The European Bank for Reconstruction and Development (EBRD) is providing a $30 million financial package to Astarta, one of the country’s largest sugar producers, to cope with the adverse conditions caused by Russia’s war against Ukraine and ensure more sustainable operations.
According to the agroholding’s announcement on the Warsaw Stock Exchange website Friday, the package consists of a $21 million loan from the EBRD and $9 million from the Clean Technology Fund (CTF) aimed at sustainable development. Technical cooperation support for the legal review of the operation will be provided by the Technical Cooperation Fund of Japan and the EBRD.
“Funding for the holding company’s investment plan will help Astarte continue to develop agriculture, soybean processing and sugar production amid the instability associated with the war. The liquidity support provided through this loan will help support operations and maintain the production and export volumes needed for food security, while supporting Astarta’s nearly 7,000 employees along with employees of supply chain partners,” the statement noted.
According to the agri-holding, the financing will be used to modernize and improve the energy efficiency of existing production facilities, implement climate-smart agricultural practices to improve business sustainability, reduce production and energy costs while improving productivity and operational efficiency. The funds raised will also be used as working capital to support the agricultural holding’s operations at pre-war levels.
This is the first transaction in Ukraine supported by the EBRD’s High Impact Climate Program for the corporate sector financed by the Clean Technology Fund. The loan is characterized by an innovative blended finance structure where the price is linked to achieving climate change goals, Astarta noted.
As reported, the EBRD, which accelerated lending to Ukraine after the Russian invasion in February 2022, pledged to invest €3 billion in the country between 2022 and 2023. Food security is one of the five priority investment areas, along with energy security, vital infrastructure, trade finance and private sector support.
“Astarta is a vertically integrated agro-industrial holding operating in eight regions of Ukraine. It consists of six sugar factories, farms with land bank of 220 thousand hectares and dairy farms with 22 thousand cattle, oil extraction plant in Globino (Poltava region), seven elevators and biogas complex.
Agroindustrial holding Astarta, the largest sugar producer in Ukraine, received EUR65.16 mln of net profit in 2022, which is 46.8% less compared with 2021. The company’s EBITDA decreased by 23.2% to EUR154.77 mln last year, while revenues increased by 3.8% to EUR510.07 mln.
Agro-industrial holding Astarta, the largest sugar producer in the country, has expanded its irrigated area up to 1 thousand hectares and purchased five sprinklers, the company said on Facebook.
“The project is implemented in the IPK “Poltavazernoprodukt” Astarta-Kyiv Ltd. To the three sprinkler machines were added five more. For this purpose, we purchased four more frontal machines and one circular machine, in order to maximally cover the planned area with irrigation”, – said the agricultural holding.
The new sprinklers have already been put to work on the fields with sugar beets and hybrid corn. There are 14 hydro technicians working in shifts to maintain the machines. Water for irrigation is supplied by Poltava Regional Water Resources Office. To supply it to the fields, the agricultural holding restored and additionally laid about 10 km of communications, explained in “Astarta”.
Restoration of the irrigation system in the agrofirm began back in 2015 on an area of 300 hectares with drip irrigation.
“Currently, the project has been successfully implemented, despite all the economic difficulties and the war,” summarized in the agricultural holding.
“Astarta” is a vertically integrated agro-industrial holding operating in eight regions of Ukraine. It consists of six sugar factories, farms with land bank of 220 thousand hectares, dairy farms with 22 thousand cattle, oil extraction plant in Globino (Poltava region), seven elevators and biogas complex.
Agricultural holding in 2021 increased net profit 14 times compared with 2020 – up to EUR 122.5 mln, EBITDA – 1.8 times, up to EUR 201.5 mln. Its revenue increased by 18.2% – to EUR 491.35 mln, one third of which (EUR 170 mln) was generated by sugar production and sales.
Agropromholding Astarta, the largest sugar producer in Ukraine, received EUR16.13 mln in net profit in Q1 2023, which is 6.2 times more as compared to Q1 2022, according to the company report on the Warsaw Stock Exchange.
According to it, during this period revenues increased by 37.1% to EUR163.55 million, gross profit – 2.2 times to EUR59.71 million, operating – 2.4 times to EUR25.92 million and EBITDA – 63.5% to EUR37.91 million.
