  and  materials  increased;  however,  cost-saving measures have helped
limit  the  growth  of  operating  expenses  to  3% in  a  challenging  economic
environment.  Labour costs have remained at the same level as the previous year,
thanks to continuous efforts to improve process efficiency.

Product  assortment and process optimisation remain  key areas of focus, with an
emphasis  on  meeting  the  goals  of  the sustainability strategy. The culinary
department  has  transitioned  to  using  recyclable  monomaterial packaging for
nearly all product categories, bringing the company closer to achieving the goal
of  100% recyclable packaging. In  addition to product  packaging, attention has
been directed to transport packaging, with a full transition to reusable plastic
pallets for logistics.

As of the end of December, the supermarket segment included 73 Selver stores, 2
Delice  stores, a Mobile  Store, and a  café, with a  total sales area of 124.8
thousand  square metres.  In addition,  there is  e-Selver, which is the largest
online store in Estonia by service area, and the central kitchen, Kulinaaria OÜ,
whose product portfolio includes over 400 products.

Department stores

The  sales revenue of the department  store business segment for 2024 was 104.2
million  euros, representing a  5.7% decline compared to  the same period in the
previous  year. The sales revenue for the fourth quarter was 33.2 million euros,
a  decrease  of  4.7% compared  to  the  prior  year.  The  pre-tax  loss of the
department  store segment for 2024 was  0.3 million euros, which was 2.0 million
euros  lower than the result  for the previous year.  The pre-tax profit for the
fourth  quarter was 1.8 million euros, 7.2% lower  than the comparable period in
the prior year.

The  average sales revenue per  square metre of selling  space in the department
stores  for 2024 was 0.32 thousand euros per  month, a decrease of 6.6% compared
to  the same period  in the previous  year. The economic  slowdown that began in
2023 continued  into the reporting  year, resulting in  more aggressive discount
campaigns  in the first half  of the year compared  to 2023, which also affected
the  performance of the department stores. The results of the Tallinn department
store  were negatively impacted  by the ongoing  construction of the Old Harbour
tram  line in the city  centre and the closure  of the Viru Centre bus terminal,
which  significantly affected foot  traffic. In the  Tartu department store, the
full  renovation  of  the  Toidumaailm  (Food  World)  began at the end of June,
leading  to a two-month closure  of the Tartu Toidumaailm  during the summer. On
29 August,  a  completely  redesigned  food  store  with  the  best selection in
Southern  Estonia was opened, and foot traffic has increased significantly since
the  reopening. The autumn season of  2024 was marked by unusually warm weather,
with  true winter conditions only arriving late in the year, which significantly
affected  the sales of fashion goods in  the fourth quarter. Customers were more
measured  in their  Christmas shopping,  starting their  holiday purchases early
during  the  major  campaigns  of  the  fourth quarter. Nevertheless, during the
Christmas  season,  the  department  store  achieved  a  record-breaking sale of
handcrafted truffles as part of its charitable project, with proceeds donated to
the  charity foundation "Minu Unistuste Päev" (My Dream Day), which supports the
emotional well-being of children with severe illnesses.

In  the first  quarter, the  department store  launched a  new e-store platform,
which  significantly  improved  user  convenience  and  introduced an AI-powered
recommendation  engine  to  enhance  sales  performance.  In the fourth quarter,
customers were also able to access financial services through the e-store.

The  sales  revenue  of  OÜ  TKM  Beauty  Eesti, which operates I.L.U. cosmetics
stores,  was 2.8 million euros  in the fourth  quarter of 2024, 2.21% lower than
the  same  period  in  2023. The  profit  for the fourth quarter was 0.1 million
euros,  which was 0.1 million euros lower than the result for the fourth quarter
of  2023. Christmas  sales  were  affected  by  a  general  decline  in consumer
confidence,  driven  by  anticipation  of  upcoming  tax  changes,  leading to a
preference  for lower-priced and promotional gifts.  The sales revenue for 2024
was  8.7 million euros, an increase of 3.0% compared to 2023. The pre-tax profit
for 2024 was 0.2 million euros, which was weaker than the previous year's result
by  0.2 million euros. A key  event of the year  was the expansion of the I.L.U.
store  in the Lõunakeskus shopping centre, accompanied by updates to the store's
concept and product offerings.

Car trade

The  sales revenue of the car  trade business segment for 2024 was 200.8 million
euros,  exceeding the previous year's  sales revenue by 3.3%. The fourth-quarter
sales revenue of 51.2 million euros surpassed the revenue for the same period in
the prior year by 12.0%. A total of 6,2646,619 new vehicles were sold during the
year,  including 1,4221,878 in  the fourth  quarter. The  pre-tax profit  of the
segment  for 2024 was  11.1 million euros,  16.1% lower than  the result for the
previous year. The pre-tax profit for the fourth quarter of 2024 was 2.3 million
euros, which was 0.4 million euros higher than the profit for the same period in
the prior year.

