Astarta sugar sales drop, key crop sales rise in 1Q19

Sugar sales at Ukraine’s leading sugar producer and
farmer Astarta (AST PW) dropped 42% yoy to 54.0 kt in 1Q19, according to its
Apr. 24 trading update. Average sugar prices fell 15% yoy to UAH 9.8/kg.

Astarta’s sales of key crops (wheat, corn, barley and sunflower)
more than doubled yoy to 329.2 kt, with their weighted average price rising 1%
yoy in UAH terms. Most crop sales came from corn, which amounted 304.2 kt (up
3.3x), and its price increased 23% yoy to UAH 4.8/kg.

Its sales of soybean oil increased 13% yoy to 14.2 kt,
while the market corrected its price by 16% yoy to UAH 17.2/kg.

Alexander Paraschiy: Based on the company’s update, we estimate its 1Q19 revenue increased
by about 21% yoy to EUR 110 mln. At the same time, given weak sugar and oil
prices, the company’s EBITDA is unlikely to improve yoy in 1Q19. Though
expecting another weak year for Astarta’s P&L in 2019, we remain optimistic
about its mid-term growth potential.