Atria Plc’s Q4-2012 - Analysts’ estimates vary a lot

Atria's Financial Statement Bulletin will be published on February 21^st and now it is the right time to look at the results from recent years.  The chart below illustrates Atria's quarterly EBITs starting from 2009.  The readings are highly unofficial. Large write-offs (Atria Baltic 2009-Q4 about €7 million and Atria Russia 2010-Q3, about €10,5 million) are excluded.  

Quarterly earnings before interest and taxes by year in Atria's business areas, 

large write-offs excluded.

Actual EBITs are indicated by solid lines.  Dashed circles show a set of reasonable country-specific Q4 EBIT figures, which could lead to EPS of €0,20, which is the same as analysts’ Q4-2012 EPS (pre-exceptional) consensus according to the data gathered by Bloomberg.   There the number of participating analysts is 7 and their estimates range from €0,11 to €0,27. The range looks horribly wide.   Undoubtedly each analyst’s estimate is mostly dependent on his or her thoughts about Atria Russia. However, a knockout loss - say €-10 million - in Russia does not fit into this range.  Apparently, such is not expected now.  

Overall, the year 2012 seems to be about as successful as the year 2009 (indicated in the chart by a white line), in Finland the year 2012 perhaps a little weaker, but in Russia and in the Baltic countries a little better.  It should be recalled here, that Q4-2009 actual EPS was €0.25. Absolutely clear is that 2012 Q4 results in Finland and especially in Russia will determine the big picture of the FY 2012.  Let’s now very briefly go through the country-specific figures presented on the chart, just to find out what kind of results analyst’s consensus might be based on. 

Atria Finland - Atria Finland’s Q4 result will most likely be better compared to 2011, which was simply bad.  One should also remember that Atria Finland’s Q4 2011 EBIT includes a non-recurring depreciation item in the amount of EUR -1.8 million on the value of the Forssa logistics site.  Then anything under €9 million would be a huge surprise. It is also reasonable to assume that, in accordance with the three preceding quarters, also the Q4 result is worse compared to the year 2009.  Consequently, Q4 EBIT of €10 million is a fairly sensible guesstimate.

Atria Scandinavia - Compared to 2011, Atria Scandinavia’s year 2012 has been quite weak. The company mainly uses imported meat and, compared to 2011, Krona has remained strong. Thus, Q4 result presumably will be something non-surprising, perhaps close to EBIT of €4 million.

Atria Russia - Atria Russia most likely is the key again.  The year 2012 has gone well.  Looking a few years back, the company seemed to be well on its way already in 2009, recovering quickly from the Campomos acquisition. One may only wonder, what went wrong during 2010-2011.  Now everything should be even better compared to 2009.  Hence zero result, EPS of €0 million, is surely reachable, quite likely rather low side.  Expectations may vary wildly but surely everyone is waiting for timely information about Atria Russia’s new products and primary production plans.

Atria Baltic - Olle Horm, the new Executive Vice President of Atria Baltic, has not yet had time to change anything.  EBIT of €-1 million is simply a reasonable guess. 

More guesswork 

Total of those guesses about what the analysts might have thought, is €13 million.  We must now make a few subtractions, using the past few quarters’ readings as guidelines.  Some minor subtractions or additions are ignored.  Subtracting unallocated costs about €1 million, finance cost about €4 million and taxes roughly €2 million, we get the final reading of around €6 million.  The number of shares is about 28,3 million.  Consequently the earnings per share would be about €0,21, which is very close to analysts’ consensus of €0,20 and clearly within the range of analysts’ estimates, which goes from €0,11 to €0,27. 

We will discuss Atria later but on Friday, March 1^st, we are going to look at HKScan’s businesses.  But before that, on Thursday, February 21^st, we will take a brief look at just then released Atria's Financial Statement Bulletin.

One day God accidentally created the cross-country skiing competitions and the Norwegians.  After that it became evident that He must also create the snow and the winter.  Okay, okay!  But summer will come soon.

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