Company Announcements

Financial Sustainability Forecasts

COMPANY ANNOUNCEMENT
The following is a company announcement issued by AST Group P.L.C., a company registered under the laws of Malta with company registration number C 66811 (the “Company”), pursuant to the rules of Prospects, a market regulated as a multi-lateral trading facility and operated by the Malta Stock Exchange.

                                            Financial Sustainability Forecasts

QUOTE
The Company refers to the obligation to which Prospects MTF companies are subject to in terms of Rule 4.11.03 and Rule 4.11.12 relating to the publication of the twelve-month financial information as defined in Table 1 paragraph 3 and specifically the publication and dissemination via an announcement of Financial Sustainability Forecasts including management assumptions thereon (‘FSFs’). The below copy of the Group FSFs (which consists of AST Group p.l.c. and its subsidiaries Damask Investment Limited, AST Shipping Limited, Damask Chartering Limited and Damask Shipping Management Company Limited), as approved by the Board of Directors, are based on the following assumptions:

Revenues

Historically, the animal feed business consisted of guar meal, DDGS, Hi-Pro Sunflower Meal and fishmeal, however, following the COVID-19 pandemic, the Group added corn and barley (i.e. grains) to its product portfolio given that there was a surge in demand for flour. Given that grains are high volume but low margin products an increase in total turnover shall result in FY2021. The projections assume that the Group will generate revenue of €25.3 million from the animal feed business by trading 8,000 tons of guar meal, 2,000 tons of fishmeal, 11,000 tons of DDGS, 800 tons of Hi-Pro Sunflower meal, 41,000 tons of corn and 18,000 tons of barley.

Revenue from shipping operations is generated through the operation of its vessel, M/V AST Malta. The projections assume that the vessel will operate for 340 days at sea and will be used either to carry the corn and barley products aforementioned (i.e. own use) or chartered out to third parties at €2,900 per day. The 340 days at sea factor in rough sea days as well as a fortnight for drydocking, when the vessel would not be able to generate revenue.

The Group’s revenue for the twelve months ending 31 December 2021 is expected to total €26.3 million.

Direct costs

Direct costs comprise the purchase cost of the animal feed products sold and the associated transport cost, crew costs to operate the Vessel, brokerage costs, insurance costs, bunkering and vessel maintenance costs. The projections have been based on the AST Group’s gross profit margins achieved historically, factoring in also the lower margin on the trading of corn and barley.

Administrative expenses

Administrative expenses are expected to amount to c. €0.6 million in FY2021, and primarily consist of administrative salaries, professional fees, insurance costs and depreciation and amortization costs.

Finance costs

Finance costs are expected to total €0.2 million in FY2021 and consist of interest on the Bond as well as interest incurred on bank factoring.

Taxation

Current taxation is calculated at an effective 30% tax rate on profits generated on animal feed through the branches operating throughout Europe however, profits derived from shipping activities are exempt from tax given that that the shipping of the Group satisfy the conditions set out in the Merchant Shipping Act and regulations issued thereunder.

Drydocking costs

The projections also assume that the Group will incur drydocking costs of €0.1 million on M/V AST Malta.

Consolidated income statement of AST Group

Statement of comprehensive income for the year ending 31 December

€000s                                                                                            FY2021

Revenue                                                                                          26,344

Cost of sales                                                                                  (25,472)

Gross profit                                                                                      873

Administrative, selling and distribution expenses                (616)

EBIT                                                                                                  256

Net finance costs                                                                            (202)

Profit before tax                                                                                 55

Tax for the year                                                                                 (51)

Loss after tax                                                                                    4

Consolidated statement of financial position of AST Group

Statement of financial position as at 31 December

€000s                                                                                                2021

Assets

Non-Current assets

Property, Plant and equipment                                                   1,619

Deferred tax assets                                                                           27

Sinking fund                                                                                     100

Total non-current assets                                                        1,746

Current assets

Inventories                                                                                        1, 247

Trade and other receivables                                                          3,122

Cash and cash equivalents                                                              200

Total current assets                                                                        4,568

Total Assets                                                                               6,314

Equity and liabilities

Equity

Share capital                                                                                       50

Total reserves                                                                                   1,020

Total equity                                                                                       1,070

Non-current liabilities

Borrowings                                                                                        1,765

Deferred tax liability                                                                          22

Total non-current liabilities                                                           1,787

Current liabilities

Trade and other payables                                                               3,457

Total current liabilities                                                                   3,457

Total liabilities                                                                                 5,244

Total equity and liabilities                                                  6,314

Consolidated statement of cash flows of the AST Group

Statement of cash flows for the period ending 31 December

                                                                                                       2021
Cashflows generated from operating activities
EBITDA                                                                                               465
Finance cost                                                                                      (202)
Tax                                                                                                        (51)
Working capital movements

Movement in inventory                                                                    (27)
Movement in trade receivables                                                       (25)
Movement in trade payables                                                            139
Net cash generated from operating activities                 300
Cashflows generated from investing activities
Drydocking costs                                                                                 (100)
Net cash (used ingenerated from investing activities) (100)
Cashflows generated from financing activities
Sinking fund repayments                                                                   (100)
Net cash (used in) financing activities                                (100)
Movement in cash balance                                                         100
Opening cash balance ast beginning of year                                      100
Closing cash balance at end of year                                                     200

 

UNQUOTE

Dr Katia Cachia
Company Secretary
29th April 2021