Interim Results

Ukrproduct Group Ltd

29 September 2026

 

29 September 2026

UKRPRODUCT GROUP LIMITED

(“Ukrproduct”, the “Company” or, together with its subsidiaries, the “Group”)

UNAUDITED INTERIM FINANCIAL RESULTS FOR THE SIX MONTHS ENDED 30 JUNE 2026

Ukrproduct Group Limited (AIM: UKR), one of the leading Ukrainian producers and distributors of branded dairy foods and beverages (kvass), today announces its unaudited interim financial results for the six months ended 30 June 2026.

The full unaudited interim financial results for the six months ended 30 June 2026 are available on the Company’s website at www.ukrproduct.com .  

For further information contact:

Ukrproduct Group Ltd
Rinat Abdrasilov, Non-Executive Chairman	Tel: [phone]
Oleksandr Slipchuk, Chief Executive Officer	www.ukrproduct.com
Strand Hanson Limited
Nominated Adviser and Broker Rory Murphy, Richard Johnson	Tel: [phone] www.strandhanson.co.uk

Chairman and Chief Executive Statement  

The first half of 2026 has tested Ukrproduct in ways even the preceding four years of war had not: two of our own sites came under missile strikes, our sector’s supply chains absorbed repeated blows, and the conditions our people work under grew harder, not easier, as the period wore on. The fact that we still closed the half with production running, salaries paid and customers supplied is, we believe, the clearest measure of this business’s resilience.

We are deeply grateful for the continued commitment of our employees across Ukraine, who kept plants and offices running through air-raid alerts, strikes on our own facilities, and the loss of colleagues and homes; for our farmers, drivers, distributors and retail partners, who have absorbed herd losses, warehouse destruction and stretched lead times alongside us; for the EBRD, whose continued, solutions-focused engagement we value; and, above all, for those defending Ukraine, without whom none of this is possible.

Ukrproduct, one of the leading Ukrainian producers and distributors of branded dairy foods and beverages, announces its interim results for the six months to 30 June 2026 (“H1 2026” or the “Period”) and provides an outlook for the remainder of the year.

2026 Half-Year Highlights

Ukrproduct Group delivered a resilient operating performance in an environment that remained under severe, and in several respects worsening, pressure. Revenue in local currency (UAH) increased by 2.4% during H1 2026, primarily driven by inflation-related price adjustments and higher export volumes of non-branded products. Revenue reported in British pounds declined by 6.0%, from £20.2 million in H1 2025 to £19.0 million in H1 2026, reflecting the significant and ongoing depreciation of the Ukrainian hryvnia against sterling.

Operating environment.

Now in its fifth year, the war continues to reshape the fundamental operating environment of the Group. During the Period, two of the Group’s own sites sustained damage from missile strikes, which forms part of a broader pattern of attacks on dairy and food-processing infrastructure across the country, including fatal strikes on peer producers and damage to the storage facilities of other major international operators in Ukraine. Russian strikes on national energy and water infrastructure caused repeated, extended disruption to supply, materially affecting production planning; mobilisation and displacement continued to shrink the available workforce, with the extension of travel permissions to men aged 18–22 adding further pressure.

Repeated strikes on retail and logistics infrastructure - including the loss of more than half the warehousing capacity of one of the Group’s key domestic distribution partners - have disrupted the Group’s ability to reach consumers within the country. The national dairy herd has contracted by more than 38% since the start of the full-scale invasion, tightening raw milk availability industry-wide, and approximately one-fifth of Ukraine’s territory remains affected by landmines and unexploded ordnance, constraining agricultural land use nationally. Export routes and the duty- and quota-free access on which they increasingly depend remain under threat. We continue to prioritise the safety of our people and continuity of supply, though these conditions materially affect planning horizons, working capital needs and production efficiency, and - consistent with our peers operating in Ukraine - we are not in a position to provide confident guidance on the remainder of the year.

