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Schouw & Co. reported its Q1 2025 earnings with a flat top line of 7.9 billion DKK and a 13% decline in EBITDA to 565 million DKK. Despite maintaining its full-year guidance, the company’s stock fell by 4.3% following the announcement, reflecting investor concerns over immediate performance challenges and broader market conditions.
Key Takeaways
- Schouw & Co.’s EBITDA dropped by 13% in Q1 2025.
- The company maintained its full-year guidance across all business segments.
- The stock price fell by 4.3% in reaction to the earnings release.
- Strong customer relationships and innovation were highlighted as key strengths.
Company Performance
Schouw & Co. reported stable revenue for Q1 2025 at 7.9 billion DKK, while EBITDA fell by 13% to 565 million DKK. The company remains focused on innovation and strategic acquisitions, such as gaining full ownership of its Costa Rica joint venture and Norway R&D facility. Despite these positive moves, the company faces challenges in the automotive and electronics sectors, contributing to a volatile business environment.
Financial Highlights
- Revenue: 7.9 billion DKK (flat compared to previous periods)
- EBITDA: 565 million DKK (down 13% year-over-year)
- Cash Flow: $220 million for the quarter
Market Reaction
Following the earnings announcement, Schouw & Co.’s stock price declined by 4.3%, closing at 578. This movement reflects investor concerns over the company’s declining EBITDA and broader market challenges, despite the maintained guidance and strong customer relationships.
Outlook & Guidance
Schouw & Co. maintained its full-year guidance, projecting EBITDA between 2.82 billion DKK and 3.12 billion DKK. The company forecasts BioMar’s turnover to reach 16-17 billion DKK, with an EBITDA of 1.47-1.57 billion DKK. GPV’s top line is expected to be 8.7-9.3 billion DKK, with EBITDA ranging from 590-650 million DKK. The outlook is supported by strong customer relationships, innovation, and a solid order backlog.
Executive Commentary
"We are seeing very strong positions and long relations with our key customers globally," stated Jens, a company executive, highlighting the company’s robust market presence despite current challenges. He also emphasized, "We have different positive key drivers," pointing to innovation and strategic acquisitions as growth catalysts.
Risks and Challenges
- Declining EBITDA and potential impact on profitability.
- Volatile market conditions affecting the automotive and electronics sectors.
- Tariff impacts on US and international trade could pose additional challenges.
- Soft demand expected in the first half of 2025.
- One-off costs of 40 million DKK anticipated in June 2025 related to GPV’s ERP system implementation.
Q&A
During the earnings call, analysts inquired about BioMar’s margin challenges and the company’s tariff strategies. Executives provided insights into a potential BioMar IPO and clarified market share and volume dynamics, offering a glimpse into future strategic directions.
Full transcript - Schouw & Co. (SCHO) Q1 2025:
Jens, Company Presenter/Executive, SCOR and Company: Welcome to SCOR and Company’s q one presentation. I will, as usual, go through the presentation, and then, afterwards, I will open up for questions. Skor and Company had in the quarter a satisfying quarter. We performed well in very difficult times. You could say that somewhat soft development was expected, And we also have to acknowledge that uncertainty in the business environment, of course, also in one or another way impacted our businesses.
But we came out of the quarter as expected. Our top line was flat with DKK7.9 billion and EBITDA was as expected down 13% to DKK565 million. 20 20 4 Q1 was positively impacted from one offs of around million. Our cash flow continued with very good traction and came in with $220,000,000 for the quarter. Skorum company continues to evaluate a potential IPO of BioMar.
It’s likely that banking syndicate is established in the near future. Of course, the actual business climate needs also to be taken into considerations when, one, are considering these IPO thoughts. Looking from strong company to Biomar, Biomar really continued to perform very well and strengthen its position. The top line was up five percent to 3,400,000,000.0, and the volume increased 12% to 294,000 tonnes. We have over the last year offset tonnage a little bit on to get our margins up, and we have succeeded with that.
Especially the salmon and shrimp segment delivered the main part of the tonnage uplift. Of course, still, we have continued focus on margin and profitability, but scale is also a very important driver for Biomar. EBITDA was as expected down 24% to $2.00 6,000,000. Q2 Q1 twenty twenty four was exceptionally strong both on climate issues and on margin. And as mentioned also, we had one offs of million, which came from BioMar in Q1 twenty twenty four.
