HKScan Plans to Strengthen its Financial Position
HKScan, the Nordic meat and meals company, is planning a share issue of up to €60 million to secure its financial position and to strengthen its capital structure. The planned share issue is intended to provide a strong foundation for developing the company’s business portfolio and balancing its financial situation and for building future growth.
The company plans to publish a prospectus regarding the shares to be offered in the share issue on or about 31 May 2019.
In addition to the planned share issue, HKScan is negotiating a new financing agreement and a maturity extension with its current creditors, to enter into force if certain conditions, including the share issue, are met.
“The planned financing arrangement would significantly strengthen the company’s financial position. HKScan is in the middle of a turnaround, and we are focusing on improving the company’s cash flow and profitability according to plan. In addition to balancing the company’s financials in the short term, we are actively assessing the Company’s business portfolio and updating HKScan’s strategy, with the help of which we aim to restore the company’s path towards profitable growth,” explains Tero Hemmilä, chief executive of HKScan.
HKScan produces, markets and sells high-quality, sustainably produced pork, beef, poultry and lamb products, as well as charcuterie and meals, with strong consumer brands, including HK®, Scan®, Rakvere®, Kariniemen®, Rose®, Pärsons® and Tallegg®. Its customers are the retail, food service, industrial and export sectors, and its home market comprises of Finland, Sweden, Denmark and the Baltics. HKScan exports to close to 50 countries. In 2018, HKScan had net sales of €1.7 billion.
Outlook
Global meat consumption is projected to increase during the coming years. Within HKScan’s home markets, consumption growth is estimated to be led by poultry and meal categories, while demand in other categories is expected to remain stable. HKScan expects its improvement programmes and other corrective actions to start recording results in 2019 and the company’s comparable EBIT is expected to improve clearly from the previous year.
