18 November 2011
MHP (MHPC LI), the largest poultry producer in Ukraine, reviewed its 2011 EBITDA guidance from USD 370 mln to USD 410 mln during a conference call yesterday. Management said the upgrade was due to a higher-than-expected corn harvest, which is already 80%-collected. MHP’s corn yield was 9.8 mt per ha, up 25% y-o-y and 55% above the Ukrainian average. The company also disclosed that it is selling its corn at USD 270 per mt at CPT basis thanks to a favorable contract signed in August. Current corn prices stand at USD 211 per mt on CPT basis, according to APK-Inform. MHP plans to consume 550 ths mt of internally produced corn, sell 150 ths mt by the end of calendar year and another 300 ths mt next year. Yegor Samusenko: We think management’s guidance for 2011 is quite achievable given that EBITDA will not depend on the timing of crop sales but account for this year’s plentiful harvest. For 2012, we maintain our projection of USD 390 mln in EBITDA though will likely review it upward should poultry prices continue rising.