Working capital significantly reduced to DKK1.75 billion. Interesting also that our swim customer seems to be willing now to invest in innovation, meaning also that our tech division or particularly our AQ1 had a very good quarter. Biomark continues to invest and build strengths, meaning that we acquired the remaining 50% of the JV we have in Costa Rica. And we also acquired full ownership of our R and D facility, let’s see, in Norway, all in all investments of around DKK 100,000,000 in the quarter. Guidance for Biomar maintained turnover in the magnitude of DKK16 billion to DKK17 billion and EBITDA in the range of DKK1.47 billion to DKK1.57 billion.
Biomark continues to have full focus on utilizing the innovative platform and are also looking for scale and margin management. Moving on to GPV. GPV’s market continued to be volatile with rather soft demand. Top line was expected 5% down to DKK2.2 billion. GPV’s EBITDA came down 8% to 43,000,000 as expected.
We had, of course, impact from lower volume and mix. A lot of activities is going on across the company to stimulate profitability, factory footprints. This is different things is going on. And one ERP system is now implemented or initiated to be implemented across all companies. Decided footprint initiatives is progressing well.
We are optimizing the structure and the platform. And to accommodate that, we will see one offs in the June of million in 2025. Soft demand is expected to continue in the first half of twenty twenty five, but guidance maintained. We expect now a top line of DKK 8,700,000,000.0 to DKK 9,300,000,000.0 EBITDA in the range of DKK $590,000,000 to DKK $650,000,000. And as I mentioned in this EBITDA guidance, there is included DKK 40,000,000 in one offs.
Order intake really supports our guidance, seems to improving. We have a book to bill index that is quite good and looking into interesting order intake in the coming months. Moving on then to HydroSpecma. And now we’ll see if it changes here on the technology. I’ll move on to the HydroSpecma slide here.
Hydropower really continues to deliver very solid and the top line 3% up to CHF 800,000,000. There was a very good traction in renewables and our global OEM segment. EBITDA up 27% to million. However, we had a one off positive impact from sale of real estate. Normalized for one offs, EBITDA was up 12%.
There’s been effect of a very solid margin management and control across all companies within HydroSpecma and also a positive effect of continuously optimizing their supply chain. HydroSpecma is preparing for future building a very solid project pipeline and relocating a lot of the products to to best cost countries. They are also taking strong positions in the defense segment. The top line guidance is maintained. EBITDA up, meaning that the top line will be DKK 2,900,000,000.0 to DKK 3,200,000,000.0, and EBITDA now expected to be in the range of DKK $350,000,000 to DKK $380,000,000.
Automotive is really hampered by a mix of fierce competition and cost increases. Top line was flat, $5.00 6,000,000. But our new segment, Newman, really had a good and positive development in the quarter. EBITDA was down 32% to NOK32 million. Margins at all levels in the reman segment has been under severe pressure.
But also we have to recognize that we had a core negative core regulation of CHF 12,000,000 hampering results in the quarter. Borys relocating their production to both Poland and Tunisia. Our REX and PSR produced in U. K. Will be moved to Lublin in Poland.
And basic products as starters and alternators will start to be moved to our newly acquired facility in Tunisia. Boro is downgrading their top line and EBITDA due to fierce competition due to a lot of inflow of new made products from China. China is really sending a lot of products into Europe because they cannot deliver in U. S. Because of the tariffs.
Top line now expected to be DKK2 billion to DKK2.2 billion. EBITDA is million to DKK180 million. BOW has initiated a comprehensive profit protection plan, and it’s initiated to deliver both on the short and the long term. Moving on then to Fibrotech’s personal care really developed much better than Fiat. Fibrotech’s personal care delivered much better than expected.
Top line decreased, however, 4% to $447,000,000. Asia volume slightly down, but Europe came in with a very good development. EBITDA was flat at million. Very good to see that margins in Asia better than Fiat. Volume in Asia also improving a little bit.
We are here benefiting from long term quality and trustworthiness with a lot of global customers. Also good to see that the future potential is reconfirmed for Fibrotech’s personal care. Asia starts slowly to get their momentum back. Our position in Europe has been strengthened and our innovation platform continues to be very strong. We are giving a guidance uplift on EBITDA.
Top line expected to be maintained, 1,400,000,000.0 to 1,600,000,000.0, and EBITDA with a small uplift now in the range of NOK 140,000,000 to NOK 170,000,000. Then moving on to Fibrotex nonwovens, Fibrotex nonwovens kept sales momentum in rather difficult markets for them. Top line flat at CHF579 million. Segment and product mix was different than in Q1 twenty twenty four. The EBITDA down 26% as expected to million.
Here we saw this expected negative effect from mix. Our high margin segments came out soft. Good to see also that The US volume up, but The US volume still with lower margins, but margins in US continuously improving. Our US transformation plan is really starting to show results. Productivity and quality at the new factory in U.
