Page 69 - UKRRptSept20

€19.1mn) and the discontinued consolidation of its Polish subsidiary (whose revenue was €4.1mn in 1H19). As the result of a new strategic investor appearing at the Poland-based Ostrowia plant, Milkiland’s share in the facility decreased to 20%. The deal allowed Milkland to decrease its consolidated debt by €1.9mn. The company’s EBITDA decreased 79% y/y to €0.1mn in 1H20 as the improvement of the result in Ukraine (up 6.6x y/y to €1.0mn) was offset by weakness in Russia (where EBITDA fell to negative €0.8mn from positive €0.8mn a year ago). Due to increased ForEx losses (to €13.0mn), the company’s net loss surged to €22.8mn in 1H20, from €7.3mn a year ago. Milkland’s total debt decreased 9% y/y to €75.1mn as of end-1H20, still remaining solid as compared to the company’s size. Its cash position decreased 77% y/y to €0.7mn as of end-1H20. The company is planning to continue negotiations on debt restructuring and will search for the settlement of debt related to its Russian Kursk Milk facility, which is undergoing a bankruptcy procedure now.
Ukraine’s egg producer Ovostar Union reported a 17% y/y decline in net revenue to $44.63mn​, according to its August 28 filing. This was solely a result of lower shell egg prices, which ​dropped 20% y/y in $terms​. The company’s EBITDA decreased 19% y/y to $4.82mn, with EBITDA margin falling just 0.2pp to 10.8%. Ovostar’s bottom line decreased 33% y/y to $2.44mn, which was largely a result of increased D&A charges.​ ​The company’s operating cash flow before working capital changes fell 32% y/y to $5.71mn in 1H20, while net cash flow from operations decreased 19% y/y to $8.90mn. Ovostar’s CapEx fell 73% y/y to $1.67mn as the company put on hold its key expansion project referring to the COVID-19 pandemic. Its net debt decreased 11% y/y to $9.05mn, while the cash balance fell 87% y/y to $1.67mn as of end-1H20.
Ukraine’s farmer Agroton decreased net revenue 22% y/y to $13.85mn in 1H20, according to its filing on August 27. ​Most of its revenue comprised sales of sunflower seeds, or $12.14mn (doubled y/y). Its operating profit jumped 29x y/y to $5.86mn, which was the result of increased profits from crop farming and higher reported IAS 41 gain. At the same time, the company’s bottom line was negative at $3.59mn in 1H20 due to reported ForEx losses of $8.37mn (vs. $3.28mn net profit reported in 1H19 on the background of ForEx gains of $3.56mn). The company reported that the value of its crops under cultivation and harvested as of end-1H20 was $32.42mn (vs. $33.03mn a year before). Agroton’s financial debt remained flat y/y at $0.13mn, while the value of land lease obligations amounted to $18.95mn (down 7% y/y) as of end-1H20. Its end-1H20 cash balance was $10.24mn (down 14% y/y) and the book value of loans receivable was flat y/y at $18.55mn.
Ukraine’s Avangard, Europe’s largest egg producer, may close six of its 20 farms​, cutting production by 20% by mid-October, reports Poultry World. UkrLandFarming, Avangard’s parent company, may have to lay off 2,500 employees. Avangard owner Oleg Bakhmatyuk says that due to ongoing court cases against him, he is unable to get bank loans. In 2010, Avangard raised $187.5mn in an IPO on the London Stock Exchange. But Russia’s 2014 annexation of Crimea and occupation of half of Ukraine’s Donbas resulted in Avangard losing valuable properties. Although Avangard produced 2.6bn eggs in 2018, its debt is estimated at $2bn.
69​ UKRAINE Country Report​ September 2020 ​ ​www.intellinews.com