“Manufacturing” soft drinks at a factory doesn’t require massive equipment compared to, say, beer or milk. If I recall correctly, the concentrate and water are mixed and carbonation is added in a single machine before the bottling line. So it is certainly possible that Olvi now has enough logistics space and loading capacity for a major brand. The concentrate would then be the major brand’s proprietary product, delivered by tanker truck.
Time will tell…
The result fell short of expectations. “Operating profit decreased by 14.5 percent from the comparison period and was EUR 10.6 (12.4) million. The decrease was due especially to the weakening of the Danish operating profit. In addition, operating profit was burdened by depreciation resulting from the allocation of acquisition costs compared to the previous year. The operating profit of the new subsidiaries was negative overall due to, among other things, acquisition costs and high costs relative to a sales-wise low quarter.”
Revenue was about as expected, but Belarus generated about EUR 5 million more sales than expected, and elsewhere it was softer. So, the structural development in this area was undesirable.
“Beverage company Olvi’s operating profit in January–March was EUR 10.6 million. The result fell short of the analyst consensus compiled by FactSet, which expected an operating profit of EUR 13.9 million.
The company’s revenue during the review period was EUR 148 million, which exceeded the EUR 146 million forecast by analysts tracked by the Factset database. The operating profit margin settled at 7.2 percent.”
The report was very soft. EPS compared to the prior-year period was -40%. The problems in Denmark still haven’t been resolved, and there are no signs of a quick improvement. The outlook was kept unchanged, even though there is no information on the completion of the Värska deal. Without Belarus, the result would look even worse.
On the positive side, Q1 is not a significant quarter for the company, but in the coming quarters, a similar performance simply won’t be enough anymore.
On the other hand, upcoming quarters face uncertainty from consumer demand and the rise in material and logistics costs caused by the war in Iran. Additionally, the integration of M&A activities will cause extra costs.
All the more so, since Q1 included Easter sales unlike last year, and conversely, they will be absent from Q2 unlike last year.
I am currently concerned about the impact of the situation in Iran on the availability and cost development of cans for breweries. And on the other hand, the relative position of breweries if potential problems arise. Olvi’s strength is, of course, its large size, which is an advantage for security of supply. On the other hand, the low price point of the products means that when prices rise, the can eats into the margin disproportionately much, unless the costs can be easily passed on to selling prices.
OP lowered Olvi’s target price from 34 euros to 33 euros, but due to the share price drop, changed its recommendation to “add” (previously “reduce”).
Earlier, OP predicted Olvi would reach the mid-point of its guidance, but now expects it closer to the lower end with a result of 84.8 MEUR. OP’s earnings expectation thus decreased by 3.4 MEUR. At the same time, the quality of the result was weakened as the Belarusian businesses are expected to generate 1.5 MEUR less in earnings.
Sandels’ lead as Finland’s best beer grows:
While the “best” quality of both Sandels and all the other bulk beers on the list is always open to debate, the results speak volumes about brand power and competitiveness.
Here is the previous vote:
Riku-Matti Akkanen wrote about Olvi. 
According to OP Pohjola analyst Matti Kaurola, non-alcoholic products represent Olvi’s most important long-term source of growth.
Consumption of traditional beer in Finland has long been flat or declining, while the market for non-alcoholic beers, soft drinks, and waters has grown by about five percent per year during good years.
Acquisitions also support this development.
For example, the acquisition of the Estonian Värska Originaal will, once completed, increase Olvi’s non-alcoholic product volume by approximately ten percent.
Olvi’s figures from the beginning of the year support this same trend.
In Finland, sales grew in both alcoholic and non-alcoholic products, with energy drinks and hard seltzer products performing particularly well.
Subheadings:
An Iltalehti article of interest to Olvi investors regarding the growth of Hard Seltzers. The article quotes an Alko product manager, according to whom Hard Seltzer sales (at Alko) have doubled since last summer. This refers to the entire beverage category, not just Olvi’s Hard Seltzers.
Similar messaging has also come from Kesko.
Among alcoholic beverages, the popularity of alcoholic mixed drinks, such as hard seltzers, is growing the most this summer.
The rise of hard seltzers is not just limited to this summer, as their demand has been growing for several years, and the growth has accelerated even further during the current year.
Last Friday, OP published its earnings preview for Olvi. The headline pretty much sums it up: “Earnings growth is already priced into the stock.” The target price remained at 33 euros, but with the rise in the share price, the “accumulate” (lisää) recommendation was changed to “reduce” (vähennä). As for me, while tinkering with my holdings, I have been adding to the stock again.
From the OP report: “We forecast that the company’s revenue grew by 10.6% compared to the reference period, amounting to 215.8 million euros. Revenue growth is being driven particularly by better early summer weather in the Finland segment, combined with an increase in private consumption. Similarly, sales in the Other Europe segment are being boosted by growing volumes following acquisitions. We forecast that the adjusted operating profit will grow to 28.2 million euros, led by the Finland and Belarus segments.”
For the full year, OP expects an operating profit of 84 million euros, which falls at the lower end of the 84–92 million euro guidance. OP considers the risk of a profit warning to be elevated.
I noticed that Olvi’s partnership with Pernod Ricard hasn’t sparked any discussion here yet:
“The selection includes iconic names from various categories, such as Absolut Vodka, Jameson, Chivas Regal, Ballantine’s whiskies, and Martell cognac. In addition, the portfolio includes, among others, Beefeater gin, Havana Club and Bumbu rums, Kahlúa liqueur, and Aberlour whisky, as well as G.H. Mumm & Perrier-Jouët champagnes.”
@Rauli_Juva, as you are a man who likes his spirits—ha ha, I mean, as the Anora analyst—do you know more about the setup? Is Pernod Ricard shutting down its Finnish office entirely, and is Olvi taking over responsibility for the distribution of all “global brands” here? The company did outsource its domestic brands to Hartwall some time ago, didn’t it?
