Huhtamäki Oyj’s Results January 1-December 31, 2024: Solid year in a gradually improved market

HUHTAMÄKI OYJ FINANCIAL STATEMENT RELEASE 14.2.2025 AT 8:30

Huhtamäki Oyj’s Results January 1-December 31, 2024: Solid year in a gradually improved market

Q4 2024 in brief

Net sales increased 2% to EUR 1,059 million (EUR 1,033 million)
Comparable net sales growth at Group level was 3%
Reported EBIT was EUR 95 million (EUR 146 million); adjusted EBIT was EUR 110 million (EUR 108 million)
Reported EPS was EUR 0.61 (EUR 0.83); adjusted EPS was EUR 0.68 (EUR 0.68)
The impact of currency movements on the Group's net sales was EUR -2 million and EUR -0 million on EBIT

Q1-Q4 2024 in brief

Net sales decreased 1% to EUR 4,126 million (EUR 4,169 million)
Comparable net sales growth at Group level was -0%
Reported EBIT was EUR 372 million (EUR 381 million); adjusted EBIT was EUR 417 million (EUR 393 million)
Reported EPS was EUR 2.14 (EUR 1.97); adjusted EPS was EUR 2.48 (EUR 2.32)
The impact of currency movements on the Group's net sales was EUR -37 million and EUR -4 million on EBIT
Capital expenditure was EUR 248 million (EUR 319 million)
Free cash flow was EUR 216 million (EUR 321 million)
The Board of Directors proposes a dividend of EUR 1.10 (1.05) per share

Key figures

EUR million	Q4 2024	Q4 2023	Change	2024	2023	Change
Net sales	1,058.7	1,032.9	2%	4,126.3	4,168.9	-1%
Comparable net sales growth	3%	-3%		-0%	-2%
Adjusted EBITDA¹	163.7	159.5	3%	622.2	590.1	5%
Margin¹	15.5%	15.4%		15.1%	14.2%
EBITDA	151.4	205.7	-26%	595.6	621.2	-4%
Adjusted EBIT²	110.3	107.5	3%	416.9	392.6	6%
Margin²	10.4%	10.4%		10.1%	9.4%
EBIT	95.0	146.0	-35%	372.3	380.9	-2%
Adjusted EPS, EUR³	0.68	0.68	-1%	2.48	2.32	7%
EPS, EUR	0.61	0.83	-27%	2.14	1.97	8%
Adjusted ROI²				12.1%	11.2%
Adjusted ROE³				13.4%	13.2%
ROI				10.8%	10.9%
ROE				11.6%	11.8%
Capital expenditure	113.8	114.8	-1%	247.9	318.7	-22%
Free Cash Flow	55.6	128.4	-57%	215.8	321.4	-33%
¹ Excluding IAC of	-12.2	46.2		-26.5	31.1
² Excluding IAC of	-15.3	38.5		-44.7	-11.7
³ Excluding IAC of	-7.1	16.0		-35.1	-35.9

Unless otherwise stated, all comparisons in this report are compared to the corresponding period in 2023. 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, 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, implementation costs concerning large projects with SaaS cloud computing technology, 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.

President and CEO’s review

For Huhtamaki, 2024 was a solid year, with improved safety performance and increased profitability. In the first half of the year, demand was muted in many markets. The second half saw gradual recovery, with variations across categories and regions. Demand for pre-packed food, especially egg packaging, increased, and flexible packaging saw gains in a volatile market. Food on-the-go volumes remained subdued, particularly for coffee chains, due to high prices caused by inflation. The North American foodservice market performed better than other regions. The ongoing Middle East conflict affected global brands in some Middle Eastern and Asian markets throughout the year.

In Q4, comparable net sales increased by 3%. Sales volumes growth was supported by customers’ promotional activities. We improved our profitability as the adjusted EBIT margin reached 10.4% and adjusted EBIT grew by 3% to EUR 110 million.

For the full year 2024, comparable net sales remained at the previous year’s level. Sales prices decreased due to a pass-through of lower raw material prices, while volumes increased slightly. Despite the muted topline development, our adjusted EBIT increased by 6% and the margin increased to 10.1%. Free cash flow reached 216 million, driven by higher profit and lower investments, still investing in growing the profitable core. On the other hand, free cash flow in the comparison period was supported by a material decrease in working capital.

