Q4 2017 in brief
- Net sales grew to EUR 745 million (EUR 732 million)
- Adjusted EBIT was EUR 65 million (EUR 65 million); EBIT EUR 62 million (EUR 64 million)
- Adjusted EPS improved to EUR 0.51 (EUR 0.44); EPS EUR 0.47 (EUR 0.42)
- Comparable net sales growth was 5% in total and 9% in emerging markets
FY 2017 in brief
- Net sales grew to EUR 2,989 million (EUR 2,865 million)
- Adjusted EBIT was EUR 268 million (EUR 268 million); EBIT EUR 264 million (EUR 266 million)
- A record adjusted EPS of EUR 1.90 (EUR 1.83); a record EPS of EUR 1.86 (EUR 1.81)
- Comparable net sales growth was 3% in total and 4% in emerging markets
- Capital expenditure of EUR 215 million for future growth
Jukka Moisio, CEO, says, "Huhtamaki had a good year in 2017. Comparable growth was 3% and adjusted earnings per share improved by 4% to a record EUR 1.90. Despite the headwinds in India growth in emerging markets was 4% and accelerated to 9% during the fourth quarter. The whole Huhtamaki Team did well in 2017 and I want to thank everyone for their contribution.
Foodservice Europe-Asia-Oceania and North America segments enjoyed positive momentum with increased net sales and good profitability. Flexible Packaging segment had net sales and profitability headwinds in India but the segment started to trade better towards the year-end.
We implemented our forward-looking investment program and at EUR 215 million our capital expenditure was 55% of Adjusted EBITDA. The most significant organic growth action in 2017 was constructing a new world class facility in Goodyear, Arizona, to serve the U.S. West Coast and Southwest markets. Parallel to the Arizona facility development we built new and expanded existing foodservice capabilities in China, Poland, Spain and Russia. In the Flexible Packaging segment we completed two new facilities in Eastern India, began building a new plant in Egypt, and extended our current operations in Thailand and Vietnam.
Our firepower and appetite for value-adding acquisitions remains high and we are ready to execute acquisitions when both strategic and financial justifications are met. In 2017 we made an important strategic acquisition with the purchase of International Paper's foodservice packaging operations in China. The acquisition, together with the consolidation of operations both in South and North China, gives us a footprint of three well-located and efficient manufacturing units and provides an excellent position to support our customers in the growing foodservice market of Greater China.
The business environment in 2017 was generally positive and we look optimistically towards 2018. Megatrends support demand for food-to-go and prepacked food packaging, and we are well on our way in building the best global food packaging network. Our philosophy is to improve continuously and therefore we develop our people, operations, and business competence to make Huhtamaki a world class company. In 2018 our key deliverable is to leverage our investments into accelerated growth while delivering our profit targets."
Outlook for 2018
The Group's trading conditions are expected to remain relatively stable during 2018. The good financial position and ability to generate a positive cash flow will enable the Group to address profitable growth opportunities. Capital expenditure is expected to be approximately at the same level as in 2017 with the majority of the investments directed to business expansion.