UMG - United Malt Group

[Dona Ferentes]

drop of 10% on the Update

United Malt said it does not expect a recovery in export sales to the Asian region until freight disruptions fully ease and Covid Delta restrictions normalise...

and the Annual Results in mid May have not aided performance. From around $4.00 then to an all-time low of $3.20 recently

Leveraging improving market conditions whilst managing volatility in freight, barley crop and inflation factors

• Canadian barley crop - continuing to manage the impact of the Canadian barley crop quality and additional logistics costs. Planting for the 2022 Canadian barley crop has commenced
• Supply chain disruption - Delaying shipments to customers. Working with customers on alternative supply methods to improve delivery performance
• Inflation impact – higher energy, labour and inbound and outbound freight. Increased input cost escalations will be largely passed through to customers over the course of the next 9 months under existing and renewed contracts, reducing the impact into FY23

FY22 Underlying EBITDA is expected to be in the range of $115 -140 million (before SaaS costs) Including ~$20 - 25 million of costs resulting from the severe drought conditions in Canada
- Major growth capex initiatives completing in FY22 delivering cashflow and earnings uplift from FY23
- Committed to deliver ~$30m in annualised net benefits from business transformation program by FY24
- Foundations in place to deliver meaningful increase in earnings in FY23 and beyond

 

[JohnDe]

Timing is everything.

The world shortage of food grains should help the sale price. The question is, for how long and how much?

I'm a keen craft beer consumer, I thought of buying into UMG because I saw the world grasp the new beer scene and its need for quality grain. And then Covid and China bans hit, the SP became overvalued.

Pricing starting to look good now. One to keep an eye on.

 

[Dona Ferentes]

and the Annual Results in mid May have not aided performance. From around $4.00 then to an all-time low of $3.20 recently

any recent recovery has been striped off, with an update outlining a litany of headwinds. Now $3.22

The company said its processing unit in North America had suffered from

• the deterioration of the barley crop,
• supply chain disruptions,
• increased costs of imported barley and
• general cost inflation.

United Malt’s earnings for FY22 are now expected to be below previous guidance because the expected second half improvement in North America was now delayed....
It expects underlying EBITDA for FY22 to be in the range of around $100 million to $108 million but said it anticipated a material increase in earnings in FY23 with underlying EBITDA (before SaaS costs) expected to be in the range of $140 to $160 million.

 

[Dona Ferentes]

Timing is everything.....
Pricing starting to look good now. One to keep an eye on.

Now in a trading halt: a bid between $4.80 and $5.00 is expected soon for UMG,, from European suitor Malteries Soufflet, part of Soufflet Group, and backed by European agricultural investor InVivo and financial investors including KKR,

 

[Dona Ferentes]

Has been around $4.60-4.70 since a suitor appeared.

This may seal the t/o

United Malt Group has downgraded its underlying EBITDA guidance for the first half after reporting lower sales volumes and the delayed start of its Inverness facility.

The company now expects underlying EBITDA (before SaaS costs and one-off items) for the first half to be approximately $51 million ( previous guidance of $58-66 million before SaaS costs).

 

[Dona Ferentes]

And $5.00 it is.

 

[System]

On November 16th, 2023, United Malt Group Limited (UMG) was removed from the ASX's Official List in accordance with Listing Rule 17.11, following implementation of the scheme of arrangement between UMG and its shareholders in connection with the acquisition of all the issued capital in UMG by Malteries Soufflet SAS.