2015-02-12 07:30:00 CET
2015-02-12 07:30:49 CET
REGULATED INFORMATION
Huhtamäki Oyj - Financial Statement Release
Huhtamäki Oyj's Results January 1 - December 31, 2014: Good sales growth and EBIT
Huhtamäki Oyj Financial statement release 12.2.2015 at 8:30
Huhtamäki Oyj's Results January 1 - December 31, 2014: Good sales growth and
EBIT
The Films business segment, which was sold at the end of December 2014, is
reported as discontinued operations in this release and in the Results 2014.
Unless otherwise stated, all income statement related quarterly and reporting
period figures presented in this release and in the Results 2014, including
corresponding periods in 2013, cover continuing operations only. Continuing
operations include the Foodservice Europe-Asia-Oceania, North America, Flexible
Packaging and Molded Fiber business segments.
Q4 2014 in brief
* Net sales were EUR 581 million (EUR 527 million)
* EBIT was EUR 45 million (EUR 38 million, excluding NRI of EUR -18 million)
* EPS was EUR 0.39 (EUR 0.32, excluding NRI)
* Comparable net sales growth was 6% in total and 7% in emerging markets
* Currency movements had a positive impact of EUR 19 million on the Group's
net sales
* The Films business segment was sold to a German private equity fund and is
reported as discontinued operations
FY 2014 in brief
* Net sales were EUR 2,236 million (EUR 2,161 million)
* EBIT was EUR 175 million (EUR 160 million, excluding NRI of EUR -28 million)
* EPS was EUR 1.24 (EUR 1.17, excluding NRI)
* Comparable net sales growth was 6% in total and 10% in emerging markets
* Currency movements had a negative impact of EUR 36 million on the Group's
net sales
* Acquisition of Positive Packaging, a flexible packaging company operating in
India, United Arab Emirates and Africa, was announced in July and closed at
the end of January 2015
* The Board of Directors proposes a dividend of EUR 0.60 (EUR 0.57) per share
Key figures
EUR million Q4 2014 Q4 2013 Change FY 2014 FY 2013 Change
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Net sales 580.5 526.8 10% 2,235.7 2,161.1 3%
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EBITDA* 67.6 57.7 17% 259.0 241.6 7%
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EBITDA margin* 11.6% 11.0% 11.6% 11.2%
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EBIT** 45.3 37.5 21% 174.9 160.0 9%
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EBIT margin** 7.8% 7.1% 7.8% 7.4%
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EPS**, EUR 0.39 0.32 22% 1.24 1.17 6%
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ROI*** 12.6% 12.1%
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ROE*** 16.1% 15.8%
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Capital expenditure 49.8 39.0 28% 127.0 121.0 5%
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Free cash flow 54.1 18.3 196% 64.6 56.0 15%
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Including discontinued operations
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EPS***, EUR 0.35 0.32 9% 1.28 1.21 6%
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EPS, reported, EUR 0.40 0.14 186% 1.33 0.91 46%
* Excluding non-recurring items (NRI) of EUR -17.1 million in Q4 2013 and EUR
-21.3 million in FY 2013.
** Excluding NRI of EUR -18.1 million in Q4 2013 and EUR -28.1 million in FY
2013.
*** Excluding NRI of EUR 5.1 million in Q4 2014 and FY 2014 and EUR -18.1
million in Q4 2013 and EUR -30.6 million in FY 2013.
Unless otherwise stated, all comparisons in this release are compared to the
corresponding period in 2013. ROI and ROE figures presented in this release are
calculated on a 12-month rolling basis.
Jukka Moisio, CEO:"Our financial performance in 2014 was strong. We recorded comparable net sales
growth of 6% and have now reported more than 5% like-for-like growth in six
consecutive quarters since mid-2013. Growth in emerging markets during the year
was 10%, although there were large monthly and country-by-country variations
during the course of the year. Our profitability development was stronger than
the sales development and we reached all-time high EBIT, EBIT margin and EPS.
The profitability improvement was particularly good during the fourth quarter.
We were also able to improve our cash flow compared to the previous year, mostly
thanks to the final quarter. Our financial position remains strong and supports
us in our future growth aspirations.
For Huhtamaki, 2014 was a year of change. We sharpened our strategy and focused
our business on food packaging, where we already are among the leading companies
in the world, and where we want to be successful in years to come. In July, we
announced the acquisition of Positive Packaging, a flexible packaging
manufacturer having operations in India, the United Arab Emirates and Africa.
After closing the acquisition at the end of January, we're now enthusiastic to
start integrating the business into our Flexible Packaging segment.
Due to our focus on food packaging, we decided in the summer to look for future
options for our Films segment and announced the sale of the segment in November.
The transaction was closed on the last day of 2014 and therefore the business is
now reported as discontinued operations. Related to the sale, we have also
booked a gain of approximately EUR 5 million for the fourth quarter. These two
sizable transactions, the acquisition of Positive Packaging and the sale of
Films, increased significantly our focus on food packaging and also the share of
fast-growing emerging markets in our portfolio. Now a majority of our employees
and manufacturing plants are at the emerging markets, as well as close to 40% of
our net sales.
