Huhtamäki Oyj’s Interim Report January 1–September 30, 2023: Good
operational profitability in a challenging market
HUHTAMÄKI OYJ INTERIM REPORT 20.10.2023 AT 8:30
Huhtamäki Oyj’s Interim Report January 1–September 30, 2023:
Good operational profitability in a challenging market
Q3 2023 in brief
- Net sales decreased 12% to EUR 1,037 million (EUR 1,178
million)
- Adjusted EBIT was EUR 100 million (EUR 101 million); reported
EBIT was EUR 93 million (EUR 137 million)
- Adjusted EPS was EUR 0.57 (EUR 0.59); reported EPS was EUR 0.42
(EUR 0.89)
- Comparable net sales growth at Group level was -4% and -7%
in emerging markets
- The impact of currency movements on the Group’s net sales was
EUR -70 million and EUR -7 million on EBIT
Q1-Q3 2023 in brief
- Net sales decreased 7% to EUR 3,136 million (EUR 3,375
million)
- Adjusted EBIT was EUR 285 million (EUR 302 million); reported
EBIT was EUR 235 million (EUR 327 million)
- Adjusted EPS was EUR 1.64 (EUR 1.84); reported EPS was EUR 1.14
(EUR 2.11)
- Comparable net sales growth at Group level was -1% and -3% in
emerging markets
- The impact of currency movements on the Group’s net sales was
EUR -108 million and EUR -9 million on EBIT
- Capital expenditure was EUR 204 million (EUR 185 million)
- Free cash flow was EUR 193 million (EUR -60 million)
Key figures
|
|
|
|
|
|
|
|
|
|
|
|
EUR million |
|
Q3 2023 |
Q3 2022 |
|
Change |
|
Q1-Q3 2023 |
|
Q1-Q3 2022 |
Change |
2022 |
Net sales |
|
1,037.2 |
1,178.4 |
|
-12% |
|
3,136.0 |
|
3,375.4 |
-7% |
4,479.0 |
Comparable net sales growth |
|
-4% |
17% |
|
|
|
-1% |
|
18% |
|
15% |
Adjusted EBITDA1 |
|
149.0 |
153.2 |
|
-3% |
|
430.6 |
|
453.6 |
-5% |
596.9 |
Margin1 |
|
14.4% |
13.0% |
|
|
|
13.7% |
|
13.4% |
|
13.3% |
EBITDA |
|
145.4 |
190.6 |
|
-24% |
|
415.6 |
|
484.4 |
-14% |
614.9 |
Adjusted EBIT2 |
|
100.3 |
101.5 |
|
-1% |
|
285.1 |
|
301.7 |
-6% |
395.1 |
Margin2 |
|
9.7% |
8.6% |
|
|
|
9.1% |
|
8.9% |
|
8.8% |
EBIT |
|
92.8 |
137.1 |
|
-32% |
|
234.9 |
|
327.2 |
-28% |
405.3 |
Adjusted EPS, EUR3 |
|
0.57 |
0.59 |
|
-2% |
|
1.64 |
|
1.84 |
-11% |
2.49 |
EPS, EUR |
|
0.42 |
0.89 |
|
-52% |
|
1.14 |
|
2.11 |
-46% |
2.65 |
Adjusted ROI2 |
|
|
|
|
|
|
10.6% |
|
11.0% |
|
11.0% |
Adjusted ROE3 |
|
|
|
|
|
|
12.9% |
|
14.9% |
|
14.9% |
ROI |
|
|
|
|
|
|
8.8% |
|
11.9% |
|
11.4% |
ROE |
|
|
|
|
|
|
9.6% |
|
16.6% |
|
15.7% |
Capital expenditure |
|
69.7 |
57.4 |
|
21% |
|
203.9 |
|
185.3 |
10% |
318.5 |
Free Cash Flow |
|
122.2 |
5.6 |
|
>100% |
|
193.1 |
|
-60.2 |
>100% |
11.1 |
1 Excluding IAC of |
|
-3.5 |
37.3 |
|
|
|
-15.1 |
|
30.8 |
|
18.0 |
2 Excluding IAC of |
|
-7.5 |
35.6 |
|
|
|
-50.2 |
|
25.4 |
|
10.2 |
3 Excluding IAC of |
|
-15.7 |
31.8 |
|
|
|
-51.9 |
|
27.6 |
|
16.0 |
Unless otherwise stated, all comparisons in this
report are compared to the corresponding period in 2022. Figures of
return on investment (ROI), return on equity (ROE) and return on
net assets (RONA) as well as net debt to EBITDA presented in this
report are calculated on a 12‑month rolling basis.
