"I am proud that Humble Group is showing organic growth of 21% in the fourth quarter. This is much higher than the underlying FMCG market growth and shows that the demand for our healthy and sustainable products is both strong and sustainable. Net sales amounted to SEK 1,606 million (854) and, in addition to organic growth, our acquisitions contributed with a total sales increase of 67%. Adjusted EBITA amounted to SEK 152 million (142), with a margin in line with the previous quarter despite an unusually volatile macro environment. In addition, our ambition has been to strengthen the balance sheet by freeing up working capital. During the quarter, we achieved a positive operating cash flow of SEK 247 million (111), thereby reducing net debt by SEK 121 million to SEK 2,306 million (1,610). In the quarterly report, we have, as previously communicated, switched to reporting according to IFRS. The advantages of this are that it provides a higher degree of transparency in the Group's reporting and takes us a big step closer to a change of listing to Nasdaq Stockholm's main list. We are launching new segments in our reporting to provide a clearer picture of the Group's performance. We have also had a strong start to the new year and in January we can show organic growth of over 20% with increased profitability despite more difficult comparative figures. My assessment is that we are well equipped for 2023." - Simon Petrén, CEO Humble Group AB.
FINANCIAL INFORMATION:
FOURTH QUARTER
- Net sales amounted to SEK 1,606 million (854).
- EBITDA amounted to SEK 143 million (5).
- Adjusted EBITDA amounted to 179 MSEK (148)
- EBITA amounted to SEK 119 million (-1).
- Adjusted EBITA amounted to SEK 155 million (142).
- EBIT amounted to SEK 63 million (-36).
- Adjusted EBIT amounted to SEK 99 million (107).
- Adjusted EBIT per share amounted to SEK 0.34 (0.44).
- Cash flow from operating activities amounted to SEK 247 million (111).
- Earnings per share before and after dilution amounted to SEK -0.19 (-0.35).
TWELVE MONTHS
- Net sales amounted to SEK 4,800 million (1,486).
- EBITDA amounted to SEK 504 million (-39)
- Adjusted EBITDA amounted to SEK 551 million (235)
- EBITA amounted to SEK 419 million (-64).
- Adjusted EBITA amounted to SEK 466 million (210).
- EBIT amounted to SEK 257 million (-125).
- Adjusted EBIT amounted to SEK 304 million (149).
- Adjusted EBIT per share amounted to SEK 1.11 (0.81).
- Cash flow from operating activities amounted to SEK 255 million (85).
- Earnings per share before and after dilution amounted to SEK -0.23 (-1.18).
SIGNIFICANT EVENTS:
IN THE FOURTH QUARTER
- Humble secures a new revolving credit facility together with SEB and Nordea totaling SEK 650 million, replacing the previous credit facility with SEB of SEK 400 million.
- Humble receives decision that patent for EUREBA will be granted.
AFTER THE FOURTH QUARTER
- Humble announces conditional share purchase agreements regarding Privab Ystad, Privab Trollhättan and Privab Grossisterna.
- Humble obtains bondholders' approval in a written procedure to amend the terms of its senior secured bonds.
- Humble changes accounting principles to IFRS and RFR2.
CEO COMMENTARY FROM THE REPORT
" CONTINUED STRONG GROWTH AND A GOOD START TO 2023
I am proud that Humble Group is showing organic growth of 21% in the fourth quarter. This is much higher than the underlying FMCG market growth and shows that demand for our healthy and sustainable products is both strong and sustainable. Net sales amounted to SEK 1,606 million (854) and, in addition to organic growth, our acquisitions contributed with a total sales increase of 67%. Adjusted EBITA amounted to SEK 152 million (142), with a margin in line with the previous quarter despite an unusually volatile macro environment. In addition, our ambition has been to strengthen the balance sheet by freeing up working capital. During the quarter, we achieved a positive operating cash flow of SEK 247 million (111), thereby reducing net debt by SEK 121 million to SEK 2,306 million (1,610). In the quarterly report, we have, as previously communicated, switched to reporting according to IFRS. The advantages of this are that it provides a higher degree of transparency in the Group's reporting and takes us a big step closer to a change of listing to Nasdaq Stockholm's main list. We are launching new segments in our reporting to provide a clearer picture of the Group's performance. We have also had a strong start to the new year and in January we can show organic growth of over 20% with increased profitability despite more difficult comparative figures. My assessment is that we are well equipped for 2023.
