In January-March 2024, Ovostar Union, a vertically integrated holding company, one of the leading producers of eggs and egg products in Ukraine, increased its total number of hens by 2.7% to 7.31 million, while reducing the number of laying hens by 4.1% to 6.12 million.
According to the group’s report published on the Warsaw Stock Exchange website on Friday, the volume of egg production in the first quarter of 2024 amounted to 331 million eggs, which is 9% less than in the same period of 2023. Accordingly, sales in the egg segment amounted to 211 million units, which is 12.4% less than last year.
Export sales of shell eggs in January-March 2024 also decreased by 22.9% and amounted to 81 million units, which was 38% of the total number of eggs sold in this period in 2024. A year earlier, this figure was 44%, the report says.
At the same time, in the first quarter of 2024, the agricultural holding increased egg processing by 42% to 132 million eggs, while in 2023 this figure was 92 million. Ovostar produced 571 tons of dry egg products and 3.41 thousand tons of liquid egg products, while last year the processing amounted to 406 tons and 3.07 thousand tons, respectively.
Sales of dry egg products amounted to 629 tons, up 18.5% year-on-year, of which 478 tons (76%) were exported. In the first quarter of 2023, 354 tons (67%) of dry egg products were exported to foreign markets.
Sales of liquid egg products amounted to 3.4 thousand tons, up 11% year-on-year, of which 1.14 thousand tons (34%) were exported. A year earlier, 1.29 thousand tons (42%) of liquid egg products were exported.
“In the first quarter of 2023, the volume of egg production decreased due to a slight decrease in the number of laying hens. Given the downward trend in egg prices, the company increased the volume of egg processing, which led to a steady increase in egg production. In the current situation, the management is satisfied with the operating results achieved in the first three months of the year,” said Boris Belikov, CEO of Ovostar Union.
Ovostar Union, a vertically integrated holding company, is one of the leading producers of eggs and egg products in Ukraine. “In the first nine months of 2023, Ovostar earned $29.08 million in net profit, up 12.2 times year-on-year. Its revenue for the nine months increased by 36.3% to $123.06 million, mainly due to higher prices for its products.
Agro-industrial group of companies “Ovostar Union”, one of the leading producers of eggs and egg products in Ukraine, in January-September 2022 reduced the production of chicken eggs in shell by 5.1% compared to the same period in 2021 – 1.19 billion eggs. , while their sales decreased by 2.4% – to 824 million units.
According to the report of the group of companies published on the website of the Warsaw Stock Exchange on Tuesday, Ovostar increased the export of eggs by 6.7% in the first nine months of this year, to 223 million eggs, as a result of which the share of foreign deliveries in the company’s sales increased by 2 percentage points. P. – up to 27% from 25%.
“During the third quarter of 2022, the group’s companies continued to operate under the pressure of risks and uncertainties caused by the ongoing Russian military invasion of Ukraine. Given the specifics of the current operating environment in Ukraine, management assesses the group’s operational results as satisfactory,” said Borys Belikov, CEO of the company. the words of which are given in the message of the holding.
Also, Ovostar processed 339 million eggs in January-September 2022, which is 10% less than its figures for the same period last year.
The number of birds “Ovostara Union” as of September 30, 2022 amounted to 6.84 million heads (14.2% less than on the same date a year earlier), including laying hens – 5.75 million heads (- 13.3%.
Sales of dry egg products of Ovostar for the three quarters of this year decreased by 55.9% compared to January-September 2021 – to 1.16 thousand tons, and the share of their exports in the total sales structure did not change, remaining at the level of 68% .
At the same time, sales of liquid egg products decreased by 26.4% – to 7.53 thousand tons, the share of their exports amounted to 41% against 28% in the same nine months of 2021.
The average selling price of chicken eggs in shell in the specified reporting period of the current year remained at the last year’s level – $0.076/piece, dry egg products increased by 80%, up to $8.63/kg, liquid egg products – by 10%, up to 1 83 $/kg.
The Ovostar Union group of companies is a vertically integrated public holding company, one of the leading producers of chicken eggs and egg products in Europe. The manufacturer has been a certified exporter to EU countries since 2015.
The holding company of the group is Ovostar Union N.V. in mid-June 2011, it held an IPO of 25% of the shares on the Warsaw Stock Exchange and raised $33.2 million. The majority stake in the company is owned by Prime One Capital Limited, which is controlled by its CEO Boris Belikov and chairman of the board of directors Vitaly Veresenko.
Ovostar received $1.65 million in net profit in 2021, which is 38% less compared to 2020. Its EBITDA fell 29% to $5.7 million, while revenue increased 35% to $133.3 million.
Avangard agricultural holding, the largest egg producer in Ukraine, cut monthly production by 50% over the past year due to pressure from law enforcement officers, largely due to the impossibility of organizing the export of its products in such conditions, owner of the agricultural holding Oleh Bakhmatiuk has said. “We now produce 170 million eggs a month, and we produced about 300 million, and in May – 350 million! Of which 170 million were exported in May, and this month we will send for export, maybe 20 million,” he said is in an interview with the Interfax-Ukraine agency.
