The agro-industrial group Kernel is negotiating with its creditors to defer the repayment of debt obligations that have grown to a record high since the beginning of the Russian military invasion of Ukraine – up to $1.95 billion as of June 30, 2022, which is 37% more than its amount as of the same date in 2021 of the year.
According to a financial report on the holding’s website on Wednesday night, this increase in debt was mainly due to a sharp increase in short-term debt raised to replenish working capital in the winter of 2021-2022 and outstanding by the summer of 2022 due to Russian aggression and related with it negative factors.
According to the group of companies, its net debt obligations by June 30, 2022 increased by 1.8 times compared to the same date last year – to $ 1.49 billion, and the ratio of debt to EBITDA jumped to a record five-year ratio of 6.8x compared to 1.0x in 2021.
“The Russian invasion began just at the peak of our working capital cycle, when we had the highest seasonal debt level of $1.95 billion in the history of the company and an all-time high inventory of $0.9 billion. Fortunately, we entered into this is a turbulent time in a relatively good financial condition, so we continued to service our debt, but we were forced to negotiate a deferral of repayment of the principal debt to creditors,” the holding said in a statement.
Kernel recalled that the first such negotiations allowed it to defer the repayment of the principal amount of the debt until September 30, 2022, and now it is negotiating to extend the delay until June 30, 2023.
“As of the day of this report, we received refusals to extend the maturity of the principal debt in the amount of $627 million with creditors until June 30, 2023. For debt obligations totaling $246 million, we are in the process of issuing such refusals,” the holding emphasized in the report .
Kernel specified that in December 2021 it completed the early redemption of Eurobonds for $213 million, reducing the total amount of Eurobonds maturing in 2022 to $595 million.
“Due to the fact that the group did not have an unconditional right to defer settlements of 12 months or more in relation to its banking services as at June 30, 2022, $198 million of long-term bank loan balances and $595 million of Eurobonds outstanding were reclassified as short-term as of June 30, 2022,” the holding said in a statement.
Also, according to him, by June 30, 2022, Kernel pledged 370,000 government bonds of Ukraine in the amount of $6.08 million as collateral for previously taken short-term loans.
“While we have completed one of the most difficult periods in our history, the prospects for the future remain unclear and will greatly depend on the outcome of the war in Ukraine and the group’s ability to export agricultural products through the Black Sea ports of Ukraine,” the holding stated.
Before the war, Kernel ranked first in the world in the production of sunflower oil (about 7% of world production) and its export (about 12%), and was also the largest producer and seller of bottled sunflower oil in Ukraine. In addition, the company was engaged in the cultivation of other agricultural products and their sale.
The largest co-owner of Kernel through Namsen Ltd. is Ukrainian businessman Andrey Verevsky with a share of 39.3%.
Agro-industrial group Kernel, the largest producer of vegetable oil in Ukraine, will publish its consolidated report for the 2022 financial year (FY, July-2021 – June-2022) on November 10 instead of the previously scheduled date of October 28.
As indicated in the message of the holding on the Warsaw Stock Exchange on Wednesday, the postponement was caused by the collection of additional information about the consequences of Russian aggression in Ukraine.
It is specified that on the day of the publication of the report, the management of Kernel will not hold a regular telephone conference, since “no information in addition to that published in the report should be presented during such a conference.”
“The management does not intend to make any recommendations or forecasts regarding the future activities of the company, given the uncertainty prevailing in Ukraine due to the Russian invasion. The company will return to the usual practice of arranging quarterly calls after the lifting of martial law in Ukraine,” the agricultural holding emphasized in an exchange message. .
In addition, the group of companies will continue to analyze the consequences of Russian aggression in Ukraine and inform all parties interested in the company’s activities about updates and changes in the work of Kernel.
Before the war, Kernel ranked first in the world in the production of sunflower oil (about 7% of world production) and its export (about 12%), and was also the largest producer and seller of bottled sunflower oil in Ukraine. In addition, the company was engaged in the cultivation of other agricultural products and their sale.
The largest co-owner of Kernel through Namsen Ltd. is Ukrainian businessman Andrey Verevsky with a share of 39.3%.
The agricultural holding in fiscal year 2021 (FY, July 2020 – June 2021), increased its net profit by 4.3 times compared to FY 2020 – up to $513 million, its EBITDA increased 2.1 times – up to $929 million, revenue – by 38%, to $5.65 billion.
Agro-industrial group “Kernel”, the largest producer of vegetable oil in Ukraine, will publish a consolidated report for fiscal year 2022 (FY, July-2021 – June-2022) on October 31, 2022 due to the unstable situation in Ukraine in the context of the Russian invasion.
As stated in the message of the holding on the Warsaw Stock Exchange, the management of Kernel in this fiscal year will not hold a regular conference call on the day the report is published, since “no information in addition to that presented in the report should be presented during such a conference.”
“The management does not intend to make any recommendations or forecasts regarding the future activities of the company, given the uncertainty prevailing in Ukraine due to the Russian invasion. The company will return to the usual practice of arranging quarterly calls after the lifting of martial law in Ukraine,” the agricultural holding emphasized in an exchange message. .
In addition, the group of companies will continue to analyze the consequences of Russian aggression in Ukraine and inform all parties interested in the company’s activities about updates and changes in the work of Kernel.
Before the war, Kernel ranked first in the world in the production of sunflower oil (about 7% of world production) and its export (about 12%), and was also the largest producer and seller of bottled sunflower oil in Ukraine. In addition, the company was engaged in the cultivation of other agricultural products and their sale.
The largest co-owner of Kernel through Namsen Ltd. is Ukrainian businessman Andrey Verevsky with a share of 39.3%.
