Well, thank you. Thank you very much. Again, a warm welcome to this conference call, where we will present the max report for the second quarter of 2023. I'm Karl Sandlund. With me, I have Helena Nathhorst, our CFO. We will be speaking to a presentation that is available on our website, as usual, and we'll try to guide you to the right page during the presentation. To start with, I will give a short business update before Helena will cover the financials. After that, I come back with a summary before we open up for questions. If we start and move to Page 2 in the presentation. As you know, this, the second quarter, is part of our high season, and during this reported quarter, Byggmax delivered solid profitability above the pre-pandemic level.
We had a stable high gross margin and a strong cost control, with lower operating costs than at the same quarter last year. As expected, the consumer market continued to be weak during the second quarter, even though the development was less negative than during the first quarter of the year. In this market environment, we continued to strengthen our position and continued to gain market share. We also made progress on our key strategic priorities, which we will cover later during this call. The very short headline financials are as follows. You see them on the page. Sales in Q2 decreased to just over SEK 2.2 billion, 13% compared to last year. This is a reduced decline versus the one that we saw in the first quarter.
We continue to have a high share of e-commerce in the group. The gross margin was, as mentioned, high in the quarter. We delivered the same level as we did the second quarter last year. This level is actually only beaten by the one that we had in 2021 during the pandemic. A historically strong gross margin, driven both by product mix but also by active purchasing. We have in total 12 more stores compared to last year, and despite this, as well as inflation, we managed to reduce our costs with lower operating costs than last year, both like for like and the total costs. In addition, we continue to have control of our inventory with lower inventory levels compared to last year.
The EBITDA margin was 7.8%, which means that the margin in Q2 is higher this year than what we had before the pandemic in 2019. Solid performance in a continued weak market. If we move to Page 3, well, as mentioned, the market continued to be weak, even though the development was less negative than the one that we saw during the first quarter. The consumers continued to be hesitant, particularly related to larger investments, while we saw solid progress regarding products related to smaller projects. One example is the paint category that we have, which noted a new sales record during the quarter. Customers still want to take care of and improve their homes, but this year it seems like they are making smaller projects.
We see some of the customers' behavior more similar to those that we saw before the pandemic. More customers make their purchases in the stores, especially during nights and weekends, and this is partly on the expense on e-commerce. In all, we estimate that the Nordic consumer markets decreased by approximately 15%-20% compared to the same quarter last year, and this is to a level clearly below the time before the pandemic. As you see, while the overall market developed negatively, Byggmax continues to strengthen its position, and for the last years, we have consistently performed better than the market and gained market share, and this is something that is true also for the second quarter this year. In these times, the Byggmax's business model, which is based on low prices, is perhaps more relevant than ever.
If we look at Page 4, there has been a general trend the last couple of years with a higher interest for low-price retailers across industries, and this model is more relevant in times of high inflation. Our view is that customers who compare and see our low prices and experience our new store concept with a wider assortment of products for different types of home improvement projects, they tend to return to us, and this is one reason why our development is better than the market. In addition, our model with e-commerce in combination with many stores in the proximity of the customer is a strength, not least when customers are returning to more pre-pandemic behaviors. It's quick and easy for the customers to make the purchases, whether they choose to do it online or in the store.
Our model low price position with a widespread store of a network of stores combined with online sales enabled us to continue to strengthen our market position. If you look at Page 5, as communicated in earlier quarters, we have set three top priorities for the year of 2023, and here you see an update on these three top priorities. The whole headline here is to be as ready as possible when the market picks up again. The first priority is to continue to take market share and to continue to increase the competitiveness of Byggmax. We see that we are making good progress on this priority.
We continue to develop better than market, as you saw, and we have more and upgraded stores, and we have continued to drive efficiency, as you saw in the strong OPEX developments. Besides focusing on efficiency, our colleagues around the company have made a great effort securing that our stores are ready for the customers during this important high season. That's always, that's been a strong operational focus, and we are really happy to see that our customers appreciate the store experience. In our internal customer satisfaction survey, we have noted record high scores during this quarter. An acknowledgment of our colleagues' very strong efforts. The second priority for us is, this year, is to, what we call, to tune in some of our growth initiatives.
We launched, as many of you know, Byggmax Studio 2 quarters ago. This is our concept for indoor renovation with a larger focus on tiles. The concept is up and running. We continue to optimize it, and really look forward to opening an additional store in Umeå, Sweden, in the beginning of next year. During the quarter, we also started sales of an e-commerce concept for customized complimentary buildings. These are buildings that are configured with help of an online tool. Our customers can design personalized building, which is based on modular options. We launched it under our Skånska Byggvaror. We'll expand with more features and in more countries over time.
