Goodvalley maintained satisfactory operations in Q2 2020 despite challenging market conditions during the outbreak of COVID-19, which entailed volatility, significant price fluctuations and a decline in local currencies entailing a temporary negative translation effect. The Group continued to boost sales of branded premium products and acquired a sow farm in Gniewno to increase production capacity in Poland.
“We protected our business and employees and maintained satisfactory operational performance in Q2 2020 in the face of unprecedented challenges and market volatility during the COVID-19 crisis.” says CEO Hans Henrik Pedersen.
Q2 2020
• Group revenue decreased by 9% to DKK 352 million (Q2 2019: DKK 385 million), and Goodvalley’s Adjusted EBITDA decreased to DKK 69 million (Q2 2019: DKK 77 million), corresponding to an Adjusted EBITDA margin of 19.6% (Q2 2019: 20.0%).
• The Polish segment revenue declined to DKK 214 million (Q2 2019: DKK 240 million), and Adjusted EBITDA was stable at DKK 22 million (Q2 2019: DKK 22 million) corresponding to a slight improvement of the Adjusted EBITDA margin of 10.5% (Q2 2019: 9.3%) driven by satisfactory performance at the slaughterhouse during the outbreak of COVID-19 and despite unsustainably low price levels for deboned meat due to reduced demand.
• In Ukraine, Goodvalley increased revenue to DKK 106 million (Q2 2019: DKK 97 million), and Adjusted EBITDA increased to DKK 45 million (Q2 2019: DKK 37 million) corresponding to an Adjusted EBITDA margin of 42.2% (Q2 2019: 37.9%) on the back of high production efficiency and strong volume growth.
• Revenue in the Russian business declined to DKK 32 million (Q2 2019: DKK 48 million) as a result of lower volumes after an outbreak of PRRS and a drop in pig prices, which contributed to a decrease in Adjusted EBITDA to DKK 7 million (Q2 2019: DKK 13 million) and a lower Adjusted EBITDA margin of 22.8% (Q2 2019: 27.2%).
Outlook
Goodvalley maintains the outlook for 2020 and expects revenue of DKK 1,600 - 1,750 million and an Adjusted EBITDA of DKK 320-380 million. The outlook is based on strong year-to-date performance coupled with continued market challenges related to COVID-19 in the short-term and an expected stabilisation in the second half of 2020.
Conference call
On 24 August 2020 at 08.30 (CET), Goodvalley will host a conference call at which CEO Hans Henrik Pedersen and Vice CEO Kristian Brokop Jacobsen will provide comments on financial and operational performance, the outlook and answer questions. Registration is not required.