Slide 1: Interim Report Q3 2022
Interim Report Q3 2022 Juha Ruohola, interim CEO Jyrki Paappa, CFO 3 November 2022
Slide 2: Safety First: Goal-oriented work towards zero accidents at work
Safety First: Goal-oriented work towards zero accidents at work Accident frequency, LTIR 30 * Rolling 12 months average 25 20 15 10 5 0 Q3/19 Q3/20 Q3/21 Q3/22 -30% lost-time accidents -20% days of absence due to accidents +85% safety observations *lost-time accidents per million working hours Inter
Slide 3: Q3/2022: The quarter was twofold due to high inflation
Q3/2022: The quarter was twofold due to high inflation • Clear net sales growth in all home Net sales, M€ markets and sales channels - Increased costs due to high inflation 600,0 550,0 520.8 passed on to sales prices 500,0 446.8 - Food service sales continued to increase +17% 450,0 400,0 clearly in
Slide 4: Q3/2022: Profit improvement continued in Sweden and Denmark
Q3/2022: Profit improvement continued in Sweden and Denmark • Sweden and Denmark continued good performance • In Finland, comparable EBIT was Change of comparable EBIT, M€ positive, but the sharp rise in energy prices exceeded forecasts 7.7 0.3 0.1 • Losses in the Baltics increased -1.2 as energy an
Slide 5: Net sales growth continuing
Net sales growth continuing Quarterly net sales, M€ 530 521 510 506 492 490 473 470 464 449 447 450 439 439 441 438 437 429 428 430 410 402 390 370 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 350 2019 2020 2021 2022 Interim Report Q3/2022 5
Slide 6: Food service market continued to grow
Food service market continued to grow Net sales breakdown Q3/2022 Markets Sales channels Categories 5% (+0.5) 6% 10% (+0.5) (+0.5) 15% 11% (+1.5) 13% 35% (+2) 43% (-1) 24% (+2) 76% (-3) 36% (-2) 26% (-1) Finland Retail Beef and pork Sweden Food service Charcuterie, sausages and bacons Denmark Indust
Slide 7: Quarterly comparable EBIT, M€
Quarterly comparable EBIT, M€ 15 12 10 8 8 7 6 5 3.8 5 1.5 1 1 0 -1 -5 -3 -4 -10 -8.5 -10 -15 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2019 2020 2021 2022 Interim Report Q3/2022 7
Slide 8: Guidance for 2022 updated on 29 September 2022
Guidance for 2022 updated on 29 September 2022 HKScan's comparable EBIT is expected to decrease from the comparison year, but remain positive. It has been decided to lower the financial guidance due to the significantly changed situation on the energy market. The uncertainty in the energy market aff
Slide 9: HKScan's strategic target is to grow into a versatile food company
HKScan’s strategic target is to grow into a versatile food company in the long term
Slide 10: Strategic renewal requires better profitability and stronger balance sheet
Strategic renewal requires better profitability and stronger balance sheet Improving Renewal into the profitability of a versatile the core business food company Strengthening Profitable growth the financial base CASH FLOW · PROFITABILITY · BALANCE SHEET 2022 2030 10
Slide 11: Focus on profitability improvement
Focus on profitability improvement In an exceptional and rapidly changing operating environment, HKScan focuses on profitability improvement. Measures to improve profitability 1) Passing on strong cost inflation to sales prices and other commercial measures 2) Cost management in all activities 3) In
Slide 12: Financial review
Financial review
Slide 13: HKScan – key figures
HKScan – key figures EUR million 7-9/2022 7-9/2021 1-9/2022 1-9/2021 2021 Net sales 520.8 446.8 1 463.7 1 323.6 1 815.3 EBITDA 17.3 23.5 39.0 54.5 78.1 EBIT 2.7 7.6 -20.5* 10.2 17.9 - EBIT margin, % 0.5 1.7 -1.4 0.8 1.0 Comparable EBIT 3.8 7.7 -3.2 7.2 14.5 - EBIT margin, % 0.7 1.7 -0.2 0.5 0.8 Prof
