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AUGA group Investor Presentation 2021
2259_rns_2021-09-02_7ddcb900-3e41-4147-a8c0-1f4ea47fb41a.pdf
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PRESENTATION ON THE FINANCIAL RESULTS FOR 6 MONTHS OF 2021
AUGA group, AB
PRESENTED BY
au ga
Mindaugas Ambrasas
CFO
HY2021
au
ga
RESULTS
Challenges in separate segments did not allow to increase revenue and profitability.
The group's companies continue to pay great attention to the implementation of the strategy. This will serve as the basis for the company's growth and value.
2021 HY
Similar results in 2021 HY vs. 2020 HY.
| EUR million | 2021 HY | 2020 HY | Variance | 2019 HY |
|---|---|---|---|---|
| Revenue | 33.13 | 34.69 | -4% | 28.84 |
| Gross profit | 8.50 | 8.58 | -1% | 6.33 |
| Net profit | 0.75 | 1.30 | -43% | 0.34 |
| EBITDA | 11.14 | 11.53 | -3% | 9.33 |
HY2021
Results by segment
Crop growing
au
ga
CROP GROWING 2021 HY results
Extreme heat waves in summer forced group to adjust harvest forecast, especially yields of summer cultures.
Rising production prices and better quality of basic crops will partially offset losses of unfavorable weather conditions to the harvest.
Sales revenue decreased in the first half of 2021 due to uneven distribution of sales quantities between periods - 63% of 2019/2020 season's harvest was sold in 2020 and 37% in 2021, while 51% of harvest of 2018/2019 was sold in 2019 and 49% in 2020.
Lower revenue and improved gross profit.
| 2021 HY | 2020 HY | Variance | 2019 HY | |
|---|---|---|---|---|
| Total cultivated land, ha | 39,139 | 39,637 | -1% | 38,564 |
| EUR million | 2021 HY | 2020 HY | Variance | 2019 HY |
| --- | --- | --- | --- | --- |
| Total gain (loss) on revaluation of biological assets (crops) | 6.53 | 6.38 | +2% | 3.29 |
| Gain (loss) on revaluation of biological assets (crops) recognized in previous period | 2.02 | 1.45 | +39% | - |
| Gain (loss) on revaluation of biological assets (crops) recognized in current period | 4.51 | 4.93 | -9% | 3.29 |
| Sales revenue | 9.48 | 10.83 | -12% | 8.29 |
| --- | --- | --- | --- | --- |
| Cost of sales | 10.66 | 11.44 | -7% | 9.06 |
| Inventory write-offs | 0.43 | 0.69 | -37% | 0.49 |
| Result of sales of agricultural produce | (1.61) | (1.30) | -24% | (1.27) |
| Subsidies | 4.62 | 3.71 | +25 | 3.51 |
| --- | --- | --- | --- | --- |
| Gross profit | 7.51 | 7.34 | +2% | 5.54 |
HY2021
au
ga
CROP GROWING
Wheat price dynamics
Average organic wheat price recovered by 10% in HY 2021 vs HY 2020.
As for 31.08.2021 new contracts are signed for 69% of expected 2021 harvest.
According to the signed contracts, average price of group's wheat is 16% higher compared to average wheat sales price of 2020 harvest.
Organic vs. Conventional wheat price in Germany, EUR/t
Germany, the largest EU market, is a benchmark for major organic product prices.
HY2021
Source: www.ami-informiert.de, https://www.bmel-statistik.de/
Results by segment
Dairy
DAIRY
au
Due to challenges faced in the production planned goal of increasing milk yields was not met. However, milk yields start to improve – +4% in June 2021 vs. June 2020.
Milk production remained similar to 2020 (13,867 tonnes in 2020 vs. 13,889 tonnes in 2021).
Amount of milk sold decreased due to fluctuation in sales as the group approaches new markets and increased amount of milk used for newly born heifers.
Average milk price in 2021 HY was 4% higher than in 2020 HY.
