Dairy-alts group Oatly is to “discontinue” the building of its second factory in China.
Alongside the publication of Oatly’s 2024 results today (11 February), the business said it had “determined that the production capabilities" at its the existing manufacturing site in Ma’anshan "will be sufficient to support current customers and business growth” even allowing for any possible expansion there.
The Sweden-based business said its numbers for the fourth quarter of 2024 included non-cash impairment charges of $25.1m related to the move.
In December, Oatly said it would close its Singapore manufacturing facility as part of a strategy to reduce costs and take the oat-drinks business into profitability.
Plans for new production facilities in the UK and the US were abandoned in 2023 in connection with Oatly’s so-called “asset-light strategy”.
Announcing the 2024 financials, Oatly CEO Jean-Christophe Flatin said the business expects 2025 to be its “first full year of profitable growth as a public company”.
The group saw its gross profits rise in 2024 – and its operating and net losses come down.
In 2024, Oatly generated a gross profit of $236.5m, compared to $152.1m a year earlier.
A drop in the company’s cost of goods sold, combined with higher revenue, boosted its gross profit.
Revenue increased 5.1% to $823.7m. Volumes increased 8.8%.
Oatly still generated an operating loss of $186.2m, which was lower than the $457m run up in 2023.
The group posted an annual net loss of $202.3m for 2024, versus one of $417.1m a year earlier.
Oatly’s results has given the group confidence it can see further improvement this year.
“Over the past two years, we have executed a significant transformation of our company. We have overhauled our supply chain, our overhead structure, and our mindset. We now have a much healthier business with clear strategies, clear accountability, stronger margins, and significantly improved profitability,” Flatin said.
“I am proud of our team for embracing the challenge, making the necessary changes and focusing on execution. All this hard work has enabled us to now expect 2025 to be our first full year of profitable growth as a public company.”
Just Food has asked Oatly to clarify the profitability metric to which Flatin was referring.
