Kernel crushing volumes rise 2.2% yoy in 4Q, in line with FY20 guidance

Ukraine’s largest sunflower oil producer and grain trader
Kernel (KER PW, KERPW) reported that its oilseed crushing volumes rose 2.2% yoy
(or a 2.6% qoq decrease) to 916.0 kt in 4QFY20, according to a trading update
published on July 20. The company’s edible oil sales increased 9.8% yoy to
489.0 kt (a 28.4% qoq improvement) in 4QFY20. Its grain export increased 29.6%
yoy (or a 13.5% qoq decline) to 1.86 mmt in 4QFY20. Export terminals’
throughput jumped 53.9% yoy (or a 5.0% qoq decrease) to 1.84 mmt in 4QFY20.

In FY2020, Kernel’s crushing volumes rose 8.6% yoy to
3.44 mmt in line with the company’s guidance for the period. The company’s
edible oil sales slid 6.3% yoy to 1.52 mmt in FY2020. Its grain export volumes
surged 29.7% yoy to 7.9 mmt in FY2020, while the company’s terminals throughput
jumped 44.7% yoy to 6.67 mmt in FY2020.

Andriy Perederey: The
company’s operating results show strong growth in its grain export and terminal
throughput segments in FY2020. Also, the company’s crushing volumes set a
record high with 99% capacity utilization, while edible oil sales were lower
yoy despite a strong boost in 4QFY2020. So, we are keeping unchanged our
estimate for FY2020 of total EBITDA in the range of USD 380-390 mln (vs. USD
346 mln a year ago). We are also maintaining our neutral view on KERPW bonds.