Scandinavian Tobacco Group A/S Reports Full-Year Results and Proposes a DKK 4.50 Dividend Per Share
Company Announcement
No. 2/2026
Copenhagen, 4 March 2026
Full-year report, 1 January – 31 December 2025
Scandinavian Tobacco Group A/S Reports Full-Year Results and Proposes a DKK 4.50 Dividend Per Share
Scandinavian Tobacco Group´s reported net sales for the full year decreased 1.8% to DKK 9.0 billion in 2025 with a negative organic growth of 3.1%. Excluding the impact from the discontinued distribution of third-party nicotine pouch products in our online business, organic net sales growth was -1.8%. The EBITDA margin before special items was 19.8%, the free cash flow before acquisitions was DKK 0.6 billion and the adjusted EPS was DKK 10.8. The Board of Directors will propose a DKK 4.50 ordinary dividend per share equal to a pay-out ratio of 42%.
Free cash flow before acquisitions for both the quarter and the full year was more than DKK 200 million lower than expected as result of delays in the collection of receivables associated with our new ERP implementation in Europe. This issue has now been resolved and working capital is anticipated to return to normal levels in the coming months. The delayed payments are expected to have a positive effect on cash flow during the first half of 2026.
In the fourth quarter, reported net sales declined 4.6% to DKK 2.3 billion with a negative organic growth of 0.5%. The EBITDA margin before special items margin was 19.5% compared with 24.3% in the same quarter last year and the free cash flow before acquisitions amounted to DKK 0.1 billion.
Exchange rate fluctuations had a negative impact on reported net sales by over 4% during the quarter. Organic growth was positive in the Handmade Cigars and Next Generation Products categories, remained unchanged in Machine-Rolled Cigars & Smoking Tobacco and was negative in the category Other. The decline in the EBITDA margin before special items was primarily driven by a combination of product and market mix as well as increased promotional spending in our North American online business. The change in mix mainly reflects strong net sales growth for nicotine pouches combined with lower sales of smoking tobacco products. For the full year, the EBITDA margin before special items was 19.8% in line with our guidance.
CEO Niels Frederiksen commented:
“2025 was a challenging year for our Group with U.S. tariffs, weak consumer sentiment in the U.S., currency headwinds and disruptions caused by the roll-out of our global ERP solution. Throughout the year, we have focused on protecting our market positions, integrating Mac Baren and growing our nicotine pouch business. Given these circumstances, we are satisfied with our results. However, our earnings have declined and as we begin implementing our new Focus2030 strategy, we are committed to stabilising earnings, revitalising our strong handmade cigar business and continuing to grow our promising nicotine pouch business”.
Fourth Quarter 2025
- Reported net sales decreased by 4.6% to DKK 2.3 billion (DKK 2.5 billion)
- Organic net sales growth was negative by 0.5% (-1.0%)
- EBITDA margin before special items was 19.5% (24.3%)
- Adjusted EPS were DKK 2.6 (DKK 3.8)
- Free cash flow before acquisitions was DKK 147 million (DKK 604 million).
- Return on Invested Capital (ROIC) was 7.9% (9.4%).
Full-Year 2025
- Reported net sales decreased by 1.8% to DKK 9.0 billion (DKK 9.2 billion)
- Organic net sales growth was negative by 3.1% (0.4%)
- EBITDA margin before special items was 19.8% (22.6%)
- Adjusted EPS were DKK 10.8 (DKK 13.7)
- Free cash flow before acquisitions was DKK 595 million (DKK 931 million)
Financial expectations for full-year 2026
For 2026, we expect the consumer trends unchanged for most of our product categories and markets to remain broadly similar to historic trends.
The financial expectations for the full-year 2026 are:
Reported net sales growth at constant FX from -2% to 2%
EBIT margin before special items in the range of 13.0% – 14.5%
Free cash flow before acquisitions DKK 950 – 1,200 million
Adjusted EPS DKK 9 – 11
Guidance and assumptions are based on no impact from potential new acquisitions and at current exchange rates. A 10% change in the USD/DKK exchange rate would impact group net sales by approximately 5 percentage points with EBIT margins being only marginally impacted.
The expectation for the EBIT margin before special items reflects that 2026 will be a year of stabilisation and that we will continue investing to facilitate our long-term ambitions in Focus2030. The expectation for free cash flow before acquisitions reflects the delayed payments of trade receivables negatively impacting 2025 which will be recovered during the first half of 2026. The leverage ratio is expected to move towards our target ratio during 2026 based on an expectation of a more or less unchanged EBITDA before special items compared with last year.
For further information, please contact:
Torben Sand, Director of IR & Communication, phone +45 5084 7222, torben.sand@st-group.com.
Eliza Dabbagh, IR & Communications, phone +45 5080 7619, eliza.michael@st-group.com.
A conference call will be held on 5 March 2026 at 10.00 CEST. Dial-in information and an accompanying presentation will be available at investor.st-group.com/investor around 09:00 CEST.
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