Profitability

• In line with lower revenue, cost of sales decreased by 4.7% year-on-year to £15.9 million, as a 9.8% reduction in raw material costs was partly offset by higher energy (up 9.8%) and payroll (up 3.0%) costs.
• Gross profit declined 12.4% to £3.1 million (H1 2025: £3.5 million), with the gross margin narrowing to 16.3% from 17.5%.
• Operating expenses (administrative, selling & distribution and other operating expenses) rose 7.0% to £2.5 million. Selling and distribution expenses increased by 21.9%, reflecting higher logistics and export-related costs, while administrative expenses reduced by 4.4%. Labour turnover remains elevated as younger workers relocate abroad or are unavailable due to mobilisation and family dispersal. To protect throughput, we have focused on targeted retention, cross-training and selective hiring; however, these measures increase the short-term cost base.
• EBITDA declined 37.8% year-on-year to £1.0 million (H1 2025: £1.5 million).
• Net finance expenses in H1 2026 were broadly unchanged at £0.5 million, 1.3% higher than in H1 2025, as interest continues to accrue on the higher EBRD principal balance following the earlier capitalisation of deferred interest and fees.
• Net foreign-exchange loss narrowed to £0.2 million (H1 2025: £0.9 million), reflecting a more moderate depreciation of the Ukrainian hryvnia against the euro during the period.

As a result, the Group recorded a net loss after tax of £71 thousand, compared with a net loss of £190 thousand in H1 2025.

Financial position

As at 30 June 2026, Ukrproduct Group reported net assets of £1.6 million (30 June 2025: £1.6 million; 31 December 2025: £1.7 million), with cash and cash equivalents of £148 thousand (30 June 2025: £64 thousand; 31 December 2025: £98 thousand).

For the six months ended 30 June 2026, the Group continued to be in breach of several provisions of the loan agreement with the EBRD, including failure to repay Tranches A and B by maturity and missed interest payments.

Discussions with the EBRD regarding potential restructuring of the loan and accrued interest, remain ongoing. At present, the EBRD has not exercised its right to accelerate repayment of the outstanding loan.

Outlook for 2026

Since the end of the Period, the war has entered a markedly more aggressive phase directed at food retail and distribution infrastructure. Through the third quarter of 2026, Russian strikes have repeatedly targeted supermarket warehouses and distribution centres across several of the country's leading retail chains. The Group does not operate its own retail network and distributes its products through third-party supermarket chains, several of which have themselves come under sustained attack. The Group has recognised a provision covering the estimated losses of finished product held in third-party storage and in transit, based on information currently available, and reviews and updates this allowance on a regular basis as claims are processed and further information is received.

The operating environment is expected to remain fragile, with the war in Ukraine and financial constraints continuing to weigh on the Group. Our export growth has benefited from EU market access; however, tariff-rate quotas on Ukrainian dairy exports were reinstated from June 2025 and, while a revised EU-Ukraine trade framework agreed in October 2025 increased quota volumes, it also introduced a broader safeguard mechanism that individual member states can invoke - a tool already used to restrict Ukrainian agricultural imports in some markets, and one we expect to remain a source of volume and price pressure, particularly in commodities (e.g., SMP, butter). We are preparing mitigation actions including mix optimisation towards value-added products, diversification of export destinations and closer alignment of production to confirmed orders. The Group’s liquidity remains constrained and dependent on disciplined working-capital management and continued lender forbearance while restructuring discussions with EBRD are ongoing. We are limiting capital expenditure to essential safety and maintenance, pursuing prepayments where possible and rationalising lower-margin stock and concentrating on the most profitable product range to preserve cash. The Group will support further development of recent product launches (kvass varieties, Kombucha, sandwich spreads), continue to follow a cautious capital allocation policy, prioritise liquidity preservation, seek new financing opportunities, and focus on fulfilling its existing obligations.

Rinat Abdrasilov	Oleksandr Slipchuk
Non-Executive Chairman	Chief Executive Officer

Ukrproduct Group

CONDENSED CONSOLIDATED INTERIM STATEMENT OF COMPREHENSIVE INCOME

FOR THE SIX MONTHS ENDED 30 June 2026     

(in thousand GBP, unless otherwise stated)

