Scandi Standard (SCST) Q4 2023 earnings summary

Executive summary

• Q4 net sales fell 2% reported to MSEK 3,011; EBIT rose to MSEK 105 from 99 and margin improved to 3.5% from 3.2%.

• FY net sales reached MSEK 13,014, up 7% reported and 4% at constant exchange rates; EBIT increased to MSEK 457 from 290.

• Stronger Ready-to-cook results and working-capital release lifted FY operating cash flow to MSEK 671 from 197; year-end NIBD fell MSEK 412 to MSEK 1,571.

Financial highlights

• Q4 EBITDA was MSEK 206 versus 202, with a 6.9% margin versus 6.6%; net income rose to MSEK 66 from 55 and EPS to SEK 1.01 from SEK 0.86.

• FY EBITDA was MSEK 880 versus 722; adjusted EBITDA was MSEK 871 versus 722, and adjusted EBIT was MSEK 449 versus 290.

• FY net income increased to MSEK 273 from 138 and EPS to SEK 4.11 from SEK 2.02.

• Q4 finance costs decreased, mainly due to higher interest income on interest-bearing receivables and lower interest costs.

Outlook and guidance

• 2027 targets: annual organic sales growth of 5–7%, EBIT margin above 6%, EBIT above SEK 3/kg grill weight, ROCE above 15%, and NIBD/EBITDA below 2.5x.

• FY 2023 organic growth was 4%, EBIT margin 3.5%, EBIT/kg SEK 1.69, ROCE 11.0%, and NIBD/EBITDA 1.8x.

• 2024 investment estimated at MSEK 500, including Norwegian Ready-to-eat expansion, deboning capacity, Irish product differentiation and efficiency, ERP, RTC expansion and climate-transition investments.

• Priorities include rebuilding Ready-to-eat orders and Farre utilization, improving RTC Denmark profitability, and moving RTC up the value ladder.

• Q1 2024 paid financing cost estimated at ~8% p.a. of NIBD; bank financing interest at 5.5% p.a.; blended effective tax rate ~18%.