Doro reports third quarter 2024

Quarter 3 2024 in summary
· Doro‘s net sales amounted to SEK 217.7 million (272.7), a decrease of 20.2 percent.
· Gross margin was 50.3 percent (43.4).
· EBITDA amounted to SEK 40.5 (48.4), a decrease of 16.3 percent.
· Operating profit (EBIT) amounted to SEK 30.3 million (38.9), corresponding to an operating margin of 13.9 percent (14.3).
· Profit after tax for the period was SEK 24.2 million (22.0) and earnings per share was SEK 0.99  (0.90 ).
· Free cashflow was SEK 37.5 million (65.8).
 
January-September 2024 in summary
· Doro‘s net sales amounted to SEK 619.0 million (684.0), a decrease of ‑9.5 percent.
· Gross margin was 45.8 percent (40.2).
· EBITDA amounted to SEK 72.8 (76.4), a decrease of 4.7 percent.
· Operating profit (EBIT) amounted to SEK 46.0 million (43.1), corresponding to an operating margin of 7.4 percent (6.3).
· Profit after tax for the period was SEK 44.5 million (26.7) and earnings per share was SEK 1.83  (1.10 ).
· Free cashflow was SEK 69.0 million (64.0).

Message from the CEO
Driving transformation in turbulent times
The challenge I took on when joining Doro was to drive a commercial transformation and a return to sales growth. Achieving such a goal will take longer than one or two quarters so I am not overly concerned by the sales result for the quarter. The fact that we continue to strengthen margins (45.8% year to date), deliver a strong EBIT (7.4% year to date) and generate a good cashflow, provides us with the means to invest in strengthening our commercial capabilities.
 
The third quarter of 2023 was strengthened by the sell-in and pipeline fill of a new range of feature phones, whereas in the current year, quarter three was the period when customers were selling out stocks in anticipation the launch of Leva, our new range of feature phones, during quarter four. So, whilst it is a disappointment to report a decrease in net sales of 20.2% compared to quarter three last year, underlying sell out from stores is better and Doro is either maintaining or growing market share in the Feature Phone category across its major markets.
 
Our focus during the quarter has been to align a revised strategic direction with the Board, initiating a brand restage project and clarifying the plans for 2025 with special focus on building strong commercial plans.
 
I am excited about the outcome of our strategic review as I see immense potential for growth. Doro’s role is to enable digital inclusivity for all through accessible, easy to use technology. Developing products for people with additional needs requires Doro to go beyond mainstream products. Doro products are easier to use and have additional, often unique, features that mean they are appropriate not just for seniors but for all individuals sharing the same needs. We plan therefore to target all of people with the same needs in future. 
 
The brand restage project is moving at high pace. We have engaged several strategic partners to support in consumer insight, branding and media strategy. Final delivery of the project is not due until the end of Q1, 2025 but we have decided to take a test and learn approach so that we can fast track this work. As such marketing assets are already in development to support our launch of the new range of Leva feature phones and our HearingBuds during quarter four.
 
I would also like to highlight our Direct-to-Consumer (D2C) business which has been growing steadily. Within our own channels we present the entire Doro range rather than a selection of products that individual operators and retailers choose to list. We see that this approach is appreciated by Doro customers by the fact that they are selecting our most advanced and premium products. The plan is to invest in building our capabilities to aggressively grow our direct sales and learn more about our customers’ needs so that we can serve them even better in the future.
 
As announced in September, Doro will keep its subsidiary IVS GmbH within the Group. The restructuring of the region has come far and lays the foundation for more commercial focus and greater efficiency in the future.
 
An internal milestone was celebrated at the end of September, Doro 50-year anniversary where we gathered everyone in the company together. It was an opportunity to reflect on the ups and downs experienced throughout our history and to invest time in aligning on our future strategy for growth.
 
Julian Read, President and CEO