Swedencare posts higher revenue but less profit

Swedencare posts higher revenue but less profit

Following a record-breaking Q1, the firm also experienced its best-ever Q2.

Swedencare hit net revenue of SEK572.1 million ($54.5M/€49.6M) from 1 April to 30 June 2023, up 21% from SEK470.9 million ($44.9M/€40.8M) in the same period of 2022.

Net profit declined SEK16.3 million ($1.55M/€1.4M) during the quarter from SEK60.2 million ($5.7M/€5.2M) in 2022. 

The Malmö-based firm attributed the loss to “challenges optimizing production and less and delayed development projects with higher margins than average.”

Veterinary business 

CEO Håkan Lagerberg emphasizes that while the company’s online and pet retail sectors are “stronger,” the vet business remains “somewhat slow.”

However, the Swedish company’s recent acquisition of monthly subscription-based firm Vet Buyers Direct may change the outlook of its veterinary portfolio. 

Higher than predicted costs with the company’s launch of NaturVet’s latest pet supplements line, Scoopables, have also impacted profitability during this quarter. 

Acquired by Swedencare in 2022, NaturVet was the company’s bestselling brand in Q2 2023, making up 32% of total sales (+2%).

Half year overview 

Net revenue over the first 6 months of 2023 exceeded SEK1 billion ($95.2M/€86.6M), resulting in a 29% rise from the year before.

Profit after tax slid to SEK33.5 million ($3.2M/€2.9M), down from SEK74.9 million ($7.13M/€6.49M).

The group’s North American market shares went up to 81% compared to last year’s 79% of the group’s total revenue. The growth is partly due to its acquisition of NaturVet and developments in its online channel. 

Swedencare UK showed particular strength with record-breaking revenues in both quarters this year. “The rest of the world has shown a growth of 15% for the first half of the year in comparison with the corresponding period last year,” says the company.

During the second half of the year, Lagerberg predicts “even stronger” organic growth and expects the business to “bounce back” in profitability between 2023–2024.