Astarta announces strong 9M15 financials, sugar segment outlook



10 ноября 2015 года
Конкорд Капитал

Астарта (AST)


Ukraine’s integrated farming and food company Astarta (AST PW) reported its 9M15 financial results on Nov. 9 after hours. Its revenue decreased 19% yoy to EUR 200.1 mln, with declines in all its segments, caused only by devaluation of the local currency. Revenue in its core segment, sugar, declined 13% yoy to EUR 103.8 mln, as sugar prices did not catch up to UAH devaluation. In volume terms, Astarta boosted sugar sales 13% yoy to 266 kt in 9M15. Its second-most important segment, soybean processing, demonstrated a 25% yoy decline in revenue to EUR 39.1 mln, while volumes of soybeans processed increased 12% yoy to 156 kt. The company attributed this revenue decline to increased third-party soybean processing under tolling, which “allowed for healthy profitability.” The company did not disclose segment’s profits.

Astarta’s EBITDA increased 2% yoy to EUR 108.1 mln in 9M15, mostly due to the higher value of IAS 41 gains (up 16% yoy to EUR 55.3 mln). An 11% yoy increase in operating cash flow before working capital changes (to EUR 60.1 mln) confirms the company’s healthy EBITDA stats. Its net debt decreased 5% yoy and 1% qoq to EUR 203 mln, while its net debt/LTM EBITDA ratio stood at a safe level of 1.66x, as of end-9M15.

Astarta’s net profit amounted to EUR 27.0 mln in 9M15 (compared to a net loss of EUR 17.4 mln a year before). Such improvement in bottom line was mostly the result of the company’s halved yoy foreign currency translation losses to EUR 44.0 mln.

The company highlighted good preconditions for its sugar segment to improve profit in the coming season. Firstly, Astarta will enjoy a 45% yoy reduction in natural gas prices this season, in EUR terms, as well as a 10% yoy decrease in fossil fuel use per ton of sugar produced (fuel accounts for about 40% of sugar costs). Secondly, Astarta reports its sugar extraction ratio at a record-high level of 16% this season (vs. ~15% last year), which is an important factor to reduce unit costs of sugar. Thirdly, the emerging deficit of sugar on the local market (expected production this season is 1.2-1.3 mmt, vs. last year’s results of 2.1 mmt and domestic demand of about 1.8 mmt) already enables the company to benefit from a sugar price increase. Global sugar prices will also tend to increase amid declining output at key markets, Astarta expects.

Alexander Paraschiy: Astarta managed to significantly improve its revenue and EBITDA trends in 9M15, as compared to 1H15, when the declines in these indicators were 23% yoy and 22%, respectively. We expect the strong momentum on the sugar market – and Astarta’s improved cost efficiency in the segment – will drive its profitability in 4Q15. That said, we have now become much more optimistic of Astarta’s ability to improve its EBITDA and operating cash flow in 2015, in yoy terms, as well as to report yoy improvements in the first quarters of the next year. We retain our cautiously positive view on Astarta stock.

Источник: Конкорд Капитал



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