Q3 2024 in brief
- Net sales decreased 1% to EUR 1,026 million (EUR 1,037 million)
- Comparable net sales growth at Group level was -0%
- Reported EBIT was EUR 95 million (EUR 93 million); adjusted EBIT was EUR 102 million (EUR 100 million)
- Reported EPS was EUR 0.57 (EUR 0.42); adjusted EPS was EUR 0.63 (EUR 0.57)
- The impact of currency movements on the Group’s net sales was EUR -13 million and EUR -1 million on EBIT
Q1-Q3 2024 in brief
- Net sales decreased 2% to EUR 3,068 million (EUR 3,136 million)
- Comparable net sales growth at Group level was -1%
- Reported EBIT was EUR 277 million (EUR 235 million); adjusted EBIT was EUR 307 million (EUR 285 million)
- Reported EPS was EUR 1.53 (EUR 1.14); adjusted EPS was EUR 1.80 (EUR 1.64)
- The impact of currency movements on the Group’s net sales was EUR -35 million and EUR -4 million on EBIT
- Capital expenditure was EUR 134 million (EUR 204 million)
- Free cash flow was EUR 160 million (EUR 193 million)
Charles Héaulmé, President and CEO
Market conditions started to improve during the third quarter. While the situation improved compared to the first half of the year, the pace was moderate with differences between categories and geographies. Demand for pre-packed on-the-shelf food increased, particularly in egg packaging and in a volatile market, demand for flexible packaging continued to improve. Food-on-the-go volumes remained subdued, with consumers still feeling the impact of inflation and elevated market prices. The foodservice market has progressed more positively in North America than in other regions. The on-going war in the Middle East continued to affect global brands in some markets in the Middle East and Asia.
Our comparable net sales remained at the previous year’s level in the third quarter and decreased by 1% during the first nine months of the year. During the third quarter, sales volumes increased while pricing pressure continued. Adjusted EBIT increased by 2% in the third quarter and 8% during the first nine months of the year with an improved adjusted EBIT margin reaching 10%. The profitability development was supported by our actions to improve efficiency. Free cash flow remained strong, reaching EUR 160 million at the end of the third quarter. While continuing to focus on future growth, the investments level was contained, enabling further reduction of net debt and resulting in a net debt to adjusted EBITDA ratio of 2.0.
During the quarter, North America continued to deliver profitable growth, maintaining a strong adjusted EBIT margin. Flexible Packaging profitability continued to improve. Foodservice E-A-O margins were negatively impacted by low demand. Fiber Packaging profitability was weighed on by a lag in pricing, as raw material costs increased.
We have continued to make progress on the three-year EUR 100 million efficiency program launched in 2023. All activities executed thus far have positively impacted our profit during 2024. We continue to ramp up our recent investments into profitable growth, particularly in the US with egg cartons production in Hammond, Indiana, and folded carton capacity expansion in Paris, Texas. In October, we started production of fiber lids in Northern Ireland, providing the foodservice sector with additional plastic substitution capacity.
In summary, we are pleased with our profitability improvement in the current market environment. We continue to drive our strategy by investing in our profitable core, rolling out our new innovative sustainable solutions and steadily improving our competitiveness.