Milkiland reports final results for 2014, updates on debt



5 травня 2015 года
Конкорд Капитал

Milkiland (MLK)


Milkiland (MLK PW), the Ukrainian dairy company focused on the Ukrainian, Russian and Polish markets, reported its final results for 2014 on April 30, which are slightly better than its preliminary results posted on March 26. Its 2014 revenue was EUR 288.7 mln, a 15% yoy drop but 1% better than earlier guided. Its EBITDA fell 49% yoy to EUR 17.1 mln, while being 2% better than earlier guided. Milkiland’s bottom line was negative EUR 72.4 mln in 2014 (vs. positive EUR 11.7 mln a year ago), which can be only partially explained by foreign currency conversion differences. Revaluation of foreign currency loans incurred costs of EUR 65.2 mln in 2014 (vs. EUR 0.7 mln in 2013).

The share of the Russian market in Milkiland’s revenue structure decreased to 57% in 2014 (from 62% in 2013) as the company nearly stopped supplying its dairy products to Russia from its Ukrainian plants last year, due to restrictions imposed by the Russian government. At the same time, revenue at the company’s Russian assets increased in 2014 (+4% yoy in EUR terms to EUR 151.4 mln) due to decreased competition in that market. The company’s new Polish asset Ostrowia posted a 77% yoy increase in revenue in 2014 (to EUR 26.7 mln), while revenue at its Ukrainian assets fell 35% yoy to EUR 136.5 mln.

Milkiland’s total debt slightly decreased to EUR 101.9 mln, while short-term debt grew 22% yoy to EUR 96.4 mln. The company’s net debt remained flat yoy at EUR 91.5 mln. Its net debt/LTM EBITDA ratio jumped to a worrying 5.4x in 2014 from 2.7x in 2013.

The company reported it is continuing negotiations with its creditors to restructure its borrowings. It is expecting to sign a stand-still agreement with providers of a USD 58.6 mln syndicated loan (of which USD 24.7 mln is overdue) and agree on the long-term restructuring of a loan provided by Credit Agricole Bank (USD 14.5 mln) by end-June. The company is also working with other lenders on restructuring. Naturally, negotiations with debt holders will be the key priority for Milkiland in 2015. Its capital expenditures will be limited to maintenance level (EUR 2.0 mln) due to its debt covenants.

In its business, the company will focus this year on expanding on local markets for its Polish and Russian plants, as well as on new export destinations.

Источник: Конкорд Капитал



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