EIB Granting Kernel Funding for $250M

21 Дек

European Investment Bank (EIB) grants the agro-holding Kernel long-term funding amounting to $250M to cover capex for 2019 financial year (FY, July 2018 – June 2019). This comes from the company’s report at Warsaw Commodities Exchange, informs Interfax-Ukraina.
“[Funding] will be used by the company to upgrade the existing oil processing plants and build a new one in West Ukraine, as well as grain storages and terminal in the port of Chornomorsk”, specifies the report.
Prior to granting funds, EIB held assessment of possible financing Kernel’s business expanding project consisting of two grain silos to store grain, a terminal to process and store grain in Chornomorsk Port, five heating plants, and a sunflower seeds crushing facility. The overall cost of this project counts some $519M. “It is anticipated that EIB funds would enable the company to enhance its trade and export logistics having new grain storages built with access for third parties too, and transhipment objects. Thanks to construction of a new sunflower oil producing plant (…) the company should advance its resources use efficiency and enlarge its share in the Ukraine and EU markets”, said further the EIB report.
Last week European Bank of Reconstruction and Development (EBRD) approved granting to Kernel a long-term credit for up to $48M. Individual long-term investments are to be directed to the Kernel Group agro-business infrastructure. As per EBRD, the project’s total cost is estimated as $110M.
LLC TransGrainTerminal (a part of Kernel) performs a new grain terminal construction in the port of Chornomorsk with 4M t annual capacity. The terminal’s first phase launch is expected in January 2019.
In April 2017 Ukrainian Sea Ports Authority (USPA) signed a memorandum of cooperation with Kernel within which USPA undertook to enhance the depths of Sukhoi Liman first basin operational area, those at Berths 14-17, and of the port’s approach canal, while Kernel is liable to boost its cargo throughput in the port from 3 to 7M t by the second half of 2019.
Kernel is a world largest manufacturer and exporter of sunflower oil, major producer and supplier of agricultural products from the black sea region to world markets. The company’s vertically integrated structure is built of closely interwoven business segments: production, export and domestic sales of sunflower oil; horticulture; export of grain products; rendering services of storage and transhipment of grain at elevators and port terminals. The company’s land bank comprises 550,000 ha. The company owns a grain complex TransBulkTerminal in the port of Chornomorsk capable of 4M t a year. It exports production to more than 60 countries.
Kernel’s stock is listed at Warsaw Commodities Exchange since November 2007. In FY 2018 the holding reduced grain sales by 8.2$ as compared to the last year – down to 4.646M t. Sales of bulk sunflower oil amplified by 20.1% — up to 1.301M t, bottled sunflower oil – went down by 9.7% to 118.6M ltr. Grain handling at the group’s export terminals shrank by 0.6% – down to 6.06M t.
The company decreased in FY 2018 its net profit comparing with FY 2017 – to $55.95M or 3.2 times. The earnings grew by 10.8% – up to $2.403Bn, while EBITDA shrank by 30.3$ or down to $222.5M.