Milkiland EBITDA plunges 72% in 2019

Net revenue at dairy firm Milkiland (MLK PW) fell 5%
yoy to EUR 125.8 mln, while EBITDA plunged 72% yoy to EUR 0.59 mln in 2019,
according to its annual report published on Apr. 30. The company’s net loss
plummeted 42% yoy to EUR 11.6 mln. Its net debt decreased 10% yoy to EUR 76.7
mln as of end-2019, while its net debt-to-EBITDA ratio widened to 131x from 41x
a year before. The company is still in negotiations to restructure its key
credit facility, a syndicate loan for USD 58.6 mln, after its owner changed in
late 2019.

Milkiland also reported that its 2019 financials were
not audited as the company did not manage to find an auditor in the
Netherlands. The management initiated a change in its country of domicile from
the Netherlands to Cyprus by August 2020, promising that no other significant
corporate changes will occur due to this (including its share listing in
Warsaw).

Alexander Paraschiy: 2019 did not bring any signs of turnaround for Milkiland, so we
continue to view it as a highly risky equity story.