AUGA group, AB interim financial results for the 3-month period ended 31 March 2023
01 June 2023 - 1:39AM
AUGA group, AB interim financial results for the 3-month period
ended 31 March 2023
In the first quarter of 2023, the sales revenue of AUGA group,
AB and its subsidiaries (hereinafter – the Group) increased by 24%
to EUR 21.70 million due to the stable production activity and the
increase in production prices in 2022, compared to EUR 17.56
million in the same period last year.
Due to uncertainty in the crop growing and dairy
segments caused by volatile production prices, the Group
significantly lowered its forecast prices for the 2023 harvest,
resulting a lower result for the first quarter, compared to the
previous year. The gross profit of EUR 2.45 million compares to a
profit of EUR 5.65 million for the same period last year. The
Group's EBITDA decreased by 58% to EUR 2.79 million compared to EUR
6.71 million in the first quarter of previous year.
"Agricultural activity is constantly changing
and depends on many factors. This precisely is why we need
technologies that can manage some of the fluctuations in activity
and deliver more sustainable and efficient work and better harvest.
The technologies we are developing will help solve this", said
Kęstutis Juščius, the CEO of AUGA group, AB.
Crop growing segment
There are many uncertainties in the crop growing
segment, with output prices down from last year's level. The real
price level, though, will become clear at the end of the season,
after the harvest. Some of the seasonal work (mainly in the autumn
of 2022) has been done in a high-cost environment, although there
have been recent positive trends for significant costs, such as for
fuel, which has been declining in price. The Group will be able to
assess the final results of the season after the third quarter.
Taking a conservative view of the situation, the
Group reduced its forecast harvest prices, resulting in only a EUR
0.13 million change in the fair value of biological assets in the
first quarter of 2023 (last year it was EUR 3.53 million). Gross
profit, which includes revenue from the sale of agricultural
production, changes in the fair value of biological assets and
agricultural subsidies, amounted to EUR 1.52 million in the first
quarter of 2023. In the same period of 2022, it was EUR 4.94
million.
Dairy segment
After the drop in milk yield in the middle of
2022, it returned to its previous level. Sales revenue in the dairy
segment amounted to EUR 4.15 million in the first quarter of 2023
compared to EUR 4.05 million in the same period of 2022.
The segment's gross loss for the first quarter
this year was EUR 0.07 million, compared to EUR 0.57 million gross
profit for the same period last year. Falling raw milk prices
worsened the overall performance, but the situation has now
stabilised.
Mushroom growing segment
The last few years have been particularly
challenging for the mushroom growing segment due to the
consequences of COVID-19, production disruptions and increased
energy prices, but in the first quarter of 2023 the results are
significantly better than last year. The segment's improved overall
performance was driven by stable production volumes, cost control
and favourable product prices.
Sales revenue for the segment amounted to EUR
7.70 million, an increase of 10% from the same period last year.
The gross profit for mushroom growing in first three months of the
year was EUR 0.58 million, compared to a loss of EUR 0.13 million
in the same period last year.
Fast-moving consumer goods (FMCG)
segment
The FMCG segment continues to show consistent
growth – sales in this segment in the first quarter of 2023
amounted to EUR 1.94 million, an increase of 38% compared to the
same period last year. The segment's gross profit in the first
quarter of 2023 amounted to EUR 0.41 million, compared to EUR 0.27
million in the same period last year.
In May 2023, the Group launched a new line of
more sustainable organic products. It consists of basic, everyday
products: milk, kefir, cottage cheese, sour cream, oat flakes and
eggs. The products are sold in major Lithuanian supermarket chains.
For these products, the Group will target a 10% market share in the
relevant categories.
Operating costs
The Group's operating costs for the first
quarter of 2023 amounted to EUR 3.45 million, compared to EUR 2.94
million in the same period last year.
Implementation of the
strategy
On 25 May, the Group presented a new business
model to the public and investors. The model is based on three main
pillars: the development and production of sustainable farming
technologies, the organisation of agricultural activities through
cooperatives applying the AUGA sustainable farming standard, and
supplying consumers with more sustainable food products. The Group
considers that this will help to achieve the goals set out in its
strategy more effectively.
The new business model will first be tested and
refined among the Group's farms. Assuming the new model proves
effective, there are plans to allow other farms to join in the
second half of 2023.
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:Mindaugas Ambrasas, CFO, AUGA group,
ABMob. +370 620 67296E-mail: m.ambrasas@auga.lt
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