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Ukraine's MHP ups grain harvest by 23.4% y/y in 2013.

February 5, 2014

In 2013, one of the largest producers of poultry meat in Ukraine , Myronivsky Hliboproduct (MHPC LI) boosted harvesting of grain and grain legumes by 23.4% y/y to 1.984mn tonnes, the company said. The harvest was boosted thanks to the expansion of the land bank, favorable weather conditions and introduction of the best agricultural technologies. In 2013, the company increased the harvest of maize by 28.3% y/y to 1.134mn tonnes. At that, the areas under maize were expanded by 11% to 129,100 hectares from 116,260 hectares in 2012. Besides, the company raised the harvest of wheat by 14% y/y to 228,100 tonnes, at that the areas under wheat were expanded by 9% or 3,500 hectares to 42,460 hectares. In addition, the company increased sales of poultry meat by 21% y/y to 121,600 tonnes in Q4. In Q4, the average price decreased to UAH 15.43 per kg (excluding VAT) compared to UAH 16.91 (excluding VAT) in Q4 2012 mainly owing to export sales increase. In line with the Company forecast and expectations, the average price decreased by 7% y/y to UAH 15.99 per kg (excluding VAT) compared to UAH 17.19 in 2012 mainly due to significant increase of exports sales share from 15% in 2012 to 28% in 2013 as well as lower export price in H2/2013 as a result of new markets penetration and relatively stable domestic poultry prices during 2013. In 2013, the Company opened over 20 new export sales markets both in Asia , Middle East and Africa , simultaneously increasing its exports trades across all regions. MHP has reported net profit of USD 60mn in Q3, down by 46% y/y, the company has announced. In Q3, the company's revenues grew by 9% to USD 422mn over Q3/2012. It's EBITDA, in Q3, contracted by 17% y/y to USD 123mn with margin going down to 29% from 38% a year ago, mainly because of higher costs of production of chicken meat and lower average price for poultry meat and the grain crops harvested in 2013. In Jan-Sep, the company's net profit amounted to USD 150mn , down by 47% y/y. It's revenues grew slightly by 3% to USD 1.078bn . In Jan-Sep, its EBITDA was USD 317mn , a decrease by 17% against 9M 2012, predominantly due to inflated poultry production cost, softening average poultry prices and lower prices for crops harvested in 2013. EBITDA margin decreased to 29% from 36% a year earlier. The company's CEO Yurii Kosiuk commented on the financial results says that weaker grain prices which are in line with the world trends, transffered to lower 2013 financial results, than projected. However, lower priced crops harvested in 2013 will decrease poultry production cost in 2014, which, combined with increasing production of chicken meat and the company's recent acquisition of land in Russia and in Ukraine will be the core drivers to improve the company's financial and operational results in 2014. Myronivsky Hliboproduct is a vertically integrated open joint-stock company consisting of enterprises producing fodder and incubation eggs as well as enterprises breeding cattle and chicken. Myronivsky Hliboproduct produces poultry meat under the Nasha Riaba trademark, semi-finished meat products under the Lehko trademark, beef delicacies under the Certificated Angus trademark, and goose liver delicacy under the Foie Gras trademark.

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Source: IntelliNews - Weekly Reports

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