• Revenue: Above DKK15 billion for 2024.
• EBIT Growth: 20% total growth in 2024; organic EBIT growth of 15%.
• EBIT Margin: Increased to 13.1% in 2024.
• Free Cash Flow: Increased to DKK1.4 billion in 2024.
• Net Interest Bearing Debt: Reduced to DKK5.7 billion at the end of 2024.
• Net Debt to EBITDA: Improved to 2.2 times at the end of 2024.
• Organic Volume Growth: 5% in 2024.
• Organic Revenue Growth: Slightly more than volume growth due to positive price mix.
• Western Europe Volume Growth: 122% total, 7% organic.
• Western Europe Revenue Growth: 14% organic, 91% total.
• International Organic Growth: Above 20% in both volume and revenue.
• EBIT Margin Improvement in International: Improved by 8.1 percentage points to 14.5%.
• Share Buyback Program: Relaunched up to DKK250 million.
• Dividend Proposal: DKK15 per share for 2024, equivalent to a payout ratio of 51%.
• 2025 Revenue Growth Guidance: Expected 5% to 7% growth.
• 2025 EBIT Growth Guidance: Expected 7% to 13% growth.
• CapEx Expectation for 2025: 7% of net revenue.

• Warning! GuruFocus has detected 6 Warning Signs with FRA:0R1.

Release Date: February 26, 2025

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

• Royal Unibrew AS (FRA:0R1) achieved a revenue above DKK15 billion and a total EBIT growth of 20% in 2024.
• The company has expanded its multi-platform in Northern Europe, achieving full coverage in the Nordics and Baltic countries.
• Strong performance in Western Europe, with volumes increasing by 122% in total and by 7% organically.
• The company is relaunching a share buyback program of up to DKK250 million due to strong free cash flow.
• Royal Unibrew AS (FRA:0R1) has revised its sustainability goals, increasing ambitions on CO2 reduction and targeting 100% circularity for packaging materials by 2030.

Negative Points

• The European beverage market is not growing by volume, posing a challenge for overall market expansion.
• The no low alcohol category has seen slowed growth, leading to a de-emphasis in resource allocation.
• In Northern Europe, consumer sentiment remains challenging, limiting growth potential despite a strong market position.
• The company faces integration challenges in the Benelux region, with a focus on stabilizing the business.
• Logistic costs remain higher than pre-pandemic levels, impacting overall profitability.

Q & A Highlights

Q: The no low alcohol category has slowed down. Is this slowdown structural or due to the current environment? A: Lars Jensen, CEO: The slowdown in the no low alcohol category seems more structural. While beer is in a structural decline in Europe, no low sugar products are growing significantly. The growth rate of no low alcohol is not high enough to qualify for the same ambitions as other categories like no low sugar or energy drinks. We will continue to support it but not with overinvestment.

Q: Can you provide an update on the integration and commercial priorities for the Benelux region? A: Lars Jensen, CEO: We have taken over a business in decline and are focusing on stabilizing it. We have supplemented the team with new hires and are building a plan to create more market value. The integration is ongoing, and we are applying strategies similar to those used in the Nordic countries and the Netherlands.

Q: Could you clarify the EBIT guidance and the impact of M&A on it? A: Lars Vestergaard, CFO: The impact from acquisitions on EBIT is low. The PepsiCo business in Belgium is being built for the long term, and we expect some one-off costs related to integration. The Minto brands are strong, but we haven't taken over the organization yet, so there will be integration costs.

Q: What are the efficiency and complexity reduction plans for 2025? A: Lars Vestergaard, CFO: Efficiency is a high priority, especially in Northern Europe. We are reviewing innovations and product upgrades to reduce complexity and improve supply chain efficiency. The focus is on making operations simpler and more cost-effective.

Q: How do you plan to continue growing the business in Italy with the additional capacity available? A: Lars Jensen, CEO: The acquisition of San Giorgio has been successful, and we are expanding capacity there. We will continue to utilize our network of production units and add new lines as needed to support growth. The focus is on branded business growth and optimizing capacity utilization.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.