Huhtamaki Oyj (HMKIY) Q1 2026 Earnings Call Highlights: Resilient Performance Amid Market Challenges

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Revenue: EUR947 million for the quarter, with a 1% comparable growth. Adjusted EBIT Margin: Increased to 10% from 9.8% last year. Adjusted EBIT: EUR94.5 million, with a EUR4.8 million negative currency impact. Adjusted EPS: EUR0.56. Capital Expenditure: EUR27 million. Free Cash Flow: Positive at EUR10 million, an increase of EUR32.5 million from last year. Foodservice Segment: 8% comparable decline in revenue; adjusted EBIT margin at 8% with EUR16.7 million. North America Segment: 8% comparable growth in revenue; adjusted EBIT margin at 10%. Flexible Packaging Segment: 3% decline in comparable growth; adjusted EBIT margin at 9.5% with EUR28.6 million. Fiber Packaging Segment: 15.2% adjusted EBIT margin, with a EUR2.5 million increase in EBIT. Net Debt-to-EBITDA: 1.9%. Gearing: Slightly down from the fourth quarter.

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Release Date: April 29, 2026

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Positive Points

Huhtamaki Oyj (HMKIY) reported comparable net sales growth despite challenging market conditions. The company's adjusted EBIT margin increased to 10% from 9.8% last year. Strong cash flow was reported in Q1, significantly up from the previous year. The integration of Zellwin Farms is progressing well, marking a successful acquisition. The Fiber Packaging segment continues to show strong growth, driven by both pricing and volume.

Negative Points

Negative currency impacts continued to affect both net sales and EBIT. The Middle East conflict has impacted operations, with approximately 4% of sales coming from the region. Foodservice demand remained soft, particularly among smaller accounts, leading to an 8% comparable decline. Plastic prices have doubled, posing a challenge to profitability and requiring immediate cost pass-through to customers. Logistics and transport costs are rising, adding pressure to operational expenses.

Q & A Highlights

Q: Can you provide insights into the volume growth outlook in North America across different segments? A: Ralf Wunderlich, CEO, stated that all segments in North America showed volume growth in Q1, driven by retail, Foodservice, and consumer goods. The retail side was particularly boosted by Easter, and the trend is expected to continue as customers are performing well in their markets.

Q: How is the European Foodservice segment performing, and do you see any signs of recovery? A: Ralf Wunderlich noted that the European Foodservice segment has been declining, but efforts to engage smaller, regional accounts are underway. While larger accounts are performing well, the impact of the Middle East crisis remains uncertain, and recovery in smaller accounts will take time.

Story Continues

Q: What impact will the recent doubling of plastic prices have on profitability, and how quickly can these costs be passed on to clients? A: Ralf Wunderlich explained that the company has already engaged with customers to pass on the increased costs due to a 75% rise in oil prices. The procurement team is actively securing raw materials, and the company is working closely with customers to minimize the impact on their markets.

Q: Can you quantify the EBIT impact of passing on polymer costs and the effects of Easter and weather in North America? A: Ralf Wunderlich indicated that while the company is managing the raw material impact for the year, the North American Q1 results were affected by a EUR4 million currency impact and weather disruptions. Easter provided a positive boost, and upcoming events like the 250th anniversary of North America and the World Cup are expected to support Q2.

Q: How is Huhtamaki addressing logistics cost increases, and are there any surcharges being implemented? A: Ralf Wunderlich confirmed that logistics and transport costs are rising, and the company is discussing surcharges with customers to pass on these costs. The focus is on ensuring availability and maintaining customer satisfaction.

Q: With the current uncertainty, how is Huhtamaki approaching M&A opportunities? A: Ralf Wunderlich stated that the company remains active in exploring M&A opportunities, focusing on deals that are financially accretive and culturally aligned. The current uncertainty may present opportunities, and the company is prepared to act with its strong balance sheet.

Q: What drove the improvement in working capital in Q1, and will this affect cash flow dynamics for 2026? A: Ralf Wunderlich highlighted that improved working capital management is part of the company's capital discipline strategy. While raw material cost increases may impact working capital negatively, the overall focus remains on maintaining strong cash flow.

Q: How sustainable is the current growth in fiber packaging, and are there signs of pricing normalization? A: Ralf Wunderlich expressed confidence in the fiber segment's growth, supported by strong customer relationships and ongoing investments to increase capacity. The company is also expanding into fruit packaging, which is expected to drive further growth.

For the complete transcript of the earnings call, please refer to the full earnings call transcript.

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