Anora updated targets ahead of CMD – focus remains on profitability

Translation: Original published in Finnish on 11/4/2025 at 11:33 am EET.

Ahead of tomorrow's Capital Markets Day, Anora announced its new mid-term financial targets until 2028. As we expected, the focus is shifting from previous ambitious growth and margin targets to more concrete improvements in profitability. The new EBITDA target for 2028 (85-90 MEUR) remains ambitious and is clearly above our current estimates, as we anticipated. Nevertheless, it is realistic when viewed in relation to historical levels, for example. We will evaluate Anora's assumptions and measures for improving profitability after the CMD. You can stream Capital Markets Day live here on Wednesday starting at 12 pm EET.

New targets focus on improving profitability

Anora launched its updated strategy and new financial targets on Tuesday. The update to the targets was expected, as the company had communicated this in advance. We considered the company's previously set targets for 2030 to be challenging and expected them to be lowered and/or reformulated, which indeed happened.

The new targets until the end of 2028 are:

• Profitability: 6–7% p.a. growth of comparable EBITDA, implying an EBITDA of 85-90 MEUR by the end of 2028 (previous target was comparable EBITDA margin 16%)
• Growth: Organic revenue growth exceeds market growth (previous target was 3-5% p.a., including acquisitions)
• Debt leverage: Net debt/comparable EBITDA below 2.5x (unchanged)

The dividend policy (dividend payout ratio of 50–70% of the result) remained unchanged.

Targets above our estimates, but well below previous targets

The profitability target, in particular, is clearly above our current estimates. Our adjusted EBITDA forecast for 2028 is approximately 75 MEUR, so even the lower end of the target range (85–90 MEUR) would be a significant improvement in earnings compared to projected development. However, we believe the earnings target level is more realistic than the previous margin target of 16%. Based on our revenue forecast for 2028, the new earnings target roughly translates to a margin level of 12.5–13%. Thanks to strong demand during the COVID years, Anora achieved a margin of over 15% in 2020–21, but in 2016–19, the combined EBITDA of the former Altia and Anora was just over 12%.

The company also presented a three-phase plan through which it aims to achieve a total gross impact of approximately 50 MEUR on EBITDA by 2028. The net effect of these gross savings is reflected, in practice, in the aforementioned earnings target. We view it positively that gross savings are clearly being targeted more than net improvements in results because, for example, cost inflation and investments in growth inevitably increase expenses.

The revenue growth target of exceeding market growth is more moderate than before and aligns with our view that the growth outlook for the alcohol market is subdued. This means that Anora does not need to aggressively pursue growth that is not possible in the market. We consider this to be a good target and look forward to hearing the company's view on market developments in the coming years, which will provide a more concrete picture of the target. Our estimate is for annual revenue growth of 1% in the coming years.

Acquisitions seem less likely, which we view as positive

In addition to its new financial targets and the measures aimed at achieving them, Anora published a new list of its capital allocation priorities. We assume the list is in order of priority, meaning organic growth is secured first, followed by dividends, and finally, possible acquisitions. In our view, removing the impact of acquisitions from the growth target and using the term "selective mergers and acquisitions" indicates that their role will be less significant in the coming years than in the previous strategy.

We believe this makes sense for several reasons: First, previous acquisitions, particularly Globus Wine, have not been successful. Second, we believe that the company should focus on streamlining its current operations before making any new acquisitions. Third, since the company already has a strong and comprehensive position in the Nordic countries, any significant acquisitions would require expansion into entirely new markets, which we consider relatively high-risk.

The company's listed capital allocation priorities are:

• Investments in organic growth including core and top-performing brands and new product launches.
• Dividend policy: dividend payout ratio of 50-70% of the result for the period.
• Selective mergers and acquisitions to strengthen portfolio and market reach.