26 October 2011
Khlibprom (UX: HLPR UK, N/R) reported its preliminary 3Q11 non-consolidated financials yesterday: a UAH 0.82 mln loss in the quarter (5.4x growth y-o-y), which brought its loss in 9M11 to UAH 27.81 mln (vs. profit of UAH 0.62 mln in 9M10). Svetlana Rekrut: Khlibprom’s 9M losses were derived from a 18.8% increase in input costs in 1H11 against a background of non-increasing prices for ‘social’ bread (half of revenues). In early May, Khlibprom agreed to an individual plan with officials to gradually raise bread prices by 20% in May-August – the full effect of this adjustment on the company’s bottom line should be visible in 4Q11. Another income-driving factor for 4Q could be a decline in input costs (wheat prices declined by ~15% in August) due to the strong 2011 harvest.