Five Years Business Plan

Hedging Highlights

Monbat group aims to triple the EBITDA in 5 years horizon reaching 75m EUR. This envisaged extensive growth will be driven by two concurrent paths, namely:

  • Organic growth of the current business model by focusing on both market expansion and introducing a ‘hybrid go-to market’ approach, enabling production assembly activities in territories outside Bulgaria. This path will bring the group EBITDA to the level of 42m EUR, representing a 68% increase, which is close to the growth pace that Monbat exercised in the last five years 
  • Enforcing strategic projects, which drives both the scaling up of the existing business model as well as bringing completely new sources of margin - niche diversification in recycling and focused diversification in high power lithium-ion batteries. This path will inevitably bring sizable part of the indented overall growth 

The intended strategic projects represent the foreseen EBITDA upside. Once, a strategic project is completely operationalised, it will be presented as part of the budget of the core business activities, e.g – this applies for the strategic acquisition of a recycling plant in Italy and its respective synergy benefits are already integrated in the overall budget of Monbat Group.

2017-2022 Five Years growth pace

CORE BUSINESS - ORGANIC GROWTHMeasure

2017*

20182019202020212022
Volumes       
BatteriesPcs2,549,9142,922,6843,332,6403,715,8943,868,1753,950,000
Lead & Alloy MT46,56248,88858,21560,12960,52760,736
Economics & Ratios
Consolidated RevenueEUR '000166,477167,000198,213218,329224,672227,478
Consolidated Gross ProfitEUR '00045,19343,11352,58757,89959,58060,421
Consolidated Gross Profit %%27%26%27%27%27%27%
Consolidated EBITDA - organic businessEUR '00023,40027,09835,58640,09041,41942,048
Incorporated EBITDA effect from the integration of Recycling ItalyEUR '0004,0006,5006,5006,5006,500
Consolidated EBITDA %%14%16%18%18%18%18%
EBITDA Organic growth rate%16%31%13%3%2%

STRATEGIC PROJECTSMeasure

2017*

20182019202020212022
Scale through acquisitionEUR '0005,30013,20013,40017,00020,000
Niche diversification in recyclingEUR '0002,0003,4003,7004,2005,000
Focused diversification in lithium-ion batteriesEUR '000-1,50002,4005,0008,000
Strategic projects EBITDAEUR '0005,80016,60016,60026,20033,000

PLANSMeasure

2017*

20182019202020212022
MONBAT GROUP "BASE" PLANEUR '00025,59835,58642,49046,41950,048
MONBAT "BEST CAN DO" PLANEUR '00032,89852,18659,59067,61975,048
EBITDA accumulated growth pace %41%71%21%20%18%

*(un-audited)

Performance DriversThe core business budget is build on the following lead drivers, namely:

  • LME 2 100; 
  • Recovering of the volume levels of 2016 during 2018 and re-gaining the volume growth from 2019 onwards. The 2018 volume growth in comparison with 2017 represents 15% planned growth; 
  • It is envisaged that L&A sells to third parties during 2018 will range between 10 and 15% to the overall planned production volumes; 
  • It is expected that the synergy benefits of the integrated recycling plant in Italy will bring incremental EBITDA increase; 
  • It is expected that EAS batteries will decrease the amount of group support for their operational expenses to 1.5m EUR by re-gaining some of the legacy business as well as achieving early commercialization of the new product range, which will be introduced to the market in Q4 2018.
Attached