Unaudited consolidated interim accounts for the fourth quarter and twelve months of 2025

The Group’s consolidated unaudited sales revenue for the fourth quarter of 2025 was 239.2 million euros, representing a decrease of 6.8% compared to the same period of the previous year. The total unaudited sales revenue for 2025 amounted to 919.6 million euros, declining by 2.6% compared to the result for 2024, when sales revenue totalled 944.6 million euros. The Group’s consolidated unaudited profit before tax for the fourth quarter of 2025 was 8.3 million euros, decreasing by 4.9 million euros compared to the same period of the previous year. Profit before tax for 2025 amounted to 24.3 million euros, representing a decline of 31.4% year on year.

In a challenging economic environment and amid declining sales volumes, the Group achieved a profit in all business segments in the fourth quarter, supported by effective cost control, flexible management of operating volumes and the implementation of internal efficiency-enhancing measures. Compared to the previous year, profit growth was recorded in the department stores and security segments. In summary for 2025, almost all business segments ended the year with a profit. Only the department stores segment remained in a slight loss. The Group’s sales revenue was predictably most significantly affected by the substantial decline in the car segment’s sales revenue. The motor vehicle tax introduced in Estonia during the reporting year and the resulting sharp decrease in demand led to a significant contraction in new passenger car sales, with total car sales in Estonia declining by 48.6% for the year and by as much as 62.4% in the fourth quarter. Despite the challenging market conditions, the decline in the Group’s car segment sales revenue in the fourth quarter was limited to 18.5%. For 2025, the Group’s car segment sales revenue was 11.9% lower than in the previous year. Weakness in the Estonian market was partially offset by more stable sales results of the subsidiaries in Latvia and Lithuania. In the continuing cooling economic environment, the Group’s other retail segments also recorded a slight decline in sales revenue. In the fourth quarter, the security segment increased its sales revenue. Continuous improvement of work processes and optimisation of the supply chain in cooperation with the logistics centre have helped to keep labour costs under control. Labour costs increased by 0.4% in the fourth quarter, while the average number of employees decreased by 2.3%. For the reporting year, labour costs increased by 3.7%. The Group has also kept other operating expenses stable, with annual growth of 0.2%. Net profit was positively affected by a decline in interest on the Group’s borrowings, providing relief of 1.5 million euros for the year compared to the previous year. The company’s income tax expense decreased by 1.2 million euros in 2025 due to the recalculation of deferred income tax in accordance with International Financial Reporting Standards applicable in Estonia and Latvia. The comparative fourth quarter of the base year included one-off profit of 4.0 million euros. Of this, 2.1 million euros resulted from the revaluation of investment properties (the corresponding figure in the fourth quarter of 2025 was 0.3 million euros) and 1.9 million euros from extraordinary profit arising from the sale of two non-core properties in the Group’s real estate segment in Latvia. As a result of the sale of these properties, the real estate segment’s external sales revenue decreased in the reporting year.

The most significant investment of the year was the completion of the Group’s new multi-brand car showroom in Vilnius, where sales and servicing of KIA and Škoda vehicles commenced. The new showroom provides a strong foundation for further growth in the Lithuanian market and across the Baltic States. In the Selver supermarkets segment, Jõgeva Selver was renovated in the fourth quarter. In the department stores segment, the comprehensive upgrade of the I.L.U. e-commerce platform, offering enhanced marketing capabilities, was completed, with the launch scheduled for the first quarter of 2026. Earlier in the reporting year, renovation works were carried out in the first quarter in the department stores segment on two floors of the Children’s World at Kaubamaja Tallinn department store. The renewed Children’s World was opened in March. In Estonia, construction works are ongoing to establish a new bodywork workshop adjacent to the Peetri car dealership. Preparations have also commenced for the planned development of a new Selver store in Pärnu Papiniidu and for the expansion of Laulasmaa Selver, both scheduled for opening in 2026.