The agricultural holding in fiscal year 2021 (FY, July 2020 – June 2021), increased its net profit by 4.3 times compared to FY 2020 – up to $513 million, its EBITDA increased 2.1 times – up to $929 million, revenue – by 38%, to $5.65 billion.
Agroindustrial holding “Kernel” has completed the harvesting campaign of early grains in 2022, having collected, according to the calculations of the Interfax-Ukraine agency, at least 364 thousand tons of winter wheat.
As reported on the holding’s Facebook page on Monday, the winter wheat crop was harvested from an area of more than 70,000 hectares with a yield of 5.2 tons/ha.
At the same time, it is specified that the harvesting of early grains and rapeseed was completed before the end of August, despite adverse weather conditions.
“The sowing and harvesting campaigns were complicated by the military situation and weather conditions. Due to precipitation, grain harvesting continued for almost 40 days. Prolonged rains in some regions led to a deterioration in the quality indicators of the grown grain,” explained Igor Chikin, director of the Agribusiness segment, quoted by the press agricultural holding service.
According to him, the agro-industrial group experienced major organizational difficulties in the spring during the Russian large-scale invasion, when the holding was unable to grow winter crops according to the required technology. However, subsequently Kernel managed to optimize the technology and costs, carry out top dressing and protection of crops, thanks to which it was possible to get a good harvest.
The agricultural holding specified that the yield of winter rapeseed in the current season reached 3.4 tons/ha, varying between 2.8-3.7 tons/ha.
Before the war, Kernel ranked first in the world in the production of sunflower oil (about 7% of world production) and its export (about 12%), and was also the largest producer and seller of bottled sunflower oil in Ukraine. In addition, the company was engaged in the cultivation of other agricultural products and their sale.
The largest co-owner of Kernel through Namsen Ltd. is Ukrainian businessman Andrey Verevsky with a share of 39.3%.
The agricultural holding in fiscal year 2021 (FY, July 2020 – June 2021), increased its net profit by 4.3 times compared to FY 2020 – up to $513 million, its EBITDA increased 2.1 times – up to $929 million, revenue – by 38%, to $5.65 billion.
The Turkish vessel Polarnet, which left the port of Chornomorsk (Odessa region) on August 5 with 12,000 tons of corn from the Kernel agricultural holding, arrived at the Turkish port of Derince on August 8.
Kernel completed one of the most important missions – the first ship with Ukrainian grain arrived at its destination. The shipment was carried out as part of the initiative for the safe transportation of grain and food from Ukrainian ports,” the group of companies wrote on Facebook on Tuesday.
It is specified that the ship was loaded with corn at the Transbulkterminal grain terminal in Chornomorsk, which is part of Kernel. In the 2020/2021 marketing year (MY, July-June), the terminal handled 7.6 million tons of grain crops, which is 22% more than in MY 2019/2020, and became the largest in the country in terms of transshipment of agricultural products.
Agropromholding emphasized that Ukrainian agricultural exporters remain key suppliers of foreign exchange earnings to Ukraine, which is an important positive factor for the economy of the warring country.
“If we manage to maintain the trend and increase exports, farmers will not have to reduce the area under crops, and Ukraine will feel a deficit in state budget revenues,” Kernel summed up in the message.
Before the war, Kernel ranked first in the world in the production of sunflower oil (about 7% of world production) and its export (about 12%), and was also the largest producer and seller of bottled sunflower oil in Ukraine. In addition, the company was engaged in the cultivation of other agricultural products and their sale.
Its largest co-owner through Namsen Ltd. is Ukrainian businessman Andrey Verevsky with a share of 41.3%.
The agricultural holding in fiscal year 2021 (FY, July 2020 – June 2021), increased its net profit by 4.3 times compared to FY 2020 – up to $513 million, its EBITDA increased 2.1 times – up to $929 million, revenue – by 38%, to $5.65 billion.
Kernel, one of the largest Ukrainian agro-industrial groups, in the 2022 financial year (FY, July 2021-June 2022) reduced sales of vegetable oil (sunflower and rapeseeds) by 29% compared to FY 2021 – to 967,000 tonnes from 1.37 million tonnes, the total processing of oilseeds – by 31%, to 2.19 million tonnes from 3.18 million tonnes.
According to a report published on the company’s website, the decline in production and sales of oilseeds and vegetable oil was caused by the blockade of Ukrainian seaports by warships of the aggressor country of the Russian Federation, as a result of which the active harvesting, processing and export of grain and sunflower oil was stopped.
It is specified that in the fourth quarter of FY2022 (March 2022-June 2022), Kernel sold 60,800 tonnes of sunflower and rapeseeds oil (less by 78% compared from the fourth quarter of FY2021) and processed 156,600 tonnes of oilseeds crops.
The total export of agricultural crops by Kernel in the fourth quarter of FY2022 decreased by 93% compared to the same period of the last fiscal year, to 123,000 tonnes, while in FY2022 the reduction was 1% – to 7.97 million tonnes.
In total, in the fourth quarter of FY2022, the group of companies increased the volume of agricultural products delivered to its elevators by 12% compared to the fourth quarter of FY2021, to 65,500 tonnes, while for the entire FY2022, some 4.19 million tonnes of agricultural raw materials were delivered to elevators – 10% more than in FY2021.
“The situation with the group’s critical infrastructure remains unchanged. The group’s two oil extraction plants in Kharkiv region, located in the temporarily occupied territories, remain inaccessible. The new granaries were not damaged, except for two silos with a capacity of 74,000 tonnes, which were badly damaged in the spring of 2022,” the group said.
“Since the beginning of the war with Russia, 1,150 of our employees have been mobilized into the Armed Forces of Ukraine or joined the defense units. Of these, 460 were demobilized and returned to work,” the agricultural holding stated.
Kernel also noted with regret that 11 of its employees were killed in Ukraine due to the military aggression of the Russian Federation.
