HKFoods (HKSAV) Q3 2024 earnings summary

Executive summary

• Net sales for Q3 2024 rose 8.8% year-over-year to €251.6M, driven by strong food service channel growth, domestic demand, and a broad product portfolio.

• Comparable EBIT from continuing operations increased to €11.6M in Q3 2024 (4.6% margin), more than doubling year-over-year, reflecting improved profitability from commercial measures and production efficiencies.

• Major restructuring completed with the sale of Danish, Swedish, and Baltic businesses, strengthening the balance sheet and reducing net debt by €109.9M year-over-year.

• Strategic investments in ready meal production and poultry efficiency exceeded targets, supporting growth in high-value product categories.

• Retail sales and production efficiency, especially at the Rauma poultry cutting department, contributed positively.

Financial highlights

• Q3 2024 net sales: €251.6M (Q3 2023: €231.2M); 1-9/2024 net sales: €735.0M (1-9/2023: €683.3M).

• Q3 2024 comparable EBIT: €11.6M (Q3 2023: €6.6M); 1-9/2024: €17.4M (1-9/2023: €8.6M).

• Q3 2024 profit for the period: €6.4M (Q3 2023: €0.2M); EPS: €0.05 (Q3 2023: -€0.01).

• Q3 2024 EBITDA: €19.2M (Q3 2023: €14.9M); 1-9/2024: €39.4M (1-9/2023: €34.4M).

• Cash flow from operating activities in Q3 2024: €7.5M (Q3 2023: €3.5M); 1-9/2024: €22.4M (1-9/2023: €17.6M).

Outlook and guidance

• Updated 2024 guidance: Comparable EBIT from continuing operations expected at €22–25M, nearly doubling from €11.6M in 2023.

• Guidance revised upward in September 2024 due to strong performance; management confident in achieving new EBIT target, supported by efficiency and cost-saving programs.