Ukraine's Kernel Holding core profit jumps 41% on commodity trading in Q3

- Ukraine's largest grain exporter Kernel Holding KER.UAX reported a 41% year-on-year rise in its third-quarter core profit on Friday, as a surge in trading profits at its Avere unit helped offset continuing disruption from Russia's war on Ukraine.

The grain exporter and sunflower oil producer said prolonged air-raid alerts left its export terminals idle for a cumulative equivalent of 33 days in the nine months through March 31.

  • Quarterly core profit at Kernel's trading, grain-export and logistics business rose 65% from a year ago to $101.9 million, led by Avere's trading operations

  • Avere Commodities, Kernel's Switzerland-based trading arm, generated $66.6 million in core profit, up from $17.3 million in the previous three months

  • The group's net profit more than doubled year-on-year to $89 million, while revenue grew 3% to $1.18 billion

  • A delayed corn harvest and continued attacks on export infrastructure disrupted logistics during the quarter, slowing the conversion of inventories into cash

  • On May 3, after the quarter closed, a Russian drone attack damaged the group's largest vegetable oil export terminal in Chornomorsk, spilling around 1,100 metric tons of oil

  • The financial impact of the attack "cannot be reliably estimated" as of the date the financial statements were authorized, Kernel said

  • The war represents "a material uncertainty that may cast significant doubt on the Group's ability to continue as a going concern", company management said

  • Kernel targets grain exports from Ukraine of more than 6 million tons for the full fiscal year, against 5.4 million tons a year ago