ING: EBIRDA Uplift in the Processor

研报英文原文证据摘录

ING: EBIRDA Uplift in the Processor

herwise noted.

earnings benefits weighted to FY27 and out years. Priced as of prior trading day's market close, EST (unless otherwise noted).

Early days, but indicators are encouraging. Chicken processing yields have

improved FY26TD, driving a ~$20m annualised benefit, while $17.4m in

annualised cost savings have been delivered, with a further $3.1m from

identified future projects. Though we forecast EBITDA margin uplift from

FY27 (RBC FY27/28e: 10.8%/11.0%), we have not captured the full benefit

of the operational improvements in our numbers, with the FY26 result to

provide a key indicator of execution progress in our view.

3Q26 YTD group core poultry volume and NSP growth tracking in line with

RBCe. FY26TD group core poultry volumes grew +1.1% on pcp (AU: +1.2%,

NZ: +0.5%), while group NSPs also increased +1.1% (AU: +1.4%, NZ: +2.7%).

FY26 group core poultry volumes and NSPs are guided to be slightly higher

than FY25 (RBC FY26e volume growth: +0.7%; NSP growth: +0.5%), while

wholesale price and margins are expected to remain favourable vs pcp.

Balance sheet health contingent on operational improvements. Leverage

to decrease as improvements ramp, with management guiding to ND of

$410-435m in FY27 and $380m-$410m in FY28. We expect ND/EBITDA (ex.

Leases) to return to target range of 1.0-2.0x in FY27 (RBCe: 1.9x).

Earnings estimate changes: We have increased FY26/27e EBITDA (post-16)

by +2.2/1.3% with operational efficiencies supporting margin expansion,

while we remain cognisant of continued competitive pressure in the

industry and risks to conflict-related costs. Our $1.80/share PT (prev. $2.00)

reflects a revised WACC assumption (8.0%). Trading at 9x P/NTM EPS and

with ~6% implied TSR on our PT, we see ING as fairly valued.