IAC includes, but is not limited to, material
restructuring costs and acquisition related costs (gains and losses
on business combinations, professional and legal fees, material
purchase price accounting adjustments for inventory, material
purchase price amortization of intangible assets and changes in
contingent considerations) as well as material impairment losses
and reversals, gains and losses relating to sale of intangible and
tangible assets, fines and penalties imposed by authorities and
extraordinary taxes.
The figures in the tables are exact figures and
consequently the sum of individual figures may deviate from the sum
presented. Key figures have been calculated using exact
figures.
Charles Héaulmé, President and CEO
“The market environment improved slightly during the third
quarter of 2023, compared to the first half of the year. The
significant destocking that impacted the previous two quarters
faded during the third quarter. Overall, inflation continued to
affect consumption negatively across categories and
geographies.
Our profitability and cash generation in the third quarter
improved significantly compared to the first half of the year,
despite continued soft volumes and lower support from pricing.
Comparable net sales decreased by 4% compared to the third quarter
of 2022. For the first nine months of the year, comparable net
sales decreased by 1%. Currency translation continued to have a
negative impact, further accelerating in the third quarter.
Adjusted EBIT decreased by 1% in the third quarter and by 6% during
the first nine months of the year, including the negative impact
from the divestment of our Russian operations. Throughout the year,
we have taken actions to address productivity, and the results are
starting to materialize. Free cash flow was strong, reaching EUR
122 million during the third quarter and EUR 193 million during the
first nine months of the year, supported by reduced working
capital.
All our business segments delivered an improved profitability
level compared to the first half of 2023 and the third quarter of
2022. The improving trend in profitability during the third quarter
was primarily driven by a strong performance in the Fiber and North
America segments. The Flexible Packaging segment performance also
improved during the third quarter, compared to the same period
2022. The profitability of Foodservice Europe-Asia-Oceania remained
at same level as last year.
We continue to drive the execution of our 2030 strategy. We are
making consistent progress on delivering on our sustainability
commitments, particularly on operational health and safety,
renewable energy and absolute greenhouse gas emissions. We are also
investing in growth and innovation. At the end of the third
quarter, we started ramping up commercial production at our
expanded molded fiber factory in Hammond, US, entering the growing
egg carton packaging market. This will allow us to leverage the
rapid conversion into fiber egg carton packaging in several US
states where foam packaging has been banned. In Europe, the
acceleration of the fiber lids deployment in replacement of the
traditional plastic lids allows a significant volume increase from
our recently installed capacity in Alf, Germany. Our investments in
technology and capacity will increasingly support our performance
going forward.”
Financial review Q3 2023 Net sales by business
segment
EUR million |
Q3 2023 |
Q3 2022 |
Change |
|
Foodservice Europe-Asia-Oceania |
259.9 |
300.5 |
-14% |
|
North America |
348.4 |
372.4 |
-6% |
|
Flexible Packaging |
344.2 |
420.6 |
-18% |
|
Fiber Packaging |
81.4 |
89.3 |
-9% |
|
Elimination of internal sales |
3.4 |
-4.4 |
|
|
Group |
1,037.2 |
1,178.4 |
-12% |
|
Comparable net sales growth by business segment
|
Q3 2023 |
Q2 2023 |
Q1 2023 |
Q4 2022 |
Q3 2022 |
Foodservice Europe-Asia-Oceania |
-3% |
5% |
11% |
15% |
22% |
North America |
1% |
1% |
2% |
10% |
10% |
Flexible Packaging |
-11% |
-11% |
-5% |
1% |
20% |
Fiber Packaging |
4% |
7% |
17% |
17% |
19% |
Group |
-4% |
-2% |
2% |
9% |
17% |
The Group’s net sales decreased 12% to
EUR 1,037 million (EUR 1,178 million) during the
quarter and comparable net sales growth was -4%. Demand continued
to be muted by the impact of inflation, but started to show signs
of improvement in certain categories and geographies. Net sales
were weighed on by a decrease in sales volumes and changes in
currencies, whereas pricing had a positive impact. The divestment
of the operations in Russia had a negative impact. Comparable sales
growth in emerging markets was -7%. Foreign currency translation
impact on the Group’s net sales was EUR -70 million
(EUR 83 million) compared to 2022 exchange rates.
