OREANDA-NEWS. Moy Park Holdings (Europe) Limited ("Moy Park") is a leading and highly regarded European food company, providing fresh, high quality and locally farmed poultry and convenience food products to major retailers and foodservice customers. 

Moy Park announces its results for the year ended 2 January 2016. 

Full Year 2015 Financial Highlights

 

 

FY 2015

FY 2014

FY 2015 v.   FY 2014

 

Revenue

 

£1,442.3m

£1,421.7m

+1.4%

 

EBITDA before exceptional items

 

£111.7m

£107.9m

+3.5%

 

Underlying EBITDA [a]

 

£116.2m

£111.3m

+4.4%

 

Underlying Profit Before Taxation [b]

 

£45.5m

£44.6m

+2.0%

 

Exceptional Items -Cost/(Income) [c]

 

£12.5m

£0.2m

£(12.3)m

 

Profit Before Taxation

 

£9.4m

£32.3m

(71.0%)

 

Net Debt

 

£154.0m

£162.9m

£8.9m

 

Net Debt : EBITDA [d]

 

+1.38 times

+1.51 times

0.13 times

 

 

 

 

 

[a] Underlying EBITDA is before exceptional items and corporate charges

 

[b] Underlying Profit Before Taxation is before exceptional items, corporate charges, bond interest and foreign exchange movement on inter-company loans

 

[c] The exceptional item reported in the year relates to impairment of assets resulting from closure, due to strategic rationalisation, of our non-core Wisbech site and the write off of costs incurred on the potential IPO of the business.

 

[d] Net Debt : EBITDA is calculated as net debt at the relevant period end divided by EBITDA before exceptional items for the last 12 months to that date
                 

 A year of strong growth and recognition for Moy Park 

Commenting on the results, Janet McCollum, Chief Executive of Moy Park said: 

"We are pleased to announce a strong 2015 full year financial performance in the face of challenging global market conditions. The company achieved 6.7% volume growth and increased underlying profit before tax.  This strong performance was delivered against the backdrop of a highly competitive market, foreign exchange headwinds, commodity price deflation and export restrictions. 

"One of the highlights for the business was processing, for the first time, over 5 million chickens per week, which is a significant milestone. 

"As part of our £170 million strategic investment programme, the company invested £28 million in our industry-leading operations, securing Moy Park's position as one of the UK's most advanced food manufacturing companies.  A further £30 million was invested in our agricultural base through our farming partners.  Positive cash flow throughout the year enabled us to do this whilst reducing net debt. 

"We continue to build our business to the highest standards of food safety and quality, and to meet and exceed the ever evolving expectations of our customers and consumers. 

"Amongst the many awards received by the company during 2015 we were particularly honoured to be recognised as UK Food Manufacturing Company of the Year, an achievement in which the entire Moy Park team can take great pride." 

2015 Full Year Highlights 

·    Strong sales volume growth of 6.7% when compared to prior year with a good performance in both the UK & Ireland and Continental Europe business units.

·    Revenue increased 1.4% to £1,442.3m million in spite of the headwinds of foreign exchange movements, commodity price deflation and lower international sales prices partially offsetting sales volume growth.

·    Underlying EBITDA, before the inclusion of corporate charges from our parent company and exceptional items, increased by 4.4 % to £116.2 million in 2015. EBITDA margin improved by 30 basis points to 8.1%.

·    Underlying Profit before Tax increased by 2.0 % to £45.5 million in 2015. After taking account of exceptional items of £(12.5)m and interest on the bond issued during Q2 2014 and the bond re-tap in Q2 2015 of £(10.0)m, PBT of £9.4m shows a reduction of £(22.9)m against the prior year.

·    Net debt at £154.0m has reduced by 5.5% from the prior year with leverage (Net Debt/EBITDA) improving from 1.51 times at the end of 2014 to 1.38 times in 2015. 

2015 Operational Highlights 

·    Processing, for the first time, over 5 million chickens per week, a significant milestone for the business

·    Significant investment of £27.5m at facilities in Dungannon, Craigavon and Ashbourne to enhance production capabilities - securing Moy Park's position as one of the UK's most advanced food manufacturing companies

·    Continued focus on food safety including significant investment in an industry leading, innovative and robust Campylobacter reduction strategy, receiving positive feedback from the UK Food Standards Agency and other independent stakeholders

·    A year of recognition - Moy Park received a number of awards and recognition from customers and independent bodies, including the UK Food Manufacturing Company of the Year, Product Developer of the Year, Institute of Grocery Distribution Learning & Development Award and a RoSPA Health & Safety Award, reflecting Moy Park's industry leading commitment to innovation and excellence.

