TeraPlast, one of the representatives of the industrial sector in BET index with a market cap of EUR 220m, has published its 9M 2023 results along with FY 2023 expectations. In 9M 2023, Teraplast recorded a revenue decline of 8% YoY, an EBITDA decrease of 7%, and a net profit of RON 6.8m, a 58.5% YoY decrease.
TeraPlast one of the largest PVC processors in the Eastern EU has published its 9M 2023 results. In the report, the Company has also announced its FY 2023 expectations. The company managed to show a positive net result in the 9M as a result of Q3 performance. Looking at the last quarter, the management of the company emphasized that their activity accelerated driven by infrastructure works and export, partially offset by the below-expected evolution of subsidiaries’ businesses – window & door and packaging segments. Accelerated movement in Q3 specifically reflected more quantities sold with 14% YoY growth in the quarter.
Quantities evolution by quarter; tons
Source: BVB, InterCapital Research
Teraplast noted a decrease in its top line by 8% in 9M 2023, while looking at Q3 the accelerated demand started to kick in with the aforementioned 14% growth in quantities sold – resulting in 4% topline growth for the last quarter. In 9M 2023, the Company’s EBITDA decreased to RON 45m, a decrease of 7% YoY, which resulted that its EBITDA margin reached 8.7% (down 2.8 p.p. YoY). However, just as the top line noted a positive development in the last quarter, so did Teraplast’s profitability with an EBITDA margin amounting to 11% in Q3.
Teraplast key financials (9M 2023 vs 9M 2022, RON m)
Source: BVB, InterCapital Research
Looking at the FY 2023 company’s forecast, Teraplast expects another solid upcoming quarter with an acceleration of the growth rate, after already strong reported Q3. For the FY company expects its top line to decrease 5% YoY, while for its EBITDA to grow 6% YoY with an 8.3% margin (vs 7.3% in 2022). The profitability improvement is expected to arise by the evolution of average prices that dilute the potential effect of the increase in volumes for the FY. Also, the Group believes that an improvement in subsidiaries’ profitability is to be seen.
