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Introduction & Market Context
Scandi Standard, the leading Nordic poultry producer, reported a 7% increase in net sales for Q1 2025, driven by strong consumer demand for chicken products across its markets. The company continues to benefit from the ongoing shift from red meat to poultry, with consumption in the Nordics and Ireland expected to grow by approximately 13% from 2023 to 2030.
The company’s stock (SCST) closed at 85.2 SEK on April 28, 2025, up 0.71% for the day, reflecting investor confidence in its strategic direction despite short-term margin pressures from expansion initiatives.
As shown in the following chart of quarterly performance, Scandi Standard has maintained consistent growth in net sales over recent years while working to stabilize EBIT margins:
Quarterly Performance Highlights
Scandi Standard reported net sales of 3,376 MSEK in Q1 2025, up 7% from 3,160 MSEK in Q1 2024. Operating income (EBIT) increased by 2% to 124 MSEK, though the EBIT margin decreased slightly to 3.7% from 3.9% in the same period last year. This margin compression was primarily due to start-up costs associated with the company’s new Lithuanian operations.
The following slide summarizes the key financial metrics for the quarter:
When excluding the 17 MSEK impact from the Lithuanian start-up, the company’s underlying EBIT performance showed significant improvement. EBIT per kilogram (excluding Lithuania) reached 2.05 SEK/kg, representing an 18% increase compared to Q1 2024.
The company proposed a dividend of 2.50 SEK per share, up from 2.30 SEK the previous year, signaling management’s confidence in the company’s financial position despite ongoing investments.
Strategic Initiatives
Scandi Standard’s growth strategy centers on three interconnected drivers: responsible and nutritious products, convenience and taste, and affordability through sustainability. This approach has positioned the company to capitalize on shifting consumer preferences toward chicken products.
The company’s strategic vision is illustrated in this conceptual framework:
A key component of Scandi Standard’s strategy is leveraging the growing consumer preference for chicken, which has seen a 44% consumption increase in the Nordics and Ireland from 2010 to 2023. This trend is expected to continue, with forecasts indicating approximately 1.7% annual growth through 2030.
The following chart demonstrates this favorable market trend:
Chicken’s affordability relative to other protein sources remains a significant competitive advantage. According to the company’s data, chicken consistently offers the highest discount compared to salmon, beef, and pork across all cut categories, making it an attractive option for cost-conscious consumers during periods of inflation.
Segment Performance
Scandi Standard’s business is divided into two main segments: Ready-to-cook (RTC) and Ready-to-eat (RTE). The RTC segment generated 2,600 MSEK in net sales during Q1 2025, a 6% increase from Q1 2024, while the RTE segment grew by 9% to 646 MSEK.
The detailed breakdown of segment performance is shown in the following chart:
The Ready-to-eat segment has demonstrated particularly strong growth, with a compound annual growth rate of 18% from 2015 to 2024. This segment now represents approximately 25% of total sales and delivers higher margins than the traditional Ready-to-cook business.
The following chart illustrates the impressive growth trajectory of the Ready-to-eat segment:
To strengthen its position in the European breaded chicken market, Scandi Standard has acquired new production facilities that include "two of Europe’s largest and most efficient breaded product lines." This 28 MEUR investment replaces a planned 30 MEUR expansion in Denmark and is expected to significantly enhance the company’s competitive position in the premium segment of the market.
The strategic acquisition is detailed in this slide:
Forward-Looking Statements
Scandi Standard is targeting an EBIT per kilogram of more than 3.00 SEK by 2027, compared to the current level of 1.82 SEK. Management expects to make "a material step" toward this target in 2025, as illustrated in the following projection:
The company’s Lithuanian operations, while currently impacting profitability, are expected to deliver an EBIT per kilogram "well above 3 SEK" in the medium term. This low-cost platform, combined with the newly acquired breaded production capabilities, positions Scandi Standard to increase its approximately 5% European market share in the breaded chicken segment.
Operations at the new breaded production facility are planned to start in Q4 2025, with management acknowledging potential start-up costs and initial low utilization rates. The European frozen breaded market is projected to grow by approximately 60,000 tonnes by 2029, providing a favorable backdrop for the company’s expansion in this segment.
With its strategic investments in both upstream integration (Lithuanian farming operations) and downstream processing capabilities (breaded production facilities), Scandi Standard appears well-positioned to capitalize on the continuing shift toward poultry consumption while working toward its medium-term profitability targets.
Full presentation:
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