Scandi Standards AB (publ) interim report January - September 2022

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Strong recovery but continued market uncertainty

July – September 2022

  • Net sales amounted to MSEK 3,202 (2,632) in the third quarter of 2022. At constant exchange rates net sales increased by 18 percent.
  • Operating income (EBIT) increased to MSEK 112 (30), corresponding to a margin of 3.5 (1.1) percent.
  • Income for the period amounted to MSEK 66 (4). Earnings per share amounted to SEK 0.99 (0.04).
  • Operating cash flow was MSEK 248 (112).

January – September 2022

  • Net sales amounted to MSEK 9,050 (7,666) in the first nine months of 2022. At constant exchange rates net sales increased by 15 percent.
  • Operating income (EBIT) decreased to MSEK 191 (192), corresponding to a margin of 2.1 (2.5) percent.
  • Income for the period amounted to MSEK 83 (99). Earnings per share amounted to SEK 1.17 (1.49)
  • Operating cash flow was MSEK 389 (278).

Significant events in the quarter

  • At an extraordinary general meeting on August 22, Paulo Gaspar was elected as new board member. Paulo Gaspar represents Grupo Lusiaves, which is Scandi Standard's second largest shareholder.

 Key metrics2)

MSEK Q3 2022 Q3 2021 Δ 9M 2022 9M 2021 Δ R12M 2021
Net sales 3,202 2,632 22% 9,050 7,666 18% 11,485 10,101
EBITDA 212 126 68% 520 474 10% 645 598
Operating income (EBIT) 112 30 - 191 192 -1% 221 222
EBITDA margin % 6.6% 4.8% 1.8ppt 5.7% 6.2% -0.4ppt 5.6% 5.9%
EBIT margin % 3.5% 1.1% 2.4ppt 2.1% 2.5% -0.4ppt 1.9% 2.2%
Non-comparable items1) - -13 -100% - -17 -100% 26 9
Adjusted EBITDA1) 212 139 52% 520 491 6% 618 589
Adjusted operating income (Adj. EBIT)1) 112 43 163% 191 210 -9% 194 213
Adjusted EBITDA margin1) % 6.6% 5.3% 1.3ppt 5.7% 6.4% -0.7ppt 5.4% 5.8%
Adjusted EBIT margin1) % 3.5% 1.6% 1.9ppt 2.1% 2.7% -0.6ppt 1.7% 2.1%
Income after finance net 84 10 - 119 132 -10% 126 140
Income for the period 66 4 - 83 99 -16% 88 103
Earnings per share, SEK 0.99 0.04 - 1.17 1.49 -22% 1.27 1.60
Return on capital employed % 5.2% 5.8% -0.5ppt 5.2% 5.8% -0.5ppt 5.2% 5.2%
Return on equity % 4.0% 6.3% -2.3ppt 4.0% 6.3% -2.3ppt 4.0% 5.5%
Operating cash flow 248 112 121% 389 278 40% 457 347
Net interest-bearing debt 1,733 1,891 -8% 1,733 1,891 -8% 1,822 1,980
NIBD/Adj. EBITDA 2.8 2.8 2% 2.8 2.8 2% 2.9 3.4
Lost time injuries (LTI) per million hours worked 27.8 40.2 -31% 28.3 37.8 -25% 30.6 39.2
Feed efficiency (kg feed/live weight) 1.50 1.51 -1% 1.50 1.52 -1% 1.51 1.52

1) Restated non-comparable items. see note 6.
2) For a definition of alternative performance measures see page 22 

CEO Comments

Scandi Standard has delivered a result for the third quarter of 2022 in which we have largely offset cost inflation through raised sales prices and strong earnings in the Ready-to-eat segment. We also demonstrated that we can rapidly implement measures to manage a changing market. Despite a temporary reduction of slaughter volume, net sales increased 22 percent to MSEK 3,202 (2,632), driven by price increases, and I am pleased to be able to report operating income of MSEK 112 (30) for the quarter.

Strong long-term demand
Rising food prices result in consumers changing their purchasing habits and the current developments we estimate that consumer price sensitivity will increase.

The production cycle for chicken is significantly shorter than, for example, beef and pork, which has contributed to Scandi Standard being able to compensate for inflation by relatively quickly adapting our production volume to market demand. With distinct position in strong consolidated markets, our speedy response has had a real impact on balancing supply and demand. At the same time, long lead times in beef and pork production have led to surpluses and price pressure for these proteins, which has indirectly impacted chicken consumption. When the production of beef and pork has balanced the volumes to market demand, we expect to have healthy prerequisites for profitable volume development for chicken products. 

After managing the first wave of inflation that impacted the business environment in 2022, we are now preparing for energy, packaging and logistics costs to continue to rise. Our assessment is that demand for chicken will benefit in relation to other proteins in such a market climate.