Another initiative that we are tuning in is a new digital tool for our store personnel to enable them to help customers order web products. We are now able to offer the entire e-commerce assortment to the customers while they are in our stores. The personnel can combine orders including both web and store products. In this way, by integrating our various sales channels, we can provide an even more comprehensive shopping experience for our customers. Finally, the third priority for us is to continue to be opportunistic and capture opportunities when they come due to this market situation. We continue to see interest for Byggmax in terms of store location scenarios that we were not offered before, new suppliers, et cetera. We continue to evaluate these opportunities actively as they come. That was a short update on our priorities.
We continue and move to Page 6, we also have high sustainability ambitions, and one part of this, our sustainability agenda, is Byggmax's Green Ventures. Within this initiative, we invest in businesses that have circular business models contributing to positive climate benefits. The investment we have had should fulfill three criteria: They must fit into the Byggmax's offering, of course, they must contribute positively to the climate, and finally, they should generate a profit for us. We recently made an investment in the Swedish company, Recoma, and that is a company that fits into these criteria. They use recycled packaging materials to produce boards, which can substitute OSB or plywood boards, with a substantially lower emission.
This is our second investment within our Green Ventures initiative, and we have earlier invested, as some of you might know, in the company MoreWood, which produces beams made from waste wood from the timber industry. The products from Recoma are already available online, and we are really looking forward also to offer them in our stores as soon as possible. This is one example of how we are working towards our sustainability ambition. Sustainable products that fit into Byggmax's offering and generate profits. With that, I hand over to Helena to cover our financials.
Thank you. We are now on Page 7, looking into the sales development for the second quarter. In the quarter, we have a sales decline on the continued weak market. As mentioned, we still see good performance on smaller projects, but there's a little pick up in larger projects, such as outdoor timber-related garden, greenhouses, and conservatories. The sales decrease in the quarter is 13.4%. The currency impact is minus of 0.5%. We have a weakened NOK and a strengthened euro adding to that development. If we look into the contribution from new stores, new stores contributed 2.4% in the quarter. We have four new stores in this period, three in Sweden, Markaryd, Askersund, and Uddevalla, and we have Kaarina in Finland.
In the last 12 months, we have a net of 12 stores. We will open one more store, Vallberga, shortly, and then, normally, the rest of the stores will coming in ahead of high season next year. We are happy to have closed our store portfolio upgrade plan, where we now see all stores, the long-term rental agreements are upgraded ahead of this high season. That was on the sales development. If you look on Page 8, we have the full PNL for the quarter, and we have looked into the drivers of the SEK 2.2 billion sales figure. If we look into the gross margin, it is at 32%, stable versus last year, but strengthened from a historical perspective.
The gross margin has had a positive impact on product mix, lower input prices from timber material related categories, and at the same time, it's market with high promotion activities. On the cost side, the comparable costs, excluding new stores, decreased by 59%, a very strong position. It has been an operational focus in the period, and we have modified the cost base to meet the lower sales volume, and this is primarily from staffing in stores and new ways of working in stores. In all, it's a strong quarter with efficiency gains in a weak market. We have an EBITDA margin of 7.8%, which is about 2019. Page 9 is cash flow and our net debt position.
Cash flow from operating activities amounted to SEK 895 million in the quarter, a strong increase versus last year. Cash flow improved from continued strategic actions to balance inventory levels on a weaker market. The net debt strengthened to SEK 679 million versus SEK 891 million last year, and the decrease is obviously driven by the strong cash flow in the quarter, combined with reduced investment activity in the period.
Thank you. Thank you, Helena. To summarize, on Page 10, before we open up for question, a couple of points. We have strong cost and inventory control with lower levels than last year, despite more stores. We continue to strengthen our position. In the current consumer environment, we show that our model with focus on low price is perhaps more relevant than ever. As mentioned, the Nordic consumer market for building materials continued to be weak in the second quarter, even though the development was less negative than during the first quarter. There are some bright spots in terms of macro factors, at the same time, the consumers continue to be hesitant, especially when it comes to the larger purchases or investments.
Uncertainty regarding the market development makes it important to continue to have cost control, strict cost control, of course. In addition, we continue to focus on our priorities to get Byggmax ready for when the market picks up again, to further increase the competitiveness, to tune in growth initiatives and to be opportunistic in this market. We really look forward to welcoming all our customers with more stores, a strong e-commerce assortment, the lowest prices, and employees that are ready to support during this summer. With that, we conclude the presentation part of this conference call, and I turn to the operator to open up for questions.
