Neochim Q3'16 consolidated net loss up 3.4x YoY to BGN 11.7m (NEGATIVE)

Neochim Q3 2016 consolidated revenue slumped 55.7% YoY to BGN 24m as export sales declined 67% YoY and domestic sales shrank 39.4% YoY. The share of domestic sales in total revenue increased to 56% from 41% in Q3 2015. Operating expenses fell 39% YoY, slower than revenue, driven by the contraction in material expenses. Hence, EBITDA turned negative at BGN 7.6m vs. positive BGN 2.7m in the same period last year. Net financial expenses decreased 56.6% YoY to BGN 1.3m thanks to lower FX loss. Thus, the reported net loss surged 3.4x YoY to BGN 11.7m. 9m 2016 revenue decreased 24% YoY to BGN 172.8m, driven by a 38.9% YoY slump in exports and a 9.3% YoY decline in domestic sales. The EBITDA margin improved to 16.1% from 9.8% in the year-ago period, as the main OPEX line, material expenses, contracted 36.9% YoY. Lower FX loss (-55.2% YoY) contributed further to the improvement in the bottom line result, which increased 79.1% YoY to BGN 16.9m, reaching net profit margin of 9.8%.