Astarta enjoys 1.7x yoy increase of sugar, soybean prices in 1Q21

Ukraine’s leading sugar producer and farmer Astarta (AST
PW) decreased sugar sales 25% yoy to 58.1 kt in 1Q21, according to its April 16
trading update. Sugar prices increased 66% yoy to UAH 16.1/kg in the quarter.
Soybean oil and meal prices increased by roughly the same amount (up 69% and
72% yoy in UAH terms, respectively) as volumes of oil increased 13% yoy to 12.6
kt and volumes of meal decreased 15% yoy to 39.8 kt.

Its volume of key crop sales (corn, wheat and
sunflower) decreased 67% yoy 80.1 kt, but their average price increased 33% yoy
(in UAH terms) in 1Q21. Its volumes of milk sales increased 2% yoy to 24.2 kt
and milk prices increased 15% yoy to UAH 11.8/kg in 1Q21.

Compared to 4Q20, prices for sugar increased 22%, for
soybean oil and meal increased 16% and 20% and for corn increased 15% yoy in
UAH terms.

Alexander Paraschiy: The company
continues to enjoy favorable prices for its produce, so its 1Q21 margins are
going to improve further. Based on the announced results, we expect the company
to report EUR 83 mln in net revenue (down 18% yoy) and EBITDA of about EUR
26-27 mln (3-6% less yoy). We stress that the 1Q result is not indicative for
the farming company’s performance for the entire year, but the favorable price
trend of early 2021 promises another strong season for Astarta. We therefore
remain positive about the company’s mid-term value growth prospects.