Growth trend in Finnish trade in January followed last year's pattern

Translation: Original published in Finnish on 3/3/2025 at 7:14 am EET.

The target market of Kesko’s grocery trade, Tokmanni and Lindex’s Stockmann division, i.e., the department store and hypermarket chains, grew by 3% in January. Food was the main growth driver with a 3% increase, while consumer goods had a smaller impact (+1%). Among consumer goods, sales of apparel continued to decline (-2%), while sales of household and leisure goods rose by around 2%. Thus, the trend in retailing was largely unchanged from the situation at the end of 2024.

Kesko’s daily goods trade developed slower than the market

Kesko's daily goods trade sales increased by 1% in January. Revenue from the consumer business remained practically at the same level as in the comparison period, so that the company once again underperformed the market. This is somewhat at odds with the price investment program launched at the beginning of the year, which we had expected to be more supportive of the company's progress. Kespro, on the other hand, grew consistently faster than the developed market, which has been a continuous trend in recent years thanks to Kesko's extensive range of services. If the comparable development of Kesko's consumer customer sales continues on the trend of January, there is downside potential in our forecasts. Investors should be aware that the February-March figures will be distorted by the fluctuations (in one direction and the other) in the selling days year-on-year. As usual, we will monitor developments and check our forecasts against the sales figures in our Q1 preview.

Support for Tokmanni on one side and weakness on the other

From the perspective of Tokmanni's Finnish business, the market developed in different directions depending on the product category. The target market for grocery, which accounts for over half of revenue, developed positively, while the important consumer goods market showed a mixed development. Based on the market news, we see no immediate need for forecast changes, as our 2% growth forecast for the Finnish business in Q1 is broadly in line with market developments. Going forward, we expect Tokmanni to increasingly benefit from growth in the grocery market as the company plans to strengthen its grocery assortment from the beginning of the year.

Lindex's key apparel market continues to decline

The market development was negative for the Lindex Group, with sales in the apparel product group, which is important for the group, declining by 2% in January. For the Stockmann division, our Q1 forecast is at the same level as the comparison period, so there is a slight downward pressure on the revenue forecast, especially as February will be impacted by one less sales day (2024 was a leap year).