Throughout the year, we made progress on the strategic priorities. Our main focus was on improving competitiveness. Here, our key initiatives were built around our program to achieve EUR 100 million in cost savings. The program contributed to our performance throughout the year, and achieved savings of appr. EUR 76 million. The actions we took early in the program supported achieving the planned savings at an accelerated pace. The cost savings were essential to compensate for cost inflation. We expect to achieve the EUR 100 million savings target and close the program ahead of schedule, and with lower costs than originally anticipated.

While focusing on competitiveness, we continued to invest in innovation. We introduced new paperboard solutions with reduced plastic coating and paperboard-based packaging for FMCG products like ice cream, replacing plastic. We also expanded production of recyclable flexible packaging. These innovations support our sustainability agenda. We also made progress in our sustainability performance, for example, by increasing our use of renewable energy. Sustainability remains a top priority moving forward.

We have also strengthened our balance sheet. At the end of the year, our net debt to adjusted EBITDA was at the lower end of our target range of 2-3x, allowing for organic and inorganic growth. Based on our positive financial development, the Board of Directors proposes a dividend of EUR 1.10 per share. If approved, this would mark the 16th consecutive year of dividend growth, highlighting the long-term success of our business. We have a strong foundation to reach our financial ambitions and continue to deliver on our strategic priorities.

I am excited to have taken on the position as President and CEO of Huhtamaki. I know the company well and have always appreciated its ability to innovate, develop and drive world class commercial and operational results. I am happy to see an improving trend in 2024 and am determined to drive performance improvement. This is made possible by the dedication of our committed teams. I want to thank our employees, customers, suppliers, and all other stakeholders for their collaboration and trust.

Ralf K. Wunderlich
President and CEO

Financial review Q4 2024

Net sales by business segment

EUR million	Q4 2024	Q4 2023	Change
Foodservice Europe-Asia-Oceania	249.2	250.2	-0%
North America	386.5	378.1	2%
Flexible Packaging	327.5	319.8	2%
Fiber Packaging	98.5	88.8	11%
Elimination of internal sales	-3.0	-4.1
Group	1,058.7	1,032.9	2%

Comparable net sales growth by business segment

	Q4 2024	Q3 2024	Q2 2024	Q1 2024	Q4 2023
Foodservice Europe-Asia-Oceania	-1%	-7%	-6%	-5%	-5%
North America	2%	3%	-2%	-3%	4%
Flexible Packaging	5%	-0%	2%	-1%	-9%
Fiber Packaging	12%	8%	3%	1%	2%
Group	3%	-0%	-1%	-2%	-3%

The Group’s net sales increased by 2% to EUR 1,059 million (EUR 1,033 million) during the quarter. Comparable net sales growth was 3%, as sales volumes increased. Demand improved, supported by customers’ promotional activities. The impact of inflation on demand was still negative, but gradually eased as wages increased. At the same time, the boycotts of global brands in certain markets continued to have a negative impact. Comparable sales growth in emerging markets was -0%. Foreign currency translation impact on the Group’s net sales was EUR -2 million (EUR -44 million) compared to 2023 exchange rates.

Adjusted EBIT by business segment

				Items affecting comparability
EUR million	Q4 2024	Q4 2023	Change	Q4 2024	Q4 2023
Foodservice Europe-Asia-Oceania	24.7	25.0	-1%	-2.9	-7.8
North America	52.9	54.1	-2%	-1.6	-
Flexible Packaging	27.4	26.0	5%	-7.4	48.2
Fiber Packaging	15.0	9.7	55%	-0.5	-0.7
Other activities	-9.7	-7.2		-2.8	-1.1
Group	110.3	107.5	3%	-15.3	38.5

Adjusted EBIT margin by business segment

	Q4 2024	Q3 2024	Q2 2024	Q1 2024	Q4 2023
Foodservice Europe-Asia-Oceania	9.9%	8.5%	9.2%	9.1%	10.0%
North America	13.7%	13.8%	14.3%	13.9%	14.3%
Flexible Packaging	8.4%	7.3%	6.4%	6.4%	8.1%
Fiber Packaging	15.2%	9.2%	12.9%	10.1%	10.9%
Group	10.4%	10.0%	10.2%	9.8%	10.4%

The Group’s adjusted EBIT increased to EUR 110 million (EUR 108 million) and reported EBIT was EUR 95 million (EUR 146 million) in the quarter. Adjusted EBIT increased, supported by the company’s actions to improve profitability and higher sales volumes. On the other hand, the increases in labor, transportation and energy costs had a negative impact. The Group’s adjusted EBIT margin remained the same and was 10.4% (10.4%). Foreign currency translation impact on the Group’s earnings was EUR -0 million (EUR -5 million).

