Silvano Fashion Group Consolidated Interim Financial Report for Q2 and 6m of 2024 (unaudited)

Silvano Fashion Group

Wed, Aug 28, 2024, 2:59 PM 10 min read

in thousands of EUR	06m 2024	06m 2023	Change
Revenue	30 145	31 407	-4.0%
Gross Profit	17 189	18 837	-8.7%
Operating profit	8 562	10 681	-19.8%
EBITDA	10 055	12 272	-18.1%
Net profit for the period	7 786	5 422	43.6%
Net profit attributable equity holders of the Parent company	7 053	4 772	47.8%
Earnings per share (EUR)	0,20	0,13	53.8%
Operating cash flow for the period	4 137	10 802	-61.7%

in thousands of EUR	30.06.2024	31.12.2023	Change
Total assets	80 534	72 252	11.5%
Total current assets	67 483	59 395	13.6%
Total equity attributable to equity holders of the Parent company	61 433	54 120	13.5%
Cash and cash equivalents	38 867	32 878	18.2%

Margin analysis, %	06m 2024	06m 2023	Change
Gross profit	57,0	60,0	-5.0%
Operating profit	28,4	34,0	-16.5%
EBITDA	33,4	39,1	-14.6%
Net profit	25,8	17,3	49.1%
Net profit attributable to equity holders of the Parent company	23,4	15,2	53.9%

Financial ratios, %	30.06.2024	31.12.2023	Change
ROA	16,3	14,5	12.4%
ROE	22,0	20,2	8.9%
Price to earnings ratio (P/E)	3,1	4,1	-24.4%
Current ratio	6,4	5,8	10.3%
Quick ratio	3,9	3,4	14.7%

Financial performance

The Group`s sales amounted 30 145 thousand EUR during 6 months of 2024, representing a 4.0% decrease as compared to the same period of previous year. Overall, wholesale decreased by 7.2%, measured in EUR.

The Group’s gross profit during 6 months of 2024 amounted to 17 189 thousand EUR and decrease by 8.7% compared to previous year. The gross margin during 6 months of 2024 decreased by 5.0% compared to 6 months of 2023. The cost of sold goods increased by 3.1%.

Consolidated operating profit for 6 months of 2024 amounted to 8 562 thousand EUR, compared to 10 681 thousand EUR for 6 months of 2023, decrease by 19.8%. The consolidated operating profit margin was 28.4% for 6 months of 2024 (34.0% for 6 months of 2023). Consolidated EBITDA for 6 months of 2024 decreased by 18.1% and amounted to 10 055 thousand EUR, which is 33.4% in margin terms (12 272 thousand EUR and 39.1% for 6 months of 2023).

Reported consolidated net profit attributable to equity holders of the Parent company for 6 months of 2024 amounted to 7 053 thousand EUR, compared to net profit of 4 772 thousand EUR for 6 months of 2023, net profit margin attributable to equity holders of the Parent company for 6 months of 2024 was 23.4% against net profit 15.2% for 6 months of 2023.

Financial position

As of 30 June 2024 consolidated assets amounted to 80 534 thousand EUR representing increase by 11.5% as compared to the position as of 31 December 2023.

Trade and other receivables increased by 358 thousand EUR as compared to 31 December 2023 and amounted to 1 712 thousand EUR as of 30 June 2024. Inventory balance increased by 1 922 thousand EUR and amounted to 25 862 thousand EUR as of 30 June 2024.

Equity attributable to equity holders of the Parent company increased by 7 313 thousand EUR and amounted to 61 433 thousand EUR as of 30 June 2024. Current liabilities increased by 267 thousand EUR during 6 months of 2024.

Investments

During 6 months of 2024 the Group’s investments into property, plant and equipment totalled 476 thousand EUR, in previous year same period 708 thousand EUR. Investments were made mainly into opening and renovating own stores, as well into equipment and facilities to maintain effective production for future periods.

