Ovostar Union N.V. (WSE: OVO) (hereinafter the “Group”), a vertically integrated holding company, one of the leading producers of eggs and egg products in Ukraine, announces its financial results for the three months ended 31 March 2014.
Revenue, gross profit and gross margin
In 3M 2014 the Group’s revenue increased by 11% year-on-year to USD 19.5 mln (1Q 2013: USD 17.7 mln). Gross profit for the period increased by 38% to USD 9.8 mln from USD 7.1 mln while gross margin reached 50% due to lower realized cost of fodder in 1Q 2014 compared to the same period previous year.
Operating profit, EBITDA and cash flows from operating activities
In 3M 2014 the Group’s operating profit increased by 57% to USD 8.1 mln from USD 5.2 mln, while EBITDA increased by 42% to USD 9.2 mln (1Q 2013: USD 6.5 mln). Selling and administrative expenses in the first quarter 2014 have remained very similar to the same period of 2013. Net cash flows from operating activities increased to USD 7.2 mln during the three months of 2014 (1Q 2013: USD 5.0 mln).
Net profit and exchange differences on translation to presentation currency
Due to devaluation of Ukrainian Hryvnia from 7.99 UAH/USD to 10.96 UAH/USD in the first quarter 2014, the Company has recorded negative exchange differences on translation to presentation currency that reached USD 40.5 mln. In 3M 2014 net profit increased by 54% to USD 7.9 mln (1Q 2013: USD 5.1 mln).
The Group’s CEO Borys Bielikov noted:
“The Group’s management is overall content with financial results achieved by Ovostar Union in the first quarter of this year despite the complicated political and economic situation. The management of Ovostar Union is reasonably assured that good financial results in year 2014 will be stipulated by efficient business model of the Group together with constant fine quality of our products and stable demand for eggs and egg products.”