Good morning, and welcome to the presentation of Komplett Group's second quarter results. My name is Kristin Hovland, and I'm Head of Communication at Komplett. We will start today with our CEO, Lars Olav Olaussen, who will go through the highlights and key priorities going forward. Our CFO, Krister Pedersen, will present more detail on the financials. At the end, Lars will summarize the quarter. The presentation will take approximately 30 minutes. Through the presentation, you are welcome to post questions on the web, and we will answer them at the end of the presentation. That's it from me. The floor is yours, Lars.
Good morning, welcome to Komplett Group's first quarterly result presentation as a listed company. We're excited to welcome more than 5,000 new owners, and we're looking forward to showing the capabilities of the organization to a wider audience. There are several key accomplishments to take forward in the second quarter. We've combined listing the company on the Oslo Stock Exchange main board with delivering strong operational results, as well as good progress on our strategic agenda. Faced with very strong comparable figures, we're still delivering sustained growth of 17% in the quarter and with growth across all business areas. The growth is supported by strengthened gross margins as well as significantly improved operational expenses. In total, we're delivering a 49% growth in our EBIT for the quarter.
We are also executing on our long-term strategy with the introduction of product subscription service offering Flex, as well as the acquisition of IT service provider Ironstone. Looking at our top line, despite facing very strong comparable figures, Komplett is delivering 17% growth in the quarter. The growth is broad-based across all business areas and is a reflection of the very good work being done by the full Komplett team. B2C is showing sustained growth despite extraordinarily strong comparable figures last year, when our performance in B2C was positively affected by shifts in consumer behavior following COVID-19. Growth in the quarter is also driven by very strong performance in B2B, as well as new customer agreements in the distribution segment. We're confident that the online migration that accelerated during the pandemic is sticky and will continue.
Further, we also see that categories like gaming and components for Komplett are less affected by the pandemic and will continue to see strong demand. If we move to our gross margin, in total for the second quarter our gross profit increases by 12%, with improving gross profit in all segments. Komplett Group is investing significant efforts in building strong revenue management capabilities. A few examples are supplier collaborations, assortment management, promotion efficiency, and private label expansion. These efforts are paying off and are now translating into continued improved margins, where we see both B2B increasing their margin in the quarter by 0.5 percentage points and B2C increasing by 0.8 percentage points. In the distribution segment, we have taken on large new customer agreements at below-average margins. This creates a negative mix effect and is reducing the total gross margin of the group.
However, this is a conscious choice because we are able to fulfill these customer agreements in a very cost-efficient manner and see solid profitability coming out of each and every one of them. In total, despite having lower gross margin, our gross profit increases by 12%, delivering in total NOK 331 million in the quarter. Looking at our EBIT, it grows by 49% versus last year in the quarter. This of course, is driven by solid performance both on our top line and our gross margin. In addition, Komplett has a very scalable platform, and we're able to improve our efficiency as volume continues to grow. In the second quarter, we reduced our operational expense as a percentage of revenue by 1.4 percentage points, and that was on the back of last year, where we reduced OPEX with additional percentage points from 2019.
We are constantly then improving our cost leadership position in the Nordic. In total, we increase our EBIT margin in the quarter from 3% up to 3.9 percentage points, delivering a total EBIT of NOK 94 million. If we dig into our business segments, B2C is showing sustained growth in the quarter despite facing extraordinarily strong comparable growth last year. The accelerated shift to online shopping over the last year is proving to be sustainable, and we do see continued strong demand in many of our core categories. We're also making conscious efforts to drive our top line, and in this quarter we've seen the effects of improved promotion efficiency, especially within our core categories, components, and gaming. Also, our gross margin levels continue to expand in the quarter and are up 0.8 percentage points versus last year, driven by strong promotion management and improved supplier terms.
In combination with solid operations, this increases the EBIT margin in the B2C segment by 0.8 percentage points, delivering 4.1% EBIT margin and a total of NOK 56 million. Looking at B2B, it's been a very strong quarter. Revenue grew by 27%, behind a balanced growth from both new customer acquisition, increased basket size, and increased frequency of shopping. Gross margin also expands by 0.5 percentage points, driven by improved supplier terms and increased share of private label products. B2B lands an all-time high EBIT margin of 10.4 percentage points, up 1.5 percentage points versus last year, delivering a total of NOK 34 million in the quarter. The Distribution segment continues its strong growth, driven by new customer agreements, growing 50% in the quarter.
