Marimekko - Awaiting acceleration in H2
Marimekko’s domestic sales proved more resilient in Q2 than we expected while international growth was soft. With APAC forecasted to grow in FY 2025, we anticipate growth to accelerate in the second half of the year.
Some surprises in the composition of Q2 figures
Marimekko’s net sales in Q2 came in close to our estimates (act. EUR 44.5m vs. Evli est. EUR 45.0) while the composition was different than we expected. Domestic sales outperformed our expectations, with wholesale sales declining just 2% year-over-year in Q2, despite the impact of non-recurring wholesale sale deliveries in the comparison period. In the international markets, performance in APAC fell short of our expectations as net sales declined 8% y/y driven by lower licensing income and retail sales while wholesale sales stayed flat. The wholesale sales development was notably weaker than we forecasted. We expect that the main reasons relate to the current challenging macroeconomic conditions and timing issues. Profitability wise, adj. EBIT surpassed our estimates (act. EUR 6.5m vs. Evli est. EUR 6.2m) due to better-than-expected gross margin. Gross margin was positively impacted by improved product margins. On the other hand, while margin was strong, it was still negatively affected by higher discounts and FX.
We continue to expect acceleration for H2
As anticipated, Marimekko maintained its guidance for 2025. We have made no significant changes to our estimates. We project net sales of EUR 193m (prev. EUR 194m) and comparable EBIT of EUR 34.5m (unchanged). We continue to forecast acceleration in sales growth for the company in H2 as we model sales growth of 8% for the second half vs. 3% growth over comparison period in H1. Besides the softer comparison period, the shift of domestic wholesale deliveries to H2 this year, as guided by the company, will contribute positively to growth. Marimekko’s sales in APAC declined some 5% during the first half. The company still expects growth for FY in APAC, meaning that H2 should see growth of at least 5% y/y. Profitability wise, we model improvement in sales margin compared to H2 last year driven by higher volumes, continued good product margin development and slight pick-up in licensing income compared to H1.
ACCUMULATE with a TP of EUR 13.5
We maintain our TP and rating unchanged following the Q2 report. Marimekko remains priced at 15-13x adj. EV/EBIT and 20-17 adj. P/E on our estimates for 2025-2026E. In addition to rather neutral valuation on absolute terms, the company is still priced on par with the aggregate premium and luxury company peer group.