AB Linas Agro Group results for the 3 months of 2023/2024 financial year
Consolidated revenue of AB Linas Agro Group and its controlled companies (the Group) for the three months of the financial year 2023/2024 exceeded EUR 420 million and was 29% lower compared to the corresponding period of the previous year.
The Group sold almost 765 thousand tons of various products, or 20% less than in the same period last year.
Consolidated earnings before interest, taxes, depreciation and amortization (EBITDA) for the three months were almost EUR 30 million, 35% lower than the previous year. Net profit fell by 46% to EUR 15 million.
| 2022/2023 3 months | 2023/2024 3 months | 2023/2024 compared with 2022/2023, % | |
| Total tons | 951,201 | 765,179 | -20 |
| Revenue, thousand EUR | 590,063 | 420,405 | -29 |
| Gross profit, thousand EUR | 56,059 | 48,250 | -14 |
| EBITDA, thousand EUR | 45,661 | 29,736 | -35 |
| Operating profit, thousand EUR | 38,176 | 22,038 | -42 |
| Net profit, thousand EUR | 28,143 | 15,159 | -46 |
"We entered the 2023/2024 financial year by reviewing the segmentation of the Group's activities, leaving four operating segments instead of five. We have three groups of core activities: partnership with farmers, farming, food production. The main change from the previous periods is that we have merged the operating segments ‘Grains, oilseeds and feed’ and ‘Products and services for farming’ into one, called ‘Partners for farmers’ These two activities are very closely linked, often difficult to separate, and we see them as a single line of action. All other business segments have remained essentially unchanged, with only minor changes in their names," said Mažvydas Šileika, CFO of AB Linas Agro Group.
The merger of the two operating segments resulted in the new segment ‘Partners for farmers’ generating 79% of the Group's revenue. The segment generated revenue of almost EUR 331 million, gross profit of EUR 33.5 million and operating profit of EUR 18.0 million.
"In the first half of the 2022/2023 financial year, we had high fertilizer prices, which combined with the rise in grain prices resulted in higher profitability, but this year the profits from fertilizer and grain trading have returned to normal, although I would describe the trading itself as successful. Those high prices last year have also increased the self-cost of grain sown last year and harvested this year, so the year is not favorite for agricultural companies so far," said M. Šileika.
The ‘Food Production’ segment accounted for 24% of the Group's total revenue with the segment’s revenue amounting to EUR 100 million. The gross profit of this business was EUR 16.0 million and the operating profit was EUR 7.3 million.
"We are particularly pleased with the recovery of poultry business, which has been loss-making for several years and has now turned profitable, with a gross profit of more than EUR 10 million. The jump in quality in the two years since the acquisition of the poultry farms in Lithuania is also evident - we are now producing 80% of our chicken without antibiotics in Lithuania," said M. Šileika.
The ‘Farming’ segment accounted for 3% of the Group's revenue. The segment’s revenue was EUR 12 million, the gross loss was EUR 2.4 million and the operating loss was EUR 3.6 million.
"We sold 10% less crop production and 2.5% more milk than at the same time last year. Crop production was 4% lower and of poorer quality than last year, with second-class wheat dominating and wheat accounting for 61% of the total harvest. The cost of production for the 2023 harvest was 20-25% higher than in 2022, while market prices for the production fell by 20-30% compared to last year's prices. Income from crop production fell by almost 23%, while income from milk production fell by almost 29%. Both crop and livestock farming were loss-making", M. Šileika described the situation in farming.
The ‘Other products and services’ segment accounted for 1% of the Group's revenue, remained unchanged over the year and amounted to over EUR 5 million. The Gross profit from this activity was EUR 1.1 million and operating profit EUR 0.3 million.
AB Linas Agro Group, which will change its name in December, owns the largest agricultural and food production group in the Baltic States, employing almost 5 thousand people.
The Group operates along the entire food production chain from field to fork, producing, processing, and marketing agricultural and food products, and providing goods and services to farmers. In July, the Group acquired a modern robotic plant in Širvintos (Lithuania) from AUGA group, AB, which is active in the production and sale of ready-to-eat food products; its main products are organic soups, curries, cereal dishes, and organic canned vegetables in packages- about 70 product names.
Attached:
Consolidated Unaudited Financial statements and Consolidated Interim Report of AB Linas Agro Group for the three-month period ended 30 September 2023
AB Linas Agro Group Chief Financial Officer Mažvydas Šileika
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