In UAH Astarta net profit in the first quarter of this year increased 7.5 times – to 632.59 million UAH, while revenues increased by 66.6% – to 6 billion 415.09 million UAH.
It is noted that all business segments have improved, but the best result was shown in the agricultural segment, which brought EUR80 million of revenue, which is 28% more than last year, which is 49% of the total consolidated revenue.
Revenue from the Sugar Production segment increased 86% over the same period last year, to EUR37 million, and revenue from the Soybean Processing segment increased 20%, to EUR31 million.
The livestock segment generated revenue of EUR11 million compared to EUR10 million in the first quarter of 2022.
In the structure of EBITDA the main shares are in the agriculture segment – EUR10.50 million (EUR12.74 million in the first quarter of 2022), sugar production – EUR11.66 million (EUR4.34 million) and soybean processing – EUR10.22 million (EUR4.24 million in the first quarter of 2022).
“Astarta noted that export revenues increased by 39% year-on-year to EUR98 million, accounting for 60% of total revenues.
It points out that capital investment in the first quarter of this year was EUR3.25 million compared to EUR4.84 million in the first quarter of last year, while net financial debt decreased during the quarter from EUR43 million to EUR17 million after bank debt and net debt decreased from EUR152 million to EUR130 million.
The report also states that Astarta is continuing its spring planting campaign in all seven of its areas of presence. Rainy and cold weather slowed it down, but was favorable for the development of winter crops.
The company has revised its 2023 crop rotation. The area under winter crops was 57 thousand hectares, including 43 thousand hectares of wheat and 14 thousand hectares of rape, while the area under corn and sunflower is planned at 19 thousand hectares and 28 thousand hectares. Soybean area will increase to 56 thousand hectares, to increase the volume of its own raw materials for the processing plant.
“Astarta” reported that the sowing of sugar beet is already completed, its area is 39 thousand hectares, which is 20% more than in 2022.
The area under organic crops remains unchanged at 2 thousand hectares.
As reported, Astarta received EUR65.16 million in net profit in 2022, a decrease of 46.8% compared to 2021. EBITDA of the holding in the past year decreased by 23.2% – to EUR154.77 million, while revenue increased by 3.8% – to EUR510.07 million.
The main shareholders of Astarta at the end of the first quarter were the family of the founder and CEO Victor Ivanchik, Fairfax Financial Holdings LTD – 29.21%. Another 2.64% belonged to Kopernik Global Investors, 1.88% to Heptagon Capital and 0.62% to Metlife PTE SA.
Shareholders of agroholding Astarta will consider paying a dividend of EUR0.5 per share for 2022, worth EUR12.5 mln, the company said in a statement on the Warsaw Stock Exchange.
According to the statement, the distribution of profits for the previous year will be discussed at the May 24 shareholder meeting, which will be held on April 19.
In addition, shareholders are expected to instruct the board to hold talks with the company’s current auditor, PricewaterhouseCoopers, and its competitors, Ernst & Young, KPMG, Deloitte & Touche and Baker Tilly, and, depending on the outcome, appoint one of these firms as external auditor.
As reported, Astarta first paid a EUR12.155 million dividend in June 2021 based on its 2020 performance in the same amount as currently proposed – EUR0.5 per share. In the military year 2022, the company refused to pay them.
Agropromholding Astarta, the largest sugar producer in Ukraine, received EUR65.16 million in net profit in 2022, down 46.8% from 201.
Holding EBITDA last year decreased by 23.2% – to EUR154.77 mln, while revenues increased by 3.8% – to EUR510.07 mln.
Astarta shares rose 1 percent last Friday to PLN30.45 per share (about EUR6.6 per share).
“The company’s policy is to pay dividends at a level consistent with the Group’s growth and development plans, while maintaining a reasonable level of liquidity. The dividend policy will, however, be reviewed from time to time and the payment of any future dividends will actually be at the discretion of the general meeting of shareholders upon recommendation of the board of directors and taking into account various factors, including business prospects, future earnings, cash requirements, financial situation, expansion plans and Cyprus law requirements,” the company said in the dividend policy.
