Astarta sugar sales rise 8% in 2016
1 February 2017
Ukrainian farmer and sugar producer Astarta (AST PW) boosted its sugar sales volume by 8% yoy to 390 kt, the company reported in its trading update on Jan. 31. The average selling price rose 24% yoy to UAH 11,927/ton (or 6.4% yoy to EUR 422/ton). Its soybean oil sales volume surged 39% yoy to 34.8 kt, with the average selling price having increased 8% yoy to EUR 696/ton. Total grains sales volumes declined by 12% yoy to 464 kt in 2016.
Igor Zholonkivskyi: Despite the fact that Ukraine’s currency, the hryvnia, lost an average of 16% to the euro in 2016, Astarta is very likely to report annual growth in 2016 revenue and EBITDA in EUR terms due improved sales volume in its sugar and soybean processing segments, as well as strong sugar and soybean oil prices throughout the year. In addition, the company reported earlier this month that it exported a record 186 kt of sugar in 2016 (compared to 34 kt in 2015), which helped boost its FX-denominated sales.
We maintain a positive view on Astarta stock, but we also acknowledge the risks of a possible correction in global sugar prices, as well as the possible oversupply of sugar on the domestic market in 2017.
