Scandinavian Tobacco Group (STG) has released its first quarter 2024 report, showing a one percent decrease in reported net sales by DKK 1.9 billion with an EBITDA margin before special items at 17.2%. Net sales decreased two percent organically, according to the report.
The latest financial report from STG showed organic net sales growth in handmade cigars and next generation oral products was offset by a decline in machine-rolled cigars and smoking tobacco.
“Despite a slow start to the year and the first quarter profitability being impacted by mix, cost inflation, and investments in growth, we maintain our expectations for the full year. Entering the second quarter, we expect the net sales development to improve, and we expect to see a more normalized mix, which will impact profitability and cash-flows positively. In the quarter, we have continued to execute our strategy with the opening of the three Macanudo concept stores and investments in our initiatives. Our growth enablers constituted around 11 percent of net sales in the quarter,” commented CEO Niels Frederiksen.
Here are some financial performance highlights from STG’s first quarter 2024 report:
- Net sales of DKK 1,948 million (DKK 1,963 million) with 2% negative organic growth.
- EBITDA before special items was DKK 335 million (DKK 474 million) with an EBITDA margin
of 17.2% (24.1%). - Adjusted Earnings Per Share (EPS) were DKK 1.8 (DKK 3.2).
- Free cash flow before acquisitions was DKK -126 million (DKK -179 million).
- Return on Invested Capital (ROIC) was 10.4% (13.6%).
- Growth Enablers delivered a high double-digit growth rate and accounted for 11% of STG’s
net sales.
In the second quarter of 2024, STG anticipates growing organic net sales and improving EBITDA Margin compared to the first quarter of 2024. STG is maintaining its full-year guidance.
To read STG’s full first quarter 2024 report, click here.