Sure. Thank you. Ladies and gentlemen, if you'd like to ask a question, please press star one on your telephone keypad. That's star one on your telephone keypad. To withdraw your question, press star followed by two, and please, to also remember to unmute your microphones when it's your turn to speak. Now, we'll wait a couple of moments to see if we can gather any questions. We have our first question, comes from Benjamin Wahlstedt from ABG. Benjamin, your line is now open. Please go ahead.
Karl and Helena, first off, cash flow is obviously very strong, supported by working capital. Could you give any additional flavor on the higher payables, please? Do you expect a significant reversal already in Q3, or how should we think about that please?
Yes, thank you, Benjamin. That is correct. It's a strong focus on our inventory, but as you say, the payables are high and will go down a little bit in the third quarter. It is the actual sort of increase of inventory adjusted to the late season, so we have some of the payables that will revert.
Thank you. Following on the delay in the season, I believe you previously commented on running sort of low season staffing in the Q2, seeing adverse weather in the beginning of the quarter. Is it possible to quantify this somewhat? Like at what point did you feel you could return to more normalized staffing levels, please?
Yes. In some ways, it is correct that we have reduced the staffing, so there will be an increase. Also we see different ways of working in the store. It's also partly an efficiency that we see will continue going forward. We have a sort of more digitalized ways of working in the stores that will help us to keep the lower levels. Correctly, if you say, March and April and May is a little bit lower levels. In the third quarter, slight increase, but not all the way up.
All right. Thank you very much. Perhaps finally then, you also commented in the report on a higher price pressure in the market. Is this driven by campaigns, or do you feel like a shift among incumbents to more of a discounter strategy, please?
No, we would say it's more campaigns. It's, it's timber prices, and it's a lot of activities where everybody is seeking, a turnover and, lower inventory levels. I wouldn't say it's a shift, it's more a market situation.
Perfect. Thank you very much. Those were my questions for now.
Thank you very much.
As a reminder, ladies and gentlemen, to ask a question, please press star one on your telephone keypad. That's star one on your telephone keypad. We currently have no questions registered, so I will hand back to the management team for final remarks, please.
Well, thank you, a lot, and thanks a lot for your participation during this call. We really hope that you will have a nice summer, and looking forward to speak to you again after the Q3 report. Thank you.
Thank you.
Well, thank you very much. Again, a warm welcome to this conference call, where we will present the Max report for the second quarter of 2023. I'm Karl Sandlund, and with me, I have Helena Nathhorst, our CFO. We will be speaking to a presentation that is available on our website as usual, and we'll try to guide you to the right page during the presentation. To start with, I will give a short business update before Helena will cover the financials. After that, I come back with a summary before we open up for questions. If we start and move to Page 2 in the presentation. As you know, this, the second quarter, is part of our high season, and during this important quarter, Byggmax delivered solid profitability above the pre-pandemic level.
We have a stable, high gross margin and a strong cost control, with lower operating costs than we had the same quarter last year. As expected, the consumer market continued to be weak during the second quarter, even though the development was less negative than during the first quarter of the year. In this market environment, we continued to strengthen our position and continued to gain market share. We also made progress on our key strategic priorities, which we will cover later during this call. The very short headline financials are as follows. You see them on the page. Sales in Q2 decreased to just over SEK 2.2 billion, 13% compared to last year. This is a reduced decline versus the one that we saw in the first quarter.
We continue to have a high share of e-commerce in the group. The gross margin was, as mentioned, high in the quarter. We delivered the same level as we did the second quarter last year, and this level is actually only beaten by the one that we had in 2021 during the pandemic. A historically strong gross margin, driven both by product mix but also by active purchasing. We have in total 12 more stores compared to last year, and despite this, as well as inflation, we managed to reduce our costs with lower operating costs than last year, both like for like and the total costs. In addition, we continue to have control of our inventory with lower inventory level compared to last year.
The EBITDA margin was 7.8%, which means that the margin in Q2 is higher this year than what we had before the pandemic in 2019. Solid performance in a continued weak market. We move to Page 3, well, as mentioned, the market continued to be weak, even though the development was less negative than the one that we saw during the first quarter. The consumers continued to be hesitant, particularly related to large investments, while we saw solid progress regarding products related to smaller projects. One example is the paint category that we have, which notes the new sales record during the quarter. Customers still want to take care of and improve their homes, but this year, it seems like they are making smaller projects.
