HKFoods Plc, Half Year Financial Report, 6 August 2025 at 8:30 a.m. EEST
HKFoods' Half Year Financial Report 1 January-30 June 2025
April-June 2025
- HKFoods' profitability developed well in the second quarter. The comparable EBIT continued to grow and improved from the comparison period. The result for the period from continuing operations also showed clear growth.
- HKFoods' net sales from continuing operations decreased by 3.5 per cent to EUR 245.7 (254.6) million. Net sales were affected by the food industry strike in April and the shortage of beef. The cool early summer slowed down the start of the barbecue season and affected sales of seasonal products.
- Sales grew in the retail channel due to the growth in poultry and meat products. Consumer demand in Finland strengthened slightly from early 2025 and HKFoods strengthened its position in the meat product market. Sales in the food service channel were at the comparison period's level. There was a clear decline in industrial and export sales, although export sales in the comparison period were boosted by the port strike in March 2024, which caused deliveries to be shifted to the comparison period. Poultry meat exports to China developed according to plan.
- The Group's EBIT from continuing operations increased to EUR 6.2 (3.1) million.
- Comparable EBIT from the Group's continuing operations increased to EUR 6.5 (4.4) million. Comparable EBIT was driven by significant savings from the company's efficiency programme and a better sales mix.
- The strike in the food industry and the overtime and shift change bans related to labour market negotiations, along with the shortage and increased purchase price of beef, had a negative impact on comparable EBIT.
- Cash flow from business operations, including discontinued operations, strengthened and totalled
EUR 21.2 (13.1) million. Operating working capital decreased, which significantly improved cash flow. - The Group's result for the period from continuing operations increased clearly and was EUR 2.0
(-1.7) million. - The Annual General Meeting held on 23 April 2025 resolved to refund EUR 0.09 per share from the company's reserve for invested unrestricted equity, and this was paid in May.
- During the review period, the company was conducting an assessment of the future of its Polish production unit in Swinoujscie, including an evaluation of the possible sale of the unit. After the review period, on 3 July 2025, the company announced that it had completed the assessment and that the Polish production unit would continue to operate as part of the HKFoods Group.
January-June 2025
- HKFoods' profitability continued to develop well, and balance sheet strengthened. Comparable EBIT increased.
- HKFoods' net sales from continuing operations decreased by 0.8 per cent to EUR 479.4 (483.3) million. Sales grew in the food service channel and declined in the domestic retail. Nutritional recommendations have negatively impacted the demand for meat products. Industrial sales declined clearly, and export sales declined slightly.
- Net sales and profitability were negatively impacted by the strike in the food industry in April and the overtime and shift change bans related to labour market negotiations, as well as the shortage and increased purchase price of beef.
- The Group's EBIT from continuing operations increased clearly and totalled EUR 10.8 (4.3) million.
- Comparable EBIT from the Group's continuing operations increased to EUR 11.1 (5.8) million. Comparable EBIT was driven by significant savings from the company's efficiency programme and a better sales mix. The overall sales structure improved due to the growth in food service sales, the decline in less profitable meat exports, and industrial sales decreasing according to plan, among others.
- Cash flow from business operations, including discontinued operations, strengthened to EUR 16.6 (14.9) million.
- HKFoods' balance sheet strengthened, and interest-bearing net debt decreased to EUR 156.3 (215.6) million. Net gearing was 76.3 (98.1) per cent.
- Interest-bearing net debt excluding leasing liabilities under IFRS 16 was EUR 70.4 (124.4) million.
- The Group's result for the period from continuing operations was EUR 2.8 (-5.5) million.
The figures in parentheses refer to the same period in the previous year, unless otherwise mentioned. The figures are unaudited.
Outlook for 2025
HKFoods expects that in 2025 the Group's comparable EBIT will grow compared to 2024.
