Investor blogs and podcasts

Kesko’s sales and profitability were at a good level in 2024 despite the challenges in our operating environment. Towards the end of the year, we witnessed a turnaround, as our quarterly result improved for the first time in eight quarters in Q4. Full-year net sales totalled €11,920.1 million, while our comparable operating profit amounted to €650.1 million. The successful execution of our updated growth strategy in all three divisions has yielded results also in a challenging operating environment. Our cash flow from operating activities amounted to €1,008.2 million. We have also been successful in managing costs. Kesko’s good ability to generate profits and our strong financial position enable investments in growth as well as good dividend capacity. Kesko’s Board proposes to the Annual General Meeting a dividend of €0.90 per share – in total, €358 million – to be paid in four instalments.

In the grocery trade division, sales grew in 2024 in both our grocery stores and the foodservice business. Net sales for the division totalled €6,381.4 million, up by 0.5%. The comparable operating profit for the division was €438.0 million. Kespro performed particularly well in 2024, and we aim to continue the good performance in the foodservice business. The popularity of online grocery persisted, and sales grew by 13.5% thanks to express deliveries.

Campaigns and other marketing measures strengthened our customer flows and sales during the year, but the market share for our grocery stores came down as average purchase decreased. Price competition in Finnish grocery trade remained tight, and price continues to be a significant factor for grocery customers. At the beginning of 2025, we responded to customer wishes by launching an extensive price programme, reducing prices of more than 1,200 grocery products. The investment in this strategic programme amounts to nearly €50 million, shared between Kesko and the retailers. Our focus in grocery trade is to strengthen our market position while maintaining good profitability.

In building and technical trade, profitability remained good even though it declined year-on-year due to weak construction activity. Net sales for the division totalled €4,351.6 million, up by 3.8% thanks to the Davidsen acquisition in Denmark. The division’s comparable operating profit totalled €169.1 million. In 2024, demand decreased in both building and home improvement trade and technical trade in all our operating countries as construction volumes came down, but sales picked up in the latter half of the year.

In the longer term, the outlook for building and technical trade is positive. Urbanisation, renovation and infrastructure investment debt, infrastructure projects, and the green transition underpin construction over cycles. During the year, we expanded operations to Denmark by completing the acquisition of Davidsen Koncernen A/S, one of the leading operators in Danish building and home improvement trade, at the beginning of February. In August, we announced the acquisitions of three other Danish operators: Roslev, Tømmergaarden and CF Petersen & Søn. Strategic focus areas for the division are securing profitability and improving cash flow with a country and business focus.

The car trade market in Finland was weak in 2024, but profitability for Kesko’s car trade division stayed at a good level. The market showed some signs of picking up, but weak consumer confidence, continued high interest rates, and uncertainty regarding powertrain alternatives slowed down recovery. Development in the used car market was clearly better than in new cars, and sales also grew in car related services. Net sales for the division in 2024 totalled €1,209.4 million, representing a decrease of 4.0% in comparable terms. The division’s comparable operating profit totalled €69.3 million. The major transformation measures carried out within the division in recent years have improved its profitability. Kesko’s strategic focus is on outperforming the market in all car trade business areas, namely new cars, used cars, and services.

I took over as Kesko’s President and CEO at the beginning of February 2024. In June, we updated Kesko’s strategy, keeping the main pillars intact. In all business operations, we seek sales growth, better customer experiences, profitability and efficiency with the help of e.g. digital services and artificial intelligence. All three divisions have plenty of potential for growth and for further strengthening their business especially by listening to their customers and responding to customer needs. I see Kesko’s future bright also in upcoming years. I want to thank all our customers, the people of K Group, our shareholders, and our partners for their trust and good collaboration over the past year.

KEY FIGURES IN OCTOBER-DECEMBER 2024:

• Group net sales in October-December totalled €3,040.6 million (€2,902.0 million); reported net sales grew by 4.8% while comparable net sales grew by 1.1%

• Comparable operating profit totalled €170.8 million (€170.5 million)

• Operating profit totalled €121.0 million (€159.8 million)

• Cash flow from operating activities totalled €301.0 million (€342.4 million)

• Comparable earnings per share €0.31 (€0.31); reported earnings per share €0.19 (€0.28)

KEY FIGURES  IN JANUARY-DECEMBER 2024:

• Group net sales in January-December totalled €11,920.1 million (€11,783.8 million); reported net sales grew by 1.2%, while comparable net sales decreased by 2.3%

• Comparable operating profit totalled €650.1 million (€712.0 million) 

• Operating profit totalled €579.5 million (€695.4 million)

• Cash flow from operating activities totalled €1,008.2 million (€1,049.5 million)

• Comparable earnings per share €1.11 (€1.28); reported earnings per share €0.95 (€1.25)

• The Board proposes a dividend of €0.90 per share, proposed to be paid in four instalments

See full results release and other materials

Kesko's Vice President of Investor Relations Hanna Jaakkola was named the best Investment Relations Officer in both Finland and all of Nordics

Kesko's investor relations (IR) efforts have received recognition both on a Finnish and international scale recently.

The IR Nordic Markets (IRNM), conducted by the Swedish company Regi, is the largest study concerning IR work conducted by listed companies in the Nordic countries. Over 1,000 financial analysts from the Nordic countries, the EU, the UK, and the US annually evaluate the IR work of listed companies based on 21 criteria.