Adjusted EBIT excludes EUR -15.3 million (EUR 38.5 million) of items affecting comparability (IAC), including costs of implementing operational efficiency measures.

Adjusted EBIT and IAC

EUR million	Q4 2024	Q4 2023
Adjusted EBIT	110.3	107.5
Acquisition related costs	-0.0	-0.1
Restructuring gains and losses, including writedowns of related assets	-9.6	28.0
PPA amortization	-2.2	-2.2
Settlement and legal fees of disputes	-1.4	0.0
Prague site closure-related costs	-	13.5
Property damage incidents	-0.5	-0.1
Implementation costs concerning large projects with SaaS cloud computing technology	-1.6	-0.6
EBIT	95.0	146.0

Net financial expenses were EUR 19 million (EUR 18 million) in the quarter. Tax expense was EUR 11 million (EUR 29 million). The decrease was due to the unusually high deferred tax charge related to functional currency remeasurements in Türkiye in the comparison period. Profit for the quarter was EUR 65 million (EUR 99 million). Adjusted earnings per share (EPS) was EUR 0.68 (EUR 0.68) and reported EPS EUR 0.61 (EUR 0.83). Adjusted EPS is calculated based on adjusted profit for the period attributable to equity holders of parent company, which excludes EUR -7.1 million (EUR 16.0 million) of IAC.

Adjusted profit and IAC

EUR million	Q4 2024	Q4 2023
Adjusted profit for the period attributable to equity holders of the parent company	70.8	71.2
IAC in EBIT	-15.3	38.5
IAC in Financial items	-0.1	-0.9
IAC Tax	8.2	-13.0
IAC attributable to non-controlling interest	0.0	-8.6
Profit for the period attributable to equity holders of the parent company	63.7	87.2

Financial review 2024

Net sales by business segment

EUR million	2024	2023	Change
Foodservice Europe-Asia-Oceania	989.6	1,037.2	-5%
North America	1,460.1	1,457.9	0%
Flexible Packaging	1,322.5	1,341.0	-1%
Fiber Packaging	363.2	343.1	6%
Elimination of internal sales	-9.1	-10.3
Group	4,126.3	4,168.9	-1%

Comparable net sales growth by business segment

	2024	2023	2022
Foodservice Europe-Asia-Oceania	-5%	2%	18%
North America	0%	2%	14%
Flexible Packaging	1%	-9%	14%
Fiber Packaging	6%	7%	15%
Group	-0%	-2%	15%

The Group’s net sales decreased by 1% to EUR 4,126 million (EUR 4,169 million) during the reporting period, and comparable net sales growth was -0%. Demand improved during the second half of the year, after a muted first half. The impact of inflation and boycotts of global brands in certain markets had a negative impact on demand. Net sales were weighed on by changes in currencies and lower pricing, while sales volumes increased slightly. Comparable sales growth in emerging markets was -2%. Foreign currency translation impact on the Group’s net sales was EUR -37 million (EUR -153 million) compared to 2023 exchange rates.

Adjusted EBIT by business segment

				Items affecting comparability
EUR million	2024	2023	Change	2024	2023
Foodservice Europe-Asia-Oceania	91.0	98.0	-7%	-15.1	-9.9
North America	203.4	187.9	8%	-7.6	-0.0
Flexible Packaging	94.2	88.0	7%	-16.6	5.8
Fiber Packaging	43.5	39.6	10%	-2.2	-6.2
Other activities	-15.2	-20.9		-3.2	-1.4
Group	416.9	392.6	6%	-44.7	-11.7

Adjusted EBIT margin by business segment

	2024	2023	2022
Foodservice Europe-Asia-Oceania	9.2%	9.4%	9.5%
North America	13.9%	12.9%	11.7%
Flexible Packaging	7.1%	6.6%	6.3%
Fiber Packaging	12.0%	11.6%	11.0%
Group Total	10.1%	9.4%	8.8%

The Group’s adjusted EBIT increased to EUR 417 million (EUR 393 million) and reported EBIT was EUR 372 million (EUR 381 million). Adjusted EBIT increased by 6% supported by the company’s actions to improve profitability as well as lower raw material and energy costs. On the other hand, lower sales prices and the increase in labor costs had a negative impact on profitability. The Group’s adjusted EBIT margin increased and was 10.1% (9.4%). Foreign currency translation impact on the Group’s earnings was EUR -4 million (EUR -15 million).

