Published: 2018-02-24 23:10:00 CET
PRFoods
Quarterly report

PRF: Consolidated Unaudited Interim Report of AS PRFoods for 4th quarter and 12 months of 2017

Tallinn, Estonia, 2018-02-24 23:10 CET (GLOBE NEWSWIRE) --  

Overview of the economic activities

MANAGEMENT COMMENTARY

PRFoods Q4 2017 is the first when new group’s full term consolidated numbers are available. It is a pleasure to see that then new strategy of PRFoods to become high value added and vertically integrated International fish processing company, has been fully justified. Strong growth in sales and profitability demonstrate it clearly. Both the existing and newly added PRFoods subsidiaries have performed exceptionally, thanks to good work and effort by our local management teams and entire staff.

PRFoods Q4 revenues were 32 million euros, growing year-on-year by 89.3%. Gross margin increased 3.4 times and was 6.6 million euros. EBITDA from operations (excluding biomass) grew by 3.2 times and was 4.3 million euros. EBITDA growth was 4.5 times and amounted 1.6 million euros. Net profit was 1.2 million euros, increase by 3.5 times year-on-year. We are happy to see that gross margin growth on year-on-year was 80.5%, Q4 gross margins was 20.6%.

Sales and profitability were particularly boosted by strong sales in Finnish market, as a result of very successful integration between Trio Trading Ab, Heimon Kala Oy and Vettel OÜ. Business was helped by substantial decrease in raw material prices, as compared to extraordinarily high prices in Q4 2016. It is very positive to see that sales to export markets has grown significantly.

PRFoods 12 months unaudited consolidated sales were 73.6 million euros, growing 55.2% on annual basis. EBITDA from operations increased 7 times and was 5.4 million euros. EBITDA was 3.6 million euros, growing by 0.95 million euros year-on-year. Net profit grew 2 times and amounted to 1.4 million euros.

Our fish farming performed very well, the biggest impact came from drop in global salmon prices. The difference between operational EBITDA and EBITDA is the biomass revaluation. At the end of 2017 the biomass revaluation amounted to -1.5 million euros, compared to +2.3 million in 2016. Biomass revaluation is standard practice and is impacted mainly by three factors: global fish prices at the end of the period, annual biomass growth in tons annual extraction of fish from farms. Although in tons our biomass increased, in value terms the biomass decreased due to drop in rainbow trout prices by 19.5% as of 31.12.2017. Rainbow trout prices were 6.0 euros per kilo compared to 7.4 euros at the end of 2016. Also, salmon prices decreased in Q4 by 29.9% year-on-year and by 39.2 if compared to 31.12.2016. Both trends are very positive for PRFoods, as over 2/3 of our raw material is purchased on open market. Raw material price drop boosts overall profitability of our business. The value of biomass at the end of the year was 5.6 million euros and average price was 3.87 EUR/kg.

PRFoods balance sheet continues to be strong. Investment loans taken to purchase subsidiaries have resulted in positive net debt. Debt to EBITDA is 3.1. Cash balance increased to 6.5 million euros and net debt of PRFoods is 16.6 million euros (including 2.6 million euros of minority buyout option liabilities, which the management deems to be of low probability in short term).

PRFoods employs 408 people as of end of the year in Estonia, Finland, Sweden and United Kingdom

PRFoods shares rose by 63.2% on annual basis, being one of the best performing stocks on NASDAQ Tallinn. The liquidity of share trading increased nearly 2 times.

Current financial year was prolonged until 30.06.2018 and in the future PRFoods financial year is from July to June.

In summary we can say that 2017 was very successful for PRFoods. Big challenges wait us ahead, to turn PRFoods subsidiaries into even more globally competitive businesses. Strategic directions of group are increasing profitability, sustainable and environmentally friendly production, innovation in product development and marketing, development of our staff’s professionalism and working conditions.

