IMC revenue rises 15%, EBITDA drops 19% in 1H17
29 August 2017
Ukrainian farmer IMC (IMC PW) reported a 15% yoy rise
in net revenue to USD 62.6 mln in 1H17, which resulted mostly from a 16% yoy
increase in sales of corn to USD 59.3 mln, according to its Aug. 29 earnings
report. Its EBITDA decreased 19% yoy to USD 40.1 mln, which the company
attributed to increased operating costs and the hryvnia strengthening in the
first half. Its net profit fell 7% yoy to USD 30.3 mln in 1H17.
IMC’s operating cash flow before working capital
changes surged 48% yoy to USD 18.9 mln and net cash from operations increased
47% yoy to USD 20.2 mln in 1H17. With its CapEx for the period being just USD
3.4 mln, the company managed to continue deleveraging: it repaid net USD 8.7
mln in 1H17 and reduced its total debt 8% YTD to USD 77.1 mln as of end-June.
Its net debt decreased 19% YTD to USD 64.6 mln and ratio of net debt-to-LTM EBITDA
remained nearly unchanged YTD at 1.3x. IMC reported its plans to further reduce
its total debt to USD 65 mln by the year-end.
full-year 2017, we remain bullish on the company, whose stock trades at about a
3.2-3.3 forward EBITDA multiple. The company’s low and decreasing leverage, as
well as its plan to gradually expand its land bank, suggests there is value
growth potential in this stock.
