In This Article:
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Sales: Decreased by 1% in Q3 2024, with comparable sales flat due to currency impact.
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Adjusted EBIT: Increased by 2% to EUR 102 million, with a margin of 10.0%.
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EPS Growth: 9% increase compared to last year.
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CapEx Reduction: Decreased by approximately 30% in Q3 and year-to-date, supporting cash flow.
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North America Sales Growth: Reported and comparable sales growth of 3% in Q3.
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North America Adjusted EBIT Margin: 13.8% in Q3, 14% year-to-date.
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Flexible Packaging Adjusted EBIT Margin: 7.3% in Q3, up from 7.2% a year ago.
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Fiber Packaging Adjusted EBIT Margin: 9%, impacted by raw material cost increases.
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Net Debt to EBITDA: Ratio at 2, with deleveraging of approximately 8.5% from the previous year.
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Dividend Payment: Second and final installment paid in early October.
Release Date: October 24, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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Huhtamaki Oyj (STU:HUKI) reported a 2% improvement in adjusted EBIT compared to the previous year, driven by cost-saving measures.
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The company has successfully implemented a cost efficiency program, generating savings above the linear trajectory, with EUR18 million saved year-to-date.
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North American sales showed a 3% growth, indicating a recovery in demand, particularly in the food service sector.
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The fiber packaging segment experienced volume growth, especially in egg packaging, supported by additional capacity installations.
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Huhtamaki Oyj (STU:HUKI) has reduced capital expenditures by 30% year-to-date, supporting a solid cash flow position.
Negative Points
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Overall sales decreased by 1% in the third quarter, with food service packaging demand remaining soft due to high inflation.
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The company faces continued pricing pressure due to lower demand volumes and competitive market conditions.
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The flexible packaging segment showed significant variations in demand across different regions, with India and Turkey underperforming.
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The fiber packaging segment's profitability was temporarily subdued due to a 50% increase in recycled paper prices.
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Currency fluctuations, particularly with the Indian Rupee and Brazilian Real, negatively impacted financial results.
Q & A Highlights
Q: Is there any plan to control administration costs to improve margins? A: Thomas Geust, CFO, mentioned that while administration costs are a focus area, the key to margin improvement is volume growth. Cost management is ongoing, but the administration line is influenced by various factors, including incentive programs.