Profoto withdraws dividend proposal due to uncertain U.S. economic condition
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Swedish lighting company Profoto presented preliminary figures for the first quarter of 2025, amounting to SEK 164 million, compared to SEK 171 million last period, corresponding to a decrease of approximately 3.7%. Preliminary EBIT was SEK 17 million, half of last year. The result is affected by a significant decline in sales in the United States, mainly due to the current economic situation, as well as negative currency effects. The preliminary EBIT margin during the first quarter was 10.4 percent, compared to 20.1 percent last year.
The strengthening of the Swedish krona has resulted in negative translation differences from operating activities that affected EBIT by SEK -8 million, a deterioration of SEK 13 million compared to the corresponding quarter last year. The translation difference is directly attributable to short-term receivables which are valued at the balance sheet date. Adjusted for this, the preliminary EBIT margin amounted to 15 percent in the first quarter.
“We are facing a challenging market situation, especially in the US, and are now acting decisively with cost reductions to secure our future profitability,” says Anders Hedebark, CEO of Profoto. “At the same time, we continue to invest strategically in LED to take a premium position in the film and LED market and to maintain our leading position in innovative lighting solutions.”
Preliminary sales growth by region in reported currency was:
- APAC: +4.3%
- EMEA: +2.6%
- Americas: -12.1%
The negative development in the United States can mainly be explained by the current economic situation, which has created uncertainty and a reduced willingness to invest among customers. Specifically, retailers have become cautious as many customers have held off on placing orders.
Previous dividend proposal withdrawn while share buy-back proposal remains
Due to the current market situation, the Board of Directors proposes to withdraw the previous proposal regarding the dividend for 2024. The proposal for a share buy-back program of up to 10% of the shares until the 2026 AGM remains. Through this proposal, Profoto increases its financial flexibility in this time of uncertainty.
Adjustment of cost base with continued focus on sales and product development
Over the past year, the company has completed three successful flash launches and built a future-proof flash portfolio. With a complete and largely renewed product portfolio in flash, and the newly launched L1600D in LED, Profoto can focus and streamline product development while maintaining competitiveness. Profoto has decided to implement a cost savings plan that will reduce the cost base by approximately 20 percent. The full impact of the savings measures is expected to be visible in the second half of 2025.