Adjusted EBIT by business segment
|
|
|
|
Items
affecting comparability |
EUR million |
Q3 2023 |
Q3 2022 |
Change |
Q3 2023 |
Q3 2022 |
Foodservice Europe-Asia-Oceania |
26.7 |
30.6 |
-13% |
-0.1 |
24.4 |
North America |
45.9 |
41.8 |
10% |
- |
- |
Flexible Packaging |
24.7 |
26.3 |
-6% |
-3.0 |
-4.8 |
Fiber Packaging |
10.2 |
8.5 |
19% |
-4.4 |
16.7 |
Other activities |
-7.2 |
-5.7 |
|
-0.1 |
-0.7 |
Group |
100.3 |
101.5 |
-1% |
-7.5 |
35.6 |
Adjusted EBIT margin by business segment
|
Q3 2023 |
Q2 2023 |
Q1 2023 |
Q4 2022 |
Q3 2022 |
Foodservice Europe-Asia-Oceania |
10.3% |
9.2% |
8.3% |
9.1% |
10.2% |
North America |
13.2% |
12.2% |
11.9% |
12.8% |
11.2% |
Flexible Packaging |
7.2% |
4.9% |
6.1% |
4.2% |
6.2% |
Fiber Packaging |
12.5% |
10.8% |
12.1% |
12.7% |
9.6% |
Group |
9.7% |
8.8% |
8.8% |
8.5% |
8.6% |
The Group’s adjusted EBIT decreased to
EUR 100 million (EUR 101 million) and reported
EBIT was EUR 93 million (EUR 137 million) in the quarter.
Adjusted EBIT decreased mainly due to lower sales volumes and the
divestment of operations in Russia, whereas pricing had a positive
impact. The Group’s adjusted EBIT margin increased and was 9.7%
(8.6%). Foreign currency translation impact on the Group’s earnings
was EUR -7 million (EUR 7 million).
Adjusted EBIT excludes EUR -7.5 million
(EUR 35.6 million) of items affecting comparability (IAC).
Adjusted EBIT and IAC
EUR million |
Q3 2023 |
Q3 2022 |
Adjusted EBIT |
100.3 |
101.5 |
Acquisition related costs |
-0.1 |
-0.1 |
Restructuring gains and losses, including writedowns of related
assets |
-5.4 |
2.6 |
PPA amortization |
-2.2 |
-1.6 |
Settlement and legal fees of disputes |
-0.1 |
-2.7 |
Prague site closure-related costs |
0.2 |
- |
Property damage incidents |
- |
- |
Divestment of subsidiaries |
- |
37.5 |
EBIT |
92.8 |
137.1 |
Net financial expenses were EUR 17 million (EUR
22 million) in the quarter. Tax expense was EUR 29 million (EUR 20
million). The increase is due to the business in Turkey, which has
the US dollar as a functional currency. As taxes are calculated in
the significantly devalued Turkish lira, the current tax charge as
well as deferred tax liabilities increased significantly. The
functional currency remeasurements related impact to deferred tax
liabilities (mainly Turkey) are a non-cash item and are treated as
IAC. Profit for the quarter was EUR 47 million (EUR 95 million).
Adjusted earnings per share (EPS) was EUR 0.57 (EUR 0.59) and
reported EPS EUR 0.42 (EUR 0.89). Adjusted EPS is calculated based
on adjusted profit for the period, which excludes EUR -15.7
million (EUR 31.8 million) of IAC.
