Industrial Milk Company revenue falls 17% yoy in 1Q16
13 May 2016
Net revenue at grain farmer Industrial Milk Company (IMC PW) fell 17% yoy to USD 26.8 mln in 1Q16, according to its May 12 report. The decline was caused by falling sales of its key crop, corn, by 16% yoy in money terms to USD 25.4 mln, which was mainly the result of a 12% yoy decrease in volume sold.
The company’s EBITDA decreased 41% yoy to USD 5.8 mln and cash generated from operations decreased 46% yoy to USD 6.8 mln in 1Q16. Its CapEx was minimized at USD 0.5 mln in the quarter, which enabled the company to continue its deleveraging. In particular, its total debt decreased 8% qoq to USD 90.4 mln and net debt fell 6% qoq to USD 86.7 mln. Its net debt-to-LTM EBITDA ratio was 1.39x as of end-1Q16, compared to 1.59x a year before.
Alexander Paraschiy: As usual, the 1Q data is not very indicative for a pure crop farmer like Industrial Milk. What’s important is that the company is going forward with its deleveraging plan announced in July 2015, which is aimed at reducing its total debt to USD 80 mln by end-2016. We continue to consider IMC to be one of the top picks in the Ukrainian equity universe.