		Six months ended		Six months ended
		30 June 2026		30 June 2025
		£ ‘000		£ ‘000
Revenue		19 012		20 232
Cost of sales		(15 920)		(16 701)
GROSS PROFIT		3 092		3 531
Administrative expenses		(1 148)		(1 201)
Selling and distribution expenses		(1 237)		(1 015)
Other operating expenses		(90)		(97)
PROFIT FROM OPERATIONS		617		1 218
Net finance expenses		(463)		(457)
Net foreign exchange loss		(237)		(924)
LOSS BEFORE TAXATION		(83)		(163)
Income tax		12		(27)
LOSS FOR THE SIX MONTHS		(71)		(190)
Attributable to:
Owners of the Parent		(71)		(190)
Non-controlling interests		-		-
Earnings per share from continuing and total operations:
Basic (in pence)		(0.18)		(0.48)
Diluted (in pence)		(0.18)		(0.48)
OTHER COMPREHENSIVE INCOME:
Items that may be subsequently reclassified to profit or loss
Currency translation differences		15		(143)
OTHER COMPREHENSIVE INCOME, NET OF TAX		15		(143)
TOTAL COMPREHENSIVE LOSS FOR THE SIX MONTHS		(56)		(333)
Attributable to:
Owners of the Parent		(56)		(333)
Non-controlling interests		-		-

Ukrproduct Group

CONDENSED CONSOLIDATED INTERIM STATEMENT OF FINANCIAL POSITION

AS AT 30 June 2026  

(in thousand GBP, unless otherwise stated)

		As at		As at		As at
		30 June 2026		31 December 2025		30 June 2025
		£ ‘000		£ ‘000		£ ‘000
ASSETS
Non-current assets
Property, plant and equipment		6 469		6 700		6 538
Intangible assets		185		227		266
		6 654		6 927		6 804
Current assets
Inventories		4 807		4 010		4 207
Trade and other receivables		4 666		4 879		4 748
Current taxes		496		720		707
Other financial assets		25		25		26
Cash and cash equivalents		148		98		64
		10 142		9 732		9 752
TOTAL ASSETS		16 796		16 659		16 556
EQUITY AND LIABILITIES
Equity attributable to owners of the parent
Share capital		4 282		4 282		4 282
Treasury shares		(315)		(315)		(315)
Share premium		4 583		4 583		4 583
Translation reserve		(16 649)		(16 664)		(16 672)
Revaluation reserve		5 420		5 480		5 553
Retained earnings		4 291		4 302		4 209
		1 612		1 668		1 640
TOTAL EQUITY		1 612		1 668		1 640
Non-current Liabilities
Deferred tax liabilities		247		270		285
		247		270		285
Current liabilities
Bank loans		5 758		5 692		5 752
Short-term payables		446		609		441
Trade and other payables		8 695		8 373		8 370
Current income tax liabilities		15		15		16
Other taxes payable		23		32		52
		14 937		14 721		14 631
TOTAL LIABILITIES		15 184		14 991		14 916
TOTAL EQUITY AND LIABILITIES		16 796		16 659		16 556

Ukrproduct Group

CONDENSED CONSOLIDATED INTERIM STATEMENT OF CHANGES IN EQUITY

FOR THE SIX MONTHS ENDED 30 June 2026

(in thousand GBP, unless otherwise stated)

	Attributable to owners of the parent
	Share capital		Treasury shares	Share premium	Revaluation reserve	Retained earnings	Translation reserve	Total	Non-controlling interests			Total Equity
	£ ‘000		£ ‘000	£ ‘000	£ ‘000	£ ‘000	£ ‘000	£ ‘000	£ ‘000			£ ‘000
As at 31 December 2024	4 282	(315)		4 583	5 628	4 324	(16 529)	1 973		-	1 973
Loss for the six months	-	-		-	-	(190)	-	(190)		-	(190)
Currency translation differences	-	-		-	-	-	(143)	(143)		-	(143)
Total comprehensive loss	-	-		-	-	(190)	(143)	(333)		-	(333)
Depreciation on revaluation of property, plant and equipment	-	-		-	(75)	75	-	-		-	-
As at 30 June 2025	4 282	(315)		4 583	5 553	4 209	(16 672)	1 640		-	1 640
Profit for the six months	-	-		-	-	20	-	20		-	20
Currency translation differences	-	-		-	-	-	8	8		-	8
Total comprehensive income	-	-		-	-	20	8	28		-	28
Depreciation on revaluation of property, plant and equipment	-	-		-	(73)	73	-	-		-	-
As at 31 December 2025	4 282	(315)		4 583	5 480	4 302	(16 664)	1 668		-	1 668
Loss for the six months	-	-		-	-	(71)	-	(71)		-	(71)
Currency translation differences	-	-		-	-	-	15	15		-	15
Total comprehensive loss	-	-		-	-	(71)	15	(56)		-	(56)
Depreciation on revaluation of property, plant and equipment	-	-		-	(60)	60	-	-		-	-
As at 30 June 2026	4 282	(315)		4 583	5 420	4 291	(16 649)	1 612		-	1 612

