Milkiland EBITDA plunges 85% in 9M19

Dairy firm Milkiland (MLK PW) reported a drop in its 9M19
revenue by 2.3% yoy to EUR 96.6 mln, according to its interim results published
on Nov. 15. Its EBITDA plunged 85% yoy to EUR 0.7 mln, which is mostly the
result of plummeting profits in Russia (by 85% yoy to EUR 0.6 mln) and
increased operating losses in Poland (up 23x yoy to EUR 1.2 mln).

Milkiland EBITDA for the last 12 months turned
negative at EUR 1.7 mln. The company attributed its weak results to higher raw
material costs (raw milk), increased competition at the Russian dairy market
and unfavorable output prices in Poland.

Milkiland’s net losses decreased 15% yoy to EUR 11.4
mln in 9M19. Its total debt slid 2% yoy to EUR 84.3 mln and net debt declined
5% yoy to EUR 81.2 mln.

Alexander Paraschiy: With such
results, the company has no chance to survive. All the attempts to change
Milkiland’s strategy over the last five years have proven to be unproductive.
We see no value in MLK equity.