FINANCIAL INFORMATION:
FOURTH QUARTER
- Net sales amounted to SEK 2,089 million (1,936), an increase of 8% compared to the corresponding period last year. Organic growth amounted to 7%.
- EBITA amounted to SEK 152 million (156).
- EBIT amounted to SEK 105 million (66).
- Adjusted EBITA amounted to SEK 157 million (142), an increase of 11% compared to the corresponding period last year.
- Cash flow from operating activities after changes in working capital amounted to SEK 146 million (285).
- Profit after tax amounted to SEK 43 million (-11).
- Basic and diluted earnings per share amounted to SEK 0.10 (-0.02) and SEK 0.09 (-0.02) respectively.
TWELVE MONTHS
- Net sales amounted to SEK 7,708 million (7,050), an increase of 9% compared with the corresponding period last year. Organic growth amounted to 9%.
- EBITA amounted to SEK 570 million (547).
- EBIT amounted to SEK 376 million (318).
- Adjusted EBITA amounted to SEK 578 million (505), an increase of 15% compared to the corresponding period last year.
- Cash flow from operating activities after changes in working capital amounted to SEK 300 million (1,088).
- Profit after tax amounted to SEK 124 million (-106).
- Basic and diluted earnings per share amounted to SEK 0.28 (-0.28) and SEK 0.27 (-0.28).
- The Board of Directors proposes that no dividend be paid for the financial year 2024.
SIGNIFICANT EVENTS:
IN THE FOURTH QUARTER
- Humble has extended its existing credit agreement by a total of SEK 300 million. SEK 150 million of the new loan was used to refinance Humble's bridge loan from Nordea and SEB. The remaining part of the loan, SEK 150 million, is subject to restrictions and is intended to invest further in Humble's growth projects. See note 8 for more information.
AFTER THE QUARTER
- There were no significant events after the end of the quarter.
CEO WORDS FROM THE REPORT
"INCREASED PROFITABILITY AND A STABLE LAST QUARTER OF THE YEAR
We ended 2024 with a solid fourth quarter. Net sales increased to SEK 2,089 million (1,936) and organic growth amounted to 7.2 percent, despite tough comparative figures. Adjusted EBITA amounted to SEK 157 million (142), corresponding to an increase of 11 percent and an adjusted EBITA margin of 7.5 percent. Taking into account the effect of the divested properties, the total EBITA increase was 14 percent during the quarter and 18 percent for the full year. The gross margin continued to strengthen sequentially and amounted to 32 percent (32). It remains a high priority area for further improvement.
Strategic developments in the quarter
Reflecting on the quarter's performance, I am pleased that we have been able to successfully implement several key strategic initiatives planned for 2024. To name a few, the beverage plant in Habo is fully operational and we have started producing the first beverages for both internal and external customers. The renovation and separation of the colonial production from Ewalco has been successful and is now in operation, allowing for additional capacity and streamlining the production of trace nutrition products. Both Grahns Konfektyr and Franssons Konfektyr have switched to two-shift production, which is starting to have an effect. Bars Production Sweden has implemented its fifth production line, where we have not yet filled up capacity with new customers. From the acquisition of the protein bar production line in Australia in the last quarter of 2023, we have now completed a successful first year with both sales and profitability exceeding our expectations. This demonstrates our ability to act on opportunities and drive synergies across our group and platform. In our hero brands, we have continued to invest for internationalization and launched several new products in multiple markets. We have also secured further distribution in 2025 in the Swedish service trade, with launches of innovations such as True Dates, Bsc EU Mellow Bar, Pändy and Funlight ready-mixed drink, which is an exciting collaboration together with Orkla.
Market dynamics in the FMCG sector continue to change, with increasing demand for private label products and fluctuations in the cost of key raw materials and freight. The macro environment requires us to maintain our focus on efficient sourcing and dynamic execution. We have continued to increase our investments in the Group's manufacturing facilities, with the ambition to enable production efficiency and higher capacity. The Swedish wholesale and logistics centres have been reorganised to better fit structural agreements with larger chain customers, allowing us to scale and maintain high service levels. In parallel, our production facilities have undergone significant upgrades, ensuring that we can meet increasing demand while maintaining operational excellence. These investments not only strengthen our competitiveness but also our ability to gain market share over time.
Having recently returned from ISM in Cologne, Europe's largest candy and confectionery show, where we had a joint Humble stand, I conclude that our entrepreneurs are more optimistic about 2025 than in previous years. We are confident that our diversified product range and business model will continue to show its resilience and the opportunities for international expansion are great.
