08.09.2011, 07:01
PhosAgro Releases Strong 1H11 IFRS Financial Results
OREANDA-NEWS. September 08, 2011. PhosAgro released a solid set of 1H11 IFRS financial results which, however, were right in line with market expectations. In addition, QoQ comparisons indicate a rather lacklustre performance which we attribute to scheduled maintenance shutdowns at the company’s production facilities, reported the press-centre of ATON.
Buoyed by strong fertiliser prices for PhosAgro’s namesake product (87% of total revenues; phosphate benchmark DAP prices increased over 40% YoY in 6M11), the company’s 1H11 revenue came in 35% higher YoY at RUB48.8bn. As costs grew more slowly than revenue, gross margin improved a whopping 10 ppts YoY to 45%. Net profit for the period was up 143% YoY to RUB10.3bn.
We note that in 2Q11 the company’s revenues were essentially flat, edging down 1% YoY while profitability levels deteriorated only marginally.
Bottom line
PhosAgro’s 1H11 IFRS financial results look strong, in our view. We note that the company’s operating cash flow increased 4.2x YoY to RUB17.9bn with net debt at RUB19.8bn (the net debt/EBITDA ratio thus stands at a comforting 0.6x).
The stock is now trading below its IPO level (USD 14/GDR) with its share price performance lagging that of its peers. Based on Bloomberg consensus numbers, PhosAgro is now trading at respective FY11 P/E and EV/EBITDA multiples of 6.3x and 4.5x – far below the average levels for foreign peers (11.5x and 6.3x). This, in our view, positions PhosAgro as interesting exposure to the Russian fertiliser space and a cheap (and high quality) alternative to Uralkali.
Buoyed by strong fertiliser prices for PhosAgro’s namesake product (87% of total revenues; phosphate benchmark DAP prices increased over 40% YoY in 6M11), the company’s 1H11 revenue came in 35% higher YoY at RUB48.8bn. As costs grew more slowly than revenue, gross margin improved a whopping 10 ppts YoY to 45%. Net profit for the period was up 143% YoY to RUB10.3bn.
We note that in 2Q11 the company’s revenues were essentially flat, edging down 1% YoY while profitability levels deteriorated only marginally.
Bottom line
PhosAgro’s 1H11 IFRS financial results look strong, in our view. We note that the company’s operating cash flow increased 4.2x YoY to RUB17.9bn with net debt at RUB19.8bn (the net debt/EBITDA ratio thus stands at a comforting 0.6x).
The stock is now trading below its IPO level (USD 14/GDR) with its share price performance lagging that of its peers. Based on Bloomberg consensus numbers, PhosAgro is now trading at respective FY11 P/E and EV/EBITDA multiples of 6.3x and 4.5x – far below the average levels for foreign peers (11.5x and 6.3x). This, in our view, positions PhosAgro as interesting exposure to the Russian fertiliser space and a cheap (and high quality) alternative to Uralkali.
Комментарии