Kernel resumes long-term debt servicing according to original schedule

MOSCOW. April 8 (Interfax) - Ukraine's Kernel agricultural holding has this year managed to negotiate an exit from waiver letters with creditors on long-term credit lines concluded after the start of the military operation in the country, and a return to debt servicing in accordance with the original repayment schedules.

"This will give an additional room for the Group to properly manage its operations with as much efficiency as possible," Ukrainian media reported, citing a Kernel filing with the Warsaw Stock Exchange.

Kernel said this became possible after sales and export volumes from the deep-water seaports of Ukraine along the temporary Black Sea corridor for commercial shipping stabilized from October 2023. The company said that thanks to this, it decided at the end of December 2023 to repay short-term credit facilities opened before February 2022, including the Natixis PXF Facility and ING PXF Facility.

"As of the date of this announcement, no potential event of default or event of default is outstanding under the notes," the statement said.

Kernel said waiver letters were also signed with respect to credit facilities from the European Bank for Reconstruction and Development and the European Investment Bank. These were initially concluded for the period to June 30, 2023, and then were extended several times, the last time until June 30, 2024.

The company also said the situation in Ukraine remained highly uncertain and the group continued to face challenging operating conditions. Kernel's normal business processes are disrupted from time to time.

Kernel is one of the largest producers and sellers of bottled oil in Ukraine, and is a major producer and exporter of sunflower oil, as well as cultivates agricultural products and sells them.

Kernel reported a net profit of $299 million for financial 2023, compared to a net loss of $41 million a year earlier. The group's revenue fell 35% to $3.455 billion, while EBITDA jumped 150% to $544 million.

In the first half of financial 2024, Kernel's net profit tumbled 72% year-on-year to $102 million and EBITDA fell by half to $223 million, as revenue slumped 16% to $1.59 billion.