AUGA group, AB interim financial results for the 9-month period ended 30 September 2023
30 Novembre 2023 - 9:22PM
AUGA group, AB interim financial results for the 9-month period
ended 30 September 2023
The sales revenues of AUGA group, AB and its subsidiaries
(hereinafter – the Group) in the first nine months of 2023 amounted
to EUR 59.93 million and grew by 4% compared to the same period of
2022.
The Group had a gross loss of EUR 1.87 million
for the first nine months of 2023, while in the same period last
year it had a gross profit of EUR 13.14 million.
The Group's EBITDA for the reporting period was
EUR –1.22 million. In 2022, EBITDA was EUR 16.78 million.
"The main reason for the Group's financial
performance is fallen purchase prices for organic products. Seeing
the situation, we decided already in summer 2023 to employ
regenerative conventional farming methods on part of the land. That
will let us diversify market risks, reduce yield and income
volatility, lay the foundations for future growth and improve our
financial performance. Meanwhile, the Group is not changing its
strategic focus on developing and commercialising sustainable
agricultural technologies, and so will seek additional, varied
forms of financing for further development," says Kęstutis Juščius,
the Chair of the Board of AUGA group, AB.
Crop growing segment
According to the Group’s figures, the overall
yield for the 2023 season is average, except for beans, which were
the worst hit by the drought early in the season. The yield of
beans was half of what was planned. The result of the segment was
also determined by one of the lowest purchase prices for organic
products in recent years. Precisely for this reason, on August 7,
2023, the Group announced that a third of the land will be
cultivated using regenerative conventional farming. Next season,
40% less land than this year will go to summer organic crops, which
are sensitive to the climate. Such a decision will ensure that by
2024, half of the Group's income will come from the sale of
conventional products, and price changes will have a smaller impact
on the variability of results. At the same time, enough organic raw
materials will be produced to meet demand on the Lithuanian market
and ensure the provision of organic products for end-consumers.
The segment's gross loss for the first nine
months of 2023 was EUR 3.57 million, which includes sales of
agricultural products, changes in the fair value of biological
assets and agricultural subsidies. That compares to a gross profit
of EUR 11.96 million in same period of 2022.
Dairy segment
Although milk yields were 4% higher in the first
nine months of 2023 than a year earlier, the segment's overall
performance reflects a 18% drop in milk prices.
During the reporting period, the dairy sales
revenue fell to EUR 11.26 million, compared to EUR 12.32 million in
the first nine months last year.
The segment had a gross loss of EUR 0.60 million
for the first nine months of 2023, compared to a gross profit of
EUR 1.67 million for the same period in 2022.
Mushroom growing segment
Higher production prices, managed production
costs and lower energy prices have improved results in the mushroom
segment.
For the first nine months of 2023, this segment
had a gross profit of EUR 1.12 million, compared to a gross loss of
EUR 1.51 million in the same period last year.
Fast-moving consumer goods (FMCG)
segment
During the reporting period, this segment's
sales decreased slightly to EUR 5.28 million compared to EUR 5.50
million a year earlier. The change reflects the fact that as of
August, the product portfolio no longer includes canned products
following the sale of 100% of the shares of the Kooperatinė
bendrovė "Grybai LT".
Gross profit for the first nine months of 2023
increased 16% to EUR 1.17 million, up from EUR 1.01 million in the
same period in 2022.
In 2023, the Group launched a new line of more
sustainable organic products for consumers, based on a range of
dairy products and also including oat flakes, eggs and vegetables.
The new products are made exclusively from raw materials grown on
the Group's organic farms. They are sold in major Lithuanian
supermarket chains.
Operating costs
The Group's operating costs for the first three
quarters of 2023 amounted to EUR 10.86 million, compared to EUR
8.93 million in the same period last year. Operating costs were
increased by marketing expenses, investments related to the
introduction of new end-consumer products, and higher employee
pay.
Implementation of the
strategy
The Group continues to develop its technology
projects and is preparing to scale them. The AUGA M1 tractors from
the first production batch are being further tested. Three
biomethane plants are being prepared for connection to the natural
gas grid. On 29 November 2023, the Group announced the confirmed
results of testing of its feed technology. Tests showed that the
technology enables an increase in the milk yield with no impact on
the milk’s quality and a reduction of the methane emissions from
cows' digestive processes by 32% per litre of raw milk. The test
results were evaluated and their validity was confirmed by
scientists from the Veterinary Academy of the Lithuanian University
of Health Sciences.
Financial data in MS Excel
format
To facilitate investors' access to and analysis
of the Group's financial data, the Group has prepared and makes
publicly available on its website historical financial data,
including data for the most recent reporting period, in MS Excel
format. The data can be accessed at the following link:
https://auga.lt/en/investors/reports-and-presentations1/quarterly-and-annual-reports/
Contacts:CEO of AUGA group, ABElina Chodzkaitė-Barauskienė+370 5
233 5340
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