14 August 2024
Emmi half-year results 2024
Emmi is on track and focussing on strategic acquisitions
Welcome
Ricarda Demarmels | Oliver Wasem | Gisela Heel | Simone Burgener |
Spokesperson & Senior | |||
Chief Executive Officer | Chief Financial Officer | Head of Corporate Communications | |
Communications Manager | |||
3 | Half-year results 2024 - 14 August 2024 |
Agenda
1. Strategy execution & highlights
Ricarda Demarmels, CEO
2. Performance H1/2024
Oliver Wasem, CFO
3. Outlook
Ricarda Demarmels, CEO
4. Q&A
Ricarda Demarmels, CEO I Oliver Wasem, CFO
4 | Half-year results 2024 - 14 August 2024 |
1. Strategy execution & highlights
Ricarda Demarmels, CEO
Emmi on track - with focus on strategic acquisitions
Return to broad-based volume growth with improved profitability, cash flow and ROIC
- Sales of CHF 2,017.2 million, as expected overall below previous year (-4.1%)
Sales development was held back by negative acquisition effects of -2.2% (disposal of Gläserne Molkerei and acquisition of Verde Campo (closing end of May)) and currency effects of -1.9%
- Return to positive volume growth (+1.4%); negative price effects driven by milk prices in particular had an equivalent negative impact (-1.4%);
organic growth at group level flat (0.0%) - lower exports of surplus Swiss milk (-0.4%) and milk shortages in Tunisia (-0.4%) have significantly held back organic growth; a strong July pushed YTD organic growth up to +1.2%, driven by positive volume/mix growth of +2.4%.
- Good organic growth in the Division Europe, in important markets of the Division Americas and in strategic niches
Growth is being driven by the key markets Brazil and Chile, Mexico, Darey Brands in the USA, premium desserts from Italy, Emmi Caffè Latte and goat's milk powder from the Netherlands
- Additional margin improvement through ongoing portfolio transformation and further operational progress in international business
EBIT of CHF 140.3 million and EBIT margin +37 bps to 7.0% (PY: CHF 138.5 million or 6.6%) thanks to significant improvement in gross profit margin (+201 bps); cash conversion 91% (PY: 86%); ROIC 9.0% (PY: 8.3%)
Strategically important acquisitions accelerate portfolio transformation
- Focused execution of the proven Emmi strategy
Increased focus on profitable markets and investments in strategic niches and branded businesses
- Ongoing portfolio transformation with three strategically important acquisitions
Verde Campo (BR, closing in May 2024), Hochstrasser (CH, signing in June 2024), Mademoiselle Desserts (FR, signing in July 2024)
- Further progress on the execution of the Emmi Sustainability Strategy
Industry initiative "KlimaStaR Milch" for a more sustainable dairy economy in Switzerland with positive interim results, recyclable PET bottles for milk and milk products in Switzerland launched
Confirmation of outlook for 2024 without potential acquisition effect from Mademoiselle Desserts
- Persistent, challenging macroeconomic conditions
Maintain focus on strategic course, further develop tried-and-tested business model, focus on profitable volume development and integration of acquisitions made
- Outlook of organic sales growth at group level of between 1% and 2% confirmed
- EBIT of CHF 295 million to CHF 315 million and net profit margin of 5.0% to 5.5% confirmed
Disregarding potential acquisition effects from Mademoiselle Desserts, which at present cannot be reliably assessed
6 | Half-year results 2024 - 14 August 2024 |
Emmi is on track
encouraging margin development over the last 2 years
in CHF million
H1/24 H1/23 H1/22 H1/21 H1/20
Net sales | 2,017.2 | 2,103.4 | 2,016.5 | 1,883.6 | 1,773.5 |
Net sales increase in organic terms in % | 0.0 | 6.5 | 5.4 | 3.7 | 2.0 |
EBITDA | 197.8 | 194.9 | 163.7 | 186.4 | 168.1 |
as % of net sales | 9.8 | 9.3 | 8.1 | 9.9 | 9.5 |
EBIT | 140.3 | 138.5 | 108.6 | 129.4 | 112.0 |
as % of net sales | 7.0 | 6.6 | 5.4 | 6.9 | 6.3 |
Net profit | 104.4 | 97.8 | 78.1 | 98.7 | 81.3 |
as % of net sales | 5.2 | 4.6 | 3.9 | 5.2 | 4.6 |
Headcount (full-time equivalents) as at 30 June | 9,977 | 9,333 | 9,281 | 8,862 | 8,173 |
7 | Half-year results 2024 - 14 August 2024 |
Trend reversal to positive, broad-based volume/mix growth
in percent
10 %
8 % | 7.7% |
7.0% | |
6.1% | |
6 % | |
Geopolitical situation
Decline and shift in consumption
#1 Operational progress
in strategic markets and niches
Labour market
4 % | 3.5% | 2.4% | ||||
2 % | 1.4% | 1.2% | ||||
0 % | 0.0% | |||||
-0.7% | ||||||
-2 % | ||||||
-1.4% | -1.2% |
#2
#3
Persistent
inflation
Efficiency and cost-saving programmes
including procurement, integration of entire value chain, relaunch of Emmi Operational Excellence (EOE)
Emmi Commercial Excellence
Customer-oriented concepts/marketing and sales
Currency and
financing situation
-4 % | -2.6% | ||||||||
2022 | 2023 | H1/2024 | YTD 07/2024 | ||||||
Volume/mix effects | Price effects | Organic growth | |||||||
Flat organic sales development in H1/2024, with broad-based volume/mix growth offset by negative price effects driven primarily by milk prices. Lower exports of surplus Swiss milk and milk shortages in Tunisia had an overall negative impact on organic growth of -0.8%.
