Consolidated Unaudited Interim Report of AS PRFoods for the 1nd quarter and 3 months of 2021/2022 financial year
28 Noviembre 2021 - 11:17AM
Consolidated Unaudited Interim Report of AS PRFoods for the 1nd
quarter and 3 months of 2021/2022 financial year
MANAGEMENT COMMENTARY
Q1 had many things we can be satisfied with- our
sales grew by 11.5% and group net loss decreased by 50%.
Unfortunately, there are many things, that unearthed massive
management mistakes in Finnish unit. All PRFoods current problems
stem from management mistakes made in 2020-2021. As of toda, we
have completed 100% the change of management and key people in
Finland, that we started in summer and decision to close lossmaking
Kokkola factory. These steps build base for renewal of
profitability in 2022.
Corona crises speed up the unearthing of
weaknesses in Finnish unit, and unfortunately the previous
management did not want to acknowledge their mistakes or correct
them. The proof that we are on right track with right people who
joined us in fall this year, is the fact as of October we back to
being profitable also in Finland: Heimon Kala Oy October EBITDA was
28 thousand euros and better by 270 thousand euros on YoY basis.
Finnish unit caused liquidity crisis, which we are correcting with
increased performance of our farming unit and cashflow released
from biomass harvesting.
Thanks to the changes made to product portfolio
and production by new Finnish management, we are out of all
non-profitable products in Finland and have secured price and sales
increases for next year in all categories. Considering the
turbulent times in Finland, we aim to provide investors with
regular updates from this unit.
Very well performed our UK unit, who despite
some one-offs, fulfilled its EBITDA target in the sum of 172
thousand euros. Estonian EBITDA was still in minus by 150 thousand
euros in Q1 due to loss-making Finnish sales.
The decline in Finnish management continued in
summer, where instead of cutting loss-making production, they
increased it, resulting in 880 thousand euros EBITDA loss.
Fish farming is making very good results in
current quarter thanks to increased harvest volume and prices. Fish
farming could even post a better EBITDA, but we delayed our Swedish
harvest until Q1 2022 due to smaller biomass increase in hot
summer. Considering that fresh fish prices are higher in winter,
this decision has positive economic impact. At the same time this
will decrease our cash flow from biomass in current quarter by 1.5
million euros, which will be deferred until Q1 2022.
We have followed our previously announced plan
to emerge from this crisis:
- Decrease our bank loans: cash flow from financing was -1.5
million euros in Q1
- Restructure totally Finnish unit, including selling possibly or
closing units or closing loss making units. Eliminating form
Finnish sales all low margin products: target achieved by end of
2021.
- Increas retail sales in UK, EU and other domestic markets:
target achieved in all markets, except Finland.
- Group’s strategic focus is on fish farming, as area that has
been constantly profitable. Group’s target ist o achieve 10
thousand tons of biomass by 2023, which should give group sales of
40-50 million euros: Swedish farms should contribute already
additional 1.500-1.700 tons of biomass by fall 2022.
Group’s financial position is not easy. At the
same time, we must remember that 11 million euros bonds have been
issued solely for refinancing of John Ross Jr. Acquisition and John
Ross Jr results have not been impacted so severly, their
operational cash flow is very strong and they pay regularly
dividends to parent company, therefore we find their leverage to be
acceptable.
Fish farming requires long term capital for fish
feed and this is under works.
Last year we were forced to reduce significantly
working capital financing through banks, which put strain on
company’s finances. We have reduced significantly working capital
needs in operations, also through lower inventory. Most important
is to restore profitability in the environment of lower sales and
restructure loss-making business units.
Having cut our teeth now for second year in
corona crisis, we know that it is not sustainable to rely on
outside help and all tough decisions need to be taken sooner than
later. For our advantage the fish market has started much stronger
this year and is more predictable and demand for our products is
growing. The only objective of new financial year is profit and
everything that blocks our road to profitabilty must be
eliminated.
