AAK Reports Continued Profit Growth for Q1

AAK’s recently published interim report for the first quarter of 2020 shows a continued profit growth in an increasingly volatile market.

Total volumes for the quarter decreased by 1%, while operating profit, excluding acquisition costs, reached over EUR50m, a year-over-year improvement by 7%. Earnings per share increased by 11% during the same period.

AAK’s Food Ingredients business reported an operating profit improved by 6% to approx. EUR30m, primarily driven by Bakery and Plant-based Foods as well as some good spot opportunities in the quarter. Special Nutrition continued to have a favorable product mix.

The chocolate & confectionery fats business reported an 8% improvement, to approx. EUR20m, which represents continued good growth for the filling fats and spreads while other products reported limited or negative volume growth.

“Our business model and strategic direction stand strong despite the increased uncertainty. Special Nutrition, Chocolate & Confectionery Fats and Plant-based Foods, all with a high proportion of specialty solutions based on our co-development approach, continue to develop well with close customer relationships. Other segments are, however, suffering from a more direct impact from the corona pandemic. Foodservice, part of business area Food Ingredients, had significantly lower sales to restaurants, hotels and airline catering during the latter part of the quarter. We are also exposed to temporary disruptions due to lockdowns applied by governments in some countries where we operate. In February, we were forced into an extended closedown of our operations in China and we also had several disruptions in India at the end of March, continuing to impact our business negatively into the second quarter. Despite the business challenges at the end of the quarter, the consistent trend of profit growth continued,” said AAK’s CEO Johan Westman in a press release.