The  Baltic car  market, which  experienced a  decline in  the first half of the
year,  achieved an overall  growth of 6% for  the year, according to preliminary
data. This was significantly influenced by a purchasing boom in Estonia ahead of
the  car tax  implementation in  2025. The Group's  car segment experienced more
modest growth in sales volumes. The car tax applicable to the models sold by the
Group  is somewhat  more competitive,  and the  Group refrained from engaging in
deep  price dumping,  thereby helping  to maintain  profitability. In the fourth
quarter  of the  reporting year,  the all-new  KIA EV3  electric vehicle and the
updated  EV6 model were  introduced to the  market. The car  tax impact on these
models is minimal, which meant consumers were not in a rush to purchase them. In
2025, the  KIA EV4 will be added to the portfolio, along with the first electric
vans  by year-end. Other significant additions include the completely redesigned
KIA Ceed family and the refreshed KIA Sportage SUV.

The  Group's  Estonian  dealer,  Viking  Motors,  completed  a  new KIA flagship
showroom  in Peetri,  on the  outskirts of  Tallinn, which  opened its  doors to
customers  on 2 January  2025. Construction of  a body  shop next  to the Peetri
showroom  is ongoing. At the  end of the reporting  year, a new KIA showroom was
opened  in the Bikernieku area of Riga to better serve customers in that part of
the  city. In Lithuania, work continued in collaboration with TKM Lietuva UAB on
the construction of a new KIA-Shkoda multi-brand showroom in Vilnius.

Security segment

The  security segment's  sales revenue  earned outside  the Group  in the fourth
quarter  of 2024 was 6.0 million  euros, a growth  of 13.5% compared to the same
period  in the previous year. The segment's  pre-tax loss for the fourth quarter
amounted  to 0.1 million euros, an improvement  of 0.1 million euros compared to
the  same period in the prior year.  The security segment's sales revenue earned
outside  the Group in 2024 was 21.9 million euros, representing a 39.6% increase
compared  to the previous  year. The segment's  pre-tax profit for 2024 was 0.2
million  euros, an  improvement of  0.3 million euros  compared to  the previous
year.

Both  turnover and profit  growth continued in  the fourth quarter, supported by
all  business areas.  Growth was  particularly strong  in the  management centre
services  sector and  in technical  project construction.  However, there remain
more  payment difficulties among  clients than usual,  and price sensitivity has
increased.  Despite the  challenging economic  environment, the security segment
achieved  growth in both  turnover and profit  over the year  and continues on a
positive trajectory.

Real estate

In  the 2024, the real estate segment's sales revenue from outside the Group was
7.3 million  euros,  reflecting  an  increase  of 10.8% compared to the previous
year.  The sales revenue from  outside the Group in  the fourth quarter was 2.1
million  euros, marking a 23.7% growth compared to  the same period in the prior
year.  The pre-tax profit  of the real  estate segment for 2024 was 11.1 million
euros,  an increase of 6.0%. The pre-tax  profit for the fourth quarter amounted
to  5.5 million euros, representing an improvement of 2.7 million euros compared
to the corresponding period in the previous year.

The  growth  in  fourth-quarter  sales  revenue  for the real estate segment was
supported by rental income from the logistics centre, which commenced operations
at the end of September. To focus on core activities and improve efficiency, the
Group's logistics centre is operated by an external professional party with whom
the  Group  has  an  established  long-term  partnership.  Sales revenue for the
quarter  decreased  in  the  Latvian  real  estate  business  due to the sale of
commercial  buildings in Ogre  and Rezekne, which  previously generated external
rental income. Annual sales revenue growth was bolstered by the summer launch of
the  car wash, built as an extension to the petrol station leased to an external
party near the Peetri Selver, and the occupancy of commercial spaces in shopping
centres  by  new  tenants.  Despite  the  low economic activity, footfall in the
shopping  centres owned by the real  estate segment remained only slightly below
the levels of the previous year, with a decline of less than 1%. The decrease in
footfall  at the  Tartu Kaubamaja  Centre was  linked to  the renovation  of the
ground  floor during the summer, during which some stores were partially closed.
The  last months of  the year showed  signs of stabilisation  in shopping centre
footfall, with some months recording an increase.