After the changes made in 2014, this year we will focus on implementing our
sharpened strategy. The new strategy will call for more collaboration in
innovation, operations and supply chain as well as higher consistency in
managing customer interfaces - all this for the benefit of our customers and
business partners. We're well positioned for future growth and look positively
into 2015."
Financial review Q4 2014
The Group's comparable net sales growth was 6% during the quarter. Growth was
strongest in the Flexible Packaging business segment, followed by the Molded
Fiber and North America business segments. Comparable growth in the emerging
markets was 7%. The growth in emerging markets was driven by good volume
development especially in South Asia and Eastern Europe, whereas negative net
sales development in China continued. The Group's net sales were EUR 581 million
(EUR 527 million). The foreign currency translation impact on Group's net sales
turned positive during the quarter and was EUR 19 million compared to the 2013
exchange rates. The majority of the positive currency impact came from the
strengthening of the US dollar versus euro.
Net sales by business segment
EUR million Q4 2014 Q4 2013 Change Of Group in Q4 2014
---------------------------------------------------------------------------
Foodservice Europe-Asia-Oceania 155.6 152.1 2% 27%
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North America 205.7 181.0 14% 35%
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Flexible Packaging 159.8 138.6 15% 27%
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Molded Fiber 63.2 60.3 5% 11%
Excluding internal sales eliminations of EUR -3.8 million in Q4 2014 and EUR
-5.2 million in Q4 2013.
Comparable growth by business segment
Q4 2014 Q3 2014 Q2 2014 Q1 2014 FY 2014
------------------------------------------------------------------------
Foodservice Europe-Asia-Oceania 2% 4% 5% 3% 4%
------------------------------------------------------------------------
North America 5% 4% 10% 3% 6%
------------------------------------------------------------------------
Flexible Packaging 12% 6% 4% 7% 7%
------------------------------------------------------------------------
Molded Fiber 7% 9% 10% 10% 9%
------------------------------------------------------------------------
Group 6% 5% 7% 5% 6%
The Group's earnings development was good, with particularly strong improvement
in the North America business segment. Earnings growth was strong also in the
Foodservice Europe-Asia-Oceania and Flexible Packaging business segments. The
Group's earnings before interest and taxes (EBIT) was EUR 45 million (EUR 38
million, excluding NRI of EUR -18 million). In constant currencies EBIT grew by
18%. Positive foreign currency translation impact on Group's EBIT was EUR 1
million.
EBIT by business segment
EUR million Q4 2014 Q4 2013 Change Of Group in Q4 2014
---------------------------------------------------------------------------
Foodservice Europe-Asia-Oceania 13.0 12.2 7% 30%
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North America 8.6 5.0 72% 19%
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Flexible Packaging 12.4 10.1 23% 28%
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Molded Fiber 10.0 8.9 12% 23%
Excluding Other activities EBIT EUR 1.3 million in Q4 2014 and EUR 1.3 million
in Q4 2013. Foodservice Europe-Asia-Oceania EBIT excluding NRI of EUR -18.0
million in Q4 2013.
Net financial expenses increased to EUR 8 million (EUR 4 million). The increase
was due to the larger share of higher interest-paying bonds in the external loan
portfolio. Tax expense was EUR 4 million positive (EUR 0 million). The positive
taxes were mostly due to dissolved tax provisions based on finalized tax audits.
Profit for the period was EUR 42 million (EUR 16 million including NRI of EUR
-18 million). Earnings per share (EPS) were EUR 0.39 (EUR 0.32 excluding NRI or
EUR 0.14 reported).
Profit for the period for discontinued operations was EUR 1 million, including
NRI of EUR 5 million (EUR 0 million, no NRI reported). Profit for the period for
continuing and discontinued operations in total was EUR 43 million, including
NRI of EUR 5 million (EUR 16 million, including NRI of EUR -18 million).
Reported EPS for discontinued operations was EUR 0.01, (EUR 0.00, no NRI
reported). Reported EPS for continuing and discontinued operations in total was
EUR 0.40, (EUR 0.14). EPS for continuing and discontinued operations in total
excluding NRI was EUR 0.35 (EUR 0.32).
Financial review FY 2014
The Group's comparable net sales growth was 6%. In the emerging markets
comparable growth was 10%, with Eastern European markets showing fastest growth
throughout the year. The Group's net sales were EUR 2,236 million
(EUR 2,161 million). The negative foreign currency translation impact on Group's
net sales, primarily related to adverse currency movements during the first half
of the year, was EUR 36 million compared to the 2013 exchange rates. The largest
negative impact came from the Russian ruble, Indian rupee and Australian dollar.
For the whole year, translation impact from the US dollar was minor, despite
strong fluctuations towards euro during the year.
Net sales by business segment
EUR million
FY 2014 FY 2013 Change Of Group in FY 2014
---------------------------------------------------------------------------
Foodservice Europe-Asia-Oceania 620.4 629.1 -1% 27%
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North America 769.4 725.3 6% 34%
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Flexible Packaging 618.0 585.8 5% 28%
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Molded Fiber 247.0 236.3 5% 11%
Excluding internal sales eliminations of EUR -19.1 million in FY 2014 and EUR
-15.4 million in FY 2013.
