New products drive growth for Thule in Q3 2024

Thule looked to new products to improve sales and profitability in its Q3 2024 (July-Sept) financials.

Net sales grew 1.4% in Q3 2024, reaching SEK 2,344m (2023: 2,311m). adjusted for exchange rate and acquisitions – sales increased 4.4%.

Operating income for the quarter amounted to SEK 413m (2023: 359m), corresponding to a margin of 17.6% (15.5). Net income for the quarter was SEK 300m (262m).

Mattias Ankarberg, CEO and President, noted the US market was proving tougher than Europe, but Thule inventory normalisation was ahead of schedule and the brand’s “market-leading” position and drive to invest was pushing the business forward positively.

He said: “We had a good third quarter of the year. Sales increased, profitability was good and the cash flow reached a record high level. Our many new products continue to drive growth and the work to build market positions in the new categories continues as planned… The market continues to be challenging, with cautious consumers and retailers. The North American market remains more challenging than its European counterpart. Our sales growth was driven by our many well-received product launches and by bike-related products. Sales remained unchanged in RV Products, where the market is experiencing a tougher period. Sales to manufacturers (OE) declined notably and were offset by good growth in sales to dealers. During the quarter, sales through thule.com opened in two more countries, Finland and Portugal, which led to immediate growth in the DTC channel.

“The gross margin for the third quarter increased to 42.9 percent (39.7). The EBIT margin amounted to 17.6 percent (15.5), the highest to date for a third quarter, with the exception of the pandemic years. The reduction in Inventory levels continued to outpace our goal for the year. Cash flow from operating activities reached was strong and totaled almost SEK 1bn for the third quarter. Together with an already strong balance sheet, this provides us with a continued capability to invest for the future.

“We continue to work towards our ambitious sustainability targets. In the third quarter we introduced several products designed with a higher share of recycled material and completed the installation of air-source heat pumps at one of our largest factories, both of which will help us reach our target of net zero emissions.

“This year, we are launching more products than ever before. This has resulted in a record number of design awards as well as immediate sales growth. In the third quarter we continued to note good growth from upgraded bestsellers, for example, our market-leading all-terrain jogging stroller Thule Urban Gilde, our updated duffel bag Thule Chasm, and the newly launched next-generation multisport- and bike trailers Thule Chariot. Growth within bike-related products also improved due to the launch of two new bike carriers in the quarter.

“We are a global market leaders in our most important product categories. This is one of our greatest strengths. An even more important strength is our ability to further develop and grow our market-leading positions.

Improving and developing is at the core of the Thule spirit. We are not content being market leaders – we continue investing to increase our lead over competition. As a market leader we have deep knowledge about technology, safety, regulations and consumer behaviour. We also have financial and other resources to invest in the long term. With the Thule spirit and a world class global development and test center, we are constantly raising the level of our ambitions and improving the quality of our innovations. In conclusion, we make more, and better, products than anyone else – driving growth for the product category and for ourselves. As a market leader, we essentially create our own future.

“One clear example of this is the third quarter’s new bike carriers, a category where we are a global market leader. We launched an updated version of our best-selling Thule Easyfold as well as a new niche product, the Thule Revert. The Thule Revert can transport up to six bikes at once vertically, and is the market’s only vertical carrier that provides assistance in raising and lowering to manage the weight of six bikes. Thanks to our existing strengths, the development time was short, and being the result of an innovative product and established distribution, the first production volume is already sold out. We will now meet the next bike season with an improved bestseller and a winner in yet another niche. This is how we grow our market leading positions.

“During the last few years, we have invested significant resources in developing products for new categories, particularly in car seats. We will continue to invest to become a market leader in car seats – even if it takes 25 years, like it did for roof boxes. However, we also have great opportunities to further develop many of our existing market-leading positions, which leads to a quick and direct impact on sales and profitability. These investments will increase going forward. For example, we will launch other important new products and innovations within bike carriers as early as spring 2025.

“Thule is doing well, even in a tough market. We continue to invest long-term in areas that create value for Thule: product development; more product categories; increased consumer visibility; and increased efficiency in our supply chain. More people also want to live active lives, a trend that gives us a long-term tailwind.
After a good high season, an exciting fourth quarter awaits.”