Condo Nordic Holding Q4/2024 interim report

Condo Nordic Holding experienced excellent year-or-year revenue growth in the fourth quarter of 2024. Total net sales in Q4 were 24% higher than in Q4 2023 (SEK 7 811 thousand vs. SEK 6 277 thousand).

Especially in October and November, net sales showed strong year-on-year performance, marking the second-best October and November in the company's history for net sales.

Condo Nordic Holding
Interim Report

January - December 2024

Monthly growth of sales resulted in an all-time high Q4

Monthly growth of sales in Q4

Condo Nordic Holding experienced excellent year-or-year revenue growth in the fourth quarter of 2024. Total net sales in Q4 were 24% higher than in Q4 2023 (SEK 7 811 thousand vs. SEK 6 277 thousand).

Especially in October and November, net sales showed strong year-on-year performance, marking the second-best October and November in the company's history for net sales.

1 October – 31 December 2024

•   Net sales for the period 7,811 (6,277) kSEK

•   EBITDA of -992 (-610) kSEK

•   Adjusted operating profit after financial items, taking into account items affecting comparability,

-992 (-606) kSEK, equaling a margin of -12.7% (-9.6)

•   Cash flow from operations before changes in working capital amounted to -1,618 (-1,837) kSEK.

•   Operational cash flow amounted to 2,368
(-1,895) kSEK.

 
1 January – 31 December 2024

•   Net sales for the period 37,252 (34,472) kSEK

•   EBITDA of -5,994 (3,909) kSEK

•   Adjusted operating profit after financial items, taking into account items affecting comparability,

-260 (3,968) kSEK, equaling a margin of -0.7% (11.5)

•   Cash flow from operations before changes in working capital amounted to -2,710 (2,536) kSEK

•   Operational cash flow amounted to 7,025
(-1,472) kSEK

Q4 Significant events

-         Planning about and preparing for entering and developing the Swedish market contiued.

-         The new warehouse in Varkaus became fully operational.

Significant events after the End of the Q4

-         None.

CEO comments

Laying a Strong Foundation for Sustainable and Profitable Growth

The last quarter of 2024 continued the positive growth trajectory we initiated in Q2 and Q3. Revenue growth in October, November, and December was substantial, with year-on-year increase of almost 50 % that reflects our good market positioning and capabgood sales and growth even during the quite period of the year. 

However, rising lease costs across Finland have pressured our sales margins. While price adjustments have been initiated, these dynamics underscore the importance of our efforts to build resilience into our operations. 

We are excited about our preparations to enter the Swedish market, which we hope to launch soon. This expansion represents a crucial step in our long-term strategy to establish Condo as a leading provider of project accommodation solutions across the Nordic region. 

Business Highlights 

The original business was founded in 2017; Condo’s business in Finland specialises in providing tailored housing solutions for project teams, serving corporate clients with stays ranging from several months to years. Our customer base is built on trust, supported by a robust network of lease providers in Finland and partnerships across Europe. In addition to project accommodation, our parent company, Condo Nordic Holding AB, is developing a portfolio of permanently furnished apartments in major cities to address the growing demand for short-term accommodation among retail customers. 

Q4/2024 Performance 

The growth momentum from late Q3 carried through into Q4, with Condo achieving a remarkable 25% year-on-year increase in total revenue for the quarter. The company will anticipate total revenue for 2024 to fall at about SEK 35 million, thus in line with the guidance provided in our listing memorandum. 

While operational cash flow stood at SEK 2.4 million compared to SEK -1.9 million last year, this reflects changes in working capital. Cash flow from operations before changes in working capital was SEK -1.6 million, compared to SEK -1.8 million in the previous year. The company currently has a low level of cash but is actively working on solutions to bridge the gap until operations turn cash flow positive. Measures include securing additional funding, optimizing working capital, and driving revenue growth. Management remains focused on strengthening liquidity and ensuring a sustainable path forward.

Market Drivers 

Condo Nordic Holding AB has identified key trends driving demand for our offerings: 

1. Preference for Longer Stays: Furnished apartments provide a comfortable and spacious environment, ideal for extended stays. 
2. Diversification of Accommodation Options: Travelers and businesses increasingly seek alternatives to traditional hotels, valuing the homelike experience of furnished apartments. 
3. Rise in Business Travel: Corporate clients prioritise cost-efficient, long-term housing solutions for their teams, particularly in non-cyclical industries. 
4. Prime Locations: Our apartments are strategically located in city centres and residential areas, offering convenience and access to local amenities. 
5. Focus on Privacy and Independence: Fully furnished apartments offer privacy and functionality. They feature separate living spaces and fully equipped kitchens for greater autonomy. 

By staying attuned to these market dynamics and leveraging our strengths, we can drive sustainable growth and create lasting value for our shareholders. 

Ville Valorinta, CEO

Condo Nordic Holding AB

Financial development

October - December 2024

Net sales

In Q4/2024, net sales increased by approximately 25% to SEK 7.8 million (compared to SEK 6.3 million in the same period the previous year).

Gross profit

The gross profit for Q4/2024 reached SEK 3.6 million, reflecting a slight increase from SEK 2.9 million during the corresponding period last year.

EBITDA

EBITDA amounted to SEK -0.9 (-0.6) million for the period. This decrease can be attributed to rising lease costs associated with Condo operations and some one-off costs.

Profit before tax

The result after financial items in Q4/2024 amounted to SEK -2.0 million (-1.3), corresponding to a negative margin. The negative margin is primarily due to lower-than-expected sales margin and some one-cost.

The period's result after tax amounted to SEK -2.0 (-1.4) million.