Personnel

As of 30 June 2024, the Group employed 1 625 employees, including 507 people in retail operations. The rest were employed in production, wholesale, administration and support operations. In 31.12.2023 there were 1 626 employees, including 500 people in retail operations.

Total salaries and related taxes during 6 months of 2024 amounted to 7 117 thousand EUR ( 6 902 thousand EUR in 6 months 2023). The remuneration of key management of the Group, including the key executives of all subsidiaries, totalled 305 thousand EUR.

Decisions made by governing bodies during 06 months 2024

On the 19th of March 2024, the AS Silvano Fashion Group proposed to the shareholders to adopt the resolution of the extraordinary general meeting of shareholders stated below without convening the meeting.

The notice of the general meeting was published on March 19, 2024, in the information system NASDAQ OMX Tallinn https://view.news.eu.nasdaq.com/view?id=b77cafc430f1ac23a81813069a95a15cd&lang=en and Warsaw Stock Exchange, on the website of SFG https://www.silvanofashion.com/investors/company-announcements/ and in the newspaper Eesti Päevaleht.

On April 9, 2024 Silvano Fashion Group Extraordinary Meeting of Shareholders adopted the following decisions:

1.1. To appoint the auditing company Ernst & Young Baltic AS (registry code 10877299, located at Rävala puiestee 4, 10143 Tallinn) as the auditor of AS Silvano Fashion Group;

1.2. To authorize the Management Board of AS Silvano Fashion Group to enter into an audit service agreement with the auditing company AS Ernst & Young Baltic for auditing the economic activities of AS Silvano Fashion Group 2023.

On the 29th of May 2024, AS Silvano Fashion Group proposed to the shareholders to adopt the resolutions of the annual general meeting of shareholders without convening the meeting.

The notice of the general meeting was published on May 29, 2024, in the information system NASDAQ OMX Tallinn https://view.news.eu.nasdaq.com/view?id=bc1ccceca27a9390039f730c2b2b98136&lang=en&src=listed

and Warsaw Stock Exchange, on the website of SFG https://www.silvanofashion.com/investors/company-announcements/ and in the daily newspaper Eesti Ekspress.

On June 20, 2024 Silvano Fashion Group held its regular Annual General Meeting of Shareholders. The Meeting adopted the following decisions:

Approved the 2023 Annual Report;
Left the net profit undistributed and included the net profit of the financial year 2023 in retained earnings.

The decisions of the general meeting was published on the website of AS Silvano Fashion Group https://www.silvanofashion.com/investors/company-announcements/.

Consolidated Statement of Financial Position

in thousands of EUR	Note	30.06.2024	31.12.2023
		Unaudited	Audited
ASSETS
Current assets
Cash and cash equivalents	2	38 867	32 878
Trade and other receivables	3	1 712	1 354
Prepayments and other tax receivables	3	917	1 115
Current loans granted		20	29
Other assets		105	79
Inventories	4	25 862	23 940
Total current assets		67 483	59 395

Non-current assets
Non-current receivables		297	292
Investments in associates		109	85
Investments in other shares		223	213
Deferred tax asset		2 375	2 155
Intangible assets		651	579
Investment property		911	899
Property, plant and equipment	5	8 485	8 634
Total non-current assets		13 051	12 857
TOTAL ASSETS		80 534	72 252

LIABILITIES AND EQUITY
Current liabilities
Current borrowings		2 312	0
Current lease liabilities		1 222	2 162
Trade and other payables	6	4 933	7 377
Tax liabilities		2 086	747
Total current liabilities		10 553	10 286

Non-current liabilities
Deferred tax liability		773	736
Non-current lease liabilities		4 751	4 321
Non-current provisions		48	46
Total non-current liabilities		5 572	5 103
Total liabilities		16 125	15 389

Equity
Share capital	7	3 600	3 600
Share premium		4 967	4 967
Statutory reserve capital		1 306	1 306
Unrealised exchange rate differences		-19 742	-20 002
Retained earnings		71 302	64 249
Total equity attributable to equity holders of the Parent company		61 433	54 120
Non-controlling interest		2 976	2 743
Total equity		64 409	56 863
TOTAL EQUITY AND LIABILITIES		80 534	72 252

