Good morning. Welcome to Kamux quarterly results presentation. My name is Juha Kalliokoski . I'm CEO and Founder of Kamux.
Good morning. My name is Marko Lehtonen . I am Kamux CFO.
There in Helsinki, there is very nice weather, as same as our figures. This presentation, first week Q1 in brief, then we check our financial development, our strategy, outlook, and financial targets, and then we summarize these. Our vision is to be number one used car retailer in Europe. In these six areas, what we always tell to investors, if we compare to Q1 2020 and 2021, last year, January and February went well. In March, last two weeks experienced a significant change. And in this year, in Finland and Sweden, the market was quite good if we think that this COVID-19 situation, but in Germany, we had lockdown, and we mainly selling remotely these cars the whole Q1. Our revenue increased 25.4% to near to EUR 210 million, and of course, we are very happy about that and proud about that.
Our gross profit increased by 26.9% to EUR 23.2 million. Adjusted operating profit increased by 44% to EUR 5.7 million. Like-for-like, revenue increased by 12.8%, and it's very strong figures in this side. Kamux internationalization progressed , and total revenue increased in Sweden by 47.8% to over EUR 66 million, and in Germany by 40.3%, over EUR 21 million. Especially in Germany, when we think about the situation, what we have had in this Q1, it's very strong growth in Germany. Then the market situations, how the total market worked in these countries. In Finland and Sweden, the market in Finland slightly increased, and Sweden increased, and in Germany it declined. And then we think about Germany, that the market was declined and our revenue growth was over 40%, it's a very strong growth in this period.
Also in Finland it was over 20% growth. If you compare to market situation, and also in Sweden, even the market growth, our growth was nearly 50%. Of course, growth is very important for us and also one key point to our strategy to grow faster than earlier, but also that the growth is profitable growth. This is nice that our figures growth is 25% and adjusted operating profit over 40%, and it went the right way. We sold a little bit more than 2,000 cars more than a year ago, 16,200 cars, and growth per pieces was 14.2%. As we see that it's a lower number than our revenue growth, and it means that our average price grew over 10%. This trading environment has nearly returned to normal in Finland and Sweden.
Integrated services revenue relative development was impacted by increased average sales price because we have many products which are euros or crowns per sold car, and when the revenue is higher per car, it means that it's a smaller part of this revenue, this integrated services. Also in Germany, integrated services revenue was impacted by difficulties with sale of finance related additional contracts during the lockdown. This is also very big situation in Germany's market. Still if you compare last year, it was EUR 8.9 million revenue from integrated services, and this year Q1, EUR 9.4 million. We announced last week our openings in Oulu, which is our new strategy model, that we open this processing center and also store in Oulu, which the Kamux own, and we open it start of next year. It's 4,000 sq m size. Last week we opened in Gothenburg, in Sweden.
It's our biggest store ever. This is to our also plan that we don't open so many stores, but these stores what we open are bigger than earlier. Nowadays, we have in Finland 50 stores, Sweden 21, and Germany eight stores, totally 79 stores. Marko, here you are. Tell about the financial development.
Thanks, Juha. I am glad to do that. I have to note that the mood in the used car market at the moment in May is relatively different compared to last year. Due to the COVID-19 pandemic, the situation last year was quite unusual. If we start with the things what I have listed and I think are important for the shareholders, and of course, if we think about our balance sheet and our operating cash flow, so the inventory level is very significant factor. It's good to keep in mind that when we published our new growth strategy in March, so we have started already to add the level of inventory at the end of Q4 last year, and we have been doing that also now during the quarter one.
Of course, it's impossible to grow in this business if you do not have adequate level of inventory. In any case, even though we have been adding the inventory, the return on equity was 26.5% and was very strong, and it was growing from the last year. Also, equity ratio was 45.4%, and it improved slightly compared to previous year. After the comparison period, the first installment of the dividend, EUR 0.11 per share, was paid at the end of April. The earnings per share, which was EUR 0.09, it was growing 36.5% from the previous year. All in all, our strong financial position is giving us a very good foundation for the growth strategy. If we move on to the key figures, I'm not going to repeat the same figures what Juha just presented, but I will make few highlights here.
Firstly, gross profit being 11% was growing slightly compared to previous year. Adjusted operating profit 2.7% was growing slightly also compared to previous year. What we can be very satisfied is that the like-for-like growth was 12.8%, very strong development compared to the previous year. Revenue from integrated services was growing compared to previous year, but as Juha was mentioning, due to the slightly increased average selling price. So, relatively compared to revenue, it was a bit smaller compared to previous year. As we were buying stock and increasing the stock levels for our most important sales period, which is being the spring and the summer season, so it was also strongly impacting our inventory turnover. So Inventory turnover was 54.3 days, and it was increasing compared to the previous year.