Growth in Ready-to-cook and continued positive trend for Ready-to-eat
The Ready-to-cook segment reported net sales of MSEK 2,265 (1,942), corresponding to growth of 17 percent, and operating income increased to MSEK 34 (7). The management in all markets has worked hard to manage increased inflation in a long-term and sustainable manner. The positive effects of the work have been offset partly by increased imports in some of our home markets.

The situation in Denmark remains challenging and we posted a loss of MSEK -50 (-60) in the Ready-to-cook segment. For this reason, operational changes are being implemented on an ongoing basis. Scandi Standard’s total operations in Denmark, including Ready-to-eat and Ingredients, has once again posted a quarter with positive earnings.

Scandi Standard’s other major segment Ready-to-eat has continued to develop positively. Net sales increased 36 percent to MSEK 802 (589) and operating income increased 54 percent to MSEK 70 (46). To enable continued growth, an expansion of the capacity of the Danish factory in Farre is planned during the fourth quarter of 2022. A decision has been made to start an additional expansion, which will increase production capacity in Farre by 30 percent by 2024.

By continuing to invest in our rapidly growing and profitable Ready-to-eat segment, we create added value for our protein as we take advantage of larger parts of the chicken while at the same time moving higher in the value chain. This is one of Scandi Standard’s strategic focus areas and one of the keys of developing Scandi Standard’s profitability for the years ahead.

Climate labelling steers conscious choices
Creating a future proof, sustainable business is one of Scandi Standard’s strategic focus areas. It is therefore an important step that Scandi Standard launches climate labelling in all of its home markets. With help of the specialised and independent organisation, the Carbon Trust, we have calculated and certified the carbon footprint across the entire value chain of 282 products, all the way from farm to fork. The calculations have been certified in order to provide us with a good foundation to start from to achieve our climate targets that are aligned with the 1.5 °C goal of the Paris Agreement and to have a good foundation for our efforts to increase transparency as well as to guide consumers to more conscious choices.

Several scientific studies show that chicken is the animal protein that impacts the climate the least per kilo, but we also need to continue to reduce our carbon footprint. With these calculations as a basis, we can work more systematically with our climate efforts.

The sustainability indicators, use of antibiotics and foot pad condition, are largely unchanged in comparison with the preceding quarter, which is a decline compared with the preceding year, primarily driven by Ireland. A number of measures have been taken to improve the situation, but long lead times limit the effect in the quarter. We also launched an initiative to increase transparency upstream with our suppliers, in the areas of animal welfare, climate and the environment.

Strong cash flow and stable position
Cash flow was strong during the quarter, driven by a profit improvements, low investments and low working capital. Net debt declined in the quarter by MSEK 216 to MSEK 1,733. To date this year, the company’s capital expenditures has been MSEK 143 of an expected MSEK 300 for 2022.

We have together with our suppliers and customers shown in 2022 that we have the necessary flexibility to implement measures and therefore handle any further inflation. We are now preparing for a period of high uncertainty in terms of inflation and changing consumer behaviour. I can remind you that the fourth quarter is a weaker period for Scandi Standard in terms of earnings due to seasonal variations.

In the longer term, there is a considerable potential for increasing the value per bird processed. It will be material for Scandi Standard to establish a long-term stable earnings level above the margins reported between 2015 and 2020. The transition requires a strong focus on the right culture, governance and leadership, increased efficiency throughout the value chain, and innovative development of our product portfolio. At the same time, we will create a fundamentally sustainable business in the long term. The work within these strategic focus areas is ongoing for all of Scandi Standard, but change takes time. After spending even more time in the business and met even more of Scandi Standard’s employees, I am convinced that together, we can look forward to a positive and value-creating journey ahead.


Stockholm, 28 October 2022

Jonas Tunestål, Managing director and CEO

Conference Call
A conference call for investors, analysts and media will be held on 28 October 2022 at 8.30 AM CET.

Dial-in numbers:

UK: 020 3936 2999
Sweden: 010 884 80 16
US: +1 646 664 1960
Other countries: +44 20 3936 2999

Slides used in the conference call can be downloaded at under Investor Relations. A recording of the conference call will be available on afterwards.

Further information

For further information, please contact:
Jonas Tunestål, Managing director and CEO and Julia Lagerqvist, CFO
Tel: +46 10 456 13 00

Henrik Heiberg, Head of M&A, Financing & IR
Tel: +47 917 47 724


Financial calendar

Interim report for Q4 2022 February 9, 2023
Interim report for Q1 2023 May 3, 2023
Interim report for Q2 2023 August 23, 2023

This interim report comprises information which Scandi Standard is required to disclose pursuant to EU market abuse regulation and the Securities Markets Act. It was released for publication at 07:30 AM CET on 28 October 2022.

About Scandi Standard
Scandi Standard is the leading producer of chicken-based food products in the Nordic region and Ireland. The company produces, markets and sells ready to eat, chilled and frozen products under the well-known brands Kronfågel, Danpo, Den Stolte Hane, Manor Farm and Naapurin Maalaiskana. Eggs are also produced and sold in Norway. We are approximately 3,000 employees with annual sales of more than SEK 10 billion.