Ladies and gentlemen, thank you for standing by, and I would like to welcome you to MHP's 4th quarter and 12-month 2026 results conference call on the 5th of May, 2026. At this time, all participant lines are on listen-only mode. The format of the call today will be a presentation followed by a question and answer session. Without further ado, I would now like to pass the line to Anastasiya Sobotyuk, Director of Investor Relations. Please go ahead, ma'am.
Thank you very much, Michael. Dear stakeholders, good day to you. Thank you for joining us for MHP's conference call dedicated to our fourth quarter and the results of the year. Just give me a second. I have a problem with the line. Just give me another second. I'm so sorry, but I have a problem with the line. Can you hear me well?
We can hear you loud and clear.
All right. Because it looked like that I do not have a good connection. I'm so sorry. I can continue, right? You can hear me well. Thank you. Thank you very much. Once again, good day to you and thank you for joining us for the conference call, which we dedicate to our fourth quarter and 12 months results. My name is Anastasiya. I'm Director of Investor Relations, and I'm joined today by Viktoriia Kapeliushna, Chief Financial Officer of MHP. Together, we will present and discuss the company's financial and operational performance for the reporting period. Please note that today's discussion is based on the press release, investor presentation and annual report released earlier today. In addition, during our discussion, we will share our outlook and strategic plans, which reflect current assumptions as well as domestic and international market trends.
We kindly ask you to take this context into account during the call. We are moving to page three of the presentation. Thank you. Let me walk you through the latest macroeconomic picture in Ukraine. Starting with GDP, Ukraine has moved from a deep contraction in 2022 to 2023 during the peak of the war impact into a stabilization and modest growth phase. As we move into 2025, 2026, growth is normalizing. For 2025, real GDP growth came in at around 2% year-over-year, the central bank expects a similar trajectory into 2026. The key takeaway here is resilience. Despite ongoing infrastructure attacks and security risks, the economy is maintaining positive momentum, albeit at a slower and more sustainable pace.
On inflation, we have seen a significant improvement compared to the volatility of prior years. Inflation peaked in 2022 and has since been trending downward overall, though with some fluctuations. As of Q4 2025, CPI moderated to around 8%, down from nearly 12% in the previous quarter. Looking ahead, the National Bank of Ukraine expects inflation to decline further to around 6%-7% in 2027, with a continued downward path thereafter. This disinflation reflects a tighter monetary policy and gradual stabilization in supply chains, which is supportive for real returns and investment planning. Turning to the currency, the Hryvnia has shown stability over the past year. The Ukrainian to USD dollar exchange rate remained largely stable through 2025, ending close to its starting level despite external pressures.
We did see a moderate depreciation of about 13% during the year, reflecting global dollar strength rather than domestic imbalance. This relative effective stability is important. It signals effective central bank management and helps reduce volatility for foreign investors. On key sectors, agriculture continues to demonstrate resilience. The 2025 harvest confirmed Ukraine's ability to sustain output despite wartime conditions. Grain production reached approximately 64 million tons, up 15% year-over-year. Let's move on slide four of our presentation, so we come back to the results of MHP, and let me walk you through our financial performance. Starting with Q4 2025, revenue grew strongly by 44% year-over-year, reaching approximately $1.1 billion.
This was primarily driven by higher prices in poultry and processed meat, as well as continued contribution from our European operations, including the consolidation of the UVESA business in Spain. Despite this top line growth, profitability was under pressure. Operating profit declined by 33% and the EBITDA was down 12% year-over-year, mainly due to higher payroll and administrative costs, as well as elevated war-related expenses, which remained a persistent drag on margins. As a result, we reported a net loss in Q4 compared to a small profit last year. Looking at the full year 2025, revenue increased by 24%, reaching $3.8 billion. EBITDA remained broadly stable at approximately $570 million, with a margin of 15%, slightly below last year.
Importantly, net profit increased by 30%, supported by lower FX losses compared to 2024, despite ongoing war-related costs throughout the year. On the export side, we continued to see a positive mix shift. Total exports increased from $1.8 billion in 2024 to over $2 billion in 2025. Growth is primarily driven by higher value products, particularly poultry and processed meat, while grain remains an important but more volatile contributor. Let's move on slide number five of the presentation. Here we have the breakdown of our 2025 performance by segment. Starting with revenue mix, our poultry segment remains the core of the business, contributing 51% of total revenue.