The 4th quarter of 2017 compared to the 4th quarter of 2016

  • Unaudited consolidated revenue 31.99 million euros, increase +15.09 million euros, i.e. +89.3%.
  • Gross margin 20.6%, increase +9.2 percentage points, i.e. +80.5%.
  • Negative impact from revaluation of biological assets -2.73 million euros (Q4 2016: negative effect -1.10 million euros).
  • EBITDA from operations +4.30 million euros, increase +3.25 million euros.
  • EBITDA +1.57 million euros, increase +2.02 million euros.
  • The operating profit +1.06 million euros, increase 1.82 million euros.
  • Net profit +1.23 million euros, increase +1.72 million.

The 12 months of 2017 compared to the 12 months of 2016

  • Unaudited consolidated revenue 73.61 million euros, increase +26.18 million euros, i.e. +55.2%.
  • Gross margin 14.4%, increase +5.9 percentage points.
  • Negative impact from revaluation of biological assets -1.51 million euros (12 months 2016: positive impact of
  • +2.26 million euros).
  • Effect of one-offs to the result -0.31 million euros (12 month 2016: negative influence -0.40 million euros).
  • EBITDA from operations +5.37 million euros, increase +4.62 million euros.
  • EBITDA +3.56 million euros, increase 0.95 million euros.
  • The operating profit +2.01 million euros, increase 0.63 million euros.
  • Net profit +1.42 million euros, increase 0.70 million euros.

KEY RATIOS

Income Statement, EUR mln Q1 2017 Q2 2017 Q3 2017 Q4 2017 12m 2017 Q1 2016 Q2 2016 Q3 2016 Q4 2016 12m 2016
Sales 10.6 13.1 18.0 32.0 73.6 10.2 9.8 10.5 16.9 47.4
Gross profit 0.5 1.0 2.5 6.6 10.6 1.0 0.6 0.5 1.9 4.0
EBITDA from operations -0.3 0.1 1.2 4.3 5.4 0.2 -0.3 -0.3 1.1 0.8
EBITDA -0.6 0.3 2.2 1.6 3.6 -0.2 0.7 2.6 -0.4 2.6
EBIT -0.9 0.03 1.8 1.1 2.0 -0.5 0.3 2.3 -0.8 1.4
EBT -0.9 -0.1 1.4 0.8 1.2 -0.6 0.2 2.2 -0.8 1.1
Net profit (-loss) -0.8 -0.1 1.2 1.2 1.4 -0.5 0.04 1.6 -0.5 0.7
Gross margin 5.0% 7.5% 13.7% 20.6% 14.4% 9.5% 6.3% 4.7% 11.4% 8.5%
Operational EBITDA margin -2.7% 1.0% 6.9% 13.4% 7.3% 2.1% -2.6% -2.6% 6.2% 1.6%
EBITDA margin -5.3% 2.6% 12.3% 4.9% 4.8% -2.2% 6.8% 24.9% -2.7% 5.5%
EBIT margin -8.3% 0.2% 9.9% 3.3% 2.7% -5.2% 3.6% 22.0% -4.5% 2.9%
EBT margin -8.5% -0.4% 7.6% 2.5% 1.6% -5.5% 2.3% 21.3% -4.5% 2.4%
Net margin -7.9% -1.0% 6.4% 3.9% 1.9% -4.5% 0.4% 15.5% -2.9% 1.5%
Operating expense ratio 11.2% 9.5% 10.9% 9.2% 9.9% 10.5% 12.7% 11.2% 7.7% 10.1%

 