In this year’s IRNM:

• Kesko’s Vice President of Investor Relations Hanna Jaakkola was named the best Investor Relations Officer in Finland and all of the Nordics

• Kesko's overall investor relations work was rated the second best in both Finland and the Nordics

In addition, at the annual gala organised by the Finnish Foundation for Share Promotion, Kesko's investor webpages were rated third best among Finnish large cap companies.

”I am thrilled for such recognition, and would especially want to thank my amazing team and great colleagues. IR is definitely a team sport!” says Kesko’s Vice President of Investor Relations Hanna Jaakkola.

Jaakkola notes: ”My work is made easier by the fact that Kesko is a company I’m proud to talk about, and we have a lot going on at all times. Kesko is also a very sustainable company, and we have intentionally aimed at high-quality investor relations work. Everyone in Finland knows the K brand, and the number of Finnish households owning Kesko shares has grown steadily in recent years.”

“Working with investors and analysts – the discussions and feedback – is definitely one of the favourite parts of my work. I am the happiest if we can increase investors’ understanding of our company and operating environment. To me, this is a service profession,” concludes Jaakkola, who has previously been named ”IRO of the Year 2023” by the by the Finnish Foundation for Share Promotion.

More about IRNM: Results IR Nordic Markets 2025 | IR Nordic Markets

One of the objectives for Kesko's strategy – which was updated last summer – is to profitably gain market share in grocery trade. Key measures taken to achieve this are:

• Strengthening store-specific business ideas: focusing on strengthening our chosen competitive advantages and further improving the quality of K Group grocery stores

• Developing our store network: making targeted investments in the store network, with an emphasis on growth centres; and

• Improving our price competitiveness: strengthening the price competitiveness of our grocery stores and improving their price image.

Kesko is the quality leader in Finnish grocery, and we will not be compromising on quality at any point. At the start of January, we announced a new price programme that will cut prices on over 1,200 products in K Group grocery stores. K Group cuts the prices of some 1,000 everyday brand staples and some 200 popular Pirkka K Group private label products, in other words everyday staples that consumers buy often and that account for a significant portion of sales. Price reductions of branded products are on average 4–6 percent, but at best, the price cuts can be as much as 15–20 percent. For Pirkka private label products, the price reductions are on average 9-12 percent. Campaigns and offers are in our DNA, and we will continue them also in 2025, but the price programme is a more long-term effort, with significant investments in the basic price levels of our stores.

The price reductions have been made in close cooperation between Kesko, the K-retailers, and product suppliers. Kesko and K-retailers together will invest some €50 million in the programme during 2025. Reducing the price of popular branded products fits Kesko’s strategy better than, for example, adding cheap foreign products to our selections.

In addition to the investments made in basic price levels, K Group's grocery stores will continue to offer their popular OmaPlussa mobile benefits, the reasonably priced Pirkka private label range with over 2,600 products, and various other offers and campaigns.

As stated when we launched the updated strategy, investments in price and the store network will have a slight impact on the profitability of the grocery trade division in the coming years. However, despite the investments, the grocery trade division’s operating profit development will continue to be stable, and our aim is to keep the division’s profitability clearly above 6% during the 2024-2026 strategy period.

Kesko will publish its financial statements release for 2024 on Wednesday, 5 February 2025, at around 8.00 am Finnish time. An English audiocast/teleconference for investors and analysts will be held at 9.00 am Finnish time, and can be accessed here.

NEWS, FINANCIALS AND SHARES

• Presentation for Kesko’s Q4 investor roadshow meetings. (presentation)
  
  

SALES DEVELOPMENT

• Kesko’s sales in October. (release)

• Kesko’s sales in November. (release)
  
  Sales figures for December will be released in mid-January.
  
  

SUSTAINABILITY

• Kesko was once again included in the Dow Jones sustainability indices the DJSI World and the DJSI Europe. In the DJSI Europe index, Kesko ranked as the best company in its industry (Consumer Staples Distribution & Retail) for the third consecutive year. In the global DJSI World index, Kesko ranked fourth highest in its industry. (release)

• Kesko updated its sustainability strategy: the four main strategic focus areas continue to be he climate and nature, value chain, people, and good governance, with increased focus now also placed on supply chain sustainability, water use and biodiversity. Kesko will be setting emission reduction targets for its own operations extending to year 2034. (release)

   
  

GROCERY TRADE

• New K-Citymarket opened in Helsinki. In its continued effort to update its store network with focus on growth centres, Kesko opened the K-Citymarket Vuokki store in Eastern Helsinki in November. This was the first of the announced 7 new hypermarkets to be opened by Kesko in 2024-2028. In total, Kesko now has 82 K-Citymarket hypermarkets. (release in Finnish) 

• More K Group grocery stores received international recognition. The UK-based Institute of Grocery Distribution (IGD) named K-Citymarket Vantaa Jumbo as its ”Store of the month” in November 2024 (release in Finnish), while K-Market Iso Omena in Espoo made IGD’s list of "2025 Must-see stores" (release in Finnish).
  
  

CAR TRADE

• "Profitability is central to all areas of Kesko’s car trade”, says the President of Kesko’s car trade division Johanna Ali in our investor blog interview, where she also expands on K-Auto’s competitive advantages as well as the changing landscape, growth opportunities and the division’s plans for the future. (blog post)

• Kesko is set to renovate its largest K-Auto showroom complex in Helsinki, and build a new large-scale damage repair unit in Vantaa. The projects aim to improve customer experience for Kesko’s car trade customers and support K-Auto's strategic goal of building a nationwide multichannel service network for Finnish motorists. (release).