KYIV. Nov 30 (Interfax-Ukraine) – Kernel, a large Ukrainian agrarian group, saw a 2.6-fold rise in net profit in Q1 FY2017 (July 2016-June 2017) year-over-year, reaching $63.07 million.
The company said in a report its revenue in July-September 2016 grew by 2%, to $384.06 million stemming from y-o-y increase in sales volumes and lower international agricultural prices.
Gross profit increased 28% year-over-year to $94.7 million in Q1 FY2017, as a result of positive revaluation of biological assets, and improved operating performance of our infrastructure and farming divisions. Earnings before interest, taxes, depreciation and amortization (EBITDA) increased by 31.4%, to $72.4 million and profit from operations – by 43%, to $58.5 million.
The company decreased net debt by 16%, reaching $326.2 million as of late September 2016. This resulted in a fall in net debt/ EBITDA ratio to 0.9 from 1.0 a year ago.
Sunflower oil business weak performance in Q1 FY2017 was within expectations (sales fell by 7.8%, to $175.6 million). Sales volumes grew by 7.2%, to 188,600 tonnes. Bottled sunflower oil sales grew by 13.7%, to $23.3 million in money terms and by 20.3% in kind, to 21,300 tonnes.
EBITDA contribution declined to $12.6 million, down 52% year-over-year, due to poor availability of sunflower seeds in the market in May-June 2016, which translated into expensive carry over stock.
Grain business continued to set records in Q1 FY2017 with 1.2 million tons of grain exports, up 27% year-over-year, as we accumulated a presold stock at year ended June 30, 2016. In money terms grain sales grew by 13.3%, to $199.7 million.
Consequently, the gain and infrastructure segment’s EBITDA contribution was $21.9 million, up 4% year-over-year. As a result, the export terminals’ total EBTIDA came to $10.5 million in Q1 FY2017, experiencing a two-fold increase as compared to a year ago. The silo services segment total EBITDA contribution amounted to $7.1 million, up 39% year-over-year.
The company’s farming division posted record revenues of $146 million, 2.6-fold increase year-over-year, with EBITDA at $77.7 million compared to $22.6 million a year ago, stemming from further improvements in farming technology attributable to revaluation of our crops in fields and agricultural produce at the moment of harvest as a result of a double digit growth in yields, and $30.8 million of unrealized profits, arisen upon intragroup sales of agricultural products, which remained unsold to the third parties as of the end of the reporting period.
The total grain and oilseed harvest is expected to increase by 14% year-over-year to 2.13 million tonnes in FY2017.
As reported, Kernel saw a 2.1-fold rise in net profit in FY2016, totaling $225.2 million. Its revenue fell by 14.6%, to $1.989 billion and earnings before interest, taxes, depreciation and amortization (EBITDA) – by 12.7%, to $346.4 million.
Kernel is a vertically integrated company which has been operating in the Ukrainian agribusiness sector since 1994. The group produces sugar and sunflower oil, distributes bottled oil, exports oil and grain and provides elevator storage services for grain and oilseeds.
