Dustin (DUST) Q4 24/25 earnings summary

Executive summary

• Q4 achieved 3.6% organic growth, led by LCP segment strength and Windows 11 upgrades, while SMB remained weak due to cautious customer behavior and accounting changes.

• Efficiency measures were fully implemented, resulting in annual savings of nearly SEK 200 million and a 10% reduction in FTEs year-over-year.

• Strategic focus shifted to business customers, closing the consumer business and standardizing services across markets.

• Updated sustainability targets were approved by SBTi, aiming for significant emission reductions by 2030 and net zero by 2050.

• Full-year net sales declined 5% to SEK 20,407 million, with organic sales growth at -3.3% year-over-year.

Financial highlights

• Q4 net sales reached SEK 5,056 million (+1.4% YoY), with gross profit at SEK 642 million and gross margin at 12.7% (vs. 12.9%).

• Adjusted EBITA for Q4 was SEK 83 million (vs. SEK 28 million), with margin improving to 1.6% (vs. 0.2%/0.6%).

• Cash flow from operating activities was SEK -73 million in Q4, improved from SEK -355 million last year, but still burdened by high inventory and late invoicing.

• Leverage ended at 4.3x, up from 4.0x last year.

• Q4 profit was SEK 3 million, but the full year ended with a net loss of SEK -2,631 million due to a SEK -2,500 million goodwill impairment.

Outlook and guidance

• Market stabilization is expected to continue, with larger customers leading recovery due to Windows 11 upgrades, while SMB remains tentative.

• Inventory and working capital levels are targeted for reduction in Q1, with expectations for improved cash flow.

• Management maintains long-term margin targets for SMB (6.5%) and LCP (4.5%), viewing them as achievable in a more positive market.

• No dividend proposed for 2024/25.

• Medium-term targets include >10% EPS growth (3-year average), leverage of 2.0–3.0x Net debt/EBITDA, and >70% dividend payout ratio.