Cash flow

Cash flow amounted to SEK -0.2 (-1.1) million.

January - December 2024

Net sales

Net sales increased by approximately 8% to SEK 37.3 million from January to December 2024 (compared to SEK 34.5 million in the same period the previous year).

Gross profit

The company's gross profit totalled SEK 15.9 million during the reporting period, representing a decline from SEK 19.4 million recorded in the same period the previous year. This decrease in gross profit can be primarily attributed to the IPO process and starting up the holding company in Sweden, significant increases in lease costs, which have put pressure on overall profitability. Additionally, the financial year 2024 experienced a slow start, further contributing to the reduced gross profit figures. This combination of escalating operational expenses and a less favourable business climate has impacted the company’s financial performance compared to the prior year.çed to establishing the Swedish holding company. The total cost for establishing the holding company and the listing amounted to approximately SEK 5.7 million, significantly impacting the results for this period.

The period's result after tax amounted to SEK -9.4 (1.6) million.

Cash flow

Cash flow amounted to SEK -0.5 (-1.4) million.

Summary of financial reports

Condensed consolidated statement of comprehensive income

Condensed consolidated statement of financial position

The reverse acquisition made in connection with the listing has been reclassified from a business aquisition to an asset acquisition. As a result, no goodwill is recognized in the consolidated balance sheet.

Condensed consolidated statement of cash flow

Condensed income statement for the parent company

The parent company, Condo Nordic Holding AB (publ) (CIT 559432-1571), was registered with the Swedish Companies Registration Office on April 28, 2023, and the current business name was registered on June 20, 2024.

The parent company, Condo Nordic Holding AB, performs group-wide functions related to company management and stock exchange matters. The group's operating company is the subsidiary Condo Finland Oy.

Condensed balance sheet for the parent company

Notes

General information about the Group

The Condo Nordic Holding Group includes the parent company Condo Nordic Holding AB (CIT 559432-1571) and its subsidiary Condo Finland Oy (CIT 2777073-4), which has a wholly owned subsidiary, Suomen Majoituspalvelu Oy (CIT 2558565-8). The parent company is a Swedish public limited company whose board is based in the municipality of Stockholm. The company's registered address is ℅ Aalto Capital, Riddargatan 17, 114 57 Stockholm.

Accounting principles

Condo Nordic Holding AB prepares its accounts according to the Annual Accounts Act and the Accounting Board's general advice, BFNAR 2012:1, which includes the Annual report and consolidated accounts (K3).

Group accounts

Condo Nordic Holding AB's acquisition of Condo Finland Oy is reported in the consolidated accounts according to the rules on reverse acquisition. Condo Finland Oy is reported as the acquiring company even though Condo Nordic Holding AB is, legally speaking, the parent company.

Reverse acquisition and listing cost

Applied consolidated accounting and the rules for reverse acquisition where Condo Finland Oy is reported as the acquiring company means, among other things, that an exceptional cost of a non-recurring nature, a listing cost (surplus value) of SEK 5,304 thousand arises and charges the operating expenses in the Condensed consolidated statement of comprehensive income for Q2 2024.

Comparative numbers

The group's comparative figure for 2023 refers to the legal subsidiary Condo Finland Oy, which, from an accounting point of view, constitutes the parent company following the principle of reverse acquisition. As of April 28, 2023, the group's income and balance sheets include the legal parent company, Condo Nordic Holding AB.

Estimates and assessments

Preparing the report requires that company management make judgments, estimates, and assumptions that affect the application of accounting principles and the reported amounts of assets, liabilities, income, and costs. Actual outcomes may differ from these estimates and judgments, which are reviewed regularly.

Staff

At the end of the period, the group had three full-time employees, two men and one women. Thus, the number of permanent employees has decreased significantly as part of building a less fixed-cost-based cost structure.

Transactions with related parties

There is an outstanding loan of 408 kEUR to Opema Oy, owned by Ilkka Holmlund at 55%, Ville Valorinta at 30%, and Karri Rantasila at 15%. The original plan was for Opema to expand its hotel business and eventually merge with Condo. However, due to the post-COVID environment, Opema required working capital to keep developing the hotel business. To meet this need, it was decided that Condo would provide the necessary working capital through a loan to Opema. Later, in late 2023, a decision was made for Condo to focus on project accommodation and furnished apartments exclusively. As a result, the hotel business was never merged into Condo. The loan is interest-free and matures on January 31, 2029. The loan can be continuously amortised with cash and dividend offsets during the loan term. A bankruptcy application was filed against Opema at the end of June 2024. The process is ongoing, and negotiations are underway about withdrawing the application. To mitigate the credit risk to the company, one of Condo's owners, Feiholm Invest Oy, has committed to indemnify Condo. As part of this guarantee, Feiholm has pledged shares as collateral and will cover any credit losses incurred by Condo.

Material risks and uncertainties

The Listing Memorandum for Condo Nordic Holding AB on the Spotlight Stock Market in July 2024 describes the group's overall risk assessment.

Review by auditor

The group's auditor has not reviewed this interim report.

Upcoming reports

Board of Directors assurance

The Board of Directors and the CEO confirm that this report provides a fair overview of the Company’s business, position and results and describes the significant risks and uncertainties facing the Company and its subsidiaries.

Stockholm, February 21, 2025

This disclosure contains information that Condo Nordic Holding AB is obliged to make public pursuant to the EU Market Abuse Regulation (EU nr 596/2014). The information was submitted for publication, through the agency of the contact person, on 21-02-2025 09:00 CET.

ir@condoholding.com