March 15, 2012

Cherkizovo's Q4 net income up 13%

Russia's leading meat processor Cherkizovo Group reported Wednesday (Mar 14) a 13% on-year rise in fourth-quarter net profit to US$39.3 million.

The company's revenues grew 22% to US$392.5 million. Adjusted earnings before interest, taxation, depreciation and amortization (EBITDA) rose 30% to US$65.5 million, while the EBITDA margin went up to 17% from 16%.

Cherkizovo's net profit for 2011 went up 2% to US$147.8 million, while its revenue rose 24% to US$1.473 billion.

"These results have been achieved despite a very challenging operating environment at the start of the year, where extreme weather conditions had resulted in lost harvests and a steep increase in grain prices," said Cherkizovo CEO Sergei Mikhailov.

The company benefited from important and timely government measures in 2011 to support poultry and pork producers through subsidies and action in the grain market, he added.

Cherkizovo's net debt amounted to US$719.2 million as of December 31, 2011, while the effective cost of the debt decreased to 2% from 2.5% in 2010.

Meanwhile, the company plans to increase its capital expenditures 41% to US$300 million in 2012, the company's CFO Lyudmila Mikhailova said.

It also plans to use US$118.6 million to finance the development of a poultry plant in the city of Yelets in the Lipetsk region, she added.

Cherkizovo comprises seven meat processing plants, four poultry producing complexes, two poultry processing plants, 10 pig farms, and two feed plants, as well as trading houses.