The fourth quarter is seasonally the Group's most important quarter, with high sales and many crucial decisions to position our products for the coming year. We end in the same spirit as previous quarters with continued high organic growth and good profitability. The underlying gross margin has been stable despite some negative impact from freight costs and a weak Swedish krona (consolidation effects of Privab affected the gross margin negatively by three percentage points). As previously communicated, we expect freight costs to stabilize at lower levels during the year. The report presents our new segments Future Snacking, Quality Nutrition, Sustainable Care and Nordic Distribution. The new segments make it clearer how we create value between our businesses and show the attractive position that we have established with Humble Group in a short time, both in the Nordic region and internationally. It is gratifying to see how each individual segment has an underlying average annual sales growth of about 12% and an annual EBITDA increase of 17% at a pro forma level since 2015. We can also see that the subsidiaries are growing faster and with improved profitability after becoming part of the Humble Group.
Operational focus
In the fourth quarter, we can see the positive effects of our focus on freeing up working capital and strengthening the profitability of our subsidiaries, which has resulted in an operating cash flow of SEK 247 million (111), strengthened liquidity and reduced net debt by SEK 121 million. We expect high growth also in 2023, but we will continue to have a clear focus on strengthening cash flow and have implemented several strategic initiatives to reduce inventory levels and streamline the use of working capital. We are at an early stage of the Group's optimization work and we are not yet satisfied. There is thus further potential ahead to further improve profitability and cash flow.
Acquisitions
During the quarter, we signed agreements for three acquisitions, which we can integrate with the already existing Privab units in the Nordic Distribution segment. In a short time, this has given the segment a strong position in the Swedish FMCG market, with efficient and dynamic distribution of both listed and unlisted products to relevant segments and stores. With this platform, we can generate growth for both our existing and new brands. There are still many exciting companies to acquire and the interest in becoming part of Humble Group has never been greater. Although we will maintain a slower pace of acquisitions than in the past two years, we intend to continue to grow with selective strategic acquisitions if the right opportunities arise. A slower climate will also provide the opportunity to acquire companies at lower valuation multiples.
Outlook 2023
I am very optimistic about 2023 given all the projects and initiatives underway within the Group. The year has started strongly with organic growth in January of over 20% and improved profitability in many of the subsidiaries. In addition, the organization is imbued with a great energy and positive spirit that makes us well equipped for the future. The journey towards building the leading FMCG company with a focus on healthy and sustainable products continues.
The report is attached and can also be downloaded in full from the company's website here.
For further information, please contact:
Simon Petrén, CEO, Humble Group AB
Tel: +468 61 32 888
Email: simon.petren@humblegroup.com
This information is information that Humble Group AB is obliged to make public pursuant to the EU Market Abuse Regulation 596/2014. The information in this press release was published through the agency of the contact person set out above, at the time stated by Humble Group's news distributor Cision at the time of publication of this press release.
About Humble
Humble Group is a Swedish foodtech and FMCG group delivering the next generation of consumer products that are good for people and the planet. Humble focuses on the foodtech, eco, sustainability and vegan segments. The company is growing through organic growth, acquisitions and leveraging synergies across its business units: brands, distribution, manufacturing and ingredients. Humble's technologies, refined through scientific research and extensive market experience, facilitate new formulations and recipes that improve taste and texture for the next generation of sugar-reduced, sustainable and vegan products. For more information visit www.humblegroup.com
Humble is listed on Nasdaq Stockholm, First North Growth Market, under the ticker HUMBLE.
FNCA Sweden AB is Humble's certified adviser. Tel: 08-528 00 399 E-mail: info@fnca.se
Forward-looking statements
This press release contains forward-looking statements that reflect Humble's intentions, beliefs or expectations regarding Humble's future results of operations, financial condition, liquidity, performance, prospects, anticipated growth, strategies and opportunities and the markets in which Humble operates. Forward-looking statements are statements that are not historical facts and can be identified by the use of words such as "believes", "expects", "anticipates", "intends", "estimates", "will", "may", "anticipates", "should", "could" and, in each case, the negatives thereof, or similar expressions. The forward-looking statements in this press release are based on various assumptions, many of which are based on additional assumptions. Although Humble believes that the assumptions reflected in these forward-looking statements are reasonable, there can be no assurance that they will materialize or that they are accurate. Because these assumptions are based on assumptions or estimates and are subject to risks and uncertainties, actual results or outcomes could differ materially from those in the forward-looking statements for a variety of reasons. Such risks, uncertainties, contingencies and other important factors could cause actual events to differ materially from the expectations expressed or implied in this press release by the forward-looking statements. Humble does not guarantee that the assumptions underlying the forward-looking statements contained in this press release are accurate and any reader of the press release should not place undue reliance on the forward-looking statements contained in this press release. The information, opinions and forward-looking statements expressed or implied herein are made only as of the date of this press release and are subject to change. Neither Humble nor anyone else undertake to review, update, confirm or to release publicly any revisions to any forward-looking statements to reflect events that occur or circumstances that arise in relation to the content of this press release, except as required by law or Nasdaq First North. Growth Markets' Rule Book for Issuers.
