Translation: Original published in Finnish on 12/9/2024 at 7:31 am EET. Puuilo will report its Q3'24 (August-October) results on Wednesday. We expect the company to continue the strong growth seen in the first half of the year, with new store openings and moderate growth in existing stores. We believe profitability improved compared to the prior-year period due to higher volumes and increased efficiencies. Full-year guidance is likely to be reiterated. Overall, the market environment has been challenging for department stores, but we believe the company has been able to gain market share through its expanded store network and the appeal of its defensive concept. We believe Q3 was a continuation of the good performance in H2 We expect the company to continue on its upward trajectory and to achieve a revenue of 103 MEUR in Q3. This represents annual growth of 12%, which we believe is largely driven by new store openings (+7 stores vs. prior year) as the challenging market environment limits the growth potential of existing stores. The growth brought by the new stores is particularly effective in the early part of the year, thanks to the Hurrikaani stores (3), which were converted into Puuilo stores in H2, with a higher revenue level than the usual less-than-a-year-old Puuilo store l due to the existing customer base. Overall, such strong growth indicates that the company has continued to gain market share, which we believe is based on the appeal of the company's defensive concept and effective store expansion. Our forecast for Q3 revenue is slightly below consensus (105 MEUR). Cost efficiency should improve We forecast Puuilo's Q3 EBITA to be 17.3 MEUR (consensus: ~17.9 MEUR). This corresponds to 16.8% of revenue, which is an excellent level for the retail industry. The increase in profitability will primarily be driven by higher revenue, but we believe the slightly higher gross margin and cost efficiencies from the comparison period also supported the profitability development. Cost efficiencies were primarily driven by the introduction of more systematic shift planning in stores, which began to bear fruit in Q2. Therefore, we believe that the trend has continued and that fixed costs grew at a slower pace than revenue in Q3. We expect EPS to improve to EUR 0.15 (consensus:  EUR 0.16), but this will be limited by higher IFRS16 financing costs due to the expanded store network and a tax rate of 20%. Repetition of guidance expected We have not made any changes to our forecasts in the context of the previous commentary. Puuilo expects net sales for the financial year 2024 to be in the range of 380-400 MEUR and adjusted EBITA between 60 and 66 MEUR. The midpoints of the ranges indicate revenue growth of 15.2% and an EBITA margin of 16.2%. In our view, the company will reiterate its guidance in the report, although we see some uncertainty especially on the EBITA guidance (2024e Inderes: 62.1 MEUR and consensus: ~63 MEUR). Although the cost efficiency of the stores appears to have improved, the challenging market environment may have a negative impact on the company's margin as price competition intensifies. Otherwise, we look forward to the company's comments on the market/competitive environment, the progress of the shift planning program, and the attractiveness of new and old stores.

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