Puuilo Q2'25 flash comment: Summer well spent and new ambitions set

Translation: Original published in Finnish on 9/11/2025 at 9:33 am EEST.

Source: Inderes & Bloomberg (consensus, 5 analysts)

Puuilo's Q2'25 outcome was strong in terms of both revenue and results, aligning with consensus expectations but slightly missing our own, which had already reached the upper limit of the guidance. The most interesting news announced in this morning's earnings update came from the strategy front, as the company significantly raised its ambitions in Finland and will also begin piloting the concept in Sweden in the coming years.

Strong sales development in the summer as well

Puuilo's Q2 revenue grew by 13% to 136 MEUR. This figure fell slightly short of our high expectations (138 MEUR). As expected, revenue growth was driven by new stores (+8 y/y), but comparable store growth slightly missed our expectations (+1.3%), as did online sales growth (+2.4%). However, online sales represent only a minor (2%) part of the company's business in euro terms. We estimate that the company has continued to gain market share, given the continued growth in customer numbers.

Gross margin continued to strengthen

Adjusted EBITA for Q2 rose significantly from the comparison period to 28.2 MEUR (20.8% of revenue), slightly missing our robust expectation of 29.6 MEUR. As anticipated, the improvement in earnings was driven by a 0.6 percentage point increase in the gross margin (38.2%), supported once again by strong private label growth. However, the ratio of fixed costs did not improve as much as we had expected, mainly due to sales falling short of expectations. The company reiterated its guidance range (revenue of 425-455 MEUR and adj. EBITA of 70-80 MEUR), whereas we had anticipated a refinement of the earnings range toward the upper end of the guidance. We do not consider this to be particularly dramatic since the current guidance of 15% growth and 17% profitability is already very strong.

Long-term targets set higher than our own expectations

Puuilo said that, during the upcoming strategy period, it will continue to grow in Finland but will also seek international growth for the first time. Puuilo's targets are average annual revenue growth of over 10% and revenue of over 800 MEUR (our 2030 forecast is 720 MEUR) by the end of the 2026-2030 strategy period. The company now plans to open 7–10 new stores per year and aims to have a network of over 100 stores by the end of the 2030 financial year. In connection with the strategy update, Puuilo's management raised its estimate of store potential in Finland to a total of over 90 stores (was 70). The company is also embarking on organic international expansion by opening pilot stores in Sweden. The 2030 target is an EBITA result of over 136 MEUR (17% margin), which is also slightly higher than our expectation (130 MEUR EBITA).

If the ambitious new targets for 2030 are achieved, the share price still has upside. However, conquering the Swedish market will by no means be easy, even though we think the company has already learned something about the market through its online store, which has been operating there for a long time. In Finland, however, the concept has taken the market by storm, making it easier to believe in the targets there. Puuilo has consistently achieved its goals in Finland thus far, which lends further credibility to the management's statements. The earnings day webcast (in Finnish) will be worth tuning in to.