Borregaard (BRG) Q4 2024 earnings summary

Executive summary

• Full-year EBITDA reached an all-time high of NOK 1,874 million, up 5% year-over-year, driven by strong BioSolutions performance and higher sales across all segments, despite increased input costs and lower Fine Chemicals deliveries.

• Q4 EBITDA rose to NOK 398 million, a 22% increase year-over-year, supported by higher sales and improved product mix, especially in BioSolutions.

• Proposed dividend is NOK 4.25 per share, a 13% increase, representing 52% of net earnings and totaling an estimated NOK 423 million.

• Return on capital employed was 17.1%, above the 15% target but down from 18.3% last year.

• BioSolutions and specialization led growth, while higher wood costs offset BioMaterials gains.

Financial highlights

• Q4 operating revenues increased 9% year-over-year to NOK 1,744 million; full-year revenues rose 7% to NOK 7,617 million.

• Q4 EBITDA margin improved to 22.8%; full-year EBITDA margin at 24.6%.

• Q4 EPS was NOK 1.30 (up from NOK 1.20); full-year EPS was NOK 8.25 (down from NOK 8.73) due to higher depreciation and environmental accruals.

• Cash flow from operations was NOK 314 million in Q4 and NOK 1,068 million for the year, lower than 2023 due to increased net working capital.

• Q4 profit for the period increased 30% to NOK 136 million; full-year profit NOK 829 million.

Outlook and guidance

• BioSolutions 2025 sales volume forecast at 330,000 tonnes, with Q1 expected at 80,000 tonnes and continued strong agriculture demand.

• BioMaterials 2025 sales volume expected at 150,000–155,000 tonnes, with higher average prices in H1 2025 (8–10% above H1 2024).

• Fine Chemicals bioethanol prices expected to decline to 2022 levels due to increased supply; fine chemical intermediates volume to grow.

• Wood costs expected to remain flat into H1 2025; full-year benefit from energy and CO2 reduction investments.

• Positive currency hedging impact anticipated in 2025, with net FX EBITDA impact estimated at +220 mNOK.