The new agreements, as said, are on below-average margins, but they're leveraging on our existing infrastructure, and we're able to fulfill these agreements very efficiently. These efficiency improvements enable us to increase our EBIT margin by 0.1 percentage point up to 2.5% in the quarter, despite being on lower gross margin. In total, we deliver an EBIT of NOK 18 million in the quarter. Looking at our strategic agenda, a key part of the Komplett 2025 strategy is to expand our services offering. During the second quarter, Komplett launched a new product subscription service offering called Flex in our B2C segment. The offering allows customers to buy a wide range of products at a fixed monthly fee with a guaranteed residual value. Consumers can return and exchange their product after a down payment period, while Komplett will ensure that the product is sold in the second-hand market.
In addition to being an attractive customer offering, Flex represents a solid circular economy initiative supporting our sustainability agenda. We're also confident that this new way of owning products will create close customer relationships with the opportunity to create customer loyalty and recurring revenue streams going forward. As you can see on the slide, we've done a soft launch in Norway and Sweden. This means that we haven't yet invested in marketing behind the Flex offering. Despite that, the initial results are very promising, and we see up to 5% of our turnover coming through the Flex offering in the early days of being launched. Komplett recently announced the acquisition of 65% of the shares in Ironstone. Ironstone is a leading supplier of cloud-based IT solutions and services.
There is a growing demand from our customers to add services like basic IT setup, cloud-based applications, and IT security to Komplett's traditional hardware offering. The acquisition of Ironstone thus represents a strategically attractive add-on for Komplett and will strengthen our offering in the growing service segment. Going forward now, we will engage with the Ironstone team to ensure that we continue to drive their existing business model, while at the same time initiating the work of building an offering for the Komplett customer. Komplett does consider selected M&A a potential lever for delivering on our strategy. We will especially be looking for opportunities that strengthen our services offering, accelerate our sustainability agenda, or provide opportunities for consolidation that could strengthen our commercial position and deliver cost synergies.
Looking forward, our focus will be on continuously improving our competitiveness through driving efficiency improvement and scaling on our current platform, and then starting to also reinvest more and more into pricing and marketing. Further, we'll continue the work of building a service plan offering, both on the back of Flex and within our new collaboration with Ironstone. We're also initiating the previously announced supply chain program where we're progressing with the work on both a new warehouse in Sweden, as well as the new high-rise warehouse in connection to our current warehouse in Sandefjord. I'm now going to give the word to our CFO, Krister Pedersen, who will take you through the financial performance of the quarter.
Thank you, Lars, and good morning to you all. As Lars already has been through, we have a growth of 17% in the quarter. The revenue growth, the improved gross margin in B2C and B2B segment, and the limited growth in operating expenses have resulted operating result up almost 50%. Operating expenses has increased by only 3%, and that should be seen in comparison with 17% increased sales. The cost of the IPO process was NOK 9 million for the period and NOK 11 million in total. On net financials, that is colored by low debt, but also including initial cost of the new RCF facility of the fee is initial cost is NOK 2 million.
In the net tax expense, there has been a settlement of a transfer pricing issue where Komplett now can utilize a loss carried forward of approximately NOK 100 million and with a tax effect of around NOK 22 million, and this is booked in the first quarter. On the cash flow, there has been a good progression in operating result. However, the operating cash flow is hampered by increased net working capital. The main driver of this is increased inventory, both following the strong end of 2020, needing us to build up inventory in Q1 2021, but also taking positions to secure goods in the following season. This is a chosen strategy. There is a scarcity of components in the market, and we need to purchase goods and place orders earlier than we have done earlier or previous years.
The main increase in sales is from the B2B and distribution segment, where the customers have credit terms and leading to a higher accounts receivable. Regarding financials, Komplett has a new revolving credit facility of NOK 500 million, where of NOK 400 million is utilized due to dividend payout in the Q2. Net interest-bearing debt has increased from NOK 344 million to NOK 626 million. Despite that, the available liquidity has increased from NOK 156 million to NOK 474 million. The leverage ratio, excluding IFRS 16, has decreased from 1.8x-1.5x. Our financial targets are on the following two pages. For the group, we aim for annual growth in the level of 10%, with that surpassing NOK 15 billion in 2025. EBIT margin to improve year-on-year across all segments. Yeah, already said that.
