Swedish-based Nobia – the parent company behind retailer Magnet Kitchens – has managed to slow the loss to its profits and improve over Q1 of last year, but continues to report a disappointing overall loss to its bottom line.
In its latest financial report, the company reported a year-on-year decrease to its Q1 net sales. This year, sales in the first quarter dropped to SEK 2.474bn (approximately £191m), falling by around 5% from last year’s SEK 2.615bn (roughly £202m).
In terms of geography, Nobia saw year-on-year net sales of SEK -7m (or a less than 0% difference) in its home territory of the Nordic region. However, this plummeted to SEK -146m (or a 12% difference) for the UK region specifically.
Examining this in more detail, Nobia said this sales decline was partly explained by a reduction in its number of UK kitchen stores compared with last year, after it announced its plans to close some “underperforming” Magnet stores. According to Nobia, the total number of kitchen stores in the UK is now 170 – down from 191 a year ago.
However, operating profit for the kitchen giant had improved by a significant 86% year-on-year, rising from SEK -44m this time last year to SEK -6m in Q1 2025. The company’s profits after tax also improved by almost 45%, rising from SEK -219m last year to SEK -124m this year.
Despite the improvement, Nobia still appears to be running at a loss. However, these results definitely show green shoots of recovery for the company, especially considering its operating profit for 2024 as a whole plummeted by an alarming 240% year-on-year.
“I am pleased with the profitability improvements in the Nordics and the fact that our Group gross margin has improved year-over-year for the fifth consecutive quarter,” commented Nobia CEO Kristoffer Ljungfelt.
He continued: “While we continue to make solid progress in consumer sales, margin improvements, and cash generation, we remain challenged by historically low market volumes in the project segments.
“The growing number of store visits and kitchen design appointments continues to support the positive development in the consumer segment. Conversely, the low activity in residential property developments continues to burden demand and growth in the project segment across all markets, with double-digit volume declines in Finland, Norway and the UK.”
Commenting on the UK market specifically, Ljungfelt said: “Gross margin improved to 41.3% driven by growth in consumer sales, while the supply chain remains burdened by volume underabsorption. Cost savings in the quarter were offset by marketing spend to drive order intake during the important winter period. While we safeguard the positive momentum in consumer sales, we will continue the transition to an asset light operating model and realize savings from executed cost reductions and store closures.
Looking ahead to the rest of the year, Ljungfelt concluded: “We estimate that the consumer market will continue its recovery, while the project market is likely to remain subdued for the remainder of 2025. While recent changes in international trade policies do not currently have a direct impact on Nobia, their indirect effects – particularly in relation to interest rates, inflation, and broader macroeconomic dynamics – remain uncertain.
“Regardless of the market uncertainty, we remain confident in our strategic priorities going forward; to ramp-up the new Nordic factory in Jönköping, to continue the turnaround of the UK operations and deliver on our cost reduction initiatives.
