Analyst Comment

Finnish trade saw slight growth in August

Summary

We assess that the grocery consumer market relevant to Kesko grew by 2.5% in August, while Tokmanni's target market saw a 4% increase in July, with growth evenly distributed across sub-segments.
Kesko's grocery sales to K Group stores increased by 0.4% in August, and after adjusting for delivery days, sales grew slightly faster than the market, indicating a turnaround in market share.
In B2B, Kesko's sales declined by 5%, losing a small market share in foodservice, while Tokmanni's non-grocery revenue increased by 2.1% in August, with apparel and home product groups showing growth.
We expect Tokmanni's segment revenue to grow by 4% in Q3, aligning with market trends, but caution that July's strong growth margin may have been weaker due to inventory reduction discounts.

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Translation: Original published in Finnish on 10/1/2025 at 7:35 am EEST.

According to figures reported by PTY, the grocery consumer market relevant to Kesko grew by 2.5% in August, while the target market for Tokmanni, i.e., revenue from department store and hypermarket chains, increased by 4% in July. Growth was relatively even across all sub-segments. Kesko has already reported its August figures, which, however, cannot be directly compared to PTY's figures.

Kesko's reported figures not directly comparable to PTY's figures

Kesko's grocery sales to K Group grocery stores grew by 0.4% in August. When comparing this figure to PTY's, however, it should be kept in mind that Kesko is a wholesale supplier in the grocery trade (with individual stores as retailers), while PTY's figures measure retail trade. It should also be noted when comparing figures that there was one less delivery day in wholesale trade in August than in the comparison period, but the number of retail sales days is typically the same (stores are open every day). On the other hand, not all products sold in K Group stores come from Kesko, which also affects the comparison of Kesko's and PTY's figures. After adjusting for delivery days, Kesko's grocery sales appear to have grown slightly faster than the market, which aligns with the company's Monday announcement of a turnaround in its market share in the grocery trade. In B2B, Kesko's sales declined by 5%, while market development was -4%. Both figures were affected by the smaller number of delivery days than in the comparison period. These figures are comparable, so Kesko lost a small amount of market share in foodservice.

Market development for Tokmanni in line with our expectations

The revenue of the department store and hypermarket chains of Finnish Grocery Trade Association member companies continued to grow in August compared to the previous year. In terms of non-grocery products, which are particularly relevant to Tokmanni, revenue increased by 2.1% in August. Within this category, the apparel product group grew by 2.6%, while the home and leisure product group grew by 1.9%. In July, meanwhile, the non-grocery market grew by 7.3%, with the apparel market growing by 9.9% and the home and leisure market by 6.5%.

We currently forecast a 4% growth in Tokmanni segment revenue in Q3, which is well in line with overall market development in July–August. However, we would like to remind investors that the strong growth margin structure achieved in July, in particular, was likely weaker than in the comparison period. This is due to the cold early summer and delayed season start, which likely forced traders to accelerate inventory reduction through discounts.