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CEO’s review

CEO’S REVIEW ON 2017

2017 was a year of change and growth for Kamux. Our key accomplishments of the year were profitable growth, listing, strengthening the company’s management, developing processes and investing in training our personnel.

Kamux has a unique concept and business model, proven by the company’s strong, organic and profitable growth. We want to renew used car sales and serve customers better than traditional sales channels. We are a reliable partner for our customers, seeking to offer the best overall service and pricing that is attractive to customers. Factors important for our success include the ability to purchase the right cars for the right price and low fixed costs. We also want to reward our sales personnel for closing sales.

Stock exchange listing was one of the year’s milestones

One milestone of the year was our listing on the Nasdaq Helsinki main market, resulting in over 1,200 new shareholders for the company. The listing was an important step for us on our journey towards becoming the leading retail chain specialising in used car sales in Europe. The status as a listed company has increased awareness of the company, and increased interest in Kamux as an employer both in Finland and abroad. Our goal is to be a trendsetter and pioneer in used car sales and to renew industry practices.

Our growth continued

Our revenue, operating profit and number of employees increased, and our customer satisfaction remained high. Our profitability decreased slightly due to the relative decrease in gross profit, increase in operating expenses and operating profit adjusting items mainly related to the listing and strategy planning and implementation. Our revenue grew by 12.4 percent from the previous year and the operating profit margin was 3.6 percent. The profit growth was mainly due to the opening of new showrooms. We opened six new showrooms during the year and expanded four showrooms. In addition, in October, we opened a Kamux Green shop-in- shop in the Konala showroom to respond to consumers’ interest towards alternative fuel cars.

As proof of successful work for our customers, we were number 1 in the used car dealership category in the Auto Bild Finland Service 1 purchase study. We want to be a service-oriented and easily approachable car dealership where it is easy and pleasant to do business. The number one position in the mystery shopping based purchase study demonstrates that we have fulfilled our promise successfully.

We strengthened the company’s management

During the year, we strengthened our company’s management. With capable leadership, we support the company’s growth. We also focused strongly on developing and unifying our processes and codes of practice as well as deploying them with our personnel and partners.

Nearly all of Kamux’s customers use digital channels to search for cars. We want to be a trendsetter in car sales and a forerunner in digitalization in the industry. In February 2017, we opened an online store in Finland and at the end of the year, we appointed a Chief Digital Officer to lead the company’s digital development.

A multifaceted business year

The success of 2017 was the result of hard work. The year was extraordinary, marked by the question of car taxes connected to the Ministry of Transport and Communications’ road transport report, published at the start of the year in Finland as well as the fuel discussion that took place throughout the year. These resulted in uncertainty among consumers and increased inventory levels, which affected pricing and the competitive landscape. On the other hand, the boost in the economy has strengthened consumers confidence in the future, particularly at the end of the year. Due to its operating model, Kamux has managed well in a challenging market situation.

When looking at Kamux’s operating countries, 2017 was a multifaceted year. New operators have entered the Finnish market, and some of the car industry’s established names have become more active in used car sales. We are responding to this challenge by investing in the training and competencies of our personnel. A Training Manager started working at Kamux in 2017 and in February 2018 we opened the Kamux training center, allowing us to provide more focused and tailored training for all our sales personnel.

In Sweden, we finetuned our processes and focused on building the right kind of skills. The right implementation of the business concept improved Sweden’s result in 2017. In Germany, we are still building our operations, and the implementation of Kamux’s ways of working is ongoing. We hired a Country Director for Germany to complement Kamux concept with local market expertise.

Our operating model benefits our customers

Kamux’s operating model is efficient, agile, and flexible. We are well positioned in our home market, and Kamux’s culture provides a clear competitive advantage. We will continue our work in 2018 and focus on profitable growth according to our strategy. We will open new showrooms, develop the skills of our personnel and invest in the digital customer experience. Inventory management will continue to play a key part in our operations along with competitive pricing. Our vision is to be the leading retail chain specializing in used car sales in Europe.

JUHA KALLIOKOSKI
CEO, Kamux Corporation