Goodvalley continued to increase production and grow sales of live pigs in Q3 2019 to accommodate increasing demand across the Group’s markets. Higher prices for live pigs boosted earnings from the Group’s pig production. At the same time, though, the crop yield came in at a record-low level and the higher pig prices had a temporary negative impact on profitability on value added pork products. The Group’s operational performance improved slightly in the quarter driven by continued efforts to improve production planning and processes.
“Our pig production generated strong results in the quarter as we leveraged our recent investments in production capacity, enabling us to sell more live pigs at a higher average price while simultaneously improving operational efficiency slightly. Even though we realised a record-low crop yield from our land in Ukraine in particular and saw the pig price effect partly offset by relatively fixed pork product sales prices, we now expect to reach the high end of our revenue and earnings outlook for the full-year” says CEO Hans Henrik Pedersen
Q3 2019
- Group revenue grew to DKK 414 million (Q3 2018: DKK 377 million) driven by an increase in sales of live pigs at a higher average price, which boosted Adjusted EBITDA* to DKK 71 million (Q3 2018: DKK 35 million) corresponding to an Adjusted EBITDA margin of 17.2 % (Q3 2018: 9.2%).
- The Polish segment grew revenue to DKK 228 million (Q3 2018: DKK 221 million) and lifted Adjusted EBITDA to DKK 34 million (Q3 2018: DKK 4 million) due to higher live pig sales volume and price. The positive development was partly offset by relatively fixed domestic pork product prices despite fewer pigs slaughtered in the quarter.
- Revenue in the Ukrainian business increased to DKK 138 million (Q3 2018: DKK 108 million) driven by higher pig prices, whereas Adjusted EBITDA declined to DKK 15 million (Q3 2018: DKK 17 million) as the crop yield came in at a record-low level below the low yield realised in the comparison period.
- In Russia, revenue was stable at DKK 48 million (Q3 2018: DKK 48 million), while Adjusted EBITDA declined to DKK 18 million (Q3 2018: DKK 22 million) due to lower pig prices
Outlook
Based on the positive development in Q3 2019, Goodvalley expects to reach the high end of the previously communicated outlook for 2019 in terms of revenue and Adjusted EBITDA. The Group now expects to generate revenue of DKK 1,450 - 1,550 against the previous expectation of DKK 1,400-1,550 million and an Adjusted EBITDA of DKK 250-280 million against the former expectation of DKK 220-280 million.
Financial highlights
| DKK million | Q3 2019 | Q3 2018 | 9M 2019 | 9M 2018 |
| Revenue | 414 | 377 | 1,121 | 1,102 |
| EBITDA | 63 | 40 | 240 | 210 |
| Adjusted EBITDA | 71 | 35 | 185 | 190 |
| Adjusted EBITDA margin | 17.2% | 9.2% | 16.5% | 17.3% |
| Profit for the period | 26 | (21) | 120 | 67 |
| Free cash flow | 28 | (33) | 78 | (68) |
| Net interest-bearing debt | 1,158 | 1,178 | 1,158 | 1,178 |
Conference call
On 27 November 2019 at 10.00 (CET), Goodvalley will host a conference call at which CEO Hans Henrik Pedersen and Vice CEO Kristian Brokop will provide comments on financial and operational performance in Q3 2019, the outlook and answer questions. Registration is not required.
The conference call will be conducted in English and can be followed live here:
https://edge.media-server.com/mmc/p/n7y8t2i6
Participants should dial the numbers provided below and state conference code 3689973
| Denmark: | +45 32 72 80 42 |
| Norway: | +47 239 60264 |
| Sweden: | +46 (0)850 692180 |
| Poland | +48 222 120 152 |
| United Kingdom: | +44 (0)844 571 8892 |
| United States: | +1 631 5107495 |
Further information
Group Communications, Anne Axelgaard
+ 45 76 52 20 00
GOODVALLEY AT A GLANCE
Goodvalley is an international producer of high-quality pork products operating in Poland, Ukraine and Russia based on Danish production standards. The company is to a large extent self-sufficient and masters the whole production chain from field to fork, from growing crops for feed, breeding and slaughtering pigs including using the manure in biogas facilities to produce electricity and organic fertilizer for the fields. Goodvalley is certified as CO2 neutral in the entire organisation by German TÜV and operates according to the highest standards in terms of animal welfare, transparency in the production and sustainable production methods.
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