The European segment is also significant at 27%, followed by agriculture at 12% and vegetable oils at 10%. In terms of profitability, the picture is more balanced. Poultry and agriculture are the main EBITDA contributors, accounting for 56% and 46% respectively. While Europe delivers a solid 21% contribution. The vegetable oil segment remains relatively small at 2%. Now turning to the EBITDA bridge. Total EBITDA remained broadly stable year on year at around $570 million, as just recently mentioned. In poultry, positive pricing, particularly higher meat prices, supported performance, but this was offset by lower sales volumes and higher input costs. In vegetable oils, results declined due to lower volumes and margin pressure. Agriculture was relatively stable. The European segment showed improvement supported by the UVESA acquisition, along with the better pricing and volumes.
I would like to pass the word to Viktoriia here. She will provide you a detailed picture on MHP's financial results across business segments. Please, Viktoriia.
Thank you, Anastasiya. Good afternoon, everyone. Let's turn to poultry and related operations segment performance, slide number six. Despite the ongoing challenges of the war in Ukraine, MHP delivered solid performance in 2025, with results significantly exceeding those of the same period last year. Revenue grew 18% year-on-year for 12 months last year. This was driven by high price for both poultry and processed meat, introduced to pass through rising production costs, preliminary reflected grain price inflation and annually salary review. The stronger price environment also contribute to higher evolution of biological assets and agricultural produce, which support our performance. As a result, adjusted EBITDA net IFRS 16 grew 26% to UAH 370 million for the full year, with margin improving 1 percentage points to 16%.
Total poultry meat sales declined modestly from 652,000 tons to 626,000 tons in 2025, primarily due to the low domestic sales in Ukraine, while export volumes remained stable. Processed meat volumes grew from 45,000 tons to 57,000 tons, driven by higher production and ongoing shift toward production of added-value product. Poultry price increased year-on-year through 2025 before moderating in Q4. The decline has continued into Q1 2026. However, we already saw signs of price stabilization in April. Looking ahead, in 2026, we expect the overall cost and price environment to remain challenging. In addition to ongoing commodity price volatility, we factor in increased energy cost, including diesel, as well as continued pressure on logistics costs and supply chain stability due to the war in the Middle East.
This factor may limit margin expansion and require continued pricing discipline. Let's proceed to the vegetable oil segment, slide seven. Performance in this segment remained weak in 2025. Revenue declined 18% year-on-year, and adjusted EBITDA fell by 71% to UAH 14 million for the full year. Q4 results were particularly soft with EBITDA near breakeven. The pressure continues to reflect higher sunflower and soybean seed price, which were not fully recovered through oil price movement and dynamic driven by an increased crushing capacity in Ukraine. Sunflower oil sales volume declined across the year as visible in the chart, while soybean oil volume partially offset this through the production adjustments change in recipe as described in our previous communications.
Looking ahead until 2026, we expect some improvement in segment profitability, supported by gradual normalization of the raw material cost environment and higher production volumes. That said, this outlook remain highly sensitive to commodity price dynamic and potentially increase in our input cost, including energy and logistics, particularly in light of ongoing instability in the Middle East. Additional, any continue imbalance between seed price and oil price could further weigh on margin. As a result, the pace of extent of recovery remain uncertain, and we maintain a cautious near-term outlook. Let's move to the slide number eight, agriculture operation. The segment demonstrates solid resilience in 2025. Revenue grew 14% year-over-year, supported by higher price across most crops and increased sales volume of soybean and wheat, which offset low volume of corn and rapeseed.
Adjusted EBITDA net IFRS 16 held broadly flat, UAH 259 million. Crop yield across the 2025 harvest were broadly stable year-on-year and in line with expectation across both winter and spring campaign. The 2025/2026 winter sowing campaign has been fully completed. Spring sowing campaign are currently underway. We expect the 2026 harvest to be broadly comparable to 2025, while we take in account the risk of higher production cost, including fuel, fertilizer, and logistics, as well as potential disruption to export routine stemming from instability in Middle East. The impact of increasing fertilizer price on the 2026 harvest is expected to be limited. That reflects the fact MHP has already produced a sufficient quantity of fertilizer required for the 2026 harvest.
