Report on interim financial results of AUGA group, AB for the
9-month period ended 30 September 2021
The sales revenue of AUGA group, AB, and its
subsidiaries (hereinafter, the Group) for the 9-month period
amounted to EUR 54.90 million and was 12% lower than the same
period last year, when the sales revenue totalled EUR 62.38
million.
According to the Group data, for the three
quarters of 2021, the Group’s gross profit was EUR 1.70 million.
The gross profit of the same period last year amounted to EUR 11.88
million. In the first 9 months of 2021, the Group’s net loss was
EUR 10.43 million.
The EBITDA of the Group amounted to EUR 5.45
million in the first 9 months of 2021, representing a 66% decrease
from the same period last year, when EBITDA was EUR 15.94
million.
“These 9-month results were driven by challenges
in the crop growing segment. In June and July, when summer crops
grow the most, an extreme heatwave was recorded in Lithuania.
Organic farming was especially affected, resulting in poor
performance in a key segment of our operations.
There is no doubt that we have started feeling
the effects of climate change more frequently and more adversely
than ever before, so accelerating our innovation agenda becomes
even more important. Today, AUGA group is diversifying its income,
growing FMCG sales and entering the AgTech segment, so fluctuating
agricultural performance will become less important in achieving
our long-term goals", says Kęstutis Juščius, CEO of AUGA group,
AB.
Crop growing segment
Due to the extreme heatwave recorded in the
summer, a relatively low yield was produced. Plants stop growing
when the air temperature reaches 25–27 °C. During the heatwave in
Lithuania, the nights were too hot for dew to form, thus, the
plants did not have the right conditions to revive overnight.
Legumes were affected the most.
Moreover, the results of the crop growing
segment were affected by other factors. In order to manage risk,
the Group concludes contracts at the beginning of the year for the
sale of a part of the future harvest. As the yield of certain crops
fell by about 60%, the Group dedicated almost all the harvest to
implement previous contracts. As a result, part of the forecast
harvest could not be sold at current market prices, which have
increased significantly. However, current market prices allow for
an expectation of better results for the crop growing segment in
the future.
The reasons mentioned above led to negative
profitability. The gross loss of the crop growing segment amounted
to EUR 0.50 million in the 3 quarters of 2021. A gross profit of
EUR 10.13 million was reported in the same period of 2020.
Dairy segment
The sales of the dairy segment amounted to EUR
10.16 million during the first 9 months of 2021. This is broadly in
line with the sales of the same period the year before, which
amounted to EUR 9.87 million.
The Group faced challenges in production at the
beginning of the year, and milk yield did not reach the desired
result during the first half of the year. Moreover, due to the
Group’s strategic attention to the dairy segment, the results were
improved in the third quarter. Milk yield was 3% higher in the
third quarter of 2021, compared to the same period last year.
Total gross profit grew to EUR 0.17 million
during the 3 quarters of 2021. This compares to total gross profit
of EUR 0.08 million during the same period of 2020.
Mushroom growing segment
There was a 6% decrease in sales of the mushroom
growing segment in the first 3 quarters of 2021 compared to sales
for the same quarters last year. In 2021, total sales for this
period amounted to EUR 21.46 million; last year they were EUR 22.94
million.
Production challenges and the COVID-19 pandemic
resulted in a 18% decrease in production volumes during
the third quarter, compared to the second quarter. This
led to an overall decrease in segment results for the entire
period.
During the first 9 months of 2021, the gross
profit of the mushroom growing segment amounted to EUR 0.56
million. This demonstrated a 59% fall from the same period last
year, when gross profit amounted to EUR 1.38 million.
The Group expects to return to typical
production volumes in the fourth quarter.
Fast-moving consumer goods (FMCG)
segment
Overall, sales in the segment rose by 45% to EUR
4.88 million in the last 3 quarters. In the equivalent period last
year, sales in the segment were EUR 3.37 million.
The third quarter showed the strongest results
in 2021, partly related to the large number of orders in the second
quarter which have been implemented during the third quarter of
2021.
Although the challenges in logistics increased
the volatility of sales and increased costs, the segment maintains
similar profitability. According to data from the Group, during the
first 9 months of 2021, the gross profit of the FMCG segment
amounted to EUR 1.47 million (a gross profit of EUR
0.29 million was reported for the same period in 2020).
Operating expenses
The Group's operating expenses during the
9-month period of 2021 amounted to EUR 8.22 million compared to EUR
7.26 million in the same period last year. Operating expenses
increased mainly due to increased salaries, selling expenses and
share-based payment expenses. Additionally, operating expenses of
Grybai LT KB is fully represented in 2021, while operating expenses
of Grybai LT KB were only partly represented in the comparative
period as the respective entity was included in the consolidated
financial statements as of 1 June 2020.
Business development
In the third quarter of 2021, the Group
introduced its first hybrid biomethane-electric tractor for
professional use AUGA M1. This is the Group’s first step in
offering technological solutions that will eliminate climate
pollution throughout the food supply chain, from field to table,
and allow food to be produced with no cost to nature. In addition,
at the end of November of 2021, the Group signed the Cooperation
Agreement on the contract manufacturing for AUGA’s hybrid tractors
with Rokiškio mašinų gamykla, AB, which specializes in the
production of various agricultural machinery.
The Group is currently developing other
sustainable solutions for technologies that will eliminate
greenhouse gas emissions from the soil and digestive processes of
cattle. These technology projects are part of the Group's strategy
to become an AgTech company.
Financial data in MS Excel file
In order to ensure more convenient access to,
and analysis of, the financial data of the Group, AUGA group, AB
has prepared and published the data from previous and the most
recent reporting periods in MS Excel format available at the
following link:
http://auga.lt/en/investors/reports-and-presentations/#tabs
Contacts: Mindaugas Ambrasas, AUGA group, AB CFO Phone: +370 620
67296 Email: m.ambrasas@auga.lt
- Auga group, AB FS 20210930
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