The momentum in egg and fruit packaging sales was maintained in Q2 2018, and Hartmann lifted revenue as a result of a larger contribution from Hartmann Technology. Operating profit rose on the back of revenue growth and efficiency gains. The European business sustained growth, and the group's American activities reported positive developments in packaging volumes and earnings growth despite significant adverse currency movements.
The 'Perform 2018' programme began to show results during the quarter and is set to help sustain the momentum of Hartmann's business and performance in the upcoming period, as utilisation of the total production capacity in North America is expected to be slower than previously projected.
CEO Torben Rosenkrantz-Theil: "We boosted packaging sales in Q2 2018 and produced efficiency gains and operating profit growth across our markets, albeit at a slower pace in the North American business than we had hoped. Despite encountering adverse currency movements and being met with accounting requirements to adjust results of operations in Argentina for hyperinflation going forward, we nonetheless expect to reach the lower end of our guidance interval for 2018."
Q2 2018
- Consolidated revenue grew to DKK 542 million (2017: DKK 514 million), and operating profit* rose to DKK 60 million (2017: DKK 32 million), taking the profit margin to 11.1% (2017: 6.2%).
- Revenue from our European business grew to DKK 321 million (2017: DKK 280 million) and operating profit increased to DKK 40 million (2017: DKK 14 million), corresponding to a profit margin of 12.6% (2017: 4.9%). The improvement was driven by a larger contribution by Hartmann Technology and increasing retail and transport packaging sales volumes.
- Despite strong volume growth, the business in the Americas recorded a drop in revenue to DKK 222 million (2017: DKK 234 million) due to adverse currency movements. Higher packaging sales and improved efficiency combined to boost operating profit to DKK 29 million (2017: DKK 25 million), for a profit margin of 13.2% (2017: 10.4%).
- Currency fluctuations reduced consolidated revenue by DKK 52 million and operating profit by DKK 16 million.
- Special items amounted to a net expense of DKK 16 million (2017: DKK 0 million).
- Return on invested capital (ROIC) rose to 22% (2017: 15%).
H1 2018
- Total revenue grew to DKK 1,166 million (2017: DKK 1,087 million) with operating profit at DKK 152 million (2017: DKK 93 million), lifting the profit margin to 13.0% (2017: 8.5%).
- In the European business, revenue rose to DKK 705 million (2017: DKK 601 million), and operating profit rose to DKK 102 million (2017: DKK 55 million), taking the profit margin to 14.4% (2017: 9.1%).
- Revenue in the Americas was DKK 461 million (2017: DKK 486 million), and operating profit came to DKK 64 million (2017: DKK 55 million), corresponding to a profit margin of 13.9% (2017: 11.4%).
- Currency fluctuations reduced consolidated revenue by DKK 107 million and operating profit by DKK 30 million.
- Special items amounted to a net expense of DKK 21 million (2017: DKK 0 million).
Guidance for 2018
- We reiterate our guidance and expect to reach the lower end of our guidance interval for revenue of DKK 2.2-2.3 billion and a profit margin of 11.5-13%, despite adverse currency movements and an expected impact from adjustment for hyperinflation of our operations in Argentina as well as slower utilisation of our total capacity in North America.
- We maintain our guidance of a return on invested capital of at least 18% and total capital expenditure of around DKK 150 million.
For further information, please contact:
Torben Rosenkrantz-Theil
CEO
Phone: (+45) 45 97 00 57
* Operating profit and profit margin are stated before special items.