Accordingly, any adverse effect from higher fertilizer price is more likely to be seen starting from 2027 harvest, which may affected overall profitability even in case of stable yield. Let's proceed to the slide number nine. Several words about European operation segment. 2025 was a landmark year for the segment. Together with results from newly acquired UVESA Group, the segment crossed $1 billion in revenue, up 76% year on year. Adjusted EBITDA net IFRS 16 grows 37% to $119 million. For full year for 2025, UVESA contribute $318 million in revenue and $15 million of adjusted EBITDA, representing five months of consolidation. Perutnina Ptuj continued to perform well organically with both poultry and processed meat price and sales volume rising consistently through the year.
EBITDA margin for the segment came in at 12% for the full year, down 3 percentage points year-on-year, partially due to downward revaluation of biological assets in Spain following an African swine fever outbreak that pressure pork related margins. Slide number 10. A few words about our cash flow, debt, and liquidity. The group demonstrates strong cash generation last year while full absorbing the UVESA acquisition into the balance sheet and debt structure. Operation cash flow grew year-on-year to UAH 413 million, 2025, driven by improving earnings. Working capital representing as investment UAH 142 million for the year, mostly reflecting seasonal sunflower seed procurement and trade receivable growth in line with revenues.
CapEx, UAH 275 million, was directed at maintenance and modernization of existing facility, expansion of international poultry operation, new bioenergy production, and compliance and margin improvement projects. Cash used for acquisitions and investment amount UAH 280 million, mostly reflecting the net cash outflow from acquisition of 92% stake in UVESA Group, complete on 31st July last year. Net debt at the end by the end of 2025 was UAH 1.532 billion, incorporating both the new facility drawn to financing the UVESA acquisition and UVESA existing debt on consolidation. Total composition was around UAH 415 million by the end of the year. The group's acquisition leverage ratio by the end of the year was 2.5.
It remains comfortable with defined limit of 30.0. The group has compliant with all bank covenants as of the reporting date. Thanks to support of MHP bondholder, we successfully complete the refinancing our $550 million senior notes that were due in 2026. In January and February 2026, MHP issue $550 million in aggregate of new senior notes due to 2029 and use the proceeds to repurchase of outstanding 2026 note. As a result of all obligation in respect of our note have been fully discharged. Our next bond maturity now 2029. We are grateful for continued trust and support of our investors throughout the process. Now I give the floor to Anastasiya.
Thank you very much, Viktoriia. Thank you for the for a detailed view on the results. Let me briefly outline our view going forward before we start our discussion. We remain prudent in our approach to growth while continuing to pursue selective international expansion in Europe, focusing on opportunities that enhance synergies, diversify hard currency earnings, and support long-term sustainable growth while maintaining stable operations in Ukraine. The operating environment remains highly uncertain. We continue to closely monitor the war in Ukraine, where any progress towards a lasting peace could support economic stabilization, although visibility remains limited. We are also monitoring the ongoing conflict in the Middle East, as you rightly mentioned, Viktoriia, particularly its potential impact on logistics and global supply chains.
Since 2002, we have demonstrated strong operational flexibility, adapting to significant disruptions and maintaining stable deliveries to key markets. However, further deterioration in conditions could still impact our operations. On cost, we expect moderate increases in grain, vegetable oil and poultry prices, driven in part by high energy and fertilizer costs, including the impact on the ongoing conflict in the Middle East, which may pressure margins in the short term. Over the medium term, we expect pricing to adjust with a lag, helping to offset these increases. We have secured key inputs and do not anticipate immediate supply constraints, as mentioned by Viktoriia. However, continued geopolitical instability, including the war in the Middle East, alongside inflationary pressures may weigh on demand. Overall, our priority remains maintaining resilience, ensuring continuity of supply, and carefully managing risks in a volatile environment.
I think this summary concludes my presentation, our presentation. We are now ready to take your questions. Operator, Michael.
Thank you. Thank you very much for the presentation. We'll now be moving to the Q&A part of the call. If you are dialed in via the telephone, please press star two on your keypad. Star two on your keypad and wait for your name to be called. We're also welcoming text questions. Please note that those text questions will be followed up by Anastasiya and the team after the call. Thank you very much. Our first question comes from Stella Cridge from Barclays. Please go ahead, ma'am. Your line is open.
