Atlantic Grupa (ATGR) Q1 2025 earnings summary

Executive summary

• Q1 2025 sales reached EUR 259.9 million, up 9.8% year-over-year, driven by growth in almost all business and distribution units, especially Coffee and Savoury Spreads, and in Serbia and North Macedonia.

• EBITDA declined 8.7% to EUR 23.0 million, and net profit dropped 38.4% to EUR 6.1 million, mainly due to record-high raw coffee and cocoa prices and increased staff investments.

• Two new brands launched: DoNatural herbal waters and Lemonish low-calorie sparkling lemonade, both showing strong initial results.

• Recognized as a top employer in Bosnia and Herzegovina and awarded the Equal Pay Champion certificate, with a gender pay gap of only 1.09%.

• Won the "Most Energy Efficient Company" award in Slovenia, with a 30% reduction in electricity use per tonne of Argeta since 2020.

Financial highlights

• Sales: EUR 259.9 million (+9.8% YoY); EBITDA: EUR 23.0 million (-8.7% YoY); EBIT: EUR 10.3 million (-29.0% YoY); Net profit: EUR 6.1 million (-38.4% YoY).

• EBITDA margin: 8.8% (-180 bp YoY); Net profit margin: 2.3% (-183 bp YoY).

• Free cash flow: EUR -26.0 million (down from EUR 2.0 million in Q1 2024), mainly due to lower operating cash flow.

• Net debt increased to EUR 231.2 million; gearing ratio rose to 33.1% from 29.5% at year-end 2024.

• Interest coverage ratio improved to 12.6 (from 11.7 in Q1 2024).

Outlook and guidance

• Management expects sales to grow to EUR 1.2 billion in 2025, but profitability will remain under pressure from high raw coffee and cocoa prices and rising labor and service costs.

• EBITDA for 2025 is expected to be at the same level as 2024 despite cost pressures.

• Over EUR 55 million in capital investments planned for 2025, with half allocated to Coffee and Snacks.

• Strategic focus on leadership, selective expansion, operational excellence, digital transformation, and organizational strengthening.