In 2025, targeting growth, gross margin should be around 15%, with an EBIT margin around 5%. For the segments B2C, annual growth in the level of 8%, sorry, 10%-12%, and for B2B in the area of 8%-10%. The distribution in the level of 5%, however, will have a significant higher growth in 2021, and that is related to new distribution agreements. Annual CapEx, operational CapEx in the level of NOK 50 million. In addition, we need to invest in supply chain. Webhallen in Sweden have a fully manual distribution center today, and we need to bring the Swedish supply chain up to new automated level to increase both capacity and efficiency. In Sandefjord in Norway, we need to invest in a new high-rise warehouse linked to the rest of the building structure, also increasing efficiency.
At last, we need to invest in IT systems to link it all together. The sum of this is around NOK 400 million and will come in the period of 2022- 2023. Tax should be on the Nordic level. For Norway, around 22%, or it is 22%. Capital structure sufficient to secure flexibility to both the target handling the targeted growth and to pay out the dividend according to the dividend policy. The dividend policy is to pay out 60%- 80% of net profit, adjusted for any non-recurring or special items. Lars?
Thank you, Krister. Summing up, we come from a quarter with strong, profitable growth. E-commerce is established now on a new and higher level than prior to the pandemic, and we also see that consumer electronics, in general, is taking a larger position in our lives, increasing demand. We think we're well-positioned to take part in the growth that lies ahead of us. The solid top-line growth is supported by gross margin improvements in both B2B and B2C, as well as a strengthened cost leadership position with OPEX down 1.4%. In total, we almost deliver 50% improved EBIT in the quarter. We also continue to progress well on our strategic agenda, both with the launch of Flex as well as the acquisition of Ironstone, giving us a way into the growing service segment in the B2B market.
Looking forward, I'm confident that we have strong commercial plans in place for the quarters to come. We have solid access to products. I think we're well-positioned to deliver sustained growth, and we're on track to meet our long-term targets. Thank you. I think we'll now open for questions.
Yes, we have received some questions. First, a couple of questions from Mario Seidal in the Mustad Industry. Do you plan to release monthly revenue numbers in the future?
We have not decided to have that disclosed on monthly basis at the moment, no. Sorry.
The second question is, can you talk about the sales momentum in the quarter, especially for the month of June?
Yes. Yes, we can. In June, we continued to see sustained growth in all business segments. Of course, we are facing extraordinary comparables, but we're quite happy to see also that the B2C segment is maintaining growth, although at lower levels, and more normalized level than prior to the pandemic. B2B and the distribution segment is of course, continuing to go very strong in those months.
Thank you. A couple of questions from Petter Nystrøm in ABG.
Are you able to share some lights on the B2C growth in Norway and Sweden?
Well, yes. Looking forward, our clear ambition is to sustain growth across all business segments. For B2C, the shift that happened during the pandemic into online is sticky, but still, most consumer electronics products are not sold online. There is still ample headroom to grow. As said, we do see that consumer electronics is taking a larger part of consumer's life and sustaining demand at a higher level than prior to the pandemic. We're well positioned to take part in those trends. However, there is of course a general risk in the market for the general demand for physical products as markets open more and more up. That risk, we think, is well balanced as we also see strong momentum in our B2B business. Those two, we think will offset each other well.
Our commercial plans, we're reviewing our commercial plans for the balance of the year. I think they're strong. I think we have good access to products. Yeah, I think we have good executional capabilities. We are absolutely aiming for sustained growth across all business segments.
The last question is, what is the key driver for higher gross margin in B2C and B2B?
Well, I think as mentioned earlier, our efforts to drive revenue management are continuing to pay off. We're continuing to see improved supplier terms coming in. This quarter, we especially see the work that's being done in both B2B and B2C on building solid assortment structures and promotion management plans that is coming through and driving improved gross margin.
Thank you. That concludes the question from the web.
Thank you.
We will be back presenting our third quarter results on the 27th of October 2021. We wish you all a great summer, and thank you all for joining us today.