We see some of the customers' behavior more similar to those that we saw before the pandemic. More customers make their purchases in the stores, especially during nights and weekends, and this is partly on the expense on e-commerce. In all, we estimate that the Nordic consumer markets decreased by approximately 15%-20% compared to the same quarter last year, and this is to a level clearly below the time before the pandemic. As you see, while the overall market developed negatively, Byggmax continues to strengthen its position, and for the last years, we have consistently performed better than the market and gained market share, and this is something that is true also for the second quarter this year. In these times, the Byggmax's business model, which is based on low prices, is perhaps more relevant than ever.
If we look at Page 4, there has been a general trend, the last couple of years with a higher interest for low-price retailers across the industry, and this model is more relevant in times of high inflation. Our view is that customers who compare and see our low prices and experience our new store concept with a wider assortment of products for different types of home improvement projects, they tend to return to us, and this is one reason why our development is better than the market. In addition, our model with e-commerce in combination with many stores in the proximity of the customer is a strength, not least when customers are returning to more pre-pandemic behaviors. It's quick and easy for the customers to make the purchases, whether they choose to do it online or in the store.
Our model, low price position with a widespread store network of stores, combined with the online sales, enabled us to continue to strengthen our market position. If we look at Page 5, as communicated in earlier quarters, we have set three top priorities for the year of 2023, and here you see an update on these three top priorities. The whole headline here is to be as ready as possible when the market picks up again. The first priority is to continue to take market share and to continue to increase the competitiveness of Byggmax, and we see that we are making good progress On this priority.
We continue to develop better than market, as you saw, and we have more and upgraded stores, and we have continued to drive efficiency, as you saw in the strong OpEx development. Besides focusing on efficiency, our colleagues around the company have made a great effort securing that our stores are ready for the customers during this important high season. As always, there's been a strong operational focus, and we are really happy to see that our customers appreciate the store experience. In our internal customer satisfaction survey, we have noted record high scores during this quarter, so an acknowledgment of our colleagues' very strong efforts. The second priority for us is, this year, is to, what we call, to tune in some of our growth initiatives.
We launched, as many of you know, Byggmax Studio two quarters ago, and this is our concept for indoor renovation with a larger focus on tiles. The concept is up and running, and we continue to optimize it, and really look forward to opening an additional store in Umeå, Sweden, in the beginning of next year. During the quarter, we also started sales of an e-commerce concept for customized complementary buildings, and these are buildings that are configured with help of an online tool, and our customers can design personalized building, which is based on different modular options. We launched it under our Skånska Byggvaror brand, and we'll expand with more features and in more countries over time.
Another initiative that we are tuning in is a new digital tool for our store personnel to enable them to help customers order web products. We are now able to offer the entire e-commerce assortment to the customers while they are in our stores. The personnel can combine orders including both web and store products. In this way, by integrating our various sales channels, we can provide an even more comprehensive shopping experience for our customers. Finally, the third priority for us is to continue to be opportunistic and capture opportunities when they come due to this market situation. We continue to see interest for Byggmax in terms of store locations in areas that we were not offered before, new suppliers, et cetera, and we continue to evaluate these opportunities actively as they come.
That was a short update on our priorities. We continue and move to Page six, we also have high sustainability ambitions, and one part of this, our sustainability agenda, is Byggmax Green Ventures. Within this initiative, we invest in businesses that have circular business models contributing to positive climate benefits. The investment we have said should fulfill three criteria: They must fit into the Byggmax offering, of course, they must contribute positively to the climate, and finally, they should generate a profit for us. We recently made an investment in the Swedish company, Recoma, and that is a company that fits into these criteria. They use recycled packaging materials to produce boards, which can substitute OSB or plywood boards, with a substantially lower emission.
This is our second investment within our Green Venture initiative, and we have earlier invested, as some of you might know, in the company MoreWood, which produces beams made from waste wood from the timber industry. The products from Recoma are already available online, and we are really looking forward also to offer them in our stores as soon as possible. This is one example of how we are working towards our sustainability ambitions, sustainable products that fit into Byggmax offering and generate profits. With that, I hand over to Helena to cover our financials.
Thank you. We are now on Page 7, looking into the sales development for the second quarter. In the quarter, we have a sales decline on the continued weak market. As mentioned, we still see good performance on smaller projects, but there's a little pick up in larger projects, such as outdoor timber-related garden, greenhouses, and conservatories. The sales decrease in the quarter is 13.4%. The currency impact is minus of 0.5%. We have a weakened NOK and a strengthened euro adding to that development. If we look into the contribution from new stores, new stores contributed 2.4% in the quarter. We have four new stores in this period, three in Sweden, Markaryd, Askersund, and Uddevalla, and we have Kaarina in Finland.
