Monbat Investors Meeting 2019: Recovery of performance trend after challenging 2018



On 26 September 2019 Monbat held its annual Investors Meeting where the management presented an update of its 5-year strategy expecting strong organic and M&A-driven growth.

Monbat already recovers its tendency of strong operational performance after a challenging 2018, which starts translating in gradual improvement of the TTM Q2 2019 results.

ELANA Trading analysts comment in a Key Takeaways Note that the company is showing a steady and balanced development in 2019 keeping in its focus on both core business and disruptive technologies.

Monbat lead-acid batteries sales up 21% YTD

Since the start of FY2019, the producer accelerated lead-acid batteries sales (up 21% y/y) and increased recycling-related revenues by 6% y/y. German operations are speeding up adding 16.5% y/y to the top line, while Italian business is still making moderate contributions to the top line, the latter arriving to BGN 158.3m (up 19.5% y/y) in H1’19. The improvement is mainly due to market diversification and predictable LME lead prices.

Management’s guidance for FY2019 sales points to BGN 324.6m (up 10.4% y/y), outpacing strong 2017

Profitability has also been on the rise, EBITDA up 67% y/y and net income surging six-fold y/y in H1’19. Margins improved considerably on annual basis, although they are still behind strong H1’17 levels.

Management’s expectations for FY2019 are for 57% y/y adjusted EBITDA rise to BGN 38.3m, with margins almost approaching FY2017 levels. EBITDA’s growth in 2019 will be supported entirely by core batteries and recycling divisions. Italian recycling plant and German li-ion business are not expected to add to profitability this year. The latter is due to time-consuming go-to-market in Germany and cumbersome EU hazardous materials transportation notification procedure in Italy. Still, these issues are expected to be resolved in 2020 when German operations will break even and Italian recycling plant will add to the Group’s EBITDA BGN 5.9m.

Information pack from Investor meeting 2019 from Monbat website

Latest financial results (August 2019)

ELANA customers can read the full Key Takeaways Note by ELANA Trading analysts in investors’ hub ELANA Online