S. Has really significantly improved. Value adding volume continues to kick in. And there’s really a strong demand in U. S.
For domestic produced products, which we expect the FibroTex nonwovens to benefit from the near future. Full year guidance maintained in spite of soft Q1. Top line expected DKK 2,300,000,000.0 to 2,500,000,000.0 and EBITDA still expected in the range of DKK 200,000,000 to DKK $230,000,000. Of course, improvements in U. S.
And our de commoditizing strategy, they are both important levers in our expectations. So concluding and looking into our guidance, our full year guidance maintained despite volatility. We expect still to deliver EBITDA of DKK2.82 billion to DKK3.12 billion. And why are we still maintaining our guidance? Because we have different positive key drivers.
We are seeing very strong positions and long relations with our key customers globally. We have continued innovation and high service. Our solid back order backlog and really progressing. And then in all our companies, we have profit protection plans and contingency plans at hand if things should change. So all in all, guidance for the year maintained.
And with that, I will conclude my remarks and then open up for questions. Lars, Elmer, welcome. Are you muted, Claus, or you can’t hear?
Klaus, Analyst: No. I’m not muted. Okay. Sorry about that. Yep.
Jens, Company Presenter/Executive, SCOR and Company: There we are. Thank you.
Klaus, Analyst: I will do some questions, and I will start out with some specific BioMar questions. So given the Q1 performance, and I know you think this was in line with your own expectations, but margins is down year over year at least. Should we expect Biomar to heading for the mid to the lower end of the range? Or how should we think about this?
Jens, Company Presenter/Executive, SCOR and Company: I think we have the range, and we have not concerns on not being able to deliver in the range. And I think also normally we say okay in the range most likely in the midpoint of the range but there’s still opportunities for Biomar. We see biological conditions good. We are in a good margin management situation. We’re still confident on guidance with Biomar.
Still, it’s first season. You know also that q one, is a low season and so on, but still positive on on biomass.
Klaus, Analyst: Even in the high end of the range?
Jens, Company Presenter/Executive, SCOR and Company: I’m not commenting on that. We have a range, and we could when we have the range, Claus, means also that we could also deliver up there if things goes well.
Klaus, Analyst: Sure. Okay. Then, you know, raw materials are coming down.
Sandra, Analyst: Mhmm.
Klaus, Analyst: Does that have an impact on your profitability, at least compared to last year? Is there anything on the raw material development that is impacting your profitability? Okay.
Jens, Company Presenter/Executive, SCOR and Company: Not not as we see it right now because we also know that, especially in the Norwegian salmon, have under contract, we have this pass on mechanisms on and off and so on. But mainly at the rest of the world, it’s we need to go and and and discuss with our customers on on every contract and so on. But also, do a lot of of recipe optimizations, utilize our raw material platform, and we have a very, very long experience in that. So we don’t see any any issues on that side.
Klaus, Analyst: Right. But okay. So then talking about the margins. Margins year over year is down when when we adjust for this 65,000,000 1 offs last last year. Yeah.
Maybe we put some more color on you know, above 6% is still very, very positive in in historical perspective, but it’s still down versus 24. So what did really happen in in the quarter?
Jens, Company Presenter/Executive, SCOR and Company: Yeah. And so there’s of course, there’s a mix. You also know when we are having a high volume in salmon, margins are a bit lower than in the other segments. And we saw, I think also you could see that volume in salmon segment was positive and up. And also it’s in the first quarter where we have not had the same sale of functional feed as we have in the other quarters and so on.
So it’s a mix of functional feed. It’s a mix of species, etcetera. And also you saw shrimp business significantly up. So it’s a mix of less functional sale, species mix, etcetera, but, we are not concerned on on the margin development as such.
Klaus, Analyst: And sorry about all these questions, but but all these, the lower functional feed share down Yeah. Yeah. Is there any specific and I only talk about salmon because it’s salmon that is seeing lower margins. So why is it down in this quarter?
Jens, Company Presenter/Executive, SCOR and Company: Yeah. But you could say, of course, it’s also a a small quarter in volume in general compared to to later on. But also, you don’t use as much functional feed in in the quarter in the first quarter because of has been a good biological conditions. We haven’t seen as many sea lice. A lot of things has played good out in the quarter compared to earlier.
Klaus, Analyst: Right. Okay. And then just a final one. Chile is is down year over year on volume. Yep.
Why is that? And I would have thought I would that was not the development I would have expected at least.