Hi there. Afternoon, everybody. Many thanks for all the updates. I was just wondering if I can ask in a couple of areas. Could you firstly just talk a little bit more about the pricing pressure that you've seen? You know, where's that coming from? Is that coming from, you know, domestic market or some of the export markets? Secondly, on the Middle East, in 2026, have you actually seen kind of pressure on any sales volumes in the Middle East, or is it more of a case of what you're discussing around, you know, the freight cost element? You know, do you think you could potentially, would that be reflected in higher prices to potentially offset that?
Finally, just on the CapEx side, it'd be great if you could give us an update on planned spending and what the priority areas would be this year. That'd be great. Thanks.
Thank you for your question. Regarding pricing, yes, first quarter, it was very difficult regarding price, especially in Ukraine, because to be honest, first quarter always is very low season. What we see right now the price stabilize and current price is the same level than we had in December. Regarding export price, the same situation, especially regarding price in Europe, in EU. Current price and price of the first quarter approximately by 10%, 13% lower than fourth quarter. Regarding cost of production, what we see right now, we see right now significant. It is not something special in Ukraine. I'm sure that everywhere in the world price of fuel increase, and in Ukraine increase approximately by 40%, 50%.
In our cost of production, fuel share of the fuel in agrifarming segment approximately 7%. That is why we see increasing cost of production approximately 3%. The same in poultry. Share of cost of fuel less. It is approximately 5%. It is the main pressure. In the first quarter, we had very, how to say, very cold winter, and we consume enormous amount of gas. Now is a good weather. Total our expectation of cost of production based of current situation in poultry segment increase year to year approximately by 5%, 7%. At the beginning of the year, we always try to be very conservative, based on conservative scenario.
Regarding CapEx, total our CapEx for 2026 approximately UAH 250 million, UAH 275 million, UAH 1,980 million include maintenance CapEx and include CapEx for expansion and for modernization in our European businesses.
That's great. Many thanks for all those details. Just on the GCC side, could you comment on what the impact's been on that side?
Middle East. Sorry?
Yes, yes, Middle East. Thanks.
Middle East. As I told, because these, because in Middle East, regarding volume, we sell because our logistic cost significantly increase. Logistic cost for deliver our product to Middle East increase approximately by 30%, 40%, but it was compensated by price. It's a big influence to us regarding the war in Middle East increase the fuel price in Ukraine. Potentially, as I told in pre-in presentation, fertilizer price. Fortunately for us, we bought all fertilizer for the season 2026 in the first quarter. That is why, we will not have any influence, any influence on our cost of production.
It would be our in Is a factor for increasing our cost of production for the next, year, next harvesting campaign, 2026.
Super. Thank you. That's all understood. Thanks for all the detail.
Thank you.
Thank you very much. Our next question comes from Mr. Dmitry Ivanov from Jefferies. Please go ahead, sir. Your line is open.
Hello. Hi, Anastasiya, Viktoriia. Can you hear me?
Yes, please go ahead.
Thank you again for the presentation. I have a few questions as well, if I may. Maybe elaborating on the previous questions. Can you remind us about your share of Europe and Middle East in your poultry sales? How much of your exports are expected to be exported to European countries and the Middle East for 2026? Just remind us about the kind of the proportions.
Based on volume, yes, our export, yes, approximately 35% in Europe, 35%, 40%. In Middle East, in total Middle East, include Iraq, approximately by 20%.
20%, approximately, Middle East sales, right?
Yeah, approximately. It depends on You understand? Yeah, we have some limitation of export volume, and that is why we see what is the price, and that is why, no, approximately around 20%. Yeah.
Understood. You mentioned you're seeing some pressure from pricing perspective in European market. I'm just trying to understand from, like, overall product mix and from, like, geographical mix. Do you expect to see lower, like, realized poultry prices? I'm kind of trying to understand because you mentioned you see some increase in prices in the Middle East, basically lower prices in Europe. You're also selling like some volumes to other, like, geographies. Should we expect some reduction in poultry prices for the business? How should we look directionally?
No, no, I will explain. Yeah. First of all, when I speak about in the Middle East price increased, but just this increase only compensate significant increased logistic cost. You understand? Our profitability remain even with increase in price the same. Yeah.
