Raisio Q1 2025 slides: EBIT surges 44% as healthy food brands drive growth

Introduction & Market Context

Raisio Oyj (HEL:HE:RAIKV) presented its Q1 2025 interim results on May 13, 2025, highlighting a strong start to its new strategy period for 2025-2027. The Finnish food company, known for its Benecol and Elovena brands, saw its stock rise 2.98% following the presentation, closing at €2.35.

The company’s results showed significant profitability improvements despite modest revenue growth, suggesting successful execution of its value-over-volume strategy in a challenging market environment, particularly in the B2B segment where lower grain prices and intense competition affected performance.

Quarterly Performance Highlights

Raisio reported net sales of €57.8 million for Q1 2025, representing a 4.2% increase from €55.5 million in the same period last year. More impressively, comparable EBIT surged 44.3% to €6.1 million, with the EBIT margin expanding to 10.6% from 7.6% a year earlier.

As shown in the following chart of Raisio’s quarterly performance:

Comparable EBITDA also showed strong growth, increasing 25.2% to €8.5 million, with the EBITDA margin improving to 14.7% from 12.3% in Q1 2024. This significant profitability improvement came despite relatively modest sales growth, indicating enhanced operational efficiency and a more favorable product mix.

The company’s return on invested capital (ROIC) improved substantially to 10.1% from 7.4% in the prior-year period, reflecting more efficient capital utilization. Cash flow remained solid at €7.6 million, though slightly below the €8.5 million generated in Q1 2024.

Raisio maintained its strong balance sheet position with an equity ratio of 79.3% and negative net interest-bearing debt of €82.6 million, essentially representing a net cash position. This financial strength provides the company with flexibility for future investments and shareholder returns.

Segment Performance

Healthy Food Segment

The Healthy Food segment, which focuses on consumer brands, delivered net sales of €39.4 million in Q1 2025, up 3.8% from €38.0 million in Q1 2024. Comparable EBIT for this segment increased 16.8% to €5.0 million.

Raisio’s geographic breakdown of Healthy Food sales shows a balanced portfolio with Northern Europe representing 53% of sales, Western Europe 42%, and Central and Eastern Europe 5%. All market areas showed positive sales trends in Q1 2025 compared to the previous year.

The segment’s performance was driven by strong brand performance, with Elovena sales value increasing approximately 7% in Finland, while Benecol products grew by 10% in Finland and 7% in the UK.

The following chart illustrates the Healthy Food segment’s financial performance:

Healthy Ingredients Segment

The Healthy Ingredients segment, which focuses on B2B sales of grain-based foods and ingredients to industrial and catering companies, as well as Benecol licensing, reported more modest revenue growth but exceptional profitability improvement.

Net sales for this segment reached €26.9 million, up 1.3% from €26.6 million in Q1 2024. However, comparable EBIT more than doubled, increasing 110.0% to €1.9 million.

This remarkable EBIT growth despite modest sales growth reflects a strategic shift toward more profitable product categories. The value of exports of gluten-free oat products grew by over 30%, offsetting a decline in domestic industrial sales, which fell by around 20%. Sales of plant stanol ester were particularly strong in the first quarter, further contributing to the improved profitability.

Strategic Initiatives

Raisio is actively expanding its international footprint, with the Elovena brand entering new markets through partnerships and a low-risk operating model. In Q1 2025, the company entered the Danish market in March, followed by Spain in April.

This international expansion strategy aligns with the company’s new strategic period for 2025-2027, which appears to focus on growing its consumer brands across European markets while optimizing its B2B business for profitability rather than volume.

Forward-Looking Statements

Raisio projects that comparable EBIT for continuing operations for the financial year 2025 will increase compared to 2024, building on the strong start to the year.

The company maintained its dividend policy, targeting to distribute 50-100% of earnings per share as dividends each year. For 2024, Raisio paid a dividend of €0.14 per share, consisting of a €0.11 basic dividend and a €0.03 supplementary dividend, which was distributed on April 29, 2025.

Raisio also announced its upcoming Capital Markets Day, scheduled for May 27, 2025, in Helsinki, where management is expected to provide more details on the company’s strategic plans for the 2025-2027 period.

With its strong balance sheet, improving profitability metrics, and growing international presence, Raisio appears well-positioned to continue executing its strategy focused on healthy food products while navigating challenges in the B2B market segment.

Full presentation:

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