17 May 2017
Despite negative situation on Ukrainian eggs market Ovostar keeps showing good performance.
EBITDA margin, %
Total shell eggs production in reporting period made 404M pieces (+28% y-o-y). Sales volume grew by 37% up to 276M eggs, out of which 82M pieces were export (+18% y-o-y, despite the restrictions on import imposed by a number of countries due to the avian influenza cases detected in south-west of Ukraine in December 2016-January 2017). Volume of shell eggs processed in Q1 increased y-o-y by 5% to 99M eggs (driven by good sales dynamics of dry products).
Ovostar revenues in Q1 2017 comprised USD 19.8M (+11.5% vs. Q1 2016). Domestic sales accounted for 65% of revenues (USD 13M), their y-o-y growth made 14%. Export proceeds grew as well – by 7% vs. Q1 2016 up to USD 6.7M. Middle East countries still account for main part of export – in reporting period their share in total Ovostar export made 75%. We also note that the company works on new export destinations – in Q1 2017 sales in Africa comprised USD 677k (no export to this region in Y2016).
EBITDA of the company in last reporting quarter made USD 5.1M with 26% margin (in Q1 2016 – USD 6.9M and 39% correspondingly). Decrease of margin has been expected because of negative situation on Ukrainian eggs market, resulted from export stagnation which led to local market prices decline. Average eggs realization price of Ovostar in Q1 2017 made UAH 1.4 per egg (-8% y-o-y).
Net operating cash flow of Ovostar in Q1 2017 made USD 8.7M and was mainly directed to new investments (USD 3.1M). In addition Ovostar increased its cash position vs. 31.12.16 by almost USD 6M up to USD 18M (debt of the company now stands at USD 15.6M). Balance sheet structure and quality of the group remains good:
Balance Sheet structure