Balance Sheet, EUR mln 31.03.2017 30.06.2017 30.09.2017 31.12.2017 31.03.2016 30.06.2016 30.09.2016 31.12.2016
Net debt 1.6 1.0 16.7 16.6 -3.1 -1.4 1.3 0.3
Equity 22.8 22.7 23.4 24.8 22.7 22.7 24.3 23.8
Working capital 11.5 11.5 5.1 5.3 11.0 11.2 13.3 12.4
Assets 33.3 33.5 66.3 67.0 28.6 29.3 34.4 35.1
Liquidity ratio 2.4 2.3 1.2 1.2 3.7 3.4 2.7 2.4
Equity ratio 68.5% 67.8% 35.9% 37.1% 79.4% 77.6% 70.7% 67.9%
Gearing ratio 6.4% 4.1% 41.3% 40.0% -15.7% -6.7% 5.2% 1.2%
Net debt-to-EBITDA 6.4 1.6 7.9 3.1 -1.1 -0.7 1.2 0.4
ROE 1.5% 0.7% -1.3% 5.8% 4.5% 3.6% 6.7% 3.0%
ROA 1.1% 0.5% -0.6% 2.8% 3.7% 2.9% 5.2% 2.2%

 

Consolidated statement of financial position

EUR '000 31.12.2017 31.12.2016
ASSETS    
Cash and cash equivalents 6,491 4,374
Receivables and prepayments 8,982 4,056
Inventories 11,747 5,393
Biological assets 5,566 7,584
Total current assets 32,786 21,407
     
Deferred income tax 222 230
Long-term financial investments 102 103
Tangible fixed assets 11,425 7,285
Intangible assets 22,450 6,031
Total non-current assets 34,199 13,649
TOTAL ASSETS 66,985 35,056
     
EQUITY AND LIABILITIES    
Loans and borrowings 10,105 3,716
Payables 17,115 5,131
Government grants 306 162
Total current liabilities 27,526 9,009
     
Loans and borrowings 12,957 940
Deferred tax liabilities 523 747
Government grants 1,144 551
Total non-current liabilities 14,624 2,238
TOTAL LIABILITIES 42,150 11,247
     
Share capital 7,737 7,737
Share premium 14,007 14,007
Treasury shares -390 -256
Statutory capital reserve 48 12
Currency translation reserve 173 428
Retained profit (-loss) 3,185 1,881
Equity attributable to parent 24,760 23,809
Non-controlling interest 75 0
TOTAL EQUITY 24,835 23,809
TOTAL EQUITY AND LIABILITIES 66,985 35,056

 

Consolidated statement of profit or loss and other comprehensive income

EUR '000 Q4 2017 Q4 2016 12m 2017 12m 2016
Sales 31,992 16,903 73,610 47,429
Cost of goods sold -25,395 -14,972 -63,034 -43,410
Gross profit 6,597 1,931 10,576 4,019
         
Operating expenses -2,934 -1,297 -7,306 -4,785
  Selling and distribution expenses -2,095 -964 -5,150 -3,346
  Administrative expenses -839 -333 -2,156 -1,439
Other income/expenses 124 -291 240 -118
Fair value adjustment on biological assets -2,727 -1,101 -1,505 2,263
Operating profit (-loss) 1,060 -758 2,005 1,379
Financial income 2 1 4 2
Financial expenses -262 -9 -802 -240
Profit (-loss) before tax 800 -766 1,207 1,141
Income tax 432 274 208 -426
Net profit (-loss) for the period 1,232 -492 1,415 715
         
Net profit (-loss) attributable to:        
Owners of the company 1,157 -492 1,340 715
Non-controlling interests 75 0 75 0
Total net profit (-loss) 1,232 -492 1,415 715
         
Other comprehensive income (-loss) that may subsequently be classified to profit or loss:        
Foreign currency translation differences -171 8 -255 -43
Total comprehensive income (-expense) 1,061 -484 1,160 672
         
Total comprehensive income (-expense) attributable to:        
Owners of the Company 986 -484 1,085 672
Non-controlling interests 75 0 75 0
Total comprehensive income (-expense) for the period 1,061 -484 1,160 672
         
Profit (-loss) per share (EUR) 0.03 -0.01 0.03 0.02
         
Diluted profit (-loss) per share (EUR) 0.03 -0.01 0.03 0.02

 

Indrek Kasela
AS PRFoods
Member of the Management Board
Phone: +372 452 1470
investor@prfoods.ee
www.prfoods.ee

 


PRF_interim_12m2017.pdf
PRF_12m2017.pdf