2021 HY results
The primary focus remains increasing efficiency.
| 2021 HY | 2020 HY | Variance | 2019 HY | |
|---|---|---|---|---|
| Total quantity of products sold, t | 13,538 | 13,902 | -3% | 13,247 |
| Milk | 12,812 | 13,158 | -3% | 12,699 |
| Milk commodities | 335 | 355 | -6% | 193 |
| Cattle | 391 | 388 | +1% | 356 |
| EUR million | 2021 HY | 2020 HY | Variance | 2019 HY |
| --- | --- | --- | --- | --- |
| Revenue | 6.73 | 6.66 | +1% | 5.70 |
| Milk | 5.29 | 5.22 | +1% | 4.82 |
| Milk commodities | 1.00 | 1.07 | -6% | 0.49 |
| Cattle | 0.44 | 0.37 | +19% | 0.39 |
| Cost of sales | 6.69 | 6.27 | +7% | 5.62 |
| Milk | 5.32 | 4.85 | +10% | 4.74 |
| Milk commodities | 0.93 | 1.06 | -12% | 0.49 |
| Cattle | 0.44 | 0.37 | +19% | 0.39 |
| Revaluation of biological assets | (1.81) | (1.61) | -12% | (1.49) |
| Subsidies | 1.51 | 1.31 | +15% | 1.11 |
| Gross profit | (0.27) | 0.09 | n/a | (0.30) |
HY2021
DAIRY
au
ga
Average milk yield in the first half of 2021 were 21.87 kg per cow per day compared to 21.84 kg per cow per day in 2020.
Herd renewal and the use of new technologies are expected to further improve milk yields.
Improving milk yields
Milk yields, kg/cow/day
HY2021
10
Results by segment
Mushroom growing
au
ga
MUSHROOM GROWING
Segment faced the challenges with an increase in the number of workers suffering from COVID-19.
Production capacity have decreased in Q2 of 2021. Group picked 6,179 tonnes mushrooms in 2021 compared to 6,466 tonnes in the first half of 2020.
Long production process did not allow to reduce the costs incurred in production.
Hot summer weather have led to a general decrease in production capacity across the market creating favorable market conditions for the Group in the coming periods.
2021 HY results
Challenges in production.
| 2021 HY | 2020 HY | Variance | 2019 HY | |
|---|---|---|---|---|
| Sold mushrooms, t | 6,335 | 6,579 | -4% | 6,001 |
| Average price (Eur/t) | 2,221 | 2,168 | +2% | 2,107 |
| EUR million | 2021 HY | 2020 HY | Variance | 2019 HY |
| --- | --- | --- | --- | --- |
| Total revenue | 14.33 | 15.21 | -6% | 13.80 |
| Mushroom sales revenue | 14.07 | 14.26 | -1% | 12.64 |
| Compost sales revenue | 0.25 | 0.95 | -73% | 1.16 |
| Cost of sale | 13.74 | 14.15 | -3% | 12.76 |
| Cost of mushrooms sold | 13.59 | 13.22 | +3% | 11.69 |
| Cost of compost sold | 0.15 | 0.93 | -84% | 1.07 |
| Gross profit | 0.59 | 1.07 | -44% | 1.04 |
HY2021
12
BUTTERNUT
SQUASH SOUP
ORGANIC
BED ROOM
ORGANIC
CHAMPIGNON
SOUP
ORGANIC
SPICY CURRY
SOUP
ORGANIC
RETURN TO THE BUTTERFLYER
WITH THE FULL FLOOR
WITH THE FULL FLOOR
WITH THE FULL FLOOR
WITH THE FULL FLOOR
WITH THE FULL FLOOR
WITH THE FULL FLOOR
BUTTERHUT
SQUASH SOUP
ORGANIC
BED ROOM
ORGANIC
RETURN TO THE BUTTERFLYER
WITH THE FULL FLOOR
WITH THE FULL FLOOR
WITH THE FULL FLOOR
BUTTERHUT
SQUASH SOUP
ORGANIC
BED ROOM
ORGANIC
FMCG
au
ga
Although higher growth was recorded in the first quarter of this year than in the second, the FMCG segment continues to show good results.
