Astarta (AST) Q2 2024 earnings summary

Executive summary

• Consolidated revenues for 1H24 rose 12% year-over-year to EUR321m, driven by strong sugar production and increased export sales.

• EBITDA declined 12% y-o-y to EUR86m, with margin down 7pp to 27% on weaker pricing and higher distribution costs.

• Net profit for 1H24 was EUR47m, down from EUR55m in 1H23, with EPS at EUR1.93 (vs EUR2.26 in 1H23).

• Export sales accounted for 67% of total revenues, up from 55% in 1H23.

• Operating cash flow increased 68% y-o-y to EUR116m, mainly from inventory sales.

Financial highlights

• Gross profit reached EUR127m (+1% y-o-y), but gross margin narrowed by 5pp to 39% due to lower commodity prices.

• Net profit margin was 15%, down from 19% in 1H23.

• Net financial debt (excluding leases) turned to a positive cash position of EUR28m; total net debt down 27% y-o-y to EUR96m.

• Investing cash flows doubled to EUR19m, focused on sugar and agriculture segments.

• Dividend of EUR0.50/share (EUR12.5m total) declared and paid in July 2024.

Outlook and guidance

• Sugar beet and late crop harvesting underway; winter rapeseed sowing for 2025 started in August.

• Management expects all sugar plants to run in 2024 and stable export activity, but notes significant uncertainty due to the ongoing war in Ukraine.

• Ukrainian sugar exports to the EU halted until end-2024 due to quota limits; new quota set for 2025.

• Company exploring non-EU markets for sugar sales amid global price declines.

• CapEx will continue in the second half, especially for the SPC project and sugar packaging upgrades.