If we then talk about our business segments and start with Finland. Of course, in Finland, we had a very strong and very profitable growth in the first quarter. It was very strong operating performance there, and especially if we think about the growth and like-for-like growth, it has to be noted that last year after the comparison period, we opened only one store in Tornio in May. So, really the growth from the new stores has been relatively limited. In Finland, the revenue increased 20.3%. Gross margin was increased to EUR 18.5 million, being 12.6% of revenue. Operating profit increased 42.1%, being EUR 8.3 million. integrated services revenue increased to EUR 8.2 million, being 5.6% of revenue, which was slightly smaller compared to previous year. In Sweden, we had a very strong revenue growth in the first quarter.
We have been growing 47.8%, and the gross margin increased to EUR 3.8 million. However, we were significantly putting effort and investment to the growth, but we were not also happy for the margin level and also for the operating profit. Margin levels were slightly impacted by increased sales between the group companies, but still also operatively, we were not fully satisfied for the profitability level in Sweden. In Sweden, the growth was also driven by the new showrooms and of course like-for-like growth. I would also like to note that in Sweden, Tommi Iiskonmäki , who is very experienced and seasoned Kamux leader, started as a Country Manager starting 1st of March. I'm confident that he will deliver well in Sweden. Germany. The story in Germany is relatively different compared to the other markets. We had a very strong revenue growth despite the lockdown.
However, in the lockdown situation when we had to sell only remotely, we were keeping the inventory turning, which means that we lost some in the margin. If we look at the total revenue increased 40.3%, but the gross margin was EUR 0.9 million, which was basically in the last year level. Operating loss increased and was EUR 1 million. We had also, in the first quarter, constantly part of our people in the German Kurzarbeit, so to say, temporary layoff model. In Germany, the integrated services revenue declined, and as Juha was mentioning, very important part of that revenue is that we are selling additional contracts and services which are related to the financial contracts, and in this remote selling environment that was then deemed difficult. Then, of course, that result we can see here. In Germany, the revenue growth was driven by the new showrooms.
We start to put more the eyes into the balance sheet and the cash flow side, we invested in the purchasing and raised the inventory levels according to our updated growth strategy. Our net working capital was growing 57.2%, and the inventory is growing 57.6%, being roughly EUR 122 million. The growth here looks relatively significant, but have to keep in mind that the last year, end of March, the mood was very different, and, of course, also the trading environment was very different. That is, of course, partially impacting this change here. Of course, when we have been growing the inventory, it has for that period a significant impact on the cash flow from the operations, and especially when we started to increase the inventory in Q4 and continued in Q1.
So this, So to say, step change has been impacting the cash flow and being now minus EUR 13 million in the first quarter. Of course, that impacted to our cash situation, but we still had roughly EUR 15 million short-term credit limits not used, so I'm not personally, I'm not personally concerned about the situation. Our cash situation is very good. If we go to the investments, according to our new strategy, we have been continuing to invest in knowledge management, which means our digital systems and functions, and investments in the first quarter was roughly EUR 1.2 million, so not big change for our investment profile as compared to the before. We also published, after the first quarter, our investment Oulu for the new bigger store and the processing center, which will happen during this year.
We have been also in the group functions centralizing resources and people more to the center, which are serving or which are developing systems or processes for the whole group benefit and for the whole group usage. This is, of course, also according and along with the new strategy we published. It is good to still repeat and memorize why we are doing this. The targets here are really to create the best online customer journey and improve and streamline our core processes. We have roughly over 900,000 direct visits to our own websites in Finland, Sweden, and Germany. If you think about the cross-selling or click and collect, as we speak about that, it was now in the period 36% in Finland and 31% in the group, where we can see also some growth compared to last year.
In the Finland last year was 33%, and in the group 29%. This cross-selling or click and collect has also developed positively during this period. I will now move to the strategy and outlook at our financial targets. We have been relatively busy implementing our new strategy, and I'm very pleased to tell you about quite many developments we have. If we start with the omnichannel customer experience and services, we launched a pilot in Finland for Kamux Huoleton . If I would translate it would mean Kamux Care free, and that is a monthly fee driving service as a pilot. If I look at the efficiencies and processes and scalability, we opened, last week, a mega store in Gothenburg, as Juha was mentioning, the biggest ever we have. Also we published the strategic property investments in Oulu.
About utilizing data and leading with the knowledge, Kamux Management System, so meaning our own sales and CRM system, it's in use in Germany, and we will gradually implement it during this year for the whole group. About developing capabilities and continuous learning, the focus is now on the leadership and supervisory skills training and development. Let's go through once more our financial targets. The targets being revenue growth over 20% annually increasing Adjusted EBIT and Adjusted EBIT margin over 3.5%, return on equity over 25%, and target to distribute dividends at least 25% of net profits. The targets, of course, are in line with our new growth strategy, and I think the biggest change compared to previous is really about the dividends, where we are now channeling more net profits to company growth and investments what is needed to growth.