·    In September 2015, Moy Park was acquired by JBS, the world's largest protein company and the second largest global food business.

 2015 Full year results

There was strong sales volume growth in both the UK & Ireland of 8% and Continental Europe of 4% during the period. Total revenue increased by £20.6 million to £1,442.3 million compared to the prior year. The revenue increase was driven by the volume growth being partly offset by the strength of sterling relative to the euro (which reduced the sterling value of European revenues), commodity input cost deflation, and lower market prices on international sales of poultry dark meats and offal. 

EBITDA before corporate costs and exceptional items of £12.5 million increased by £4.9m to £116.2m. The improvement in margins was the result of increased operating efficiencies and our ongoing focus on cost control which more than offset the lower prices on international sales. The exceptional item reported in the year relates to impairment of assets resulting from closure, due to strategic rationalisation, of our non-core Wisbech site and the write off of costs incurred on the potential IPO of the business. 

UK & Ireland

Good sales volume growth in the UK & Ireland business across both retail and foodservice was partly offset by commodity price deflation and the lower prices on international sales resulting in revenue of £1,124.1 million, 3.0% above 2014. 

Continental Europe

European revenue of €438.0 million is 6.8% ahead of 2014 with strong volume growth across our poultry and beef products. 

Q4 2015 Financial Highlights

 

Q4 2015

Q4 2014

Q4 2015 v. Q4 2014

 

 

Revenue

£378.1m

£372.3m

+1.6%

 

 

EBITDA before exceptional items

£30.0m

£30.9m

(3.2%)

 

 

Underlying EBITDA [a]

£30.0m

£32.6m

(8.1%)

 

 

Underlying Profit Before Taxation [b]

£12.1m

£15.8m

(23.8%)

 

 

Exceptional Items -Cost/(Income) [c]

£8.5m

£0m

£(8.5)m

 

 

Profit / (Loss) Before Taxation

(£1.7m)

£10.9m

(115.4%)

 

 

 

 

 

 

[a] Underlying EBITDA is before exceptional items and corporate charges

 

[b] Underlying Profit Before Taxation is before exceptional items, corporate charges, bond interest and foreign exchange movement on inter-company loans

 

[c] The exceptional item reported in the period relates to impairment of assets resulting from closure, due to strategic rationalisation, of our non-core Wisbech site.

 

 
               

 Q4 2015 Highlights

·    Strong sales volume growth of 9% when compared to Q4 2014 with good performance in both the UK & Ireland and Continental Europe business units.

·    Revenue increased by 1.6% from Q4 2014 to £378.1m million in spite of headwinds of foreign exchange movements, commodity price deflation and lower international sales prices partially offsetting the sales volume growth.

·    Underlying EBITDA, before inclusion of corporate charges from our parent company and exceptional items, reduced by (8.1) % to £30.0 million in Q4 2015.

·    Underlying PBT, before corporate charges, exceptional items and interest on the bond issued during Q2 2014 and the bond re-tap in Q2 2015, reduced by (23.8) % to £12.1 million in Q4 2015. 

Q4 2015

There was strong sales volume growth in both the UK & Ireland of 11% and Continental Europe of 5% during the period. Total revenue increased by £5.8 million to £378.1 million compared to the same period in the prior year. The revenue increase was driven by the volume growth being partly offset by the strength of sterling relative to the euro (which reduced the sterling value of European revenues), commodity input cost deflation, and lower market prices on international sales of poultry dark meats and offal. 

EBITDA before corporate costs and exceptional items of £8.5 million reduced by £(2.6)m to £30.0m. The growth in volume and increased operating efficiencies have been offset by lower international sales prices, impacted by market restrictions. When compared to Q3 2015 EBITDA shows a positive trend increasing by £3.2m. The exceptional item reported in the period relates to impairment of assets resulting from closure, due to strategic rationalisation, of our non-core Wisbech site. 

Outlook

Following a year of significant development we are pleased that 2016 is continuing to show positive progress for Moy Park. Central to our success is a business based on the highest quality standards of animal husbandry, production and processing and a determination to meet and exceed the ever changing requirements of our customers and consumers. Our plan for 2016 and beyond is to continue to invest and grow our business, and we have recently announced major investments in both our "Ready to Eat" and "Fresh Poultry" categories. With an experienced management team, a strong product portfolio, a well invested asset base and a robust financial position, we remain confident in the continued success and development of the business.