KEY FIGURES, NET SALES, CONTINUING OPERATIONS
(EUR million) | 4-6/2025 | 4-6/2024 | 1-6/2025 | 1-6/2024 | 2024 |
Net sales | 245.7 | 254.6 | 479.4 | 483.3 | 1,001.8 |
KEY FIGURES, EBIT, CONTINUING OPERATIONS
(EUR million) | 4-6/2025 | 4-6/2024 | 1-6/2025 | 1-6/2024 | 2024 |
EBIT | 6.2 | 3.1 | 10.8 | 4.3 | 22.4 |
- % of net sales | 2.5 | 1.2 | 2.3 | 0.9 | 2.2 |
Comparable EBIT | 6.5 | 4.4 | 11.1 | 5.8 | 27.7 |
- % of net sales | 2.6 | 1.7 | 2.3 | 1.2 | 2.8 |
KEY FIGURES, OTHER
(EUR million) | 4-6/2025 | 4-6/2024 | 1-6/2025 | 1-6/2024 | 2024 |
EBITDA, continuing operations | 13.3 | 11.4 | 25.4 | 20.3 | 56.3 |
Profit before taxes, continuing operations | 2.7 | -1.4 | 3.9 | -5.1 | 4.2 |
- % of net sales | 1.1 | -0.6 | 0.8 | -1.1 | 0.4 |
Profit for the period, continuing operations | 2.0 | -1.7 | 2.8 | -5.5 | -1.8 |
- % of net sales | 0.8 | -0.7 | 0.6 | -1.1 | -0.2 |
EPS, EUR, continuing operations | 0.00 | -0.03 | 0.00 | -0.09 | -0.09 |
Comparable EPS, EUR, continuing operations | 0.01 | -0.02 | 0.00 | -0.07 | -0.04 |
Cash flow from operating activities, incl. discontinued operations | 21.2 | 13.1 | 16.6 | 14.9 | 60.8 |
Cash flow after investing activities, incl. discontinued operations | 15.4 | -3.3 | 5.6 | 70.6 | 141.7 |
Return on capital employed (ROCE) before taxes, %, incl. discontinued operations | 6.3 | -1.1 | 0.9 | ||
Interest-bearing net debt | 156.3 | 215.6 | 149.8 | ||
Net gearing % | 76.3 | 98.1 | 69.5 |
HKFoods' CEO Juha Ruohola
Our profitability developed well in the second quarter. The comparable EBIT continued to grow and improved from the comparison period. The result for the period from continuing operations also showed clear growth.
HKFoods' net sales from continuing operations decreased by 3.5 per cent to EUR 245.7 (254.6) million in April-June. However, January-June net sales of EUR 479.4 (483.3) million were almost at the comparison period's level. The review period's net sales were affected by the labour dispute in the food industry and the related strike in the food industry in April, as well as the shortage of beef. Although the shortage of beef affected profitability already in the early part of the year, its impact was most noticeable in the second quarter. The strike as well as the overtime and shift change bans related to labour market negotiations had a negative impact on sales particularly during the Easter season and May Day, which are important seasons for the company. The good news from the spring collective agreement negotiations was the achievement of a three-year industrial peace agreement for the food industry.
The cool early summer has slowed down the start of the barbecue season and affected sales of summer barbecue products. Nevertheless, our sales to the retail channel increased in the second quarter and our sales to the food service channel were at the comparison period's level. We also strengthened our position in the meat product market, even though the new nutritional recommendations released at the end of last year have had a negative impact on the overall meat products market. The shortage of beef has shifted consumer demand to poultry. Our industrial sales decreased according to plan. We also saw a clear decline in export sales, although export sales in the comparison period were boosted by the port strike in March 2024, which caused deliveries to be shifted to the comparison period. Poultry meat exports to China developed according to plan.
The company's comparable EBIT increased to EUR 6.5 (4.4) million in the second quarter. The comparable EBIT margin was 2.6 (1.7) per cent, representing an improvement not only from the comparison period but also from the previous quarter. We still have some way to go to reach our target of 4.0 per cent, but we are on the right track. The comparable EBIT was driven by significant savings from the ongoing efficiency programme and a better sales mix. On the other hand, the food industry strike resulted in a pig backlog at the company's contract farms, and clearing it caused additional costs. The availability challenges and increased purchase price for beef had a negative impact on the company's comparable EBIT.
Our investments in the production in Vantaa and Eura proceeded. Besides improving profitability and increasing the added value, these investments will enable us to grow in line with our strategy in meals, meal components and snacks. In Eura, our investment in the manufacture of ready-to-eat products was completed, and the new products from the production line were launched during the second quarter. Our investment in meal production at the Vantaa unit progressed well during the review period, and new technology products manufactured on the line will be launched in the third quarter of this year.
