Ovostar’s Laying Hen Capacity Rose 28% in FY11

January 31, 2012

Ovostar Union, Ukraine’s second largest producer of eggs, released its unaudited operational results for 2011. According to the release, the company’s laying hens capacities increased by 28.6% to 2.7mn hen places. Actual number of laying hens was 2.3 mn hens as of 31 Dec 2011. Sales of eggs increased by 25% YoY, amounting 439mn eggs in 2011, including 79mn eggs, which were exported. The Company has sold 1,338 tons of dry and 4,072 tons of liquid egg products in 2011. Company also mentioned that it sold 1.4 tons of sunﬂ ower oil at the average selling price of UAH 7,763 per 1 ton in 2011. According to the press release the company’s revenue amounted to UAH 400mn or USD 50mn.

COMMENTARY

Ovostar’s operational results are in line with our expectations and company’s forecasts. Given the announced data, we estimated the company’s EBITDA at USD 17.4mn and net proﬁ t at USD 14.6mn in FY 2011. For 2011 we model EBITDA and net margins at 34.9% and 29.3% respectively. Currently Ovostar traded at P/E of 12.0 and EV/EBITDA of 9.9

For over 17 years, Eavex Capital has been assisting its clients in implementation of successful investment strategies in the highly dynamic financial markets of Ukraine. Established in 1994 as Sincome Capital, the company has been a leader in equity and fixed income trading since the inception of the Ukrainian capital markets. Re-structured and re-launched in 2010, Eavex Capital is now a full service investment house offering corporate finance and investment banking, research, custody, consultancy and equity/fixed income sales and trading services. The company is a partnership between management and minority shareholder, Swiss-based Accuro Group. Eavex Capital is a co-founder and member of the Board of the Ukrainian Exchange (UX), a member of the Board of the PFTS Exchange, a member of the Strategic Group for Development of the Capital Markets under the Ukrainian State Securities Commission, a member of the Association of Ukrainian Secruties Traders (AUST) and a member of the Professional Association of Registrars and Depositaries (PARD).

> become a client