In the last 12 months, we have a net of 12 stores. We will open one more store, Vallbersmyr, shortly, and then, normally, the rest of the stores will coming in ahead of high season next year. We're happy to have closed our store portfolio upgrade plan, where we now see also stores, the long-term rental agreements are upgraded ahead of this high season. That was on the sales development. If you look on Page 8, we have the full P&L for the quarter, and we have looked into the drivers of the SEK 2.2 billion sales figure. If we look into the gross margin, it is at 32%, stable versus last year, but strengthened from a historical perspective.
The gross margin has had a positive impact on product mix, lower input prices from timber material-related categories, and at the same time, it's market with high promotion activities. On the cost side, the comparable costs, excluding new stores, decreased by 59%, a very strong position. It has been an operational focus in the period, and we have modified the cost base to meet the lower sales volume, and this is primarily from staffing in stores and new ways of working in stores. In all, it's a strong quarter with efficiency gains in a weak market. We have an EBITDA margin of 7.8%, which is about 2019.
Page 9 is cash flow and our net debt position. Cash flow from operating activities amounted to SEK 895 million in the quarter, a strong increase versus last year. Cash flow improved from continued strategic actions to balance inventory levels on the weaker market. The net debt strengthened to SEK 679 million versus SEK 891 million last year. The decrease is obviously driven by the strong cash flow in the quarter, combined with reduced investment activity in the period.
Thank you. Thank you, Helena. To summarize, on Page 10, before we open up for questions, a couple of points. We delivered a solid profitability in the important second quarter. We had high gross margin and continued, as you have seen, to have strong cost and inventory control with lower levels than last year, despite more stores. We continue to strengthen our position. In the current consumer environment, we show that our model with focus on low price is perhaps more relevant than ever. As mentioned, the Nordic consumer market for building materials continued to be weak in the second quarter, even though the development was less negative than during the first quarter.
There are some bright spots in terms of macro factors, at the same time, the consumers continue to be hesitant, especially when it comes to the larger purchases or investments. Uncertainty regarding the market development makes it important to continue to have cost control, strict cost control, of course. In addition, we continue to focus on our priorities to get Byggmax ready for when the market picks up again, to further increase the competitiveness, to tune in growth initiatives and to be opportunistic in this market. We really look forward to welcoming, all our customers with more stores, a strong e-commerce assortment, the lowest prices, and employees that are ready to support during this summer.
With that, we conclude the presentation part of this conference call, and I turn to the operator to open up for questions.
Sure. Thank you. Ladies and gentlemen, if you'd like to ask a question, please press star one on your telephone keypad. That's star one on your telephone keypad. To withdraw your question, press star followed by two, and please, to also remember to unmute your microphones when it's your turn to speak. Now, we'll wait a couple of moments to see if we can gather any questions. We have our first question, comes from Benjamin Wahlstedt from ABG. Benjamin, your line is now open. Please go ahead.
Karl and Helena, first off, cash flow is obviously very strong, supported by working capital. Could you give any additional flavor on the higher payables, please? Do you expect a significant reversal already in Q3, or how should we think about that, please?
Yes, thank you, Benjamin. That is correct. It's a strong focus on our inventory, but as you say, the payables are high and will go down a little bit in the third quarter. It is the actual sort of increase of inventory adjusted to the late season, so we have some of the payables that will revert.
Thank you. Following on, the delay in the season, I believe you previously commented on running sort of low season staffing into Q2, seeing adverse weather in the beginning of the quarter. Is it possible to quantify this somewhat? Like, at what point did you feel you could return to more normalized staffing levels, please?
Yes. In some ways, it is correct that we have reduced the staffing, so there will be an increase. Also we see different ways of working in the stores, so it's also partly an efficiency that we see will continue going forward. We have sort of more digitalized ways of working in the stores that will help us to keep the lower levels. Correctly, if you say, March and April and May is a little bit lower levels. In the third quarter, slight increase, but not all the way up.
All right. Thank you very much. Perhaps finally then, you also commented in the report on a higher price pressure in the market. Is this driven by campaigns or do you feel like a shift among incumbents to more of a discounter strategy, please?
No, we would say it's more campaigns. It's, it's timber prices, and it's a lot of activities where everybody is seeking, a turnover and, lower inventory levels. I wouldn't say it's a shift, it's more a market situation.
Perfect. Thank you very much. Those were my questions for now.
Thank you very much.
As a reminder, ladies and gentlemen, to ask a question, please press star one on your telephone keypad. That's star one on your telephone keypad. We currently have no questions registered, so I will hand back to the management team for final remarks, please.
Well, thank you, a lot, and thanks a lot for your participation during this call. We really hope that you will have a nice summer, and looking forward to speak to you again after the Q3 report. Thank you.