Okay. Okay.
That is why. I cannot say, I cannot say is this more attractive. To be honest, because we send mostly for the Middle East, mostly the small chicken. Chicken with weight 1 kg, 1.2 kg. It is a completely different product. Shawarma, it is something different product.
Okay, got it.
No, but anyway.
You- Mm?
Yeah. Yeah.
Oh, no. Thank you. I just trying to understand basically, like, just apologies, like for another like follow-up question on CapEx. Basically your CapEx guidance, right? Basically. How much of this CapEx guidance will be spent in Ukraine operations versus like international, like Perutnina Ptuj and UVESA? What's like proportion of CapEx allocated to Ukraine and non-Ukraine businesses?
Sorry. Excuse me. Approximately 50%. 50% in Ukraine, in Ukraine it is mostly consist of maintenance CapEx. Our maintenance CapEx approximately 80%-90% in Ukraine. In Europe is amount UAH 140 million, maintenance of them total only UAH 40 million, UAH 45 million. It is a different project. Mostly related to different project, especially in UVESA, project which will allow to us increase our production and sales volume.
Thank you. Is it reasonable to assume that your European operations will be free cash flow negative this year?
Yes. Yeah, a little bit. Yeah. Yeah. Anyway, yeah, we have the clear target for. We provide acquisition in UVESA, and we have the clear business plan how we increase size of this business and increase profitability and increase sales volume. That is why we must invest money.
Understood. this year, like it will be free cash flow negative European business, basically.
Yeah.
Uh-
Yeah.
Okay. Okay. I'm just trying to understand when it comes to your like, Ukraine business, basically with all this development that you just mentioned, like increase in cost of sales, reduction in poultry sales, do you expect to be a free cash flow positive in Ukraine business perimeter?
Yes, we expect that it would be positive cash flow. Unfortunately, this year, based on current situation, we expect that low EBITDA. I don't know, maybe we will try. In the past, we tried to be always very conservative. In Ukraine, we understand that we will generate positive cash flow.
Okay. Just two quick final questions. Basically, if like you were just to stay conservative and like share some base case assumptions, how much EBITDA reduction do you expect in 2026 versus 2025 basically? Are we talking about like 10%, 15% reduction year-over-year for your kind of base case?
No, you completely right. Our expectation now we understand is around 50%. Yeah. 15%. 15%, not 50. 15. one five, one five . Yeah.
Understood. Basically versus 2025. Could you-
Yeah
-also share the latest cash position? It's already May and we're looking at 2025 financials are due to update. What's like latest cash position like?
Now it's 350. Yeah. 350, yeah. Now it's 350.
350. I guess the majority-
Yeah
is still outside of Ukraine.
Yeah. You're completely right.
I will get back into the queue. Thank you very much. All right.
Yeah. Thank you.
Okay. Thank you. Thank you very much.
Yes.
Once again, star two for any additional questions. That's star two for any additional questions. Thank you. We have a follow-up question from Mr. Dmitry from Jefferies. Please go ahead, sir.
Apologies. Just there's not many other questions in the line. Just maybe I will ask on the working capital because this increase in working capital, UAH 188 million in Q4, was a bit higher than I think you expected before, right? When we discussed. You kind of explained it by increasing the inventories. Could you please like help us understand how should we look at working capital in 2026 basically? Should we expect some release of working capital? Basically, you expect more build-up? We're just trying to understand what happened between like the latest updates and this UAH 188 million working capital hit in Q4, and what's your expectations for 2026? That would be my last question. Thank you.
Yeah. You're completely right. In 2026, we expect to have the release from working capital. Why we have so high investment in working capital last year, first of all, because there are a few reasons. One of them, significantly increased price in export and in Ukraine, that is why our trade receivable increased. We slightly increased our stocks in meat, yeah, especially in export. At the second point, we purchased a big amount of sunflower seed, significantly higher our stock of sunflower seed by the end of 2025. It grew approximately by 40% higher compared to the last year. It is the main contribution in working capital. We have some issues with the VAT reimbursement. We receive this money in January, but anyway, by the end, yeah.
Regarding 2026, yes, you're completely right. We expect some release in working capital with minimum UAH 30 million, UAH 40 million.
Minimum UAH 30 million, UAH 40 million for the full 2026 year, right?
