Emerging market flexible packaging demand drives sales - Huhtamäki Oyj
Double-digit flexible packaging net sales growth in the European and emerging Asian markets and a series of “strategic” acquisitions contributed to net sales growth of €92m – taking the year total to €2.044bn.
Acquisitions completed in the second half of 2011 accounted for €29m of the increase.
European growth continued into the fourth quarter of 2011. Asian growth was, however, stunted by severe flooding in Thailand where several of the company’s customers were forced to halt operations.
Despite this, the company recorded growth in Q4 with net sales hitting €521.8m compared with €481.8m for the same period in 2010.
Double-digit growth
“The group’s net sales developed favourably in 2011 compared to the previous year, led by the continued strong organic growth in the flexible packaging segment. Full year net sales were €2,044m,” a report from the company said.
“Earnings development was strongest in the flexible packaging segment supported by healthy net sales growth. Fourth quarter earnings development was supported by favourable price and product mix development.”
“The flexible packaging segment’s strong performance continued throughout the year, as net sales grew at double digit rates in Europe and in Asia,” the report added.
The company’s flexible packaging segment, which develops products for a wide range of consumer products including food, recorded net sales of €578.m – an increase on the €524.6m recorded in 2010.
“During the fourth quarter robust growth continued especially in Europe, whilst the growth in Asia was dampened by the severe flooding in Thailand, where several customers were forced to temporarily close operations.”
The company’s films segment also recorded positive results, with net sales hitting €177m.
Strategic acquisitions
A series of “strategic, growth enhancing acquisitions” completed during 2011 also contributed to the company’s positive results.
The company acquired two speciality folding carton packaging businesses in the US, as well as a Brazil-based hygienic films manufacturer.
“Our re-entry into acquisitive growth took place through three transactions during the second half of 2011 and the full impact of these steps will be visible in 2012. Fast-growing emerging markets grew at 14% in 2011 and now account for 24% of net sales,” said company CEO Jukka Moisio.
“In these conditions we can be satisfied with the sustained level of profitability. Our solid financial position and well-timed refinancing activities during 2011 will allow us to continue implementing our strategy of quality growth during 2012.”