Bakhmatiuk explained that the company used credit lines for $ 60-70 million for export, since delivery, for example, to Singapore takes 45 days and the supplier needs to be granted a delay.
“But thanks to the valiant actions of the NABU (the National Anti-corruption Bureau of Ukraine), all credit lines were closed to us, we were forced to almost completely close the export direction,” the Avangard owner said, adding that the coronavirus pandemic complicated logistics by making it longer and 30% more expensive.
According to him, out of seven trading houses – in Hong Kong, Singapore, Malaysia, Iraq, Liberia, Saudi Arabia and Dubai, the opening of which took six years and about $ 25-30 million, Avangard retained only one – in Dubai.
Talking about other reasons for the reduction in production, Bakhmatiuk named a painful rise in the price of raw materials, in particular, fat and oil, bagasse and cereals, common for the entire sector.
“This reputational war has been added to the general problems of the sector. In fact, 12 poultry farms have been closed, now the 13th will be closed,” he said, adding that there are 13 operating factories left.
As the businessman noted, such a reduction in production, taking into account fixed costs, led to an increase in the cost of an egg by about 20 kopecks.
Commenting on the rise in egg prices in Ukraine, he called it forced.
“We go to zero profitability and even with a small minus. Because feed prices are growing faster than the demand and the price of eggs are growing,” the businessman explained.
Ovostar Union, a vertically integrated holding company, one of the leading egg and egg products producer in Ukraine, in January-September 2020 cut shell egg sales by 10.5% year-over-year, to 795 million. Lower sales volume is accounted for by reduction of trading activities in the reporting period.
According to a company report on the Warsaw Stock Exchange (WSE) last week, egg production grew by 3.8%, to 1.236 billion. Export of eggs fell by 41.2%, to 266 million eggs. The share of export of total sales was 34% versus 50% a year ago. Average price of eggs fell by 8%, to $0.056 per egg.
The group said that in January-September 2020, 433 million eggs were processed. The output of dry and liquid egg products was 2,597 tonnes (a rise of 19%) and 9,983 tonnes (a fall of 5%).
Sales volume of dry egg products grew by 39%, to 2,417 tonnes, including 71% was exported. Liquid egg products sales fell by 7%, to 9,692 tonnes, including 36% exported.
Average selling price of dry egg products fell by 8% to $4.05 per kg, and average selling price of liquid egg products decreased 16%, to $1.19 per kg.
As of 30 September 2020 total flock of the company was 8.1 million heads demonstrating 3% increase year-over-year. The laying flock grew by 3% year-over-year and reached 6.9 million heads.
“It is worth saying that during the nine months of the year the company has been quite successful in responding to the challenges related the COVID-19 pandemic and unfavorable macroeconomic environment. We have managed to minimize negative effects on the group’s operations and to increase production volumes. In general, the management finds the operational results for the reporting period satisfactory,” CEO Borys Bielikov said.
Milk production in Ukraine in January-August 2020 (excluding the temporarily occupied territory of Crimea, Sevastopol, the JFO zone) decreased by 0.2% compared to the same period in 2019, to 6.46 million tonnes.
According to the State Statistics Service, 2.15 million tonnes of meat (in live weight) were produced in the first eight months of this year, which is 0.2% less than in January-August of the previous year.
Egg production in January-August 2020 decreased by 0.9%, to 11.54 billion eggs.
Gallusman, one of Ovostar Union companies, plans to begin the construction of an egg production complex in Latvia in partnership with the energy company ADVEN in 2021, the project is currently at the stage of assessing potential environmental impacts. According to Ovostar, it is expected that the new production complex will export up to 90% of its products. Another Latvian subsidiary of Ovostar, Ovostar Europe, which since 2015 has been cooperating with the group’s trading partners in the EU countries, will be engaged in export sales. The goal of Ovostar is to enter new markets in Europe and the Middle East.
“Today, the project is at the stage of assessing the potential impact of the new production on the environment. The examination should be completed before the end of this year, and the start of construction work is scheduled for 2021,” the company noted.
It is projected to bring about EUR 100 million investment and 200 new jobs to the Latvian economy.
Ovostar reported that Gallusman and ADVEN had already signed a letter of intent. The partnership of the companies is aimed at finding the best energy and infrastructure solutions for the egg production complex to achieve non-waste production.
“Upon completion of the project, Gallusman will become a leader in the poultry industry and animal feed trade in Latvia, as well as the largest producer of eggs and egg products in Northern Europe,” Ovostar said.
Gallusman is part of the Ovostar Union group. Ovostar Union, one of the leading Ukrainian agricultural holdings, is one of the largest egg producers in Europe. The business model of the company is built on the principle of a full production cycle.
BUILD, EGG, LATVIA, OVOSTAR, PRODUCTION
