Release Date: August 16, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Kamux Corp (FRA:4K8, Financial) maintained a good margin on the cars sold despite a tightening sourcing market.
- Germany showed strong performance with top-line growth and improved profitability.
- Integrated services, including financial products and Kamux Plus guarantees, are back on track and improving.
- The company is enhancing its web store for better consumer experience, including easier access to hybrid and rechargeable car options.
- Kamux Corp (FRA:4K8) is taking measures to improve productivity and efficiency, including reducing the number of third-party partners to better manage costs.
Negative Points
- Operating profit decreased significantly, with a 40% decline due to tighter margins and inflated car-related costs.
- Sweden's performance was weak, particularly in June, impacting overall results.
- The company faced challenges in sourcing cars, affecting inventory levels and sales potential.
- Inflation has increased maintenance, service, and logistics costs, impacting profitability.
- There is a need for improvement in operational efficiency and addressing people-related costs.
Q & A Highlights
Q: Why is Kamux confident in maintaining its full-year guidance despite challenges in Sweden and a decline in Finnish gross profit per car?
A: Tapio Pajuharju, CEO, explained that the company is addressing sourcing market issues and expects seasonality to aid in sourcing. Additionally, actions to reduce car-related indirect costs are anticipated to help maintain the guidance. Despite the challenges, Kamux remains confident in delivering on its outlook.
Q: What were the reasons for the recent management changes in the Swedish operations, and what capabilities are being sought in a new leader?
A: Tapio Pajuharju noted that the previous head did an excellent job in cleaning up the business but lacked the teamwork needed for commercial success. The new leader should be able to foster teamwork and drive the turnaround in Sweden.
Q: Can you quantify the impact of closing four showrooms on earnings and how many current showrooms are still loss-making?
A: Tapio Pajuharju stated that the closed stores were not profitable, and the closures should improve profitability. While specific numbers were not disclosed, he mentioned that Finland has no issues, but some Swedish and German stores are still not meeting benchmarks.
Q: How is Kamux addressing inflation's impact on maintenance costs, and what specific actions are being taken?
A: Kamux is bundling services to fewer suppliers and standardizing services to control costs. The focus is on logistics, conditioning, repair, and maintenance costs, which have been inflated. The company is working to offset these increases through strategic partnerships and process improvements.
Q: How does Kamux plan to tackle competition from integrated car brands that lock in new car customers for their replacement or resale?
A: Tapio Pajuharju mentioned that Kamux benefits from its operational model, as integrated brands do not typically handle trade-ins. Kamux partners with brands like Tesla and Polestar, offering competitive pricing and services, which should mitigate competitive pressures.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