Jens, Company Presenter/Executive, SCOR and Company: Yeah. But Chile have had some difficult biological conditions. And then also we have changed around on some contracts. But we have regained contracts, we expect volume to pick up in Chile. But, of course, you if you move around on one or two contracts, things can happen in in in a quarter.
Klaus, Analyst: And regained contracts, you know, risen on on lower margins, or is that on on unchanged terms?
Jens, Company Presenter/Executive, SCOR and Company: No. But it’s on unchanged terms or at least at good margins. And then you also know the drill that when we get in on a contract with what we call basic feed, then we need to work on selling up and really getting the product mix changed and so on. It’s it’s a big challenge, but we have been very strong in doing that over the last years.
Klaus, Analyst: Okay. That was all for me. Thank you so much for the answers, Jens.
Jens, Company Presenter/Executive, SCOR and Company: No. Thank you, Klaus. Sandra, welcome. Hi. Good
Sandra, Analyst: morning. You hear me? Okay. Okay. Sound
Jens, Company Presenter/Executive, SCOR and Company: and clear.
Sandra, Analyst: That’s good. I think Klaus asked a lot of the questions about BioMar, but I have a couple more. Yes. Looking at the volume side, I think doing competition here, salmon feed volumes were up, like, approximately 7%, I think. Yeah.
Can you can you say something about market share development in in Norway? Because I think at least feeding statistics indicate, like, about 25% volume growth in the first quarter, but that’s feeding. It’s not feed purchasing. So Exactly.
Jens, Company Presenter/Executive, SCOR and Company: Yeah. You’re right. Yeah. Yeah. But I think we have, kept our market share.
You know, also we have our customer base, and of course it can fluctuate a little bit up and down. How much does your customer base have in biomass at sea? So we haven’t seen huge fluctuations on market share. And you also know it’s a capacity question and so on. We are with the customer for longer term.
No significant movements on market share in there.
Sandra, Analyst: Okay. And just a detailed question on that. I thought during your fourth quarter call, you said that NovaSea was a customer of yours, and that’s been acquired by Mobi. So how does that play out?
Jens, Company Presenter/Executive, SCOR and Company: Yeah. Normally, we don’t comment on individual customer contracts, but I still I think that we still have an oversee in our in our customer portfolio, and we also expect to have them in the longer run.
Sandra, Analyst: Okay. Finally, on BioMar, I think your tech segment is doing well. You commented briefly, and looking at your EBIT, it’s come from virtually or EBITDA from virtually zero to 13,000,000, not big number of the total yet. But can you say something about the outlook there?
Jens, Company Presenter/Executive, SCOR and Company: Some of the major shrimp customers globally starting to get interest back in a new technology and so on. So so we’re positive on on on that and expect it to continue to to grow in the market. Yes.
Sandra, Analyst: Okay. So this growth more than 100%, is that
Jens, Company Presenter/Executive, SCOR and Company: I mean, of course, it’s not a big, big impact on biomass EBITDA or EBIT. But still, if they push on and develop, we expect them to develop significantly better than last year. Of course, that’s also part of our positive guidance on profitability within Bioma.
Sandra, Analyst: Okay. Excellent. Thank you, Jens.
Jens, Company Presenter/Executive, SCOR and Company: Thank you very much. Yeah. Emil Hogo, Kenegi.
Emil Hogo Kenegi, Analyst: Yes. Thank you. I think the the specific common questions have already been asked. So so my first question is of a more general character across all portfolio companies. So could you provide some some additional color on the on the macroeconomic environment as you see it specifically where you you see the greatest areas of exposure, the the expected impact of of tariff?
And I think importantly, the the measures you can take to to mitigate these. And, additionally, how how have you experienced demand in the market post these tariffs? That’ll be the first question.
Jens, Company Presenter/Executive, SCOR and Company: Yep. Okay. And I was saying thank you and super relevant. And so first, you could say of course, I think also I elaborated a little bit on that of that in my in my in my introduction saying that, of course, we have seen volatility, meaning also some customers holding back a little bit on orders, waiting and things like that. So of course, it has had an impact, but not a significantly impact on that.
Then moving on to say what’s our business in US. We have annually business of around CHF2 billion in U. S, and we are producing ourselves in U. S. Of around, I think it’s CHF800 million, CHF900 million altogether, meaning the rest is imported into to U.
S. Some is coming from Mexico and some is coming from Asia. So of course, we’re looking into tariff impacts and so on. But our mitigation and our way of viewing it is saying we are not participating in this tariff. Our customers need to to pay the tariff, and we have also products that a lot of our customers, they cannot be without them because it goes into their production and so on.
