Kernel issues USD 300-500 mln Eurobonds — Verevskiy

Kernel will increase its investment to USD 300 mln in the fiscal year 2020 (July 2019–June 2020) vs. USD 251 mln in 2019. This was announced by Chairman of the Board of Directors, Founder of Kernel, Andrei Verevskiy, during a conference call with analysts, the WSE reports.

As of June 30th, 2019, the company held USD 496.1 mln of Eurobonds maturing in 2022.

Reportedly, the USD 300 mln of investment will be used for the following purposes:

• continuation of the oilseeds crushing plant in Western Ukraine — USD 66 mln;
• construction of an export terminal in the port of Chernomorsk, TransGrainTerminal — USD 58 mln;
• investment in silos — USD 10 mln;
• railcars — USD 9 mln;
• construction of co-generation plants — USD 90 mln;
• maintenance investment — USD 68 mln.

Andrei Verevskiy projects that by the end of 2020 the net debt to EBITDA ratio will be slightly below 2.5 compared to 2 at the end of 2019.

In the upcoming financial year, the company expects 15.2 mln tons of sunflower seeds harvest, 13% up y-o-y, which materially bridged the gap to 18.5 mln t of installed processing capacities, pushing up crush margins.

As a reminder, in FY2019 (July 2018–June 2019) Kernel increased its net profit 3.6x to USD 189 mln.