Industrial Milk reports flat EBITDA, bottom line surge in 1H15



31 августа 2015 года
Конкорд Капитал

Industrial Milk Co (IMC)


Farmer Industrial Milk Company (IMC PW) generated USD 73.9 mln in net revenue in 1H15, a 10% yoy decrease, according to the company’s earnings report released on Aug. 27. As tradition, most of its revenue came from sales of corn, which reached USD 70.0 mln, a 4% yoy decline that is solely based on a drop in the average selling corn price by 23% yoy in dollar terms.
Deliveries of corn increased 25% yoy to 450 kt in 1H15. As the company's costs declined faster than revenue, IMC posted a 5% yoy increase in gross profit. Its EBITDA underwent a correction of 1% yoy to USD 57.9 mln, but net profit surged to USD 27.0 mln, up from USD 0.1 mln a year before. The latter was a result of halved ForEx losses to USD 20.2 mln in 1H15.

The company generated USD 20.2 mln in cash from operations, which reduced its leverage. The company’s CapEx, therefore, was less than USD 1 mln in 1H15, compared to almost USD 24 mln in the same year-ago period. Its net debt fell USD 24 mln YTD to USD 101 mln, as of end-1H15, and its net-debt-to-LTM EBITDA improved to 1.77x from 2.17x as of end-2014.

Alexander Paraschiy: As IMC hinted a month ago, its focus in 2015 will be on deleveraging, which is the best choice given the tough conditions on the Ukrainian debt market. In general, its 1H15 P&L looks better than we anticipated, but we still expect that IMC will report much weaker results in the second half of the year, mostly due to continued corn price weakness and expected higher costs of the new harvest. Despite this, we maintain our view on IMC as one of the most promising stocks in the Ukrainian equity universe.

Источник: Конкорд Капитал



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