So we have a we have a clear stand on on that, and and we, look at it from case to case and say we cannot really prepare a lot because we don’t know what happens tomorrow. But, of course, looking into to supply chain and more regionalization and things like that, that’s that’s what we are working on, I mean.
Emil Hogo Kenegi, Analyst: Okay. So so as I understand it, to a large extent, you expect to be able to pass on these tariffs to to customers?
Jens, Company Presenter/Executive, SCOR and Company: So far, yes, we do. And you could also say if we should take, let’s just say, some of our we are low margin business in general, and therefore we need to have a quite firm stand on that saying that we cannot support and offset all these tariffs because then we cannot make a business out of it, then it’s better to say, okay, sorry, we are not the one supplying if you want us to take full responsibility for these tariffs. But let’s see what really happens. We were very nervous on Mexico. We have a a big facility in Mexico for electronics, and things has changed so much there that maybe that could be a small opportunity for us.
And then also producing in in US, especially in the fiber businesses where we do not import a lot of raw materials from China. So, yeah, that’s the way it is.
Emil Hogo Kenegi, Analyst: Makes sense. So so as of now, with the ongoing uncertainty around this, you have not included any of these tariffs in in the current guidance.
Jens, Company Presenter/Executive, SCOR and Company: No. We haven’t. Maybe one thing I should comment on is, of course, also we we are looking cautiously on what happens in the world as would the business climate be a little bit more negative, meaning that in general, demand would be soft and things like that. Of course, that’s a concern we are having. And then all by a sudden, you could say the automotive industry in Europe starts to suffer a little bit, meaning that, they are not taking the orders we expected and things like that or the renewable business and so on.
But so far, we are cautiously optimistic on on future.
Emil Hogo Kenegi, Analyst: Perfect. Thank you for for the additional color on this. So just a last last question from from my side. And I, of course, have to to ask about the ongoing evaluation of potential IPO of Primer because there’s naturally quite some market interest in in this. Yeah.
So could you provide any kind of indication of when you expect to be in a position to to communicate a final decision from from the evaluation to the market?
Jens, Company Presenter/Executive, SCOR and Company: To be honest, I cannot say when, but I think also we we commented on it in in in in in the report saying that we are closing up on being able to appoint a banking syndicate, also meaning that we are moving. We are, of course, looking at valuation and opportunities. And I think also I said that with the present business climate, of course, things are also going on. So we have to evaluate, is it the right time to do it? And then, of course, also preparing biomass, what we call IPO readiness.
But but, honestly, could we could not, do it, before very, very late twenty five or into ’26 because a lot of things need to to be done, but we are moving. And, I think, bank syndicate is first real indicator of that things are are going in that direction. Yep.
Emil Hogo Kenegi, Analyst: Yes. That’s clear. Thank you very much.
Wyshu, Analyst, SEB: That was
Klaus, Analyst: Thank you, Remi.
Jens, Company Presenter/Executive, SCOR and Company: Sure. Thank you very much. Yeah. Wyshu, SEB, welcome.
Wyshu, Analyst, SEB: Yeah. It’s away from SAP. Thank you for taking my question. I just wanna follow-up on the build margin. You mentioned this mix effects in q one.
But what do you expect for the coming quarters? Any factors we should consider that can drive the year over year margin improvement or even at the same level as last year in the coming quarters?
Jens, Company Presenter/Executive, SCOR and Company: Yeah. And
Wyshu, Analyst, SEB: I I I’m asking because I can see that q two, q ’3, q ’4, the the comparison will not be that easy when I when I’m looking at the the the gross profit per kilo, which is important margin driver.
Jens, Company Presenter/Executive, SCOR and Company: Yeah. No. Thank you for for asking that specific question because I think you’re pointing at something very interesting is that q one, of course, lower volume, meaning that scale and volume and factory utilization, of course, will drive margin in in a good direction. And as I also said, in the coming quarters, we will see much bigger effect from selling functional feed. We are getting into the real grower season and things like that.
So so effect of scale, productivity, logistics, and then, of course, also functional feature. It’s a multitude of different levers that will secure that margin increase. We always see that also. So we feel quite confident on that the margins in in in q one. They are always lower than looking into to the coming quarters.
Wyshu, Analyst, SEB: Okay. That’s very clear. Thank you.
Jens, Company Presenter/Executive, SCOR and Company: Thank you very much. Good. And with that question, we don’t have any other questions online. So thank you very much for dialing in and listening to this presentation. Thanks for the questions.
Goodbye from here.
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