Ukrproduct Group

CONDENSED CONSOLIDATED INTERIM STATEMENT OF CASH FLOWS

FOR THE SIX MONTHS ENDED 30 June 2026  

(in thousand GBP, unless otherwise stated)

	Six months ended		Six months ended
	30 June 2026		30 June 2025
	£ ‘000		£ ‘000
Cash flows from operating activities
Loss before taxation	(83)		(162)
Adjustments for:
Exchange difference	237		924
Depreciation and amortisation	342		323
Provision for/(Reversal of) bad debts	27		2
Impairment of inventories	212		354
Interest income	(33)		(1)
Interest expense on bank loans	496		459
Operating cash flow before working capital changes	1 198		1 899
Increase in inventories	(1 009)		(1 039)
(Increase)/Decrease in trade and other receivables	461		(435)
Increase/(Decrease) in trade and other payables	(218)		167
Changes in working capital	(766)		(1 307)
Cash generated from operations	432		592
Interest received	-		1
Income tax paid	(42)		(30)
Net cash generated from operating activities	390		563
Cash flows from investing activities
Purchases of property, plant and equipment and intangible assets	(313)		(454)
Net cash used in investing activities	(313)		(454)
Cash flows from financing activities
Interest paid	(38)		(55)
Net cash used in financing activities	(38)		(55)
Net increase in cash and cash equivalents	39		54
Effect of exchange rate changes on cash and cash equivalents	11		(110)
Cash and cash equivalents at the beginning of the six months	98		120
Cash and cash equivalents at the end of the six months	148		64

Ukrproduct Group

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE SIX MONTHS ENDED 30 JUNE 2026

(in thousand GBP, unless otherwise stated)

EXTRACTS FROM NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

1. Basis of preparation

The unaudited condensed consolidated financial statements have been prepared in accordance with UK-Adopted International Accounting Standards. The condensed consolidated financial information in this half yearly report has been prepared in accordance with International Accounting Standard 34 ‘Interim Financial Reporting’ (IAS 34) and the Disclosure Guidance and Transparency Rules of the Financial Conduct Authority. 

The condensed consolidated financial statements have been prepared on a historical cost basis, except for significant items of property, plant and equipment which have been measured using the revaluation model.

The accounting policies used and the methods of computation are the same as those disclosed in the Group’s recent annual consolidated financial statements except for the adoption of new and revised accounting standards.

The interim condensed consolidated financial statements do not include all the information and disclosures required in the annual financial statements, and should be read in conjunction with the Group’s annual financial statements as at 31 December 2025.

The preparation of the unaudited condensed consolidated financial statements requires management to make judgements, estimates and assumptions that affect the application of policies and reported amounts of assets and liabilities, income and expenses. Actual results may differ from those estimates.

The Board has reviewed the Group’s ongoing commitments and cash flows forecasts for at least twelve months from the date of approval of these interim financial statements.

2. Going concern

The war in Ukraine continues to pose significant risks to the Group’s operations, including potential infrastructure damage, logistics and energy disruptions, and workforce shortages due to conscription. Despite management’s forecasts, material uncertainties remain that may cast doubt on the Group’s ability to continue as a going concern.

In addition, the Group continues to operate under financial pressure and remains in breach of certain provisions of its loan agreement with the EBRD.

As at the date of approval of these interim financial statements, the EBRD has not exercised its rights to demand immediate repayment or to accelerate the outstanding balance. Management remains engaged in discussions with the EBRD. However, no binding agreement has been reached, and no assurance can be given as to the timing or outcome of those discussions, or that forbearance will continue.

