Sees limited signs of changing consumer behaviour
ABG Sundal Collier hosted an investor presentation on Wednesday, 22 Nov with Embellence Group CEO Olle Svensk. We discussed potential market misconceptions about the company, with Mr. Svensk stating that wallpaper is far from as cyclical as some investors seem to think. Despite pressured consumers, Q3 grew by 4% organically, supported by strong performance in the Boråstapeter brand. While the price points for the Boråstapeter brand range between low- and mid to premium pricing, and other consumer companies speak at length about consumer downtrading, it was noted that the premium-priced Dahlia collection is currently one of the company's strongest products, and as such the Group does not see any clear signs of widespread downtrading. We discussed the inventory buildup since 2021, part of which is driven by the acquisition of Artscape; it is our interpretation that another part is due to a changing market dynamic in which retailers have moved to holding lower inventories.
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