Selver supermarkets

The consolidated sales revenue of the Selver supermarkets business segment in the fourth quarter of 2025 was 157.0 million euros, representing a 4.3% decrease compared to the same period of the previous year. Consolidated sales revenue for 2025 amounted to 611.9 million euros, increasing by 0.3% year on year. In the fourth quarter of 2025, profit before tax was 3.5 million euros and net profit to 1.4 million euros, which were respectively 1.1 million euros and 4.2 million euros lower than in the base period. The difference between profit before tax and net profit arose from a change in deferred income tax liability calculated on dividends. For the reporting year, the consolidated profit before tax of the supermarket segment amounted to 12.2 million euros, which was 3.8 million euros below the comparative base. Net profit for 2025 amounted to 9.5 million euros, decreasing by 6.0 million euros compared to the previous year. The average monthly sales revenue of goods per square metre of sales area in 2025 was 0.40 thousand euros (the comparable figure in 2024 was 0.41 thousand euros), and in the fourth quarter 0.41 thousand euros (the comparable figure in 2024 was 0.43 thousand euros). On the comparable stores, the average monthly sales revenue of goods per square metre of sales area in 2025 was 0.41 thousand euros (the same figure in 2024 was also 0.41 thousand euros), and in the fourth quarter 0.42 thousand euros (the same figure in 2024 was 0.43 thousand euros). In 2025, a total of 44.4 million purchases were made in stores, remaining at the level of the previous year.

When analysing the financial results, it should be considered that the comparative data for the period under review do not fully reflect the operations of the Raadi and Rocca al Mare Selver stores, which were opened in the fourth quarter of 2024. At the same time, the base data include the results of Maardu Selver, which was closed in February 2025. The renovation and expansion of Jõgeva Selver had a negative impact on financial performance in the fourth quarter, as this involved one-off additional costs and a temporary suspension of sales activities. Selver’s fourth-quarter sales results continued to be affected by the general weakness of the Estonian economy and the retail environment, as well as by the decline in customers’ purchasing power resulting from increases in income tax and the VAT rate. According to Statistics Estonia’s data for the first eleven months of 2025, sales revenue at current prices in the retail segment of non-specialised stores, where food products, tobacco and alcohol predominate, increased by 2.3%, while sales volumes have remained in decline at approximately 3%. Selver’s sales revenue growth in the most recent quarter was slower than that of the market segment. The main reasons for the decline were the increased share of promotional products and products with a lower price image in the shopping basket, as well as a deeper decline in sales of everyday consumer goods and industrial goods. The financial results for the fourth quarter of 2025 were affected by a decrease in sales volumes. At the same time, the Group has successfully coped with pressure from rising input prices for various services and materials and with the optimisation of expenditure volumes, as a result of which the segment’s operating expenses increased by only 1%. Pressure on wage costs and sales revenue growth lagging behind wage growth have led to a slight decline in labour productivity.

The supermarket segment continues to operate responsibly and with a strong commitment to sustainability, with the aim of continuously improving its operations to reduce environmental impact. The recently renovated Jõgeva Selver has taken a major step towards sustainability by switching to energy-efficient solutions that reduce the store’s environmental footprint by approximately one third. The building’s refrigeration systems were converted to a CO₂-based solution, the waste heat of which is smartly used for heating premises and water. Across the segment, the optimisation of product assortments and processes remains a key focus. To better adapt to changing customer demand, Selver added the Scandinavian white-label brand First Price to its assortment this year; the brand is available exclusively at Selver and Delice. The First Price range represents affordable pricing and reliable Scandinavian quality, expanding the selection of the most competitively priced everyday products. During 2025, the logistics centre established in Maardu in 2024 was brought fully into operation. Focus also remains on increasing activity volumes on the Bolt Market and Wolt platforms and on the further development of Selver’s e-shop. The circular economy is also supported, as mono-material bags are used at the baking points of all Selver stores. This improvement makes subsequent sorting and recycling of packaging significantly easier for consumers.

At the beginning of 2025, Selver’s e-shop was selected as the Estonian people’s favourite store in the food and consumer goods category in a public vote organised by the Estonian E-commerce Association. In April, Selver joined the Vägivallavabaks (Violence-Free) employer initiative launched under the leadership of the President Kaljulaid Foundation, which brings together employers’ efforts to combat domestic violence. In CVKeskus.ee’s 2025 survey, Selver ranked among the twenty most desirable employers in Estonia, achieving 19th place.

As of the end of December, the supermarket segment included 72 Selver stores, 2 Delice stores, a Mobile Store, and a café, with a total sales area of 123.8 thousand square metres. In addition, there is e-Selver, which is the largest online store in Estonia by service area, and the central kitchen, Kulinaaria OÜ.

