Results 2008: Strong cash flow, significant debt reduction, stable sales
· Sales growth achieved in constant currencies· Raw material, energy and distribution costs remained high with a rapid drop at year-end
· Reported earnings negative due to non-recurring charges
· Weak performance in Flexibles, Films and Asia-Oceania-Africa
· Strong cash flow improvement; significant debt reduction
· The Board of Directors proposes a dividend of EUR 0.34 (EUR 0.42 for 2007) per share
* 2008 EBIT includes EUR 165.5 million (EUR 108.0 million) non-recurring charges.
CEO Jukka Moisio: "At the beginning of 2008 Huhtamaki targeted sales growth and stable earnings, but towards the end of the year focus was shifted to cash flow and debt reduction. Financially, our main achievement in 2008 was positive free cash flow of EUR 104 million. This compares favorably with negative cash flows in both 2007 and in 2006. As a whole our performance was not satisfactory and we have accordingly addressed loss-making units and implemented actions to reduce costs.
Furthermore, the Group's strategic direction was updated in 2008. Focus will be put on businesses with a strong market position and good growth potential. The smooth and rough molded fiber products, release films, flexible packaging, foodservice paper cups and other products based on paper forming technology were identified as stronghold areas. Rigid plastic Consumer Goods operations were reorganized as a separate business under strategic review. Following the annual impairment testing that was conducted based on the updated strategic direction and the new reporting segments, significant non-recurring charges were recorded in the fourth quarter. As a result, the reported earnings were negative in 2008.
2009 will be a demanding year for Huhtamaki. The economic downturn will subdue short-term growth prospects, although our stronghold businesses can, in normal circumstances, deliver 5% organic growth. Economic uncertainty calls for prudent house-keeping, and cost efficiency combined with strong positive cash flow are our priorities. Another focus area for 2009 and onwards is to improve our industrial performance through a worldwide implementation of the continuous improvement program."
For further information, please contact:
Mr. Jukka Moisio, CEO, tel. +358-10-686 7801
Mr. Timo Salonen, CFO, tel. +358-10-686 7880
Ms. Kia Aejmelaeus, Head of Investor Relations, tel. +358-10-686 7819 or mobile +358-40-765 4616
Ms. Minna Staffans, Head of Group Communications, tel. +358-10-686 7863 get_app Results 2008 EN