KEY RATIOS
INCOME STATEMENT
mln EUR |
3Q 2021 |
2Q 2021 |
1Q 2021 |
4Q 2020 |
3Q 2020 |
2Q 2020 |
1Q 2020 |
4Q 2019 |
Sales |
14.2 |
14.7 |
14.2 |
17.0 |
12.7 |
15.1 |
18.5 |
25.4 |
Gross profit |
0.8 |
0.3 |
0.9 |
2.5 |
1.2 |
0.7 |
2.0 |
4.3 |
EBITDA from operations |
-0.8 |
-1.0 |
-0.5 |
0.6 |
-0.3 |
-0.1 |
0.0 |
2.1 |
EBITDA |
0.0 |
-0.7 |
-0.7 |
0.7 |
-0.5 |
-0.1 |
-0.9 |
1.4 |
EBIT |
-0.7 |
-1.4 |
-1.4 |
0.0 |
-1.1 |
-1.0 |
-1.4 |
0.7 |
EBT |
-0.6 |
-1.6 |
-1.8 |
-0.1 |
-1.4 |
-1.2 |
-1.8 |
0.6 |
Net profit (-loss) |
-0.7 |
-1.7 |
-1.8 |
-0.2 |
-1.4 |
-1.3 |
-1.7 |
0.5 |
Gross margin |
5.4% |
2.1% |
6.6% |
14.9% |
9.4% |
4.4% |
10.8% |
17.0% |
Operational EBITDA margin |
-5.5% |
-7.0% |
-3.5% |
3.4% |
-2.6% |
-0.9% |
0.1% |
8.4% |
EBITDA margin |
-0.1% |
-4.8% |
-5.3% |
4.1% |
-3.8% |
-0.5% |
-4.6% |
5.3% |
EBIT margin |
-4.7% |
-9.3% |
-9.9% |
0.2% |
-8.8% |
-6.4% |
-7.8% |
2.9% |
EBT margin |
-4.6% |
-10.8% |
-12.5% |
-0.6% |
-11.3% |
-8.3% |
-9.8% |
2.2% |
Net margin |
-5.2% |
-11.6% |
-12.5% |
-1.2% |
-11.3% |
-8.4% |
-9.2% |
2.0% |
Operating expense ratio |
16.3% |
15.4% |
15.6% |
15.6% |
18.2% |
14.0% |
14.3% |
12.5% |
BALANCE SHEET
mln EUR |
30.09.2021 |
30.06.2021 |
31.03.2021 |
31.12.2020 |
30.09.2020 |
30.06.2020 |
31.03.2020 |
Net debt |
24.2 |
20.9 |
21.4 |
21.9 |
21.5 |
20.7 |
17.0 |
Equity |
14.9 |
15.8 |
17.6 |
18.6 |
18.5 |
19.8 |
21.6 |
Working capital |
-2.6 |
-2.9 |
-5.0 |
-3.9 |
-4.4 |
-4.0 |
-2.5 |
Assets |
56.0 |
55.3 |
54.5 |
57.5 |
57.4 |
57.1 |
56.9 |
Liquidity ratio |
0.9x |
0.9x |
0.8x |
0.8x |
0.8x |
0.8x |
0.9x |
Equity ratio |
26.7% |
28.6% |
32.4% |
32.4% |
32.3% |
34.7% |
37.9% |
Gearing ratio |
61.8% |
56.9% |
54.9% |
54.0% |
53.7% |
51.1% |
44.0% |
Debt to total assets |
0.7x |
0.7x |
0.7x |
0.7x |
0.7x |
0.7x |
0.6x |
Net debt to EBITDA op |
-14.3x |
-16.9x |
-55.3x |
160.0x |
12.8x |
7.5x |
5.3x |
ROE |
-26.7% |
-28.7% |
-23.8% |
-21.9% |
-7.0% |
-9.1% |
-5.7% |
ROA |
-7.9% |
-9.1% |
-8.4% |
-7.8% |
-2.4% |
-3.2% |
-2.1% |
Consolidated Statement of Financial
Position
Thousand euros |
30.09.2021 |
30.09.2020 |
30.06.2021 |
ASSETS |
|
|
|
Cash and cash equivalents |
748 |
1.091 |
2.500 |
Receivables and prepayments |
3.231 |
3.232 |
3.512 |
Inventories |
5.638 |
8.746 |
5.691 |
Biological assets |
7.746 |
5.423 |
4.795 |
Total current assets |
17.363 |
18.492 |
16.498 |
|
|
|
|
Deferred income tax |
38 |
54 |
38 |
Long-term financial investments |
305 |
232 |
302 |
Tangible fixed assets |
14.897 |
16.006 |
15.300 |
Intangible assets |
23.368 |
22.606 |
23.460 |
Total non-current assets |