The Group's earnings development was strong, with all business segments
contributing to the earnings growth. Earnings growth was strongest in the
Foodservice Europe-Asia-Oceania business segment. The Group's EBIT was
EUR 175 million (EUR 160 million, excluding NRI of EUR -28 million). EBIT in
constant currencies grew by 10%. Negative foreign currency translation impact on
Group's EBIT, resulting from currency movements during the first half of the
year, was EUR 3 million.
EBIT by business segment
EUR million
FY 2014 FY 2013 Change Of Group in FY 2014
---------------------------------------------------------------------------
Foodservice Europe-Asia-Oceania 57.4 46.9 22% 32%
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North America 38.4 38.4 0% 22%
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Flexible Packaging 45.5 44.0 3% 26%
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Molded Fiber 35.0 29.6 18% 20%
Excluding Other activities EBIT EUR -1.4 million in FY 2014 and EUR 1.1 million
in FY 2013. Foodservice Europe-Asia-Oceania EBIT excluding NRI of EUR -28.1
million in FY 2013.
Net financial expenses were EUR 29 million (EUR 23 million). Tax expense was
EUR 15 million (EUR 13 million). The corresponding tax rate was 10% (12%). The
tax rate for continuing and discontinued operations combined was 11% (12%).
Profit for the period was EUR 132 million (EUR 96 million including NRI of EUR
-28 million). EPS was EUR 1.24 (EUR 1.17 excluding NRI or EUR 0.91 reported).
Profit for the period for discontinued operations was EUR 10 million, including
NRI of EUR 5 million (EUR 2 million, including NRI of EUR -3 million). Profit
for the period for continuing and discontinued operations in total was
EUR 141 million, including NRI of EUR 5 million (EUR 98 million, including NRI
of EUR -31 million).
Reported EPS for discontinued operations was EUR 0.09, (EUR 0.01). Reported EPS
for continuing and discontinued operations in total was EUR 1.33, (EUR 0.91).
EPS for continuing and discontinued operations in total excluding NRI was
EUR 1.28 (EUR 1.21).
Significant events after the reporting period
On January 30, 2015 Huhtamaki completed the acquisition of Positive Packaging, a
flexible packaging company with nine manufacturing facilities in India and the
United Arab Emirates as well as significant business in Africa and other export
markets. With the acquisition Huhtamaki continued to implement its strategy of
quality growth and significantly strengthened its position in the fast-growing
emerging markets. The annual net sales of the acquired business are
approximately EUR 220 million and it employs approximately 2,500 people in India
and the UAE as well as in sales offices in seven countries. The debt free
purchase price was USD 336 million. The business was consolidated into the
Flexible Packaging business segment as of February 1, 2015.
On January 9, 2015 Huhtamäki Oyj signed a EUR 400 million syndicated revolving
credit facility loan agreement for the period of five (5) years. With the new
credit facility, Huhtamaki refinanced a previous EUR 400 million credit facility
signed in March 2011. The funds will be used for general corporate purposes of
the Group.
Outlook for 2015
The Group's trading conditions are expected to remain relatively stable during
2015. The good financial position and ability to generate a positive cash flow
will enable the Group to continue to address profitable growth opportunities.
Capital expenditure is expected to be at the same level as in 2014. Majority of
the investments are expected to be directed to enhance growth in the emerging
markets.
Dividend proposal
On December 31, 2014 Huhtamäki Oyj's non-restricted equity was EUR 743 million
(EUR 786 million). The Board of Directors will propose to the Annual General
Meeting that a dividend of EUR 0.60 (EUR 0.57) per share be paid.
Annual General Meeting 2015
The Annual General Meeting of Shareholders will be held on Tuesday, April
21, 2015 at 11 am (EET) at Finlandia Hall, Mannerheimintie 13e, in Helsinki,
Finland.
Financial reporting in 2015
Annual Accounts and Directors' Report 2014 will be published during week 8 on
Huhtamaki's website at www.huhtamaki.com.
Huhtamaki will publish the following interim reports during the course of the
year:
Interim Report January 1 - March 31, 2015 April 21, 2015
Interim Report January 1 - June 30, 2015 July 24, 2015
Interim Report January 1 - September 30, 2015 October 22, 2015
This is a summary of Huhtamäki Oyj's Results January 1 - December 31, 2014. 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:
Jukka Moisio, CEO, tel. +358 10 686 7801
Thomas Geust, CFO, tel. +358 686 7880
HUHTAMÄKI OYJ
Group Communications
Huhtamaki is a global specialist in packaging for food and drink. With our
network of 67 manufacturing units and 23 sales offices in 33 countries, we're
well placed to support our customers' growth wherever they operate. Mastering
three distinctive packaging technologies, approximately 16,300 employees develop
and make packaging that helps great products reach more people, more easily. In
2014 our net sales totaled EUR 2.2 billion. The Group has its head office in
Espoo, Finland and the parent company Huhtamäki Oyj is listed on NASDAQ OMX
Helsinki Ltd. Additional information is available at www.huhtamaki.com.
[HUG#1893683]
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