Akola Group's Food Pivot Shields Against Agricultural Headwinds

VILNIUS, LITHUANIA – May 20, 2026 – AB Akola Group, the largest agribusiness and food production group in the Baltics, has reported financial results that paint a vivid picture of a company navigating a turbulent agricultural market by leaning on a strategic pivot towards higher-margin food production. While headline figures show a modest decline from a record-breaking previous year, the underlying performance reveals a story of resilience, with the company's 'field to fork' model being put to the ultimate test.

For the first nine months of the 2025/2026 financial year, the group posted a consolidated revenue of EUR 1.11 billion, down 5% year-on-year. Consolidated EBITDA reached EUR 66 million, a 7% decrease, while net profit fell by 18% to EUR 26 million.

However, these top-line numbers mask a dramatic divergence within the company's operations. The results underscore a calculated strategy to bolster its food production arm, which has emerged as a powerful engine for profitability, effectively shielding the group from the severe headwinds battering its traditional agricultural segments.

“Assessing the nine-month results, we see a clear signal – our business remains resilient even in an environment of increased uncertainty,” said Mažvydas Šileika, Deputy CEO for Finance and Investments at AB Akola Group. He contextualized the numbers, noting, “The same period last year was exceptional, as we achieved one of the best results in the Group’s history. Therefore, this year’s indicators reflect a more normalized level of performance.”

A Tale of Two Segments

The story of Akola Group's nine-month performance is best told through its two largest divisions. The Food Production segment was a beacon of growth, with revenue climbing nearly 10% to EUR 361 million. More impressively, its operating profit surged by over 53% to EUR 38 million, demonstrating robust margin expansion.

This growth was not accidental. The company highlighted strong performance in its poultry business, where revenue jumped over 10% to EUR 261 million, and gross profit soared by nearly 40%. The success is attributed to a strategic focus on value-added products, improved operational efficiency, and a more favorable product mix. Similar positive trends were seen in convenience foods, with instant porridges and noodles revenue growing 11% to EUR 71 million. The breadcrumbs segment grew even faster, with sales volumes and revenue increasing by nearly a third, driven by export demand and better use of production capacity.

This glowing performance stands in stark contrast to the 'Partners for Farmers' segment, which provides farmers with seeds, fertilizers, and other agricultural inputs. This division, while still the largest by revenue, saw its sales fall by 10.5% to EUR 762 million. Its operating profit plummeted by a staggering 80.7%, collapsing from EUR 20.8 million to just EUR 4 million. This dramatic decline reflects the immense pressure faced by farmers across the Baltic region.

Headwinds in the Heartland

The struggles in Akola Group's farming-related divisions were not isolated but a direct reflection of a deeply challenging agricultural environment in the Baltics throughout 2025 and into 2026. The 2025 grain season was marred by intense and prolonged rainfall, which severely damaged crop quality and hampered winter sowing for the next season. This led to lower quality wheat, barley, and rapeseed, directly impacting farmers' revenues and, by extension, the businesses that serve them.

Compounding the weather-related issues were significant price corrections. Farmers faced a pessimistic outlook as global grain harvests pushed prices down. More acutely, raw milk prices across the EU experienced a steep decline, with Lithuania seeing a 26% year-on-year price drop in January 2026. This directly impacted Akola's own Farming segment, where revenue from dairy farming fell by 6% and the division as a whole swung to an operating loss of EUR 0.5 million.

Simultaneously, operational costs skyrocketed. Farmers across the Baltics reported that prices for essential inputs like nitrogen fertilizer more than doubled. This surge in costs for fuel, fertilizer, and feed created a 'margin test' for the entire agricultural sector, squeezing profitability and reducing investment capacity.

The 'Field to Fork' Fortress

In this difficult environment, the wisdom of Akola Group's integrated 'field to fork' strategy became crystal clear. While the divisions closest to the field suffered, the value-added processing and food production segments thrived, providing a crucial buffer that stabilized the group's overall results.

This model gives the company significant control over its supply chain and, more importantly, allows it to capture more value by transforming raw agricultural commodities into higher-margin consumer products. The Deputy CEO's statement confirmed this is a deliberate strategic direction. “We continue to increase the share of these activities due to their higher margins, lower cyclicality and greater stability,” Šileika noted.

This strategic focus on food production acts as a natural hedge against the inherent volatility of primary agriculture. When grain and milk prices are low, it hurts the farming segment but provides cheaper raw materials for the food processing divisions, boosting their profitability. This internal balance is a key competitive advantage in a sector prone to unpredictable weather and global market swings.

Navigating a 'Normalized' Future

Looking ahead, Akola Group is focused on achieving what it calls a 'normalized' EBITDA level of EUR 70–90 million annually. Based on the current nine-month results, the company is approaching the lower end of this range with one quarter left in the financial year. Achieving this target will depend on the continued strength of its food production arm and a potential stabilization in the agricultural markets.

The broader economic outlook for the region offers some encouragement. The Baltic economies are projected to see growth accelerate in 2026, outpacing the EU average, which could support consumer demand for Akola's food products. However, the pressures on the farming community remain a significant risk.

Ultimately, Akola Group's recent performance is a compelling case study in strategic adaptation. By consciously shifting its center of gravity towards value-added food manufacturing, the company has built a more resilient business model capable of weathering the storms that periodically sweep through the agricultural landscape. Its ability to generate strong profits in its food division while its farming segments struggled is not a sign of internal contradiction, but rather a validation of a strategy designed for long-term stability and growth.