By KYIV. Dec 12 (Interfax-Ukraine) – Kernel, one of the largest Ukrainian agro-industrial groups, in the first quarter of fiscal year 2023 (July-September 2022), saw $161.59 million in net profit, which is 23.4% less than in the same period of the previous fiscal year.
According to the financial report on the company’s website on Saturday night, the agricultural holding’s revenue for the reporting period fell by 51.1% to $654.56 million.
Gross profit fell 47.6% to $173.34 million, operating profit fell 42.5% to $142.47 million, and EBITDA dropped 40.1% to $168.38 million.
Kernel explained the decline in revenue by low volumes of grain exports, as well as the negative impact of a decrease in sales of sunflower meal and oil.
In addition, net loss in fair value of biological assets was $2 million compared to a gain of $85 million in the first quarter of FY2022.
"Shipping and handling costs constituted 28% of cost of sales in July-September 2022, adding 47% y-o-y and 3x as compared to the previous quarter, reflecting the skyrocketed logistics costs when exporting goods from Ukraine," Kernel said in the report.
Kernel said that the contribution of the Oilseeds Processing segment to EBITDA amounted to $45 million, reflecting a robust crush margin prevailing on the market, while the EBITDA of the Infrastructure and Trading segment reduced by 35% compared to the same period last year to $60 million. EBITDA of the Farming segment in the first quarter of FY2023 was $82 million, down 61% from last year.
Net finance costs in the first quarter of FY23 increased by 31% year-on-year to $35 million, driven by higher amount of debt kept on the Group’s balance: Kernel postponed the repayment of loan principal amounts because of the stretched liquidity situation caused by the war in Ukraine, Kernel said in the report.
According to the report, net foreign exchange gain in the reporting period amounted to $58 million, owing to the depreciation of Ukrainian hryvnia against the US$ and revaluation of intra-group balances.
Kernel’s net debt, as indicated in the report, grew by 48% over the year to $1.496 billion, while the net debt to EBITDA ratio increased 12.7 times to 13.9.
