Raisio / FI. (rg) Finland’s Raisio Group published its Half-Year Financial Report for January to June (H1-2023) and announced a strong result in a weak market environment. Overview:
April to June 2023, continuing operations
- The Group’s net sales totalled EUR 52.7 (55.5) million, which signified a decrease of 5.1 percent.
- Comparable Ebitda was EUR 8.2 (6.9**) million, which accounted for 15.5 (12.4) percent of net sales.
- Ebitda was EUR 7.5* (6.9) million, which accounted for 14.3 (12.4) percent of net sales.
- Comparable Ebit was EUR 5.7 (4.4**) million, accounting for 10.8 (7.9) percent of net sales.
- Ebit was EUR 5.0* (4.4) million, which accounted for 9.5 (7.9) percent of net sales.
- The Group’s cash flow from continuing operations after financial items and taxes totalled EUR 9.8 (-0.2) million.
*Ebitda and Ebit include EUR 0.2 million in costs related to business expansion and EUR 0.4 million in costs related to reorganisation.
**The comparable Ebitda and Ebit for the comparison period include a return of EUR 1.1 million in pension fund surplus from previous years.
January to June 2023, continuing operations
- The Group’s net sales totalled EUR 109.1 (108.7) million, which signified a growth of 0.4 percent.
- Comparable Ebitda was EUR 14.9 (10.9**) million, which accounted for 13.7 (10.0) percent of net sales.
- Ebitda was EUR 14.0* (10.9) million, which accounted for 12.8 (10.0) percent of net sales.
- Comparable Ebit was EUR 9.9 (5.9**) million, accounting for 9.1 (5.4) percent of net sales.
- Ebit was EUR 9.0* (5.9) million, which accounted for 8.2 (5.4) percent of net sales.
- The Group’s cash flow from continuing operations after financial items and taxes totalled EUR 13.0 (-1.4) million.
- The comparable return on invested capital (ROIC) was 7.4 (2.5) percent and the return on invested capital (ROIC) was 6.7 (2.5) percent.
*Ebitda and Ebit include EUR 0.5 million in costs related to business expansion and EUR 0.4 million in costs related to reorganisation.
**The comparable Ebitda and Ebit for the comparison period include a return of EUR 1.1 million in pension fund surplus from previous years.
Chief Executive’s Commentary
CEO Pekka Kuusniemi: «The sharp rise in food prices, general inflation and the rapid rise in interest rates have had an unexpected impact on consumer purchase behaviour. The weakening of purchasing power has resulted in a significant drop in volumes as consumers seek to save on their daily spending, which has affected all of Raisio’s market areas. The biggest drop in volumes has been seen in the UK, where macroeconomic challenges have been widely felt in the grocery sector. In Ireland, however, demand for «Benecol» products has continued to grow despite the inflation developments.
«The volume challenges increased during the second quarter, and Raisio’s net sales fell by 5.1 percent. However, increasing efficiency in all operations significantly improved comparable Ebit, which amounted to EUR 5.7 (4.4) million and 10.8 (7.9) percent of net sales. Cash flow after financial items and taxes was very strong at EUR 9.8 (-0.2) million. We have been able to quickly turn all key performance and profitability indicators in the right direction after the shock we suffered as a result of Russia’s invasion of Ukraine.
«In a declining market, Raisio’s focus is on developing profitability, marketing efforts are targeted around the moment of purchase and efforts are made to make the most of the value of new product launches. The development of new products, made possible by the new production facilities, continues to accelerate, and consumers continue to be interested in innovative brand products, despite the recent trend towards frugality in food choices. The continued success of «Elovena» products is an excellent demonstration of this, with a 20 percent growth during the review period.
«The comprehensive modernisation of our pasta factory has progressed according to plan during the period. The new production line installed during the summer will be ready for production in August, and «Torino» pasta products will again be produced in Raisio for Finnish consumers in a factory with state-of-the-art technology and product safety. The investment is worth EUR 4.1 million and the installation work will take approximately 10 weeks in total.
«Raisio’s strategy focuses on the strengths we have developed over a long period of time, and we have a proven ability to respond quickly to changing market conditions and a resilient balance sheet that allows us to invest in future growth. My warmest thanks to Raisio’s staff for their continued good work in these exceptional times.»
Outlook 2023
Raisio announced on 10 July 2023 that it had updated its financial outlook for 2023. Previously, the company had estimated that its outlook for 2023 would show an increase in comparable net sales and profit compared to the previous year.
New guidance for 2023: Raisio expects comparable net sales to be at or slightly below the previous year’s level. Comparable profit is expected to increase from the previous year, to between EUR 21 and 23 million (EUR 18.4 million in 2022).
For additional information please read the company’s PDF file below (217 KB):
20230809-RAISIO-H1-2023.