Due to transport challenges customers reduce a quantity of orders but increase their value.
The segment's profitability margin remains at the similar level, reaching 25% in the first half of 2021.
2021 HY results
The segment continues to grow in 2021.
| EUR million | 2021 HY | 2020 HY | Variance | 2019 HY |
|---|---|---|---|---|
| Revenue | 2.59 | 1.99 | +30% | 1.05 |
| Cost of goods sold | 1.93 | 1.90 | +1% | 1.01 |
| Gross profit | 0.66 | 0.09 | +647% | 0.04 |
Revenue dynamics, th. EUR
HY2021
FMCG
au
ga
A large proportion of orders being moved to the third quarter of 2021:
- Sales in July 2021 were 69% higher than in July 2020.
- Open orders amount at the end of second quarter of 2021 amounted to EUR 1.61 million.
2021 fluctuation in sales
Sales fluctuation in 2021 vs. 2020, Eur
HY2021
14
FMCG
au
ga
The group expands its assortment of consumer goods - 3 new soups flavours were presented to the market in the second and third quarters of 2021.
New products
HY2021
15
Financial information
au
FINANCIAL INFORMATION
Main factors for EBITDA change
EBITDA decreased by 0.40 EUR million.
HY2021
au
FINANCIAL INFORMATION
Net debt remains stable - in 2021 HY reached EUR 61.8 million vs. EUR 59.1 million in 2020 HY.
The group is increasing spending on new technologies application, R&D activities.
Working capital dynamics and financing
| 2017 | 2018 | 2019 | 2020 | 2021 HY | |
|---|---|---|---|---|---|
| Net debt, EUR million* | 42.9 | 53.6 | 55.3 | 57.4 | 61.8 |
| Net debt - adjusted working capital**, EUR million | 16.87 | 15.91 | 15.14 | 15.42 | 15.98 |
HY2021
*Excluding IFRS 16 lease liabilities
**Adjusted working capital = Current biological assets + Trade receivables, advance payments and other receivables + Inventory - Trade payables - Other payables and current liabilities. The adjusted working capital formula eliminates cash and financing elements allowing the reader to see how the short-term assets and liabilities directly related to operations of the Group are being utilized.
18
au
ga
INVESTMENTS IN R&D
The group continues to allocate its resources to achieve goals determined in the strategy – a sustainable organic food value chain and agriculture efficiency through the implementation of:
1) Biogas cycle infrastructure and vehicles,
2) Specialised feed technology,
3) Regenerative crop-rotation.
Investment in 2021 HY reached EUR 6.19 million compared to EUR 2.25 million in 2020 HY.
HY2021
- Based on the synergies of the previously applied AUGA closed-loop sustainable farming model
19
au
FINANCIAL INFORMATION
The share price increased by 19.12% (from EUR 0.442 to EUR 0.527 per share) from the beginning of 2021 to 31 August 2021.
The average monthly turnover was EUR 0.90 million.
Top 2 corporate bond turnover in Baltics (turnover during 2021 - EUR 2.95 million).
Share price information
AUGA group, AB share price on Nasdaq Vilnius, EUR
Valuation target price, EUR
0.66*
0.45-0.55
0.74
HY2021
au
ga
More information:
- Nasdaq Vilnius, Baltic Main List: AUG1L
- Nasdaq Vilnius, green bonds: AUGB060024A
- Information for investors: http://auga.lt/en/for-auga-investors
- Analyst reports, data in MS Excel format: https://auga.lt/en/investors/reports-and-presentations
- News for investors subscription: http://cutt.ly/auga
- Investor relations:
Mindaugas Ambrasas, CFO
+370 620 67296
[email protected]
HY2021
21
ORGANIC FOOD WITH NO COST TO NATURE