Consolidated Income Statement

in thousands of EUR	Note	2Q 2024	2Q 2023	06m 2024	06m 2023
		Unaudited	Unaudited	Unaudited	Unaudited
Revenue from contracts with customers	9	16 241	17 266	30 145	31 407
Cost of goods sold		-6 841	-6 553	-12 956	-12 570
Gross Profit		9 400	10 713	17 189	18 837

Distribution expenses		-3 001	-2 775	-5 773	-5 554
Administrative expenses		-1 191	-1 091	-2 454	-2 277
Other operating income		59	59	107	116
Other operating expenses		-253	-188	-507	-441
Operating profit		5 014	6 718	8 562	10 681

Currency exchange income/(expense)		916	-1 492	865	-2 591
Other finance income/(expenses)		-56	-29	72	-185
Net finance income		860	-1 521	937	-2 776

Profit (loss) from associates using equity method		-2	8	14	12
Profit before tax		5 872	5 205	9 513	7 917

Income tax expense		-1 002	-1 650	-1 727	-2 495

Profit for the period		4 870	3 555	7 786	5 422
Attributable to :
Equity holders of the Parent company		4 499	3 156	7 053	4 772
Non-controlling interest		371	399	733	650

Earnings per share from profit attributable to equity holders of the Parent company, both basic and diluted (EUR)	8	0,12	0,09	0,20	0,13

Consolidated Statement of Comprehensive Income

in thousands of EUR	Note	2Q 2024	2Q 2023	06m 2024	06m 2023
		Unaudited	Unaudited	Unaudited	Unaudited

Profit for the period		4 870	3 555	7 786	5 422

Other comprehensive income (loss) that will be reclassified to profit or loss in subsequent periods :
Exchange differences on translation of foreign operations		670	-624	406	-1 384
Total other comprehensive income for the period		670	-624	406	-1 384

Total comprehensive income (loss) for the period		5 540	2 931	8 192	4 038
Attributable to :
Equity holders of the Parent company		5 049	2 029	7 313	2 612
Non-controlling interest		491	902	879	1 426

Consolidated Statement of Cash Flows

in thousands of EUR	Note	06m 2024	06m 2023
		Unaudited	Unaudited
Cash flow from operating activities
Profit for the period		7 786	5 422
Adjustments for:
Depreciation and amortization of non-current assets		1 493	1 591
Share of profit of equity accounted investees		-14	-12
Gains/Losses on the sale of property, plant and equipment		10	-11
Net finance income / costs		-937	2 776
Provision for impairment losses on trade receivables		3	-1
Provision for inventories		1	2
Income tax expense		1 727	2 495
Change in inventories		-1 922	1 342
Change in trade and other receivables		-358	-1 195
Change in trade and other payables		-1 912	-125
Interest paid		-48	0
Income tax paid		-1 692	-1 482
Net cash flow from operating activities		4 137	10 802

Cash flow from investing activities
Interest received		482	172
Dividends received		8	11
Proceeds from disposal of property, plant and equipment		20	5
Loans granted		0	-15
Proceeds from repayments of loans granted		9	0
Acquisition of property, plant and equipment		-476	-708
Acquisition of intangible assets		-72	-88
Net cash flow from investing activities		-29	-623

Cash flow from financing activities
Proceeds from borrowings		4 000	0
Repayment of borrowings		-1 700	0
Payment of principal portion of lease liabilities		-1 085	-1 118
Interest paid on lease liabilities		-375	-367
Dividends paid		-646	-525
Net cash flow from financing activities		194	-2 010

Net increase in cash and cash equivalents		4 302	8 169
Cash and cash equivalents at the beginning of period	2	32 878	25 909
Effect of translation to presentation currency		1 837	-3 452
Effect of exchange rate fluctuations on cash held		-150	415
Cash and cash equivalents at the end of period	2	38 867	31 041