Department stores

The sales revenue of the department stores business segment in the fourth quarter was 32.2 million euros, remaining 3.0% below the level of the previous year. Sales revenue for 2025 totalled 103.0 million euros, representing a decrease of 1.1% compared to the preceding year. Profit before tax for the fourth quarter amounted to 2.2 million euros, which was 25.3% higher than in the comparable period of the previous year. For 2025, the department stores segment recorded a loss before tax of 0.5 million euros, which was 0.2 million euros lower than the result a year earlier.

The average monthly sales revenue per square metre of sales area at Kaubamaja department stores in 2025 amounted to 0.32 thousand euros, which was 0.8% lower than in the previous year. In 2025, promotional campaigns performed consistently very well, with both the autumn Ilu Aeg campaign and Osturalli proving to be the most successful to date. However, fourth-quarter results were negatively affected by warmer-than-average winter months, which reduced demand for winter boots and warm outerwear, while the first frosts only arrived at the beginning of 2026. In Kaubamaja’s food retail operations, the distinctive product assortment compared to competitors continued to attract new loyal customers to the Food Worlds, and sales results exceeded expectations. December delivered the best results of all time for Kaubamaja Food Worlds. In November, a completely renewed café was opened in the Women’s World area in cooperation with top chef Anni Arro, which generated increased interest among Kaubamaja visitors. In the first months of the year, renovation works were carried out on two floors of Tallinn Children’s World, and in March the department was reopened with a fully renewed concept. New brands were added along with lifestyle-based displays, which attracted strong customer interest. Kaubamaja has also received positive attention from exclusive special collections available only at Kaubamaja. During the spring season, an exclusive anniversary collection was launched in cooperation with Lilli Jahilo, the autumn campaign featured a jewellery collection by Sigrid Kuuse, and a new private label PAI brand (“PAI”, inspired by the Estonian word for a gentle touch) bedding collection designed by Kätlin Kaljuvee. Customer interest in the e-store sales channel increased significantly, showing double-digit growth compared to the previous year.

The sales revenue of OÜ TKM Beauty Eesti, which operates the I.L.U. cosmetics stores, amounted to 2.6 million euros in the fourth quarter of 2025, representing a decrease of 7.1% compared to 2024. Fourth-quarter profit amounted to 0.02 million euros, which was 0.1 million euros lower than the result for the fourth quarter of 2024. Continued consumer caution in purchasing decisions and high price sensitivity also characterised sales in the fourth quarter. Christmas sales likewise fell short of expectations, while meeting customer expectations required more aggressive pricing campaigns, which reduced sales margins. Sales revenue for 2025 totalled 8.2 million euros, which was 5.4% lower than in 2024. The loss for 2025 amounted to 0.15 million euros, which was 0.39 million euros weaker than the result of the previous year. The focus was on optimising inventory levels and shaping an appropriate brand portfolio for stores operating under the new concept. In addition, the key development activities of the renewed e-shop, offering broader marketing opportunities, were completed, with the launch scheduled for the first quarter of 2026.

Car trade

Sales revenue of the car segment in the fourth quarter amounted to 41.8 million euros, which was 18.5% lower than in the same period of the previous year. Sales revenue for 2025 totalled 176.9 million euros, representing a decrease of 11.9% compared to the previous year. A total of 5,140 new vehicles were sold during the year, including 1,115 vehicles in the fourth quarter. The segment’s profit before tax for the fourth quarter of 2025 was 0.9 million euros, which was 1.3 million euros lower than in the corresponding period of the previous year. Profit before tax for 2025 amounted to 5.7 million euros, representing a decrease of 48.5% compared to the previous year.

The year 2025 proved to be highly uneven in the Baltic car market. The Estonian passenger car market declined by approximately 50% year on year, while the markets in Latvia and Lithuania grew by around 30% and 40%, respectively. In the fourth quarter, the downturn in the Estonian car market deepened further to 62%. The decline in sales volumes resulting from the collapse of the Estonian market was partially offset by the Group’s cross-Baltic business model in the car segment, supported by more stable retail sales in Latvia and Lithuania and the continued import of KIA vehicles across the Baltic States. The most significant event of the year was the opening of the Group’s new multi-brand showroom in Vilnius, where sales and servicing of KIA and Škoda vehicles commenced. The new showroom provides a strong foundation for further growth in the Lithuanian market and across the Baltic States. In Estonia, the establishment of Viking Motors’ body repair workshop is progressing according to schedule, with completion planned for spring 2026, which will support the expansion of after-sales capabilities in Estonia.

