Last checked at 17 Apr 2012 07:00
PRESS RELEASE
April 17, 2012, Kyiv, Ukraine
MHP S.A.Pre-close trading update for the first quarter ended 31 March 2012
MHP S.A. (LSE: MHPC) ("MHP" or "The Company"), one of the leading agro-industrial companies in Ukraine, focusing on the production of poultry and the cultivation of grain, is pleased to announce its pre-close trading update for the three months ended 31 March 2012.
Poultry and Related Operations
Poultry | Q1 2012 | Q1 2011 | % change | |
Sales volume, third parties tonnes | 85,040 | 84,300 | 1% | |
Price per 1 kg net VAT, UAH | 16.75 | 12.83 | 31% |
During the first quarter of 2012, the volume of chicken meat sales to third parties increased by 1% compared to the first quarter of 2011, reaching 85,040 tonnes. As usual, all the Company's existing poultry production facilities continued to operate at full capacity during the first quarter of 2012. Consumer demand for chicken remained high and the Company was able to sell close to 100% of the chicken meat produced.
The average chicken meat price through the first quarter of 2012 increased by 31% to UAH 16.75 per 1 kg of adjusted weight (excluding VAT) when compared to Q1 2011 and remained at the level of Q4 2011.
During the first quarter of 2012 the volume of exported chicken meat sales continued the growing dynamics of previous quarters and reached almost 10,000 tonnes, which is around 70% higher than in Q1 2011.
In Q1 2012, MHP's production of sunflower oil remained almost at the same level as in Q1 2011 constituting 45,558 tonnes (Q1 2011: 45,900 tonnes) at an average price of US$ 1,085 per tonne, which is lower by 17% than in Q1 2011.
Grain growing operations
In the first quarter of 2012 MHP sold approximately 82,000 tonnes of corn at an average price of US$ 224 per tonne, approximately 19,000 tonnes of wheat at an average price of US$ 186 per tonne, approximately 5,800 tonnes of soybeans at an average price of US$ 397 per tonne. Corn and soybeans were mostly exported, while wheat was sold domestically.
The Company's winter crops are on approximately 61,000 hectares of land. Despite challenging weather conditions during sowing campaign in autumn and low temperatures during winter 2011-2012, crops are in good condition.
Due to more efficient technology implementation, the Company already fertilized its land in autumn 2011. MHP's 2012 spring sowing campaign is ongoing now.
In 2012 the Company expects to harvest around 250,000 hectares of land in grain growing operations and to cultivate around 30,000 hectares of land in other agricultural operations. Total land bank in 2012 will remain relatively stable at around 280,000 hectares.
Other agricultural operations
Meat processing products | Q1 2012 | Q1 2011 | % change | |
Sales volume, third parties tonnes | 7,500 | 7,900 | -5% | |
Price per 1 kg net VAT, UAH | 21.53 | 18.22 | 18% |
Production volumes of sausage and cooked meat in Q1 2012 decreased by 5% to 7,500 tonnes compared to 7,900 tonnes in Q1 2011 due to the product mix optimization.
The average sausage and cooked meat price in Q1 2012 increased by 18% to UAH 21.53 per kg (excluding VAT) compared to UAH 18.22 in Q1 2011. MHP continues to execute its strategy of increasing the Company's market share in meat processing products, by using internally produced chicken meat.
Vinnytsia - expansion project
MHP's new green field Vinnytsia project is being constructed to schedule and in line with the investment plans. To follow the progress on the site please visit: http://www.mhp.com.ua/en/node/1082/.
Next release: Financial results for Q1 2012 will be disclosed on 17 May, 2012.
For further information please contact:
Anastasiia Sobotiuk (Kyiv) |
Kyiv: +38 044 207 99 58 a.sobotyuk@mhp.com.ua |
Notes to Editors:
About MHP
MHP is the leading producer of poultry products in Ukraine with the greatest market share and highest brand recognition for its products. MHP owns and operates each of the key stages of chicken production processes, from feed grains and fodder production to egg hatching and grow out to processing, marketing, distribution and sales (including through MHP's franchise outlets). Vertical integration reduces MHP's dependence on suppliers and its exposure to increases in raw material prices. In addition to cost efficiency, vertical integration also allows MHP to maintain strict biosecurity and to control the quality of its inputs and the resulting quality and consistency of its products through to the point of sale. To support its sales, MHP maintains a distribution network consisting of 11 distribution and logistical centres, within major Ukrainian cities. MHP uses its trucks for the distribution of its products, which Management believes reduces overall transportation costs and delivery times.
MHP also has a leading grain cultivation business growing corn to support the vertical integration of its chicken production and increasingly other grains, such as wheat and rape, for sale to third parties. MHP leases agricultural land located primarily in the highly fertile black soil regions of Ukraine.
Since May 15, 2008, MHP has traded on the London Stock Exchange under the ticker symbol MHPC.
Forward-Looking Statements
This press release might contain forward-looking statements that refer to future events or forecast financial indicators for MHP S.A. Such statements do not guarantee that these are actions to be taken by MHP S.A. in the future, and estimates can be inaccurate and uncertain. Actual final indicators and results can considerably differ from those declared in any forward-looking statements. MHP S.A. does not intend to change these statements to reflect actual results.