Olam: 2QFY15 results below estimates, as net profit dropped 12% y/y to $118.7m, despite a 8.3% rise in revenue to $4.9b, buoyed by higher selling prices of almonds, hazelnuts, cocoa and coffee, which offset the drop in sales volume to 3.4m MT (-8.7%).
The bottom line was impacted by the severe FX devaluation across its major markets, primarily with the US dollar against Russia, Nigeria, Brazil and Australia, as well as a fair value loss on biological assets ($12m).
Subsequently, EBITDA margin dropped from 7% to 5.8%. Excluding FX effects, margin would have fallen 0.6ppt to 6.4%.
Free cash flow turned in positive, driven by lower working capital requirements, reduced capex pace and lower net interest expense.
Net gearing stood at 1.85x.
BVPS of $1.6717.
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