Kernel (KER) Q2 2025 earnings summary

Executive summary

• Revenue for H1 FY2025 rose 22% year-over-year to USD 1,947 million, driven by higher edible oil sales and increased global prices.

• Net profit for H1 FY2025 reached USD 176 million, up 73% year-over-year, despite a challenging operating environment in Ukraine.

• EBITDA for H1 FY2025 increased 29% year-over-year to USD 287 million, but Q2 EBITDA fell 42% year-over-year due to margin pressure in oilseed processing.

• Cash flow from operations for H1 FY2025 was USD 54 million, down 44% year-over-year, with net cash outflows in investing and financing activities.

Financial highlights

• Q2 FY2025 revenue grew 10% year-over-year to USD 1,149 million; gross profit declined 28% year-over-year to USD 157 million.

• Q2 FY2025 net profit attributable to shareholders was USD 56 million, a 58% year-over-year decrease.

• Q2 FY2025 EBITDA was USD 118 million, down 42% year-over-year; EBITDA margin contracted to 10.3%.

• Net debt as of 31 December 2024 was USD 325 million, down 28% year-over-year but up 25% sequentially; adjusted net debt was negative USD 116 million.

• Net cash used in investing activities for H1 FY2025 was USD 82 million, mainly for financial assets and property, plant, and equipment.

Outlook and guidance

• Management expects continued pressure on oilseed processing margins due to limited sunflower seed supply and excess crushing capacity in Ukraine.

• Grain export volumes from Ukraine are projected to decline 21% year-over-year for the 2024/25 season, impacting infrastructure utilization.

• The Group plans to increase cargo exports in 2025 using Black Sea and alternative routes, and targets 3.2 million tons of oilseed crushing for FY2025.