Agro-industrial holding Astarta does not expect a significant drop in income because of the ban on imports of agricultural products from Ukraine imposed by Poland and other neighboring countries, as it intends to export its products to Western European countries, representatives of the company’s board said at an online conference on Tuesday.
“We have permission to transit through these countries. Rather, our export targets are Western European countries, such as Spain, Italy, Greece and Croatia. We don’t see much risk to our revenues,” Infostrefa quoted Astarta Commercial Director Vyacheslav Chuk as saying from a conference call Tuesday.
Julia Bereshchenko, director of investor relations, expressed confidence that Astarta will be supported by expected sugar shortages in the EU and world market.
“Sugar shortages are expected not only in the EU, but worldwide as the world’s largest sugar producers, such as Brazil and India, begin to use sugar to produce ethanol. This could potentially reduce these countries’ exports,” she said.
As reported, Astarta agro-industrial holding, the largest sugar producer in Ukraine, received EUR65.16 million net profit in 2022, down 46.8% compared to 201.
The holding’s EBITDA shrank by 23.2% to EUR154.77 mln, while revenues increased by 3.8% to EUR510.07 mln.
Agricultural holding “Astarta”, the largest sugar producer in Ukraine, in October-December 2022, reduced sales of the product by 27.7% compared to the same period in 2021 – up to 62.1 thousand tons, but its average selling price rose by 43.6% – to 25.62 thousand UAH per ton.
According to the agrarian group’s report on the Warsaw Stock Exchange on Tuesday evening, milk sales in the fourth quarter of 2022 increased 9% to 26,500 tons.
Soybean oil sales jumped 75.3% to 10,700 tons, wheat 2.9 times to 135,200 tons, and rapeseed more than 2.9 times to 12,400 tons,
At the same time, soybean meal sales fell by 8.2% to 26.5 thousand tons, sunflower seed – by 8.3% to 23.3 thousand tons, corn – 4 times to 82 thousand tons.
Agroholding specified that the average cost of soybean oil sold in October-December, 2022 increased by 28.1% up to 44.67 thousand UAH/ton, soybean meal – by 23.5% up to 17.54 thousand UAH/ton, milk – by 8.8% up to 13.73 thousand UAH/ton, corn – by 66.5% up to 9.6 thousand UAH/ton, wheat – by 25.3% up to 9.4 thousand UAH/ton.
Only sunflower seed went down in price – by 7.4%, to 15.94 thousand UAH/ton.
Thus, taking into account the volume of sold products and their average price, we can tentatively estimate the growth of Astarta’s revenues in the fourth quarter of last year compared to the fourth quarter before last year at 7.4% – up to UAH 5 billion 796.4 mln. In particular, sugar decreased by 3.7% to UAH 1 billion 589.5 million, wheat – 3.6 times to UAH 1 billion 270.3 million, rapeseed – almost 2.9 times to UAH 280.3 million, soybean oil – 2.2 times to UAH 488.6 million, soybean meal – by 13.4% to UAH 644.7 million and milk – 18.6% to UAH 363.2 million.
Meanwhile, sales of corn decreased 58.8% to UAH 787.7 mln, while sunflower sales decreased 15% to UAH 372.1 mln.
The company also reported that to date it has harvested corn from 90% of the area, its average yield is estimated at 9 tons per hectare.
“Astarta is a vertically integrated agro-industrial holding operating in eight regions of Ukraine. It consists of six sugar factories, farms with land bank of 220 thousand hectares and dairy farms with 22 thousand cattle, oil extraction plant in Globino (Poltava region), seven elevators and biogas complex.
In 9M2012, Agropromholding received EUR102.2 mln, which is 11.7% more than in 9M2012. 9M2012 Agroindustrial Holding received net profit amounting to EUR 102.2 mln, which is 39.3% less compared with the same period of the previous year, while its revenue increased by 13% – to EUR 341.3 mln.
In UAH terms Astarta’s net profit for 9M2012 decreased to EUR 341.3 mln. Astarta decreased its net profit by 38.6% – to UAH 2 bln 76.15 mln, while its revenue increased by 14.7% – to UAH 11 bln 268.54 mln.