Fourth-quarter   profit   for   the   segment  was  positively  impacted  by  an
extraordinary  gain  from  the  sale  of  the  commercial  buildings in Ogre and
Rezekne,  as well  as the  annual revaluation  of real estate investments, which
contributed  4.1 million euros to  profit (compared to  1.1 million euros in the
fourth  quarter  of  2023). The  segment's  profit  continues  to  be negatively
affected  by the increased cost of financing due to the rise in Euribor interest
rates in recent years. The gradual decline in the Euribor rate during the second
half  of the reporting year began  to alleviate the segment's interest expenses,
with  more significant cost reductions expected in 2025. The real estate segment
houses  a significant  portion of  the Group's  loan portfolio,  which increased
during  the reporting  period due  to the  construction of the logistics centre,
contributing  to  the  rise  in  interest  expenses.  The  logistics  centre was
constructed at a cost of approximately 20 million euros.

CONSOLIDATED STATEMENT OF FINANCIAL POSITION

In thousands of euros

-------------------------------------------------------------------------
                                                 31.12.2024   31.12.2023
-------------------------------------------------------------------------
  ASSETS
-------------------------------------------------------------------------
  Current assets

  Cash and cash equivalents                          45,454       42,064

  Trade and other receivables                        30,310       25,568

  Inventories                                        97,091       98,254
-------------------------------------------------------------------------
  Total current assets                              172,855      165,886
-------------------------------------------------------------------------
  Non-current assets

  Long-term receivables and prepayments                 235          243

  Investments in associates                           1,733        1,732

  Investment property                                81,284       64,971

  Property, plant and equipment                     424,794      433,306

  Intangible assets                                  25,785       25,370
-------------------------------------------------------------------------
  Total non-current assets                          533,831      525,622
-------------------------------------------------------------------------
  TOTAL ASSETS                                      706,686      691,508
-------------------------------------------------------------------------

-------------------------------------------------------------------------
  LIABILITIES AND EQUITY
-------------------------------------------------------------------------
  Current liabilities

  Borrowings                                         44,436       48,820

  Trade and other payables                          110,997      114,573
-------------------------------------------------------------------------
  Total current liabilities                         155,433      163,393
-------------------------------------------------------------------------
  Non-current liabilities

  Borrowings                                        279,958      258,857

  Trade and other payables                            1,285            0

  Deferred tax liabilities                            7,939        5,356

  Provisions for other liabilities and charges          543          526
-------------------------------------------------------------------------
  Total non-current liabilities                     289,725      264,739
-------------------------------------------------------------------------
  TOTAL LIABILITIES                                 445,158      428,132
-------------------------------------------------------------------------
  Equity

  Share capital                                      16,292       16,292

  Statutory reserve capital                           2,603        2,603

  Revaluation reserve                               112,167      116,521

  Retained earnings                                 130,466      127,960
-------------------------------------------------------------------------
  TOTAL EQUITY                                      261,528      263,376
-------------------------------------------------------------------------
  TOTAL LIABILITIES AND EQUITY                      706,686      691,508
-------------------------------------------------------------------------

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

In thousands of euros

  -----------------------------------------------------------------------------
                                                                         12
                                             IV quarter    12 months    months
                            IV quarter 2024     2023          2024       2023
  -----------------------------------------------------------------------------


   Revenue                          256,635       252,596      944,568  947,257

   Other operating income             4,719           830        5,971    2,016



   Cost of merchandise             -185,115      -180,529     -684,797 -686,000

   Service expenses                 -16,552       -16,365      -61,503  -60,685

   Staff costs                      -31,350       -30,370     -112,241 -108,668

   Depreciation,
   amortisation and
   impairment losses                -11,488       -10,113      -43,174  -40,770

   Other expenses                      -219           -89       -1,250     -894
  -----------------------------------------------------------------------------
   Operating profit                  16,630        15,960       47,574   52,256
  -----------------------------------------------------------------------------
   Finance income                        87            46          514       86

   Finance costs                     -3,611        -2,984      -12,889   -9,576

   Finance income on shares
   of  associates accounted
   for   using  the  equity
   method                               115            74          281      240
  -----------------------------------------------------------------------------
   Profit before tax                 13,221        13,096       35,480   43,006
  -----------------------------------------------------------------------------
   Income tax expense                -2,690          -281       -8,003   -5,582
  -----------------------------------------------------------------------------
   NET PROFIT FOR THE
   FINANCIAL YEAR                    10,531        12,815       27,477   37,424
  -----------------------------------------------------------------------------
   Other      comprehensive
   income:

   Items  that will  not be
   subsequently
   reclassified  to  profit
   or loss

   Revaluation  of land and
   buildings                              0        11,989            0   11,989
  -----------------------------------------------------------------------------
   Other comprehensive
   income for the financial
   year                                   0        11,989            0   11,989
  -----------------------------------------------------------------------------
   TOTAL COMPREHENSIVE
   INCOME FOR THE FINANCIAL
   YEAR                              10,531        24,804       27,477   49,413
  -----------------------------------------------------------------------------
 Basic and diluted earnings
 per share (euros)                     0.26          0.31         0.67 0.92



Raul Puusepp
Chairman of the Board
Phone +372 731 5000