United Malt provides trading update and FY2022 guidance; Shares down on ASX

United Malt Group Limited (ASX: UMG) has released trading update and has revised earnings guidance for FY2022 ended 30 September 2022.

The Company expects Underlying EBITDA for FY2022 to be in between AU$100 million to AU$108 million. In the interim results, the Company pointed that the Processing segment in North America was adversely impacted by several external events, comprising substantial deterioration of the North American barley crop, supply chain disruptions, increased costs of imported barley which could not be fully passed on to customers and general cost inflation.

The situation continued during April and June 2022 quarter resulting in further deterioration of gross margins in its North American operations.

Now, the Company expects its earnings to be below the previous guidance. Processing segment Underlying EBITDA is expected to range from AU$62 to AU$66 million.

However, in FY2023, UMG expects material increase in earnings. Underlying EBITDA is expected to be in the range of AU$140 to AU$160 million, which would be probably driven by:

• Improved North American barley crop conditions
• Improved pricing and commercial terms
• Completion of the Scottish expansion project
• Progressive delivery of the Transformation project

At AEST 10:42 AM, UMG shares are trading at AU$3.2, down 12.806% from the previous close.

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