Kernel EBITDA should land at c. USD 100 mln — Concorde Capital

In 3Q19, Kernel's EBITDA should land at c. USD  100 mln, as long as crushing margins even out at roughly USD 65/t, Concorde Capital analysts note.

"Excluding somewhat unusually strong bulk oil selling volumes (should decrease in the fourth quarter), the operating figures were mostly unsurprising," experts comment.

The final figure will also depend on the share of farming profits that was booked towards the current period (Kernel guided for a total of USD 170 mln for the year).

Crop sale profitability is expected to remain a key risk for 2019, taking into account that announced targets for this segment have been missed in the past.

"That said, we are generally comfortable with reiterating our annual EBITDA projection at USD 340 mln at this time. Our outlook on both leverage and liquidity likewise remains unchanged," the report states.

Earlier it was reported that Kernel had increased the volumes of sunflower oil sold in Q3 FY2019 to 390 thousand tons, up 40 per cent y-o-y given the low last year’s comparison base.