Huhtamäki Oyj's Interim Report January 1 - September 30, 2012: Strong earnings growth


 - Profitability improvement continued
 - The North America segment's net sales and earnings developed strongly supported by positive contribution from acquisitions
 - The Molded Fiber segment's solid performance continued
 - Huhtamäki Oyj received the European Commission's statement of objections concerning alleged anticompetitive behavior
Key figures

EUR million Q1-Q3 2012 Q1-Q3 2011 Q3 2012 Q3 2011 FY 2011
Net sales 1,756.3 1,521.8 588.1 515.8 2,043.6
EBIT* 126.4 100.0 43.2 32.6 127.6
EBIT margin*, % 7.2 6.6 7.3 6.3 6.2
EPS*, EUR 0.96 0.69 0.32 0.24 0.87
ROI, % 11.6 10.2     9.8
ROE, % 14.5 11.8     11.0
Free cash flow 56.9 1.1 33.1 20.3 64.9
Net debt 455.9 351.3     393.4
Gearing 0.53 0.41     0.49

*Excluding EUR -7.0 million (net amount) non-recurring items in FY 2011 and EUR -7.8 million in Q1-Q3 2011 and Q3 2011.

The Group's trading conditions remained relatively stable throughout the reporting period although market softness was evident at the end of the third quarter. Cautiousness increased as customers avoided building inventories. Foreign currency movements had a favorable impact on the Group's net sales and earnings.

The Group's net sales grew 15% during the reporting period. Slightly more than half of the growth was attributable to the acquired businesses, as organic growth slowed down during the third quarter. Organic growth was 4% in the reporting period, the strongest contributors being the North America and Molded Fiber segments. The Group's net sales were EUR 1,756 million (EUR 1,522 million) and EUR 588 million (EUR 516 million) in the third quarter.

As a result of net sales growth the Group's earnings before interest and taxes (EBIT) grew to EUR 126 million (EUR 100 million, excluding non-recurring items) and EUR 43 million (EUR 33 million, excluding non-recurring items) in the third quarter. Earnings growth was strongest in the North America segment. The acquired businesses had a positive contribution to the Group's earnings.

The Group's free cash flow improved and was EUR 57 million (EUR 1 million) and for the third quarter EUR 33 million (EUR 20 million). Return on investment (ROI) was 11.6% (10.2%) and return on equity (ROE) was 14.5% (11.8%). The quarter-on-quarter improvement of ROI and ROE continued.

The assets and business of Winterfield, LLC in the United States were acquired during the third quarter.

European Commission's statement of objections
Huhtamäki Oyj received on September 28, 2012 the European Commission's statement of objections concerning alleged anticompetitive behavior in the markets of plastic trays used for retail packaging of fresh food, such as meat and poultry, in South-West Europe, North-West Europe and France. The alleged infringements of EU competition regulations relate to the Group's operations during years 2000 - 2008. The operations referred to in the statement of objections were part of the Group's rigid plastic consumer goods business in Europe. Based on the statement of objections, the annual net sales of the affected business, as alleged by the European Commission, were EUR 40 - 50 million and the duration of the alleged infringements was on average 4 - 5 years depending on the market. Most of the operations concerned by the statement of objections have been closed down or divested in years 2006 and 2010, and the part of the concerned operations that currently remains in the Group is reported within the Foodservice Europe-Asia-Oceania segment and its annual net sales are approximately EUR 2 million. The Group's other business segments, Flexible Packaging, Films, North America and Molded Fiber, are not concerned by the statement of objections. The statement of objections is addressed to Huhtamäki Oyj and certain of its subsidiaries.

A statement of objections is a formal step in the European Commission's investigations into suspected violations of EU competition regulations. Huhtamäki Oyj will examine the documents received from the European Commission, respond to the statement of objections as requested by the European Commission and exercise its rights of defense in the process. The statement of objections does not prejudge the final outcome of the European Commission's investigation. Thus, no provisions have been made in the Group statement of financial position. It is expected that the European Commission's investigations will take several months.

Outlook for 2012
The Group's trading conditions are expected to remain relatively stable during the rest of 2012. The good financial position and ability to generate a positive cash flow will enable the Group to further address profitable growth opportunities. Growth in net sales is expected to continue and earnings per share (EPS) are expected to increase significantly compared to the EUR 0.87 (excluding non-recurring items) achieved in 2011. Capital expenditure is expected to be below EUR 100 million.

Financial reporting schedule in 2013
The Results 2012 will be published on February 13, 2013. Additionally, the interim reports will be published as follows:
- Interim Report January 1 - March 31, 2013            April 25, 2013
- Interim Report January 1 - June 30, 2013            July 19, 2013
- Interim Report January 1 - September 30, 2013       October 25, 2013
Huhtamäki Oyj's Annual General Meeting is planned to be held on April 25, 2013.

This is a summary of Huhtamaki's Interim Report January 1 - September 30, 2012. The complete report is attached to this release and is also available at the company website at

Unless otherwise stated, all statements and comments presented in this release relate to the reporting period and all comparisons are compared to the corresponding reporting period in 2011. ROI, ROE and RONA figures presented in this report are calculated on a 12 month rolling basis.

For further information, please contact:
Jukka Moisio, CEO, tel. +358 10 686 7801
Timo Salonen, CFO, tel. +358 10 686 7880

Group Communications

Huhtamaki Group is a leading manufacturer of consumer and specialty packaging with 2011 net sales totaling EUR 2 billion. Foodservice and consumer goods markets are served by approximately 14,000 people in 62 manufacturing units and several sales offices in 31 countries. The parent company, Huhtamäki Oyj, has its head office in Espoo, Finland and its share is quoted on NASDAQ OMX Helsinki Ltd. Additional information is available at

get_app Huhtamäki Oyj Interim Report January 1-September 30, 2012