Goodvalley secured strong operational performance in Q3 2020 in the face of unprecedented market volatility caused by COVID-19 and the outbreak of ASF in Germany. The Group’s geographically diversified production, strong arable yields, and growth in branded product sales partially offset the negative impact of market volatility and contributed to ensure satisfactory results in a challenging quarter.
”Despite challenging market conditions in Q3 2020 and a 9% decrease in revenue due to COVID-19 and an outbreak of ASF in Germany, we delivered strong operational performance and an Adjusted EBITDA margin of 15.2% based on higher sales of live pigs and pork meat products. Sales of branded products more than tripled, and operations were sustained at our production sites and slaughterhouse despite significant challenges and market volatility,” says CEO Hans Henrik Pedersen.
Q3 2020
• Group revenue decreased by 9% to DKK 379 million (Q3 2019: DKK 414 million), and Adjusted EBITDA came to DKK 58 million (Q3 2019: DKK 71 million), corresponding to an Adjusted EBITDA margin of 15.2% (Q3 2019: 17.2%).
• The Polish segment’s revenue declined to DKK 209 million (Q3 2019: DKK 228 million), and Adjusted EBITDA came to DKK 17 million (Q3 2019: DKK 34 million) corresponding to a lower Adjusted EBITDA margin of 8.3% (Q3 2019: 15.0%) caused by the substantial drop in prices due to COVID-19 and oversupply of live pigs in Europe following the discovery of ASF in Germany.
• Ukrainian segment revenue came to DKK 129 million (Q3 2019: DKK 138 million), and Adjusted EBITDA increased to DKK 27 million (Q3 2019: DKK 15 million) corresponding to an Adjusted EBITDA margin of 20.6% (Q3 2019: 10.7%) on the back of continued high production efficiency as well as a negative effect in Q3 2019 from flooding and low harvest yields.
• Revenue in the Russian business declined to DKK 41 million (Q3 2019: DKK 48 million) as a result of lower volumes and prices, and Adjusted EBITDA was stable at DKK 18 million (Q3 2019: DKK 18 million) corresponding to an improved Adjusted EBITDA margin of 44.8% (Q3 2019: 37.9%) driven by record high yields in the arable production and a decrease in the feed price.
Outlook
Goodvalley maintains the recently adjusted outlook for 2020 of revenue of DKK 1,450 - 1,550 million and Adjusted EBITDA of DKK 300 - 330 million as announced in company announcement no. 11/2020 on 19 October 2020. The outlook for 2020 is still based on an average market price for live pigs of DKK 11.90 per kilo slaughter pig and a feed price of DKK 1.64 per kilo in the pig division. The outlook is furthermore based on prevailing exchange rates for the Group’s key currencies. The assumptions are subject to significant uncertainty due to the outbreak of COVID-19.
Conference call
On 20 November 2020 at 13.30 (CET), Goodvalley will host a conference call at which CEO Hans Henrik Pedersen and Vice CEO Kristian Brokop Jakobsen will provide comments on financial and operational performance, 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/iksdk2gh
Participants should dial the numbers provided below and state conference code 6356898
| Denmark: | +45 32 72 80 42 |
| Norway: | +47 239 60264 |
| Poland: | +48 222 120 152 |
| Sweden: | +46 (0)850 692180 |
| United Kingdom: | +44 (0)844 571 8892 |
| United States | +1 631 510 7495 |
Further information
Group CFO, Jakob Brasted
+ 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 a carbon neutral company 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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