Auga Group (AUG1L) Q1 2024 earnings summary

Executive summary

• Q1 2024 revenue was EUR 19.74 million, nearly flat year-over-year, while gross profit rose 43% to EUR 2.71 million and net loss narrowed by 18% to EUR 2.58 million.

• EBITDA increased 59% to EUR 4.26 million, driven by operational improvements in crop growing and dairy segments.

• Operating costs decreased by 8% year-over-year, mainly due to reduced marketing and administrative expenses.

• Strategic shift to conventional regenerative farming and partial conventional dairy operations aims to boost margins and diversify risk.

• Net loss reduction was achieved despite a EUR 0.5 million rise in finance costs.

Financial highlights

• Gross profit for Q1 2024 was EUR 2.71 million, up 43% year-over-year; EBITDA margin improved to 22% from 13%.

• Net loss narrowed to EUR 2.58 million, an 18% improvement year-over-year.

• FMCG segment revenue surged 234% to EUR 0.67 million, with gross profit turning positive.

• Share price declined 4% from EUR 0.300 to EUR 0.288 per share between January and May 2024.

• Cash and cash equivalents at period end were EUR 720 thousand, down from EUR 3,455 thousand at the start of the quarter.

Outlook and guidance

• Management maintains 2024 EBITDA forecast, expecting EUR 23.3 million, with more clarity after Q2 and Q3 harvests.

• Crop conditions are currently good, with expectations for a better harvest in 2024.

• The Group expects to receive a similar amount of agricultural subsidies in 2024 as in 2023.