Fredrik Nilsson, our CFO, gives you the top arguments for investing in AAK.
1. Above the market growth
The underlying global growth in the segments in which AAK is present is normally in line with global GDP growth. AAK has in the past been able to grow faster than the underlying markets in our focus areas – speciality and semi-speciality solutions in Food Ingredients and Chocolate & Confectionery Fats. With our recent greenfield investments and latest acquisitions in growth markets, we have strengthened our geographic footprint and become a truly global company. Our ambition is to continue to grow faster than the underlying markets.
2. Average 10 percent year-over-year operating profit improvement for the coming years
Between 2010 and 2018, AAK has annually increased its operating profit by 10 percent on average (at fixed foreign exchange rates and excluding acquisitions). Including acquisitions and positive currency translation differences, operating profit has increased 11 percent on average. Based on our high go-to-market activity (sales and customer innovation) and new product development, the very solid foundation we have built, our strong executive and local management, and our increased focus on mergers and acquisitions, we see no reason to lower that ambition.
3. Strong balance sheet supporting further growth
Despite considerable investments to strengthen our geographic footprint and expand our capacity, we have over recent years built a very strong balance sheet with an improved equity ratio. Combined with long-term loan agreements and the establishment of an MTN program (Medium Term Note), this has created a solid foundation and a flexible alternative for further growth, both organically and through selective and strategic acquisitions.
4. Very strong underlying megatrends - demography and technology
AAK is represented in regions where both population and urbanization are on the increase – demographic changes that present substantial market opportunities. We see a growing middle class with a higher income and an increased spending power, and there is also a growing senior population as people live longer.
Technology is another significant growth driver. Today, everything is about sharing online. This is a good opportunity for strong brands to engage with consumers. AAK is, through our customer co-development approach, putting a lot of focus on the trends and global key drivers that affect the behavior of end consumers – indulgence, health, trust, personalization, and convenience.