If we look on the past, we can see that the dividends have been, of course, growing very strongly. Of course now we are assessing the situation carefully and looking what investment and what capital we need for our growth. Now we'll summarize this all. In Q1, revenue increased by 25.4% to EUR 209.9 million. Gross profit increased by 26.9% to EUR 23.2 million. Adjusted operating profit increased by 44% to EUR 5.7 million. Like-for-like showroom revenue increased by 12.8%, and Kamux internationalization progressed, and total revenue increased in Sweden by 47.8% and in Germany 40.3%. In Finland and Sweden, all stores were open. In Germany, the lockdown continued in January to March, car sales were mainly remote selling. Thank you for your attention, we are very happy to answer your questions.
Congrats on the strong quarter. In recent quarters, you have mentioned challenges in purchasing inventory. Was the tailwinds from the strength in the new cars market enough for you to be able to increase inventory, or did you have to compromise on purchase prices?
It is very positive that there was a slight growth in the new car market, and we think that is very natural and positive development. I think as we have discussed and also described before, that we are always looking the current situation, that what are the current market prices to buy and to sell the cars, and we have, of course, own demands for that. When we launched the new strategy in Capital Markets Day, we also said that the target is not or our aim is not to grow by slashing the margins.
Operator, we are ready to take questions.
Thank you. If you wish to ask an audio question, please press zero one on your telephone keypad. If you would wish to ask to cancel further questions, you may do so by pressing zero two to cancel. Once again, please press zero one on your telephone keypad if you wish to ask an audio question. Our first question comes from Maria Wikstrom from Danske Bank. Please go ahead.
Thank you. I try to ask in this English-speaking conference now instead. I still have some questions left, and one is on the competition situation in Finland. Obviously, one of your competitors, Saka, has been growing very fast as well. Have you as well. How would you describe the competition situation currently in Finland in used car retail, please?
The big picture, we are happy that we have competitors in all countries. It tells also that Kamux has made many things so that this is the very interesting part of car business, this used car business. It means that the.. We biggest player take the market share from the smallest one, and also it tells that the consumer trade went all the time down. It means that we must be better than the other competitors, that we can take the market share. And as we've showed in, for instance, Q1, that we can do that. I think that in the whole used car business, it's good that there are many strong players in the market.
Okay. Then maybe one more on the ancillary services and the profitability of those. I think we talked about for some time that, given the profitability is not as good in Sweden, for example, than it is in Finland, that it improves with scale and you would perhaps think about pooling the volumes to getting the better terms with your finance partners. Do we have any update on these ancillary services and where you are in terms of raising the profitability in Sweden and Germany and maybe coming up with new products which could have a better profitability?
Thanks, Maria. You know, with the integrated services and finance and insurance, we look at the contracts annually and compete them on the market annually. And then, of course, of course, so to say, we use those services. If thinking about the first quarter, our penetration rates actually were, I would say, good. No big changes compared to the past or the previous periods. As I was saying, there was relatively, relatively big challenges in Germany to sell, to sell additional contracts or services related to the finance contracts, and that can be, of course, seen in our revenue.
And then, if we look on Finland or Sweden, we can see that when our average price has been increasing, meaning the revenue is increasing, in those contracts, there are components which are more transactional Euro-based, not so much for the selling price necessarily. That is, of course, impacting that volume was in the Q1 growing less, but there is not changes in the conditions or so.
Okay, perfect. I have no further questions.
Okay, that's with the phone questions. We have couple more. Inventory turnover decreased in the quarter, days went up. Do you expect turnover to grow in the future? Do you have a target level?
We are happy between 40 to [inaudible] the days, should be inventory days between 40-50 days. And of course, it's better if we are near to 40 days. But as Marko mentioned, that just now was the time when we increased our inventory. And if we think that the biggest part of that came in March, and it means that we didn't sell these cars out and inventory growth-- inventory grew, but without sales. It means that the inventory turnover went wrong way. This is very important KPI for us, and we are carefully about that. If we compare back year, Q1 at the end of Q1, there was COVID situation in, and we sold hardly the cars out and take the cash in. Now it's the other type of situation in the market and in how we approach this 2021 spring and summer.
Good job with the growth. Related to operating profits, could you explain why operating profits have declined in Germany and what you expect in the future in terms of operating profits?
Let's start with the expectations. We have been telling in March our financial targets being on the group level 3.5%. We have not published a target level for the countries individually. As I was describing, but maybe I will do it bit more deeper. The trading and business environment in Germany in the first quarter was very difficult, so we had a lockdown, so meaning the stores were mainly closed, and we were mainly selling remotely the cars, which of course, had quite significant difficulties for our trading and a normal business operation. We had also people in temporary layoff or as the German word is [Non-English content], so we had possibilities maybe to save there some cost, but of course, it doesn't offset those difficulties with closing of the stores had there.
That finishes our questions in English.
Thank you.
Thank you very much, and have a nice spring.