And in what range could the financial benefit of such a deal be, now that Olvi (Servaali) gets to utilize its existing machinery for distribution? When considering the bottom line, is this more background noise or something economically relevant to the Finnish business?
Pernod Ricard doesn’t seem to have much of a presence in Finland anyway, since the factory has already gone to Hartwall and importing/distribution was handled by a third party. So, a pretty lean local organization. Certainly a good deal and a big acquisition for Olvi. I’ll be waiting with interest to see Rauli’s comments.
Olvi’s results are out:
“Revenue grew by 15.0 percent to 224.4 (195.1) million euros, supported by volume, a better product mix, and higher average prices.
Operating profit grew by 21.0 percent to 31.8 (26.3) million euros.”
The consensus estimate was 227.7 MEUR in revenue and 28.9 MEUR in operating profit. OP expected revenue of 215.8 MEUR and an operating profit of 28.2 MEUR, of which Belarus’s share was 12 MEUR.
My personal highlight from the interim report is this: “The impact of new business activities on segment earnings was already clearly positive in the second quarter. Acquisitions and integrations will incur one-off costs for 2026. Synergies are expected to materialize mainly in 2027.”
The clarification of the guidance was also positive news in my eyes, as the lower end held firm and, for example, OP has been diligently predicting a negative profit warning from the company.
The problems, therefore, are the excessively large share of earnings coming from Belarus and the unbearable difficulty of the turnaround in Denmark.
In short: as far as I understand, yes. They are also cutting back operations in other Nordic countries; I believe they pulled out of Norway as well, but at least they remained in Sweden. Of course, on their scale, this is just fine-tuning.
I don’t really know anything about this. However, the Trade Register shows that Pernod Ricard Finland’s most recently reported revenue is just over 3 MEUR; I don’t know if that represents the true value of the distribution, as it has been within the same group. The distribution margin is only a few percent at the EBIT level, so there wouldn’t be much profit left from that.
It seems the latest figures for Servaali are from 2024, and as a whole, it has only generated 1–1.5 MEUR in EBIT. So, based on this, I would say that this Pernod Ricard deal is not significant for Olvi’s total or even its Finnish earnings, but that’s just my guess. A nice addition to their portfolio on the distribution side, though.
OP reiterated its target price of 33 euros and its “reduce” recommendation. “Profit warning risk is gone, but for the wrong reason,” was the telling headline of the report. In other words, profits are being generated, but too much of them come from Belarus.
OP raised its operating profit forecast for the current year by 3.7 MEUR to 88.1 MEUR, but the change is almost entirely concentrated in Belarus. The revenue forecast was lowered by 10 MEUR to 763 MEUR, with the share of Belarus within that total increasing by 12 MEUR.
I sold my shares on Friday. I’ll buy back in at thirty.
The country risk here is just ballooning. According to OP’s forecast, 47% of this year’s profit will come from Belarus. I am also paying attention to the increasing risk in the “other Europe” segment. Doing beer business in Estonia involves completely different risk levels than in, say, Serbia. It’s a matter of opinion whether these risks are already adequately—or perhaps too much—reflected in Olvi’s current share price.
“At the end of June, the Vestfyen brewery presented its 2025 financial statements, in which the company lost a staggering 26 percent of its revenue, which ended up at 129.8 million Danish kroner, and the result was -44.8 million Danish kroner.”
A loss of 6 million doesn’t really sound good when you consider this:
Q2 2026:
Operating profit improved in Belarus, remained at the previous year’s level in Finland, and weakened in the Other Europe segment due to an increase in losses resulting from a decline in Danish sales volume.
That further compounds Olvi’s problems. Half of the cash is stuck in Belarus, and other business operations are heavily subsidizing the dire situation in Denmark. Someone might say it out loud that Olvi is a broken company with a strong history.
Olvi has a lot of work to do regarding these issues, and in this case, the P/E ratio tells us absolutely nothing about the business’s true earning power.
I don’t even dare to calculate what the company’s free cash flow is when excluding Belarus from the picture. I bet it’s not a very high figure in relation to the market capitalization. The balance sheet will soon start to reveal the situation in such a way that more debt will have to be taken on, even though there is ostensibly a lot of cash on hand.
Free cash flow from operations is 30 million. Since Belarus is generating 21 million in profit, its share is at most that much. So there’s no cause for concern; the cash flow is strong.
Olvi should establish an efficient unit in Poland, from which it might be possible to capture a small slice of the German market. I’m sure they have been looking into it.
At least in Finland, the margin on bulk products is so thin that the machines have to run reliably for anything to be left on the bottom line.
What concerns me most about the struggling in Denmark is that this “achievement” took place in a year when Jolly Cola’s popularity exploded and the product reclaimed its iconic status. But even that opportunity was botched due to supply issues, inappropriate product packaging, and the like. Now, of course, corrective actions have been taken by introducing 6-packs to the market, but it’s a bit late in the game.
As for non-alcoholic beverages, Olvi is shining brilliantly in Finland with its waters. Flavored mineral waters have achieved a sovereign number-one position, and at least I was surprised to find that the company is also number one in vichy waters. After all, Hartwall’s version is a quite iconic competitor, even if we aren’t talking about a “grapefruit long drink moat” here.
When it comes to sodas, however, I’m baffled by the mess: perfectly well-known Olvi colas were buried in total silence, and now they are starting from point zero with the new Juju product brand. I don’t know what the catch (juju) is, but the Juju most familiar to Finns is a pro-Russian conspiracy theorist rapper.
The news feed reports that SEB has raised its target price to 35 euros (from 33) and maintained its hold rating.