Adjusted profit and IAC
EUR million |
Q3 2023 |
Q3 2022 |
Adjusted profit for the period attributable to equity holders of
the parent company |
60.0 |
61.2 |
IAC in EBIT |
-7.5 |
35.6 |
IAC in Financial items |
1.2 |
-4.8 |
IAC Tax |
-9.4 |
1.0 |
Profit for the period attributable to equity holders of the
parent company |
44.3 |
93.0 |
Financial review Q1-Q3 2023
Net sales by business segment
EUR million |
Q1-Q3 2023 |
Q1-Q3 2022 |
Change |
|
Foodservice Europe-Asia-Oceania |
787.0 |
844.0 |
-7% |
|
North America |
1,079.8 |
1,084.7 |
-0% |
|
Flexible Packaging |
1,021.2 |
1,189.1 |
-14% |
|
Fiber Packaging |
254.3 |
275.6 |
-8% |
|
Elimination of internal sales |
-6.2 |
-18.0 |
|
|
Group |
3,136.0 |
3,375.4 |
-7% |
|
Comparable net sales growth by business segment
|
Q1-Q3 2023 |
Q1-Q3 2022 |
Q1-Q3 2021 |
Foodservice Europe-Asia-Oceania |
4% |
20% |
11% |
North America |
1% |
16% |
4% |
Flexible Packaging |
-9% |
19% |
4% |
Fiber Packaging |
9% |
14% |
2% |
Group |
-1% |
18% |
6% |
The Group’s net sales decreased 7% to EUR 3,136
million (EUR 3,375 million) during the reporting period, and
comparable net sales growth was -1%. Overall, demand was muted by
the impact of inflation. Net sales were weighed on by a decrease in
sales volumes and changes in currencies, whereas pricing had a
positive impact. The divestment of the operations in Russia had a
negative impact. Comparable sales growth in emerging markets was
-3%. Foreign currency translation impact on the Group’s net sales
was EUR -108 million (EUR 186 million) compared to 2022
exchange rates.
Adjusted EBIT by business segment
|
|
|
|
Items
affecting comparability |
EUR million |
Q1-Q3 2023 |
Q1-Q3 2022 |
Change |
Q1-Q3 2023 |
Q1-Q3 2022 |
Foodservice Europe-Asia-Oceania |
73.0 |
81.5 |
-10% |
-2.1 |
20.9 |
North America |
133.8 |
122.6 |
9% |
-0.0 |
-0.0 |
Flexible Packaging |
62.0 |
82.6 |
-25% |
-42.3 |
-9.9 |
Fiber Packaging |
30.0 |
28.8 |
4% |
-5.5 |
16.4 |
Other activities |
-13.7 |
-13.7 |
|
-0.3 |
-1.9 |
Group |
285.1 |
301.7 |
-6% |
-50.2 |
25.4 |
Adjusted EBIT margin by business segment
|
Q1-Q3 2023 |
Q1-Q3 2022 |
Q1-Q3 2021 |
Foodservice Europe-Asia-Oceania |
9.3% |
9.7% |
8.5% |
North America |
12.4% |
11.3% |
12.4% |
Flexible Packaging |
6.1% |
6.9% |
6.7% |
Fiber Packaging |
11.8% |
10.5% |
10.6% |
Group Total |
9.1% |
8.9% |
9.1% |
The Group’s adjusted EBIT decreased to
EUR 285 million (EUR 302 million) and reported
EBIT was EUR 235 million (EUR 327 million). Adjusted EBIT
decreased mainly due to lower sales volumes and the divestment of
operations in Russia. The Group’s adjusted EBIT margin increased
and was 9.1% (8.9%). Foreign currency translation impact on the
Group’s earnings was EUR -9 million (EUR 16 million).
Adjusted EBIT excludes EUR -50.2 million
(EUR 25.4 million) of items affecting comparability (IAC). The
main change in IACs relate to the planned closure of the Flexible
Packaging production facility in Prague, Czech Republic.
Adjusted EBIT and IAC
EUR million |
Q1-Q3 2023 |
Q1-Q3 2022 |
Adjusted EBIT |
285.1 |
301.7 |
Acquisition related costs |
-0.4 |
-0.7 |
Restructuring gains and losses, including writedowns of related
assets |
-10.7 |
-2.4 |
PPA amortization |
-6.6 |
-5.0 |
Settlement and legal fees of disputes |
-0.2 |
-3.0 |
Prague site closure-related costs |
-32.3 |
- |
Property damage incidents |
- |
-1.0 |
Divestment of subsidiaries |
- |
37.5 |
EBIT |
234.9 |
327.2 |
Net financial expenses were EUR 51 million (EUR
37 million). The increase was due to higher interest rates and
other financing costs. Tax expense was EUR 57 million (EUR 64
million). The effective tax rate was 31% (22%). The increase was
due to an impact from the business in Turkey, which has the US
dollar as a functional currency. As taxes are calculated in the
significantly devalued Turkish lira, the current tax charge as well
as deferred tax liabilities increased significantly. The functional
currency remeasurements related impact to deferred tax liabilities
(mainly Turkey) are a non-cash item and are treated as IAC.
