Aragvi Holding International Ltd.

At the same time, we think that EBITDA margins could potentially exhibit volatility because of to the nature of trading operations. The company does not anticipate major pressure from high energy prices because all its sunflower seeds crushing plants in Moldova use burned husk to meet energy needs. We anticipate the company will post S&P Global Ratings-adjusted debt to EBITDA of 3x-4x and FOCF to remain negative but at a more modest level than in FY2021, thanks to a strong inventory position at the end of FY2021 and assuming broadly stable global commodity prices. Through ViOil's acquisition, Aragvi acquired the largest sunflower seeds crushing plant (1,200 metric tons per day) in Serbia, which, complemented with MK Group's agricultural assets, will

...Aragvi posted historically high revenue and earnings in fiscal year (FY) 2021 (ended June 30, 2021), thanks to strong international origination activity and unprecedented rally in global sunflower oil and grain prices. Aragvi's credit metrics were well in line with our base case last year with a strong operating performance driven by favorable market conditions. The company increased noticeably its origination activity outside its traditional sourcing markets in Moldova, Ukraine, and Romania, which were hit by drought in the summer and autumn. International origination increased as a share of origination and marketing revenue (to 45% in FY2021 from 19% in FY2020), with Asia-Pacific and Latin America leading the pack. This was supported by the company's ability to originate 35% more sunflower seeds and grains volumes in FY2021. Alongside the unprecedent spike in global soft commodity prices amid the COVID-19 outbreak, which triggered global stockpiling effort for food security purposes,...

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