OREANDA-NEWS. Moy Park Holdings (Europe) Limited ("Moy Park") is a leading and highly regarded European food company, providing fresh, high quality and locally farmed poultry and convenience food products to major retailers and large foodservice customers throughout the UK, Ireland and Continental Europe.

Moy Park today announces its third quarter (Q3) results for the 13 weeks ended 26 September 2015.

Q3 2015 Financial Highlights

 

Q3 2015

Q3 2014

Q3 2015 v. Q3 2014

£'mn

£'mn

 

Revenue

350.7

354.1

-1.0%

EBITDA

21.3

24.4

-12.7%

Profit before Tax                          

0.2

3.7

-94.6%

Underlying EBITDA

26.8 

26.3

+1.9%

Underlying Profit before Tax

10.4

9.3

+11.8%

Net Debt

213.8

172.7

+£41.1mn

Net Debt/EBITDA (times)*         

1.90x

1.64x

+0.26 times
                                                                            

*Net Debt/EBITDA is calculated as Net Debt at the relevant period end divided by EBITDA before exceptional items for the 12 months to that date.

Underlying EBITDA is before corporate charges and exceptional items.

Underlying Profit before Tax is before corporate charges, exceptional items and additional bond interest incurred in the period when compared to the same period in the prior year.  

Q3 2015 Highlights

·    Good sales volume growth in both the UK & Ireland and Continental Europe business units when compared to Q3 2014.

·    Revenue decreased 1% from Q3 2014 to £350.7 million with foreign exchange movements, commodity price deflation and lower international sales offsetting the sales volume growth.

·    Underlying EBITDA, before inclusion of corporate charges from our parent company and exceptional items, grew 1.9% to £26.8 million in Q3 2015.

·    Underlying PBT, before corporate charges, exceptional items and interest on the bond issued during Q2 2014 and the bond re-tap in Q2 2015, grew 11.8% to £10.4 million in Q3 2015.

·    Leverage (Net Debt/EBITDA) at the end of the period, is 1.90 times compared to 1.91 times at the end of Q2 2015. 

Commenting on the results, Janet Mc Collum, CEO of Moy Park said: "The third quarter of 2015 has seen Moy Park produce a positive performance in a challenging market. Our continued commitment to our customers and consumers, ensuring delivery of the highest quality product while maintaining our focus on controlling costs, has enabled us to further grow our revenue base and improve margins. We have also maintained our leverage level while continuing to invest in our infrastructure to support future growth.

On September 29, 2015, the completion of the sale of Moy Park to JBS S.A. was announced. While the ownership of the company has changed, our day to day focus has not and remains to meet and exceed our customer's expectations. Being part of JBS provides us with a major opportunity to share best practice as part of one of the world's largest food businesses and to further enhance our offering to customers." 

Q3 2015

There was good sales volume growth in both the UK & Ireland and Continental Europe business units during the period. Total revenue decreased by £3.4 million to £350.7 million compared to the same period in the prior year. The revenue decrease was driven by the volume growth being offset by the further strengthening of sterling relative to the euro (which reduced the sterling value of European revenues), commodity input cost deflation, and lower prices achieved on international sales of poultry dark meats and offal. International sales prices were impacted by Avian Influenza outbreaks and foreign exchange rate movements. 

EBITDA before corporate costs (£1.5 million) and exceptional items (£4.0 million) increased by £0.5 million to £26.8 million. The improvement in margins was the result of increased operating efficiencies, particularly across our convenience product range, and our on-going focus on cost control which more than offset the lower prices on international sales. The exceptional item reported in the period is the write-off of costs incurred on the potential IPO of the business and corporate costs paid in advance.

 UK & Ireland

Good sales volume growth in the UK & Ireland business was offset by commodity price deflation and the lower prices on international sales resulting in revenue of £270.1 million, 2.6% below Q3 2014. 

Continental Europe

European revenue of €112.7 million is ahead of Q3 2014 with strong volume growth across our poultry and beef products. 

Debt funding and cash flow

Net Debt at the end of the period was £213.8 million giving a Net Debt/EBITDA ratio of 1.90 times. Net Debt/EBITDA at the end of Q2 2015 was 1.91 times. 

Sale of Moy Park to JBS S.A.

On June 21, 2015 Marfrig Global Foods S.A. announced that it had entered into a definitive agreement to sell the entire equity holding in Moy Park Holdings Europe Limited to JBS S.A. This transaction was subject to certain consents and approvals by the competent authorities, including antitrust agencies from Europe. All necessary consents were received and the transaction completed on September 29, 2015.

The sale of the business triggered a Change of Control under the Moy Park bonds and required us to make a Change of Control Offer to bond holders. This offer was made on October 23, 2015 and is due to expire on November 23, 2015.