In November, Kia’s fully electric van PV5 entered the Baltic market and was awarded the international title “2026 International Van of the Year”.

At the beginning of January 2026, as a significant post-balance-sheet event, an agreement was signed to acquire Rohe Auto AS and SKO Motors OÜ, whose principal activities are the retail and wholesale sale of Škoda-branded vehicles, spare parts and accessories, as well as the provision of maintenance and repair services in the Tallinn and Harju County region. The transaction will strengthen the position of the TKM Group’s car segment in Estonia and the Baltic States, create synergies and add resilience to the Group’s portfolio.

Security segment

The security segment’s external sales revenue in the fourth quarter of 2025 was 6.4 million euros, increasing by 6.8% compared to the same period of the previous year. The segment recorded profit before tax of 0.2 million euros in the fourth quarter, representing an improvement of 0.2 million euros compared to the corresponding period a year earlier. The security segment’s external sales revenue for 2025 amounted to 20.1 million euros, declining by 8.1% compared to the previous year. The segment recorded a loss before tax of 0.04 million euros for 2025, which was 0.3 million euros weaker than the result for the same period of the previous year.

In the fourth quarter, the segment’s turnover returned to growth and profitability also improved. The strongest growth was recorded in manned guarding and technical project construction, where both sales revenue and profit increased. The economic environment remains challenging, with continued pressure from rising input costs, high customer price sensitivity and intense competition. The security segment is focusing on service development projects with the aim of bringing several new services to market. Improving operational efficiency and increasing sales remain key priorities.

Real estate

The real estate segment’s external sales revenue in the fourth quarter of 2025 amounted to 1.9 million euros, declining by 12.5% compared to the reference period. The segment’s profit before tax for the fourth quarter was 2.1 million euros, representing a decrease of 62.8% compared to the reference period. The segment’s external sales revenue for 2025 amounted to 7.7 million euros, increasing by 5.1% compared to the same period of the previous year. In 2025, the real estate segment generated profit before tax of 9.0 million euros, which was 18.4% lower than in the previous year.

Sales revenue growth in 2025 was primarily supported by the addition of rental income from the logistics centre leased to an external third party, which commenced operations at the end of 2024. The decline in quarterly sales revenue was driven by the absence of external sales revenue from the Latvian real estate company, as the commercial properties leased to external parties were sold at the beginning of the year. Sales revenue also declined in fourth quarter at the real estate company managing Tartu Kaubamaja centre, in connection with a change of tenants in the centre. The decrease in profit during the reporting period was caused by comparative data that included one-off gains. Income in the comparative period reflects a gain of 1.9 million euros from the sale of the Ogre and Rēzekne commercial properties to external parties by the Latvian real estate company at the end of the previous year, as well as an annual gain of 2.1 million euros from the revaluation of assets to fair value. Changes in the fair value of assets did not have a material impact on profit in 2025, with revaluation gains amounting to 0.3 million euros. Profit for the reporting period was also positively affected by lower borrowing costs, as interest expenses in the segment declined by one quarter.

In cooperation with Enefit Volt, the installation of public electric vehicle charging stations in the car parks of Selver stores and shopping centres is continuing. Throughout 2025, marketing activities were consistently centred on the 20th anniversary of Tartu Kaubamaja and the 10th anniversary of Viimsi Centre, with the celebrations placing strong emphasis on engaging the local community. An important event at the beginning of the year was also the opening of a Vapiano restaurant in Viimsi Centre, which enhanced the centre’s attractiveness for customers and increased footfall.

The logistics centre completed in autumn 2024 was awarded a BREEAM Excellent certification in June and confirmed as compliant with A energy class requirements under the EU Taxonomy. In Vilnius, construction of the new KIA and Škoda showroom and service building was completed at the end of the year, and the showroom was opened for customer service. Extension and reconstruction works are ongoing at Laulasmaa Selver. In spring 2026, a bodywork workshop building adjacent to the KIA sales and service centre in Peetri, near Tallinn, will be completed.

CONSOLIDATED STATEMENT OF FINANCIAL POSITION

In thousands of euros

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

In thousands of euros

Raul Puusepp
Chairman of the Board
Phone +372 731 5000

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• TKMGrupp_4Q2025_eng