Even though profit is likely to moderate in FY'25 due to the absence of the FX gains that supported FY'24 performance, UACN's core results should remain resilient. This view is consistent with the company's Q1'25 result, which revealed a 100.8% surge in EBIT on the back of improved cost efficiencies such as the integration of low-cost energy sources (switch from firing boilers to biomass in the Feed business) and revamp of distribution model to allow customers to self- collect orders. The sustained improvement in receivable days, with further gains expected through 2025, also bodes well for the company's cash conversion cycle and overall working capital management. We have a new 12-month Target Price ("TP") of N41.49 and an unchanged BUY rating on the ticker.