Adjusted EBIT excludes EUR -44.7 million (EUR -11.7 million) of items affecting comparability (IAC), including costs of implementing operational efficiency measures and positive impacts from divestment of real estate in China and India.

Adjusted EBIT and IAC

EUR million	2024	2023
Adjusted EBIT	416.9	392.6
Acquisition related costs	-1.1	-0.5
Restructuring gains and losses, including writedowns of related assets	-25.1	17.3
PPA amortization	-8.8	-8.9
Settlement and legal fees of disputes	-2.0	-0.2
Prague site closure-related costs	-	-18.8
Property damage incidents	-1.5	-0.1
Implementation costs concerning large projects with SaaS cloud computing technology	-6.1	-0.6
EBIT	372.3	380.9

Net financial expenses were EUR 72 million (EUR 69 million). Tax expense was EUR 69 million (EUR 87 million). The effective tax rate was 23% (28%). The lower effective tax rate was due to the unusually high deferred tax charge related to functional currency remeasurements in Türkiye in the comparison period. Profit for the period was EUR 232 million (EUR 225 million). Adjusted earnings per share (EPS) were EUR 2.48 (EUR 2.32) and reported EPS EUR 2.14 (EUR 1.97). Adjusted EPS is calculated based on adjusted profit for the period attributable to equity holders of parent company, which excludes EUR -35.1 million (EUR -35.9 million) of IAC.

Adjusted profit and IAC

EUR million	2024	2023
Adjusted profit for the period attributable to equity holders of the parent company	259.2	242.3
IAC in EBIT	-44.7	-11.7
IAC in Financial items	-0.4	-0.1
IAC Tax	10.5	-15.5
IAC attributable to non-controlling interest	-0.5	-8.6
Profit for the period attributable to equity holders of the parent company	224.1	206.3

Outlook for 2025

The Group’s trading conditions are expected to remain relatively stable during 2025. The good financial position will enable the Group to address profitable growth opportunities.

Dividend proposal

On December 31, 2024, Huhtamäki Oyj’s distributable funds were EUR 1,496 million (EUR 836 million). The Board of Directors will propose to the Annual General Meeting that a dividend of EUR 1.10 (EUR 1.05) per share be paid.

Annual General Meeting 2025

Huhtamäki Oyj’s Annual General Meeting (AGM) will be held on Thursday, April 24, 2025 at 11:00 (EEST) at Scandic Marina Congress Center, Katajanokanlaituri 6, Helsinki, Finland. The Board of Directors will summon the AGM at a later date.

Teleconference

Huhtamaki will arrange a combined audiocast and teleconference today at 9:30. Huhtamaki’s CEO & President Ralf K. Wunderlich 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, and it can be followed in real-time.

A link to the audiocast is available at: https://huhtamaki.events.inderes.com/q4-2024

A link to the teleconference is available at: https://events.inderes.com/huhtamaki/q4-2024/dial-in.
Registration is required for the teleconference. After the registration you will be provided with phone numbers and a conference ID to access the conference.

An on-demand replay of the audiocast will be available shortly after the end of the call at https://www.huhtamaki.com/en/investors.

Financial reporting in 2025

In 2025, Huhtamaki will publish financial information as follows:

Interim Report, January 1 – March 31, 2025                 April 24
Half-yearly Report, January 1 - June 30, 2025                 July 24
Interim Report, January 1 - September 30, 2025                 October 23

The Annual Report 2024 will be published on the week commencing March 10, 2025.

This is a summary of Huhtamäki Oyj's Results January 1–December 31, 2024. The complete report is attached to this release and is also available at the company website at www.huhtamaki.com.

For further information, please contact:
Kristian Tammela, Vice President, Investor Relations, tel. +358 10 686 7058

HUHTAMÄKI OYJ
Corporate 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.

Huhtamaki has over 100 years of history and a strong Nordic heritage. Our around 18 000 professionals are operating in 36 countries and 101 locations around the world. Our values are Care Dare Deliver. In 2024 Huhtamaki’s net sales totaled EUR 4.1 billion. Huhtamäki Oyj is listed on the Nasdaq Helsinki and the head office is in Espoo, Finland. Find out more at www.huhtamaki.com. 

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