Additionally, the tax rate was impacted by a non-deductible
goodwill impairment related to the planned closure of the Flexible
Packaging site in Prague. Profit for the period was EUR 126 million
(EUR 226 million). Adjusted earnings per share (EPS) were
EUR 1.64 (EUR 1.84) and reported EPS EUR 1.14 (EUR 2.11).
Adjusted EPS is calculated based on adjusted profit for the period,
which excludes EUR -51.9 million (EUR 27.6 million) of
IAC.
Adjusted profit and IAC
EUR million |
Q1-Q3 2023 |
Q1-Q3 2022 |
Adjusted profit for the period attributable to equity holders of
the parent company |
171.0 |
192.2 |
IAC in EBIT |
-50.2 |
25.4 |
IAC in Financial items |
0.8 |
-0.2 |
IAC Tax |
-2.5 |
2.4 |
Profit for the period attributable to equity holders of the
parent company |
119.1 |
219.8 |
Outlook for 2023 (unchanged)
The Group’s trading conditions are expected to remain relatively
stable, despite the continued volatility in the operating
environment. Huhtamaki's diversified product portfolio provides
resilience and the Group’s good financial position enables
addressing profitable long-term growth opportunities.
Teleconference
Huhtamaki will arrange a combined webcast and teleconference on
the same day at 9:30 Finnish time. Huhtamaki´s President and CEO
Charles Héaulmé and CFO Thomas Geust will present the results. The
event will be followed by a Q&A session. The event will be held
in English, it can be followed real-time at:
https://huhtamaki.videosync.fi/2023-q3.
A link to the teleconference is available at:
https://palvelu.flik.fi/teleconference/?id=10010472. Registration
is required for the teleconference. After the registration you will
be provided with phone numbers and a conference ID to access the
conference.
Huhtamaki's financial reporting in 2024
In 2024, Huhtamaki will publish financial information as
follows:
Results
2023
February 8
Interim Report, January 1 - March 31, 2024
April 25
Half-yearly Report, January 1 - June 30,
2024
July 25
Interim Report, January 1 - September 30,
2024
October 24
The Annual Report 2023 will be published on the week commencing
February 26, 2024.
Huhtamäki Oyj’s Annual General Meeting is planned to be held on
April 25, 2024.
For further information, please contact:
Kristian Tammela, Vice President, Investor Relations,
tel. +358 10 686 7058
HUHTAMÄKI OYJ
Global Communications
About Huhtamaki
Huhtamaki is a leading global provider of sustainable packaging
solutions for consumers around the world. Our innovative products
protect on-the-go and on-the-shelf food and beverages, and personal
care products, ensuring hygiene and safety, driving accessibility
and affordability, and helping prevent food waste. We embed
sustainability in everything we do. We are committed to achieving
carbon neutral production and designing all our products to be
recyclable, compostable or reusable by 2030. Our blueloopTM
sustainable packaging solutions are world-leading and designed for
circularity.
We are a participant in the UN Global Compact, Huhtamaki is
rated ‘A’ on the MSCI ESG Ratings assessment and EcoVadis has
awarded Huhtamaki with the Gold medal for performance in
sustainability. To play our part in managing climate change, we
have set science-based targets that have been approved and
validated by the Science-Based Targets initiative.
With 100 years of history and a strong Nordic heritage we
operate in 37 countries and 116 operating locations around the
world. Our values Care Dare Deliver guide our decisions and help
our team of around 18 000 employees make a difference where it
matters. Our 2022 net sales totalled EUR 4.5 billion. Huhtamaki
Group is headquartered in Espoo, Finland and our parent company,
Huhtamäki Oyj, is listed on Nasdaq Helsinki Ltd. Find out more
about how we are protecting food, people and the planet at
www.huhtamaki.com.
Huhtamaki Oyj (TG:HUKI)
過去 株価チャート
から 5 2024 まで 6 2024
Huhtamaki Oyj (TG:HUKI)
過去 株価チャート
から 6 2023 まで 6 2024