Release Date: November 15, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- GARO AB (FRA:46GA, Financial) has launched new products like the Garo Entity Home, which has been well-received in the market.
- The company has a strong position in the European market for destination charging with a robust product range.
- GARO AB has completed recruitment for a new President and CEO, bringing in Jonas Kan with extensive industry experience.
- The company has implemented cost-saving measures, including reducing the workforce by 28 employees, expected to save approximately 40 million SEK annually.
- Positive signs in the market, such as falling interest rates and political incentives, are expected to lead to a rebound in housing construction in 2025.
Negative Points
- Net sales decreased by 11% compared to the same quarter last year, with significant declines in both the immobility and electrification sectors.
- The adjusted operating profit dropped significantly from 5 million to 0.4 million compared to the same quarter last year.
- A write-down of 48 million SEK was made for slow-moving inventory, primarily affecting the immobility business area.
- The market for immobility remains cautious, with a 26% decrease in sales and macroeconomic uncertainties affecting purchasing behavior.
- The construction of new housing in the Nordic region has declined considerably, impacting the demand for GARO AB's products.
Q & A Highlights
Q: Can you explain the current inventory levels among your resellers?
A: The inventory levels among resellers remain low. With an improving market situation, we expect them to start increasing, which is positive for Garo. This applies to both immobility and electrification sectors. - Patrick Anderson, CEO
Q: What can you say about the fourth quarter so far for immobility?
A: We are not communicating any specific numbers for Q4 at this time, so I can't provide an indication. - Patrick Anderson, CEO
Q: How much has the Garo Entity Home product generated in sales since its launch?
A: The Garo Entity Home product was launched during Q3, so sales have not been significant yet. We expect to see increased sales in Q4, Q1, and Q2 as the product gains traction in the market. - Patrick Anderson, CEO
Q: Despite the inventory write-down, inventory levels are still high. How do you view the risk of additional write-downs?
A: At this point, we do not foresee any additional risks for further write-downs. We have conducted thorough calculations and believe the current numbers are accurate. - Helena Clayon, CFO
Q: How is the market situation in Germany affecting your operations?
A: The market in Germany is slow, and sales of electric cars have dipped significantly. However, we continue to work towards IRET approval for our products and certification of our production facility in Poland. - Helena Clayon, CFO
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
