Royal FrieslandCampina (RFC) Investor Presentation summary

2024 performance highlights

• Net revenue reached €12.9 billion, a 1.1% decrease, but operating profit surged to €527 million from €75 million in 2023, with net result at €321 million versus a loss previously.

• Gross profit increased by 22.3% to €2,073 million, with gross margin improving to 16.0% from 13.6%.

• Free cash flow remained strong at €454 million, with positive cash flow and capex financed by operational cash flow.

• Cost savings of €315 million were realized, with significant contributions from Specialised Nutrition, Asia, and Ingredients.

• Supplementary cash payment of €1.21 per 100kg milk was made, reflecting improved profitability.

Business group performance

• Europe saw volume market share gains for key brands, though revenue and EBIT declined due to price adjustments and marketing investments.

• Retail & Americas achieved profit in Germany for the first time in years, with improved net margin and stable cheese volumes.

• MEPA experienced solid brand growth in the Middle East and North Africa, with volume recovery in Nigeria and increased market share in Pakistan.

• Asia reported growth in market shares and profitability, especially in Indonesia, Thailand, and Hong Kong.

• Ingredients benefited from strong demand for high-quality milk proteins, despite challenges in low-value segments.

• Specialised Nutrition grew market share in China, driving higher operating profit.

• Professional & Trading improved results due to better basic dairy prices and strengthened positions in cream and desserts.

Financial profile and capital structure

• Net debt reduced to €270 million, with net debt/EBITDA at 0.3x and interest coverage at 11.4.

• Return on capital employed rose to 13.5% from 1.5% in 2023.

• Prudent financing policy maintained, with strong credit ratings (Fitch BBB+, S&P BBB) and significant covenant headroom.

• Diverse funding profile, with new private placement funds and repayment of TLTRO loans.