Agriculture
June 04, 2013
Avangard’s ongoing capacity expansion allowed it to increase its 1Q13 top line by 6% YoY to USD 156mn. However, the company’s margins declined notably, as rising output failed to compensate for higher grain input costs and an 8% YoY decrease in the average achieved egg price, to UAH 0.68 per piece. This led to a drop in EBITDA by 13% YoY, to USD 73mn, with the EBITDA margin sliding by 10p.p. YoY to 45%. In order to incorporate the most recent developments with the company into our valuation, we are placing our BUY recommendation and target price for the AVGR stock under review.