Over the past couple of years, we have undergone a major restructuring through the sale of our businesses in the Baltics, Sweden and Denmark. As a continuation of this work, during the review period we conducted an assessment of the future of our Polish production unit, which also included considering the possible sale of the unit as one option. As a result of this assessment, we decided to continue with the current group structure, with the Polish bacon unit continuing to operate as part of the HKFoods Group. In recent years, we have made investments in the unit, and it is profitable. In the HKFoods Group's operations in Finland and Poland, we are now focusing on improving the competitiveness of our core business and profitability of our operations, and on commercial activities.
I am pleased that the Financial Times ranked HKFoods as the only Finnish meat industry company for the fifth consecutive time among the European companies that have achieved the greatest reduction in their climate emissions.
Key events in April-June 2025
Food industry strike in April due to food industry dispute
Following the failure of the mediation between the Finnish Food Workers' Union (SEL) and the Finnish Food and Drink Industries' Federation (ETL) in early April 2025, a three-day strike in the meat and staple food sector took place from 8 to 10 April 2025. HKFoods' units in Forssa, Mikkeli and Vantaa were covered by the strike. The strike and the overtime and shift change bans related to labour market negotiations significantly affected the availability of the company's products, caused a pig backlog at the company's contract farms and resulted in additional costs for HKFoods during the review period.
HKFoods launched an investigation to assess the future of its Polish bacon unit
On 28 April 2025, HKFoods announced that it had launched an investigation to assess the future of its bacon production unit in Swinoujscie, Poland, including the possible sale of the unit. The investigation was a continuation of HKFoods' assessment of its group structure and the objective of a possible sale was to strengthen the Group's balance sheet. The assessment was completed after the review period, and the unit will continue as part of the Group.
Details on the investigation to assess the future of the unit has been provided in the following stock
exchange releases: 28 April 2025 and 3 July 2025.
Events after the reporting period
Polish production unit to continue as part of the Group?
HKFoods completed its assessment of the future of its bacon unit in Swinoujscie, Poland, and announced on 3 July 2025 that the Polish production unit will continue its operations as part of the HKFoods Group. The company has invested in the Polish bacon unit over the past years, and the unit is profitable. The company has developed the unit's capacity and efficiency by investing in a slicing and packaging line in 2024, for example. During the first half of 2025, the company has also continued the investment in increasing the added value of its Polish operations and the property development project. HKFoods Poland Sp. z o.o.'s net sales in 2025 are estimated at EUR 70 million. The unit also has intra-group sales and employs approximately 300 people.?
Details on the matter were provided in the following stock exchange releases: 28 April 2025 and 3 July 2025.
Turku, 6 August 2025
HKFoods Plc
Board of Directors
Webcast
In connection with its Half Year Financial Report for January-June 2025, HKFoods will hold a briefing for analysts, institutional investors and media on 6 August 2025 at 10:00 a.m. EEST as a webcast at https://hkfoods.events.inderes.com/q2-2025.
The event will be held in Finnish, and the recording will be available later in the day at www.hkfoods.com.
The Half Year Financial Report for January-June 2025 will be presented by CEO Juha Ruohola and CFO Mika Tilli.
To arrange investor calls, please contact Executive Assistant Suvi Oksava, tel. +358 44 554 4231 or
suvi.oksava@hkfoods.com.
?
Financial reports in 2025
HKFoods will publish its Interim Report for January-September 2025 on Wednesday 5 November 2025 at about 8:30 EET.
Further information
Juha Ruohola, CEO, tel. +358 400 647 160
Mika Tilli, CFO, tel. +358 50 538 5793
HKFoods Media Service Desk email communications@hkfoods.com or tel. +358 10 570 5700.
With 110 years of experience, we at HKFoods make life tastier - today and tomorrow. With nearly 3,000 professionals, we make responsible and locally produced food for consumers' various food moments. Our well-known brands in Finland are HK®, Kariniemen® and Via®. We are developing a more climate-friendly way of producing food. HKFoods is a publicly listed company, and in 2024, our net sales totalled EUR 1 billion. www.hkfoods.com
The brands mentioned in this report - HK®, Kariniemen® and Via® - are registered trademarks of HKFoods Group.
DISTRIBUTION:
Nasdaq Helsinki
Main media
www.hkfoods.com
