Page 52 - UKRRptAug21

9.2 Major corporate news 9.2.1 Oil & gas corporate news
JKX Oil & Gas (JKX LN) produced 4,101 boepd of hydrocarbons in Ukraine in 2Q21, which is 7% more qoq, according to the company’s trading update of July 19. Its total output increased 2% qoq to 9,332 boepd in 2Q21, as production at its Russian assets declined 2% qoq. On a year-on-year basis, the company’s 2Q21 output in Ukraine was 17% less, and total output was 6% less. The key driver for JKX’ qoq increase of Ukrainian output was the commissioning of new well IG149. The well produced on average 915 boepd in June, the company reported. Another new well, IG21, produced on average 50 boepd of hydrocarbons since mid-April. The company is not drilling new wells now, as it is expecting to spud the next well in September. Meanwhile, it is engaged in some well workover operations in Ukraine. In 1H21, the company’s total production reached 9,177 boepd (or 11% less y/y), including 3,973 boepd in Ukraine (23% less y/y). The company reported its end-June cash balance is $35.6mn, which is 2.5x more y/y and 1.5x more YTD.
9.2.6 Agriculture corporate news
Ukraine's largest poultry producer MHP sold 181.8 kt of poultry meat in the second quarter of 2021, a 6.4% y/y growth (and 17.8% qoq increase), according to its July 16 trading update.
The company’s poultry exports surged 23.2% y/y to 109.1 kt (up 32.6% qoq), while domestic sales decreased 11.7% y/y to 72.8 kt (or 0.9% growth qoq) in the second quarter of 2021. MHP’s poultry meat sales at its EU-based facilities were 19.5 kt, or a 23.0% y/y increase (and 32.6% qoq growth) in the second quarter of 2021.
During the quarter, the average selling poultry price jumped 31.5% y/y to $1.67/kg (and a 22.8% increase qoq). That implies MHP’s revenue from poultry sales increased 27.6% y/y to $304mn in the second quarter of 2021. MHP’s EU-based facilities average selling price was €2.53/kg, or 1.2% higher y/y (and 2.0% hidger qoq) in the second quarter of 2021.
In 1H21, MHP’s poultry sales increased 2.4% y/y to 336.2 kt and the average selling price jumped 26% y/y to $1.56/kg. The company’s export sales increased 12.2% y/y to 191.3 kt, while domestic market sales slid 8.2% y/y to 144.9 kt in 1H21. Also, the company’s share of poultry export sales to MENA region surge to 47% vs. 36% year ago, while shares of other regions slid 1-2 pp in average.
The company showed a positive operating dynamic after the avian flu outbreak in Vinnytsia region in late 2020. The company’s poultry sales increased due to higher export volumes to the MENA region. Also, the trend of protein prices increase helped support the company’s selling prices. We expect the company will further increase its poultry sales in 2H21 and will show positive annual poultry sales dynamics. Also, we expect that the company’s EBITDA in the poultry segment will be in the range of $260-270mn in 2021 (vs. $194mn in 2020).
52 UKRAINE Country Report August 2021 www.intellinews.com