Mriya plans USD 100-250 mln in capex in 2012

Mriya Agroholding (MAYA GR) is planning to spend USD 100-250 mln in capex in 2012, depending on market conditions, the company said during a conference call yesterday. Mriya is building two 100 kt greenfield grain silos and plans to commence construction on an additional four 100 kt silos. The company also plans to expand its landbank and acquire machinery. Mriya spent USD 196 mln (vs. guidance of USD 120-130 mln) on capex in 2011, including USD 99 mln on landbank acquisition, USD 48 mln on storages & infrastructure and USD 43 mln on machinery.

Yegor Samusenko: We estimate construction of the new four grain silos will cost at least USD 100 mln, spread over two years, if Mriya’s historical capex of USD 250/t is taken as a reference. We deem the announced figures negative from Mriya stakeholders’ point-of-view as the company seems to be spending cash at a more aggressive pace than announced during its  USD 250 mln bond placement in 2011. At the same time, Mriya continues paying high costs for land: USD 1,500/ha for lease rights in 2011 vs. USD 250-1,050/ha reported by its peers. Moreover, the company is focused on high-cost greenfield silo construction: USD 250/t is at the high limit of the range (that starts from USD 80/t)  of what peers report for a greenfield silo and is a significant premium to what peers are paying for used storage facilities.