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Nobia announces drop in sales

Nobia, the Swedish kitchen furniture group, has announced a drop in sales for the first quarter. Total sales saw a decline of 19%, amounting to SEK 2,615 million (compared to 3,241 million previously), with an organic decrease of 20% (compared to 7% before). Despite this, there was an improvement in the gross margin, reaching 36.6% (up from 33.1%). When adjusted for items affecting comparability, the gross margin showed even better improvement, rising to 37.3% from 36.7%. The reported losses stood at SEK -246 million (compared to -214 million previously).

Photo: Nobia.

Nobia mentioned several measures that have bolstered its balance sheet, including the sale and leaseback transaction of a factory property, divestment of non-core operations in Austria (ewe) and the Netherlands (Bribus), and an upcoming guaranteed preferential rights issue.

Kristoffer Ljungfelt new President & CEO as of May 1 comments:

'On May 1st I started my tenure as President and CEO of Nobia. We are still operating under difficult market conditions, but I am excited, humbled and very energised to take on the responsibility to this great company.

The market remains difficult for both our consumer and project businesses. We anticipate that the combination of high interest rates and a decline in housing starts will continue to weigh on our project market throughout the remainder of the year. In the consumer market, we see modest improvements in consumer confidence and an increase in design appointments across all countries, albeit starting from a low base. The challenging market is reflected in our organic net sales that declined 20% in the quarter. Despite improved gross margin and cost out activities the operating income was slightly negative.

Together with the Nobia team, I am committed to take all actions necessary to take us through the current headwinds. As we press forward with the execution of our strategy, including transformation of our operations in the UK and unlocking the full potential in the Nordics, in part from the full commissioning of the Jönköping factory, we also need to further reduce our fixed cost base.'

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