A strong sales month July pushed YTD growth up to +1.2%, driven by a volume/mix growth of +2.4%.
#4 | Focus on local market opportunities | ||
Trading up & down to secure volume and mix | |||
#5 | Disciplined strategy execution | ||
Continuous portfolio transformation | |||
#6 | Structural & organisational optimisations | ||
Input costs remain | |||
Exploiting synergies and creating lean structures | |||
high and volatile | |||
Stable supply chains
8 | Half-year results 2024 - 14 August 2024 |
Highly competitive market environment
Key markets in the top 5
Global Trade (3% of Group)
H1/24: -11.0% | H1/23: -2.1%
Europe (14% of Group)
H1/24: +2.0% | H1/23: +2.0%
Americas (41% of Group)
H1/24: +0.1% | H1/23: +9.6%
Switzerland (42% of Group)
H1/24: -0.2% | H1/23: +6.0%
Group H1/24: CHF 2,017.2 million (organic 0.0%)
H1/23: CHF 2,103.4 million (organic +6.5%)
Top 5 markets
H1/24 | H1/23 |
Switzerland | Switzerland |
USA | USA |
Brazil | Brazil |
Spain | Chile |
Chile | Spain |
9 | Half-year results 2024 - 14 August 2024 |
Net sales by product group
Cheese 28.2% (PY 27.7%)
CHF 568.1 million (organic -0.9%)
Dairy products 27.0% (PY 28.9%)
CHF 545.6 million (organic -0.9%)
CHF 566.5 million
H1/2020: CHF 568.6 million / 32.1%
Other products/services 5.6% (PY 5.4%)
CHF 112.4 million (organic +0.6%)
Fresh products 27.9% (PY 27.3%)
CHF 563.6 million (organic +0.6%)
Fresh cheese 6.5% (PY: 6.2%)
CHF 130.4 million (organic +0.5%)
Powders/concentrates 4.8% (PY 4.5%)
CHF 97.1 million (organic +4.9%)
10 | Half-year results 2024 - 14 August 2024 |
Negative acquisition and currency effects constrain sales development
2,103.4 | 0.0% | -2.2% | -1.9% | -4.1% | ||||
H1/2023 | 2,017.2 | |||||||
Organic | Acq. effect | |||||||
FX effect | Total | H1/2024 |
Emmi Group net sales in CHF million
Emmi Group highlights
- Total sales fell in line with expectations as a result of negative acquisition and currency effects.
- Flat organic sales development, with broad-based volume growth offset by negative price effects driven primarily by milk prices. Lower exports of surplus Swiss milk and milk shortages in Tunisia had an overall negative impact on organic growth of -0.8%.
- Encouraging growth in the strategic niches of ready-to-drink coffee with Emmi Caffè Latte and premium desserts from Italy as well as cheese specialties exported from Switzerland such as Kaltbach.
11
Half-year results 2024 - 14 August 2024
- Switzerland with a decline in sales driven by milk prices which was largely offset by strong brand concepts and successful industrial customer business.
- Americas overall with subdued organic growth. Positive growth momentum coming above all from Brazil, Chile, Mexico and Darey Brands in California.
- Europe with good organic growth, in particular thanks to Emmi Caffè Latte, premium desserts and goat's milk powder from the Netherlands.