AnAn International (Y35) Q1 2024 TU earnings summary

Executive summary

• Q1 2024 revenue fell 14% YoY to US$562.75m as lower customer demand reduced fuel sales; gross profit fell 20% to US$19.75m and the period recorded a US$4.09m net loss versus US$4.26m profit.

• Lower gross margin and sales volume drove the loss; operating cash flow remained positive at US$18.75m, while cash and cash equivalents, net of overdrafts, were negative US$9.02m at quarter-end.

Financial highlights

• Revenue was US$562.75m, down 14% YoY; cost of sales declined 13% to US$543.00m and gross profit declined 20% to US$19.75m.

• Gross margin was 3.5%, down from 3.8% YoY, attributed to stiff competition and lower sales volume in fuel distribution.

• Net loss before tax was US$5.23m versus US$5.29m profit; net loss was US$4.09m versus US$4.26m profit, including a US$1.11m loss on disposal of a subsidiary.

• Selling and distribution expenses rose 32% to US$23.49m, mainly from staff costs and increased headcount; finance expenses rose 86% to US$2.33m on higher borrowing interest and bank commissions.

• EPS was a loss of 0.051 US cents versus earnings of 0.035 US cents; net assets per share were 2.431 US cents at 31 March 2024 versus 2.385 US cents at 31 December 2023.

Outlook and guidance

• Dyneff Group aims to preserve its position in oil distribution, diversify energy distribution, pursue organic growth and acquisitions, and develop toward an energy service provider.

• Strategy is being pursued cautiously amid economic uncertainty and a changing energy mix; these priorities apply to the next reporting period and the subsequent 12 months.