Improved gross margin, stable profitability and reduced debt
Gross margin continued to improve sequentially on a quarterly basis. Our factories and Nordic wholesalers have started to benefit from scaling operationally, but we have not yet realized the full impact from the investments of the last two years. Overall, we had a negative impact from product mix and accounting backlog from the high freight costs during the summer. With significant decline in global freight costs since the peak in Q3 2024, and if current price levels are maintained, we will have tailwinds from this factor going forward.
Future Snacking had a growth of 7 percent, driven by high demand for Pändy products and capacity increase in our factories. The divestment of Bayn Production and structural changes in FCB had a negative impact in the segment, where we have now completed a comprehensive reorganization in the subsidiary and see good prospects for growth again. Sustainable Care continued to expand at a good pace with growth of 12%, with contributions from Solent Group and Amber House, which had high demand from retailers. Quality Nutrition had mixed results with negative growth of -6%, attributable to supply chain issues in whey protein, an increased focus on margin improvement in Body Science and short-term production issues for some key customers in Bars Production. We expect the segment to grow going forward. Nordic Distribution continued to show strong momentum and growth of 14%, with joint sourcing starting to show results with improved gross margin and profitability.
The Group has a strategic priority to facilitate growth and expansion in our hero brands and most promising subsidiaries. During the quarter, we have continued to implement significant increases in both sales and marketing efforts for long-term value creation. Despite the increased investments, we have seen a slight margin improvement and maintained solid profitability, reflecting efficient execution and cost discipline. Cash flow from underlying operations amounted to SEK 147 million (129), where we had a smaller than desired release of working capital. Total cash flow from operations after changes in working capital amounted to SEK 146 million (285). We are not satisfied with current levels and have implemented several processes across the group to improve working capital levels in relation to net sales. Net debt to EBITDA decreased to 2.8x, bringing us closer to our financial target of a net debt to EBITDA ratio below 2.5x.
Outlook
The first quarter started strongly, with double-digit organic growth in January. We have a positive outlook for the year, confirming demand from both customers and consumers. Soon, the balance sheet is expected to reach satisfactory levels in line with our financial targets, where we will gradually start acquiring companies again. We have a pipeline of attractive and strategic potential acquisitions, with which we have had an ongoing dialog over the past two years. With many of the larger initiatives in a scale-up phase and exciting product launches ahead, we are confident in our ability to drive growth and create long-term value for our shareholders."
The report is attached and can also be downloaded in full from the company's website here.
For further information, please contact:
Simon Petrén, CEO, Humble Group AB
Tel: +468 61 32 888
Email: simon.petren@humblegroup.se
This information is information that Humble Group AB is obliged to make public pursuant to the EU Market Abuse Regulation 596/2014. The information in this press release was published through the agency of the contact person set out above, at the time stated by Humble Group's news distributor Cision at the time of publication of this press release.
About Humble
Humble Group is a Swedish group of companies that specializes in driving value creation and accelerating growth in small and medium-sized companies in fast moving consumer goods (FMCG). Through an entrepreneurial approach and active ownership, Humble Group focuses on transforming its businesses and developing them towards the consumer needs of the future. The company has a number of brands, a global distribution network and production facilities where the subsidiaries operate independently in their business areas, while Humble Group provides strategic direction and support. The Group is headquartered in Stockholm. For more information visit www.humblegroup.com
Humble is listed on Nasdaq Stockholm Mid Cap, under the ticker HUMBLE.
Forward-looking statements
This press release contains forward-looking statements that reflect Humble's intentions, beliefs or expectations regarding Humble's future results of operations, financial condition, liquidity, performance, prospects, anticipated growth, strategies and opportunities and the markets in which Humble operates. Forward-looking statements are statements that are not historical facts and can be identified by the use of words such as "believes", "expects", "anticipates", "intends", "estimates", "will", "may", "anticipates", "should", "could" and, in each case, the negatives thereof, or similar expressions. The forward-looking statements in this press release are based on various assumptions, many of which are based on additional assumptions. Although Humble believes that the assumptions reflected in these forward-looking statements are reasonable, there can be no assurance that they will materialize or that they are accurate. Because these assumptions are based on assumptions or estimates and are subject to risks and uncertainties, actual results or outcomes could differ materially from those in the forward-looking statements for a variety of reasons. Such risks, uncertainties, contingencies and other important factors could cause actual events to differ materially from the expectations expressed or implied in this press release by the forward-looking statements. Humble does not guarantee that the assumptions underlying the forward-looking statements contained in this press release are accurate and any reader of the press release should not place undue reliance on the forward-looking statements contained in this press release. The information, opinions and forward-looking statements expressed or implied herein are made only as of the date of this press release and are subject to change. Neither Humble nor anyone else undertake to review, update, confirm or to release publicly any revisions to any forward-looking statements to reflect events that occur or circumstances that arise in relation to the content of this press release, except as required by law or Nasdaq Stockholm's Rule Book for Issuers.
