Release Date: February 07, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Thule Group AB (THLPF) achieved a 5% growth for the full year, driven by new products and bike-related items.
• The company reported an all-time high gross margin of 42.7% for the year.
• Thule Group AB (THLPF) successfully launched new product categories, including dog transportation and child car seats.
• The acquisition of Quad Lock, a market leader in performance phone mounts, contributed positively to growth.
• The company was recognized for its sustainability efforts, ranking among the top 50 globally in the Morningstar Sustainalytics rankings.

Negative Points

• The North American market remains challenging, particularly in the RV segment.
• The fourth quarter showed flat or slightly down organic growth, impacted by seasonality and weak bike sales.
• Higher SG&A costs were incurred due to numerous product launches, affecting overall profitability.
• The RV product category experienced a 7% decline in net sales for the quarter and 3% for the full year.
• There is still uncertainty regarding tariffs and their potential impact on the company's cost structure.

Q & A Highlights

• Warning! GuruFocus has detected 6 Warning Sign with THLPF.

Q: Could you provide some insight into the gross margin impact of the Quad Lock acquisition for the quarter and on a full-year basis? A: The Quad Lock acquisition positively impacted Thule's gross margin, although it's not the largest contributor to the improvement. The primary drivers are the underlying business improvements, including product mix and manufacturing efficiencies. (CFO)

Q: How should we view the key drivers of Thule's gross margin in 2025? A: We expect to maintain and continue the improving gross margin trend seen in 2024, driven by improved volumes and product mix. We have some price increases planned for 2025, which will support this trend. (CFO)

Q: Regarding bike-related sales, are you back to normalized levels, or is there still some recovery needed? A: In Europe, particularly in the premium segment, the market is in a good place with healthy inventory levels. However, North America still has some recovery to do, especially among independent bike retailers. (CEO)

Q: Can you update us on the launch plans for new categories in the U.S., particularly car seats? A: We will not launch car seats in the U.S. in 2025. We are still assessing the market and regulatory changes. We have not set a new timeline for the U.S. launch. (CEO)

Q: How is the RV market performing, and what are your expectations for 2025? A: The RV market remains challenging, with growth in the aftermarket channel but declines in the OE channel due to inventory management. We expect this trend to continue into Q1 2025, with potential balance and growth as the high season approaches. (CEO)

For the complete transcript of the earnings call, please refer to the full earnings call transcript.