Elana Agrocredit 2024 Q3 review – Significantly increased profitability

• Elana Agrocredit’s revenues decreased 16.8% YoY in Q3 2024. The decrease is due to the decrease in sale of properties, where they sold BGN 2.5mln less than for the 9 months of 2023. Their main activity, however, the financial leasing operations, marked a 35.7% YoY increase from BGN 3.8mln delivering now BGN 5.2mln interest received from their financial leasing.
• Their EBIT increased 34.5% to BGN 4.8mln and the reason for that is the big change in the balance value of the sold assets, which helped decrease costs by BGN 2.4mln. Additionally, the push to optimize costs resulted in a decrease in external services, whose largest account – broker commissions and other fees was halved to BGN 0.1mln.
• Net Income, however, increased by just 4.5% to BGN 2.7mln and the smaller change compared to EBIT was due to the doubled financial expense to BGN 2.1mln. The company increased its debt over the period – short-term bank increased from BGN 6.6mln to BGN 7mln and long-term bank debt was hiked from BGN 19.2mln to BGN 25.8mln. The major impact came from a new facility from United Bulgarian Bank signed on 02.10.2023 for EUR 10mln and by 30.09.2024 the company had utilized EUR 9.5mln out of it.
• While interest coverage dropped slightly from 3.0 to 2.5 for the last 9 months, Elana is very liquid as cash alone is 7.52x interest expense, while current assets cover it 21.5 times.
• The company started a capital raise procedure in 2023. On June 2024 the newly subscribed 10,062,208 shares of nominal value of BGN 1.00 each were registered in the Central Depository and the Financial Supervision Commission and could be traded starting 01.07.2024 on the BSE.
• The slight decrease in DPS from 0.7 to 0.6 is exactly because of the increased number of shares and the fairly constant dividends payout. The company distributed dividend on 12.04.2024 in the amount of BGN 0.0729 per share representing a dividend yield of 6.7%.

Full report can be downloaded here.