Yeah, is the minimum. As you remember, we tried to be very conservative because I don't know what has happened with VAT reimbursement. You know that we are the big exporter from Ukraine, and our total VAT reimbursement for full year approximately is approximately UAH 150 million, UAH 170 million. It is always some issues.
That's clear. Thank you very much.
Oh.
Okay, thank you very much. As a final Yep, we have a question from Mary Gachanja from SALIC. Please go ahead, Mary. Your line is open.
Thank you. My question is, and I'm not sure if you mentioned it before, but what's your expectation for 2026 in terms of EBITDA? Where do you hope to end by the end of this year? Thank you.
Thank you for your question, do you understand it's very difficult to predict our EBITDA, yeah, especially with so challenges environment. No, we put in our forecast EBITDA around 5%, 15% low compared to the last year. Around $500 million, slightly higher than $510 million.
Okay. Thank you. $500 million?
Yeah, yes.
Okay. Thank you.
Yeah. Okay. Thank you.
Okay. Thank you very much. We'll give another 10, 15 seconds for any follow-up questions. Okay, we have a question from Zhanna Nekina from BCB Securities. Please go ahead. Your line is open.
Oh, hi. Thank you for the presentation. I may have missed it. Connection was not great for us here. We noticed Quarter after quarter, slight decline in production volumes and consequently a decline in sales. What is the reason for that? Is there an expectation of reversal of this trend anytime soon? I also may have missed, what is the reason for the reduction of EBITDA going into 2026? Thank you.
Yeah. Your question about the decrease of product sales volume quarter to quarter, what quarter to quarter? Fourth? Sorry. Please clarify issue. Sorry. Do you hear?
Hi, Zhanna. Just once again, your line is open. I think that we have a question to clarify your question regarding the quarters. Can you hear us?
Yeah, regarding Yeah. Decrease the volume. What Yeah.
We saw that there is slight decline in production of poultry, like in the past few quarters. What is the reason for the decline? Do you guys expect to have it, like restored to the previous level?
No, no, it is.
But-
This is a sorry. This is a sales. As I told previously, by the end of the year, we have the higher stock of meat. It is one of the biggest reason why. It is the sales decrease.
Okay.
Other very important point that we have the strategy, and we produce more ready-to-cook product and more value-added product, and that is why less carcasses, less whole chicken. If you speak about. Yeah. That is why quantity volume of this is less than if you sell just whole chicken. Regarding the current-
Okay. Basically, the reason is diversion of-
Yes
-produced poultry to the ready-cooked meal. Okay, understood. Thank you so much.
Yes. Yes. Yes. Yes. The second question about EBITDA is, I would like to repeat that, it's difficult to predict-
Yeah. basically, yeah, trend, EBITDA seems to be with all acquisitions, and we're hoping to see some growth, but you guiding, most likely.
No, all Yes. Yes, you Yes. Regarding UVESA, we have the strict plan how we increase our size of the company. We understand how we increase sales and production of chicken and how we increase our EBITDA in this segment. Yeah. Yeah. You know that we have the But this company has not just segment of poultry and pork segment, due to decreasing price of pork in Spain because it was a case of African swine fever. Yes. That is why we have some negative revaluation.
Okay. Understood.
Yeah.
Thank you.
Zhanna, to add more to the question and to the answer which Viktoriia has just given, I would like to add that the decreased EBITDA assumption now is driven by the challenges which we all see and face, right? Because of the Middle East conflict, right? We, as we've started to, you know, the year, right, we can see that we are impacted by the logistics, right? Especially logistic price, which we are trying to offset, and we expect also going forward, to have an adverse impact on the production cost of grain because of the diesel price and next year, fertilizer prices.
Right. Great. Thank you so much for this clarification.
Thank you.
It looks like we have no further questions at this point. I'll pass the line back to the MHP team for the concluding remarks.
Thank you. Thank you very much, Michael. Thank you very much, everyone. Thank you for joining us today, and thank you for the questions. In case you have any additional questions or you would like to clarify something, please give me a call or send me a message, and I will be glad to meet with you. Thank you, and have a lovely day.
Thank you.
Bye.
Yeah. Thank you. Bye.
Thank you very much. This concludes today's conference call. We'll now be closing all the lines. Thank you and bye.