Musti Group registers soft quarter, with increase in online sales

Helsinki-based Musti Group reported sales growth from October to December 2024, with net sales reaching €122.2 million ($126.4M), an increase of 5.6% year-on-year (YoY). Adjusted earnings before interest, tax, depreciation and amortization (EBITDA) declined by 16% YoY, from €20.5 million ($21.2M) during the same period in 2023 to €17.2 million ($17.8M).

Musti struggled to drive like-for-like retail growth during the quarter. The company attributed the soft numbers to a “weak consumer climate, pressure in gross profit and inflation.”

Like-for-like sales growth during the quarter was 1.2%. Online sales were a bright spot, with an 8.8% like-for-like sales growth.

In the 15 months from October 2023 to December 2024, Musti hit net sales of €560.6 million ($579.9M), with like-for-like sales growth of 1.1%. The numbers are not perfectly comparable with the prior financial year, which was a standard 12-month period.

A year of change

Musti was acquired by a Portuguese multinational, Sonae Group, near the beginning of the financial year. Its earnings report states that the new owners are looking to reinvest profits into the business. As such, Musti does not expect to distribute dividends.

“With the new majority owner, Musti Group is now in a new strategic phase with [the] need to focus on sustainable growth to create value to its pet parent customers, owners and other stakeholders,” a company press release states.

Musti has remained relatively independent and recently finalized its acquisition of Pet City, a retailer operating in the Baltic States. The group was consolidated into the company’s earnings in December.

Had Pet City been consolidated for the full quarter, Musti’s net sales would have increased by 10.7% from October to December 2024 rather than the actual 5.6%.

Country breakdown

Musti reported the lowest growth in its home country, Finland, where net sales increased by 0.1% to €51.3 million ($53.1M) between October and December 2024. The company notes sales were “still negatively affected by [a] weak consumer climate” and a product recall. One directly operated store in the country closed during the year’s final quarter.

Growth was stronger in Sweden, where net sales increased by 2.4% to €47.1 million ($48.7M). The report says that this came from new store openings.

Norway saw the strongest growth. Net sales in the country increased by 11.7% to €20.6 million ($21.3M). This came from expansions and like-for-like sales rising by 8.9%.

The country’s holdings in the Baltics were not fully integrated for the quarter, but with 62 newly acquired stores, the region is likely to make up a sizeable portion of growth in Q1.

Outlook

Musti CEO David Rönnberg told investors that he expects higher growth to resume shortly. “The economic outlook and the consumer confidence in the Nordics are expected to improve.”

The retailer forecasts lower interest rates and improved customer purchasing power will impact them positively.

“We believe that the long-term market trend of pet parenting continues despite the temporarily soft demand during the past year,” Rönnberg concludes.