Ukrproduct Group

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE SIX MONTHS ENDED 30 JUNE 2026

(in thousand GBP, unless otherwise stated)

The Directors have considered base and downside cash-flow forecasts for a period of at least twelve months from the date of approval. These forecasts incorporate feasible mitigating actions within the Group’s control, including disciplined working capital management, cost reductions, deferral of non-essential capital expenditure, and product mix optimisation. These forecasts assume no acceleration of the EBRD facility and ongoing access to key markets and suppliers. In certain downside scenarios, absent a restructuring or continued forbearance from the EBRD, the Group would require additional funding and there are no guarantees that this funding will be available.

Accordingly, the Directors note that a material uncertainty exists which may cast significant doubt on the Group’s ability to continue as a going concern. Nevertheless, having regard to the actions available to them and to the current status of discussions with the EBRD, the Directors have a reasonable expectation that the Group has adequate resources to continue in operational existence for the foreseeable future and, therefore, the interim financial statements have been prepared on a going concern basis. The interim financial statements do not include any adjustments that would result if the Group were unable to continue as a going concern.

Management acknowledges that future development of military actions and their duration represent a source of material uncertainty which may cast significant doubt about the Group's ability to continue as a going concern and, therefore, the Group may be unable to realise its assets and discharge its liabilities in the normal course of business. Despite the material uncertainty relating to the war in Ukraine, management is continuing to take actions to minimise the impact to the Group and thus believes that the application of the going concern assumption for the preparation of these condensed consolidated interim financial statements remains appropriate.

3. Foreign currency translation

Functional and presentation currency

Items included in the financial statements of each of the Group's companies are measured using the currency of the primary economic environment in which the company operates (“the functional currency”). For the companies operating in Cyprus and British Virgin Islands, the functional currency is United States Dollars (“USD”). For the Parent company, which is located in Jersey, the functional currency is Pound Sterling (“GBP”). For the companies operating in Ukraine, the functional currency is Ukrainian Hryvnia (“UAH”).

These condensed consolidated interim financial statements are presented in the thousands of Pounds Sterling (“GBP”), unless otherwise indicated.

Ukrproduct Group

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

FOR THE SIX MONTHS ENDED 30 JUNE 2026

(in thousand GBP, unless otherwise stated)

Foreign currency transactions and balances

Transactions in foreign currencies are initially recorded by the Group entities at their respective functional currency rates prevailing at the date of the transaction.  

Monetary assets and liabilities denominated in foreign currencies are retranslated at the functional currency spot rate of exchange ruling at the reporting date.   

Non-monetary items that are measured in terms of historical cost in a foreign currency are translated using the exchange rates as at the dates of the initial transactions. Non-monetary items measured at fair value in a foreign currency are translated using the exchange rates at the date when the fair value is determined. 

The principal exchange rates used in the preparation of these condensed consolidated interim financial statements are as follows:

Currency		30 June 2026 (spot rate)		Average rate for the six months ended 30 June 2026		31 December 2025 (spot rate)		30 June 2025 (spot rate)		Average rate for the six months ended 30 June 2025
UAH/GBP		59.34		58.83		57.21		57.20		53.98
UAH/USD		44.85		43.74		42.39		41.64		41.63
UAH/EUR		51.17		51.03		49.86		48.78		45.47

4. Subsequent events

As at the date of approval of these condensed consolidated interim financial statements, the military conflict in Ukraine remains ongoing and continues to create significant uncertainty in the economic and operating environment in which the Group operates.

The Group continues to operate and retains control over all of its operating assets and business activities.

Following the reporting date, military attacks on various regions of Ukraine have continued to affect civilian, transportation and energy infrastructure. These events have adversely affected logistics and distribution processes, increased delivery lead times and resulted in additional transportation, warehousing and operating costs.

The ongoing military conflict also continues to create challenges in labour availability, procurement and supply chain management. Management continues to monitor developments and to implement measures aimed at maintaining uninterrupted operations and mitigating the impact of external disruptions on the Group's business.

As at the date of approval of these condensed consolidated interim financial statements, the Group remains in active negotiations with the EBRD. While no formal agreement has been reached as at that date, the EBRD has not taken steps to accelerate repayment of the accumulated loan.

Management has assessed events occurring after 30 June 2026 and up to the date of approval of these condensed consolidated interim financial statements and concluded that, except for the matters described above, no events have occurred that would require adjustment to or additional disclosure in these financial statements.

 

END