Slide 14: HKScan – key figures
HKScan – key figures EUR million 7-9/2022 7-9/2021 1-9/2022 1-9/2021 2021 Cash flow from operating activities -6.2 -15.6 -18.2 12.5 54.6 Cash flow after investing activities -12.1 -23.9 -35.5 59.9** 81.2** Return on capital employed (ROCE) before taxes, % -0.5 5.1 3.6 Interest-bearing net debt 362.5
Slide 15: Interest-bearing net debt and net gearing
Interest-bearing net debt and net gearing 355 362 333 346 309 315 323 308 314 298 300 299 276 97% * 101% 103% ** 96% 93% 103% 95% 111% 110% 115% 90% 85% * 91% ** Q3 19 Q4 19 Q1 20 Q2 20 Q3 20 Q4 20 Q1 21 Q2 21 Q3 21 Q4 21 Q1 22 Q2 22 Q3 22 Interest-bearing net debt (EUR million) Net gearing (%) * Q2
Slide 16: Debt profile and maturity structure as of 30 September 2022
Debt profile and maturity structure as of 30 September 2022 Maturity of the Group’s interest-bearing debt*, M€ Interest-bearing debt by credit type, M€* 21.4 2.1 160 14.5 4.3 89.4 120 80 90.0 40 39.5 0 2022 2023 2024 2025 >2025 Bonds Bank loans Pension loans Total interest-bearing debt without IFRS
Slide 17: Q3/2022: Investments, cash flow and working capital
Q3/2022: Investments, cash flow and working capital Group investments, M€ Cash flow from operating activities, M€ 10 0,0 9 8.4 - 2,0 - 4,0 8 7.3 - 6,0 - 8,0 -6.2 7 2.7 - 10,0 - 12,0 6 3.2 - 14,0 - 16,0 5 1.4 - 18,0 -15.6 4 0.7 Q3/21 Q3/22 3 2.2 1.3 2 Working capital, M€ 70,0 62 1 2.1 2.2 60,0 60,0 4
Slide 18: Finland Q3/2022: Cost increases passed on to sales prices
Finland Q3/2022: Cost increases passed on to sales prices Net sales, M€ Comparable EBIT, M€ +17% 300,0 6,0 250,0 221.8 5,0 188.9 4,0 200,0 150,0 3,0 3.1 100,0 2,0 1.9 50,0 1,0 0,0 0,0 Q3/21 Q3/22 Q3/21 Q3/22 • Price increases to cover exceptionally high inflation • Food service sales continued to gr
Slide 19: HKScan expanded into new product category with Via Kasvimaa products
HKScan expanded into new product category with Via Kasvimaa products • The joint venture between HKScan and Vihannes-Laitila, Kasviskonttori Oy, launched Via Kasvimaa products in early October • Ready-to-use and ready-to-cook fresh vegetable products responding to growing consumer demand • The produ
Slide 20: Improving operational efficiency in Finland
Improving operational efficiency in Finland • Improving the profitability of the Finnish poultry business at the Rauma and Eura units - Increasing production efficiency, reorganising operations and renewing operating methods - The changes aim at annual savings of more than 3 M€ in 2023 • An importan
Slide 21: Sweden Q3/2022: Strong performance continued
Sweden Q3/2022: Strong performance continued Net sales, M€ Comparable EBIT, M€ 300,0 +9% +0.3 M€ 250,0 186.9 200,0 170.8 12,0 10,0 150,0 8,0 6.9 7.2 100,0 6,0 4,0 50,0 2,0 0,0 0,0 Q3/21 Q3/22 Q3/21 Q3/22 • Clear increase in net sales also at comparable exchange rates • The impact of high cost inflat
Slide 22: Baltics Q3/2022: Negative profit development continued in an exceptional operating environment
Baltics Q3/2022: Negative profit development continued in an exceptional operating environment Net sales, M€ Comparable EBIT, M€ excluding change of biological asset revaluation +23% 70,0 60,0 52.9 0.1 50,0 43.2 0,0 -0,5 40,0 -1,0 -1,5 30,0 -2,0 20,0 -2,5 -3,0 10,0 -3,5 0,0 -4,0 -3.6 Q3/21 Q3/22 Q3/
Slide 23: Denmark Q3/2022: Strong growth continued
Denmark Q3/2022: Strong growth continued Net sales, M€ Comparable EBIT, M€ +35% 80,0 70,0 59.2 0,5 0,5 0,4 +0.1 M€ 60,0 50,0 44.0 0,4 0,3 40,0 0,3 30,0 0,2 0.2 0,2 20,0 0,1 0.1 10,0 0,1 0,0 0,0 Q3/21 Q3/22 Q3/21 Q3/22 • Denmark showed clear sales volume growth and retail sales for the Rose brand inc
Slide 24: We make life tastier – today and tomorrow