Financial goals

Cloetta’s proximity to customers and consumers, and knowledge of local and regional market conditions – combined with strong local brands, efficient production and innovativeness – represent key competitive factors for continued growth.

 Cloetta´s financial goals are

  • Increased organic sales growth in line with market
  • EBIT margin at least 14 procent
  • Net debt ratio of 2.5 x
  • Dividend pay-out ratio 40-60 procent

     

Organic sales growth

Cloetta’s long-term target is to increase organic sales at least in line with market growth.

Activities to reach the target

Improve competitive power of the brands by improving partnership with customers, having better category and brand plans, be more effective in marketing, increase brand investments and offer consumers choice with less sugar.

Comments on the outcome 2017

Historically, total annual growth in the markets where Cloetta is active has been around 1–2 per cent. In 2017 organic growth accounted for –1.2 per cent, mainly due to specific challenges in a few markets.

EBIT margin

Cloetta’s target is an EBIT margin, adjusted, of at least 14 per cent.

Activities to reach the target

Drive sales growth, create synergies from the acquisition of Candyking, reduce the cost base and drive the Lean2020 program to improve capacity and reduce cost.

Comments on the outcome 2017

The EBIT-margin, adjusted, decreased during the year, mainly due to the acquisition of Candyking, which before synergies had substantially lower margins,
but also due to lower production volumes and sales.

Net debt

Cloetta’s long-term target is a net debt/EBITDA ratio of around 2.5.

Activities to reach the target

Cloetta has been able to reach the target the last two year and the ambition is to stay at this level.

Comments on the outcome 2017

Cloetta met the long-term target for net debt in 2017 for the second year in a row. Net debt/EBITDA reached 2.39x, which is slightly better than the target of 2.5x.

Dividend policy

Cloetta’s long-term intention is a dividend payout of 40–60 per cent of profit after tax.

Activities to reach the target

Cloetta has been paying dividend in line with the target for the last two years.

Comments on the outcome 2017

Cloetta met its long-term target of a net debt/EBITDA ratio of around 2.5x for the second year in row. Due to a decreased profit compared to the previous year, the Board of Directors proposes an unchanged dividend of SEK 0.75 per share for 2017, which corresponds to 54 per cent of the profit for the period excluding impact of impairment loss discontinued operation including income tax effects and other items affecting comparability. In addition, due to the consideration from the divestment of Cloetta Italy, a special dividend of SEK 0.75 per share was paid.

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