Lindex Group Q1’25 earnings preview: Estimates slightly improved

Translation: Original published in Finnish on 4/23/2025 at 7:00 am EEST.

Lindex Group will report its Q1 results on Tuesday, April 29 at around 8:30 am EEST. We predict that the group's revenue will be flat year-on-year and that adjusted EBIT will improve slightly. Lindex has provided guidance for the full year of 0-4% revenue growth in local currencies and an adjusted EBIT of 70-90 MEUR. We believe that the company will reiterate this guidance.

Group revenue likely to remain at last year's level

We expect the company's revenue to be at the level of the comparison period. The Lindex division is expected to grow by 1% (roughly the same in local currencies and euros), as the market development in Sweden, its main market, has been slightly positive (2%). We expect the Stockmann division's revenue to decline 4% due to weak market development in Finland. We expect the impact of exchange rates to have been minimal in the quarter.

Earnings forecasts raised slightly

We expect the Lindex division's adjusted EBIT to increase slightly to 5 MEUR from 4 MEUR in the comparison period. This is mainly due to the positive impact of the small growth and the slightly higher gross margin. In the Stockmann division, we expect the negative impact of the decline in revenue to be offset by the cost efficiencies and the result to improve to -8 MEUR (-9 MEUR). The group’s earnings forecast is set at -4 MEUR, whereas in the comparison period it was -6.5 MEUR. Q1 is seasonally by far the weakest quarter of the company and typically loss-making.   

Our estimate is within the guidance range

Lindex's guidance for the year 2025 is for revenue to change by 0-4% in local currencies and for adjusted EBIT to be in the range of 70-90 MEUR. Our estimate is close to the mid-point of the guidance, as we expect 2% growth and an adjusted EBIT of 79 MEUR. We therefore expect the company to reiterate the guidance.

In the past year, the company has had only one controversial dispute related to the restructuring process. This dispute with LocalTapiola was the subject of two separate District Court cases at the end of last year, both of which were taken further to the Court of Appeal. We believe the legal proceedings will go all the way to the Supreme Court, delaying resolution until at least 2026. We do not expect any news on the restructuring process or the "strategic review" of the department store business in the Q1 report. In any case, news on these issues should be reported separately.