AAK (AAK) Q1 2025 earnings summary

Executive summary

• Operating profit rose 1% year-over-year to SEK 1,261 million, with a 5% volume decline excluding the Hillside divestment, supported by strong performance in Chocolate & Confectionery Fats and ongoing cost optimization.

• Operating profit per kilo increased 7% year-over-year (excluding Hillside), reaching SEK 2.51, driven by global optimization and favorable product mix.

• Net sales increased 6% to SEK 11,743 million, mainly due to higher raw material prices and specialty oils.

• Cash flow from operating activities was negative SEK 492 million, primarily due to higher raw material costs and sourcing agreement restructuring.

• Ongoing focus on sustainability, with improved ESG ratings from EcoVadis and CDP.

Financial highlights

• Volumes declined 10% year-over-year (5% excluding Hillside), totaling 503,000 MT.

• Operating profit per kilo increased 11% to SEK 2.51; at fixed FX rates, up 16%.

• Return on Capital Employed (ROCE) was 22.0% (down from 22.4% at year-end 2024).

• Net debt/EBITDA at 0.43, up from 0.29 in Q4 2024.

• CapEx for the quarter was SEK 272 million, focused on maintenance, productivity, and capacity.

Outlook and guidance

• Confident in long-term growth and committed to 2030 aspiration of SEK 3+ operating profit per kilo and double-digit average annual operating profit growth.

• Cost optimization program launched, targeting SEK 300 million annual savings by mid-2026, with SEK 50 million expected in 2025.

• One-time restructuring cost of SEK 200–250 million to be recognized in Q2 2025, including up to 5% workforce reduction.

• No material margin impact expected from global trade disruptions or U.S. tariffs due to diversified sourcing and production.

• Focus on innovation and customer co-development to drive value.