38.608 |
38.898 |
39.100 |
TOTAL ASSETS |
55.971 |
57.390 |
55.598 |
|
|
|
|
EQUITY AND LIABILITIES |
|
|
|
Loans and borrowings |
6.521 |
10.322 |
7.325 |
Payables |
13.219 |
12.385 |
12.124 |
Government grants |
207 |
212 |
207 |
Total current liabilities |
19.947 |
22.919 |
19.656 |
|
|
|
|
Loans and borrowings |
18.411 |
12.261 |
17.561 |
Payables |
0 |
900 |
0 |
Deferred tax liabilities |
1.996 |
1.934 |
1.861 |
Government grants |
695 |
833 |
746 |
Total non-current liabilities |
21.102 |
15.928 |
20.168 |
TOTAL LIABILITIES |
41.049 |
38.847 |
39.824 |
|
|
|
|
Share capital |
7.737 |
7.737 |
7.737 |
Share premium |
14.007 |
14.198 |
14.007 |
Treasury shares |
-390 |
-390 |
-390 |
Statutory capital reserve |
51 |
51 |
51 |
Currency translation reserve |
447 |
-397 |
559 |
Retained profit (-loss) |
-7.641 |
-3.056 |
-6.723 |
Equity attributable to parent |
14.211 |
18.143 |
15.241 |
Non-controlling interest |
711 |
400 |
533 |
TOTAL EQUITY |
14.922 |
18.543 |
15.774 |
TOTAL EQUITY AND LIABILITIES |
55.971 |
57.390 |
55.598 |
Consolidated Statement of Profit or Loss And Other
Comprehensive Income
Thousand euros |
3m 2021/2022 |
3m 2020/2021 |
Sales |
14.207 |
12.737 |
Cost of goods sold |
-13.433 |
-11.537 |
Gross profit |
774 |
1.200 |
|
|
|
Operating expenses |
-2.309 |
-2.322 |
Selling and distribution expenses |
-1.581 |
-1.558 |
Administrative expenses |
-728 |
-764 |
Other income / expense |
51 |
91 |
Fair value adjustment on biological assets |
820 |
-94 |
Operating profit (loss) |
-664 |
-1.125 |
Financial income/-expenses |
16 |
-309 |
Profit (loss) before tax |
-648 |
-1.434 |
Income tax |
-92 |
-4 |
Net profit (loss) for the period |
-740 |
-1.438 |
|
|
|
Net profit (loss) attributable to: |
|
|
Owners of the company |
-918 |
-1.402 |
Non-controlling interests |
178 |
-36 |
Total net profit (loss) |
-740 |
-1.438 |
|
|
|
Other omprehensive income (loss) that may subsequently be
classified to profit or loss: |
|
|
Foreign currency translation differences |
-112 |
-31 |
Total comprehensive income (expense) |
-852 |
-1.469 |
|
|
|
Total comprehensive income (expense) attributable to: |
|
|
Owners of the Company |
-842 |
-1.433 |
Non-controlling interests |
-10 |
-36 |
Total comprehensive income (expense) for the
period |
-852 |
-1.469 |
|
|
|
Profit (loss) per share (EUR) |
-0.02 |
-0.04 |
|
. |
. |
Diluted profit (loss) per share (EUR) |
-0.02 |
-0.04 |
Indrek Kasela
AS PRFoods
Member of the Management Board
Phone:+372 452 1470
investor@prfoods.ee
www.prfoods.ee
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