Hartmann grew the core business in Q2 2019

Q2 2019 highlights

Hartmann grew core business revenue by 6% on the back of continued volume growth and delivered solid earnings in spite of high raw materials prices and the expected reduced contribution from sales of machinery and technology. The group stepped up investments in Q2 and maintains its guidance for full-year 2019.

• Group revenue increased to DKK 553 million (2018: DKK 542 million)
• Revenue from packaging sales increased to DKK 548 million (2018: DKK 508 million), whereas revenue from Hartmann Technology was DKK 6 million (2018: DKK 35 million)
• Operating profit* was DKK 47 million (2018: DKK 60 million), corresponding to a profit margin* of 8.5% (2018: 11.1%)
• Capital expenditure* increased to DKK 49 million (2018: DKK 28 million)
• Currency movements reduced revenue by DKK 29 million and operating profit by DKK 1 million
  
  

CEO Torben Rosenkrantz-Theil says: “Thanks to growing packaging sales and efficiency improvements, we continued to deliver solid earnings in Q2 in spite of higher raw materials prices. We are seeing strong demand for our products and are investing massively in new capacity across our markets in order to stay one step ahead.”

Growing volumes in all markets

Hartmann grew packaging sales in all markets in Q2. Sales were particularly strong in Europe and North America.

Maintaining solid profitability

Hartmann was able to cushion the effects of higher raw materials prices in Q2 by improving efficiency and lifting average selling prices.

Stepping up investments

New production capacity was put into operation in Europe and Argentina, and European capacity will be further expanded in the second half of the year. As part of the group’s ‘Think ahead’ strategy, Hartmann invests in further capacity expansion in Brazil, the USA and Europe. The new capacity is expected to be put into operation in 2020.

Machinery sales normalising at lower levels

As anticipated, sales of machinery and technology were down in Q2 compared with the year-earlier period. Sales of machinery and technology are still expected to normalise in 2019 at a level down from the 2018 high.

Guidance for 2019

Hartmann maintains its 2019 guidance of total revenue of DKK 2.2-2.4 billion after restatement for hyperinflation and a profit margin of 9-11% before restatement for hyperinflation.

The group’s performance in the second half of the year is expected to be favourably affected by continued volume growth and efficient core business operations and adversely affected by a normalised, reduced contribution from Hartmann Technology compared with 2018 and higher paper and energy costs.

As announced on 11 June 2019, capital expenditure is expected to amount to about DKK 300 million before restatement for hyperinflation, reflecting planned and already launched production capacity expansion across the group’s markets

For further information, please contact:

Torben Rosenkrantz-Theil

CEO

(+45) 45 97 00 57

* Operating profit and profit margin are stated before special items, and profit margin, return on invested capital and capital expenditure are commented before restatement for hyperinflation.

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