Agroland Agribusiness posts revenues of 46.3 million lei and a net profit of 1.3 million lei in the first nine months of 2023
Agroland Agribusiness (BVB: AAB), a Romanian entrepreneurial company, part of the Agroland group, specialized in the sale of inputs for agriculture, posts operating revenue of 46.3 million lei in the first nine months of 2023, a 10% decrease compared to the same period last year, EBITDA of 2.9 million lei, a 9% decrease, and net profit of 1.3 million lei, a 22% decrease compared to the same period in 2022.
“The third quarter of this year continued to be a challenging period for the agricultural sector in Romania and beyond, driven by the severe soil drought and global production. Thus, despite smaller harvests in our country, the downward trend in prices in the first half of the year continued, with prices falling by 30-40% on average, in the context of increasing global agricultural production. Even in this difficult context, thanks to the experience and professionalism of the team, it has managed to turn the grain trading activity into the company’s main revenue generator, with significant increases both in terms of revenue and quantities traded. We have also seen increases in pesticide and input seeds sales, an effect of the increase in the number of customers and the land areas they farm“, stated Florin Radu, CEO of Agroland Agribusiness.
In terms of revenue by category, in the first nine months of 2023, the largest share of turnover was represented by grain trading, which increased by 39% compared to the same period in 2022, to 17.7 million lei. Thus, although grain prices were significantly lower, the quantity traded was 64% higher compared to Q3 2022. The pesticides category saw a 16% increase compared to the same period in 2022, to 13.5 million lei.
Sales of fertilizers decreased by 52% compared to the first nine months of the previous year, reaching 11.5 million lei, as their purchase was limited by the low liquidity of farmers. Input seeds generated revenues of 9 million lei, a 14% increase, while sales of input fuel were down 4% to 297 thousand lei.
“Considering the current context, influenced by the prolonged drought, which has led to crop failures and the uncertainty of a harvest to cover current costs, we are compelled to make a new revision of the revenue and expense budget for this year, by decreasing the turnover from 76.6 million lei to 61 million lei and the net profit from 2.6 million lei to 1.2 million lei. Despite the below-expectations results in 2023, the company’s financial position remains strong, with a 457% increase in cash position and a 41% decrease in receivables compared to the previous quarter, as a result of efficient financial management. We are confident that the coming year will be a better one for agriculture in Romania, with significant sales increases across all input segments. This positive outlook is due to the rainfall recorded in most areas during this period, while cereal prices may see an increase next year due to the lower profitability threshold for Romanian farmers,” added Florin Radu.
In the first half of the year, Agroland Agribusiness invoiced 459 customers, a 6% increase compared to the same period of the previous year, due to consolidating the relationship with existing partners, increasing the company’s visibility and attracting new customers.
Agroland Agribusiness shares are listed on the AeRO market of the Bucharest Stock Exchange as of June 15, 2021, and are traded under the AAB symbol. Currently, the company has a market capitalization of approximately 24 million lei.
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About Agroland Agribusiness
Agroland Agribusiness is a Romanian entrepreneurial company, specialized in the sale of agricultural inputs. The company currently operates in the southern region of the country, specifically in the counties of Dolj, Olt, Mehedinti, Arges, Teleorman, Valcea, Gorj, Dambovita, Ilfov, Ialomita, Calarasi, Tulcea, Braila, and Constanta. The main agricultural inputs sold by Agroland Agribusiness are fertilizers, pesticides, seeds, and fuels, thus, the company sells the entire set of inputs needed by farmers. In addition, Agroland Agribusiness is also involved in grain trading, an activity in which it purchases grains from farmers and valorizes them towards large traders who operate only at fixed points or only in ports. Therefore, Agroland Agribusiness operates as a provider for farmers, both through the inputs it sells, and as a potential buyer of the farmers’ crops. Agroland Agribusiness shares have been listed on the AeRO market of the Bucharest Stock Exchange as of June 15, 2021, under the symbol AAB.