Sucro (SUGR) Q1 2025 earnings summary

Executive summary

• U.S. deliveries grew while Mexican volumes normalized, reflecting flexibility in shifting product to attractive markets as conditions evolve.

• Servicing all major North American sugar-consuming regions through a diversified platform blending refining, tolling, and wholesale.

• Three fully operating sites and two new refineries under construction, with a wholesale network spanning from Quebec to Texas.

• Net income was $12.0 million, down 39.2% compared to the same quarter last year, primarily due to lower margins and unrealized mark-to-market gains.

• Risk management desk actively manages price exposure amid macro risks like tariffs and freight volatility.

Financial highlights

• Delivered 176,319 metric tons of sugar, in line with prior year.

• Revenue of $155.2 million, down 12% year-over-year due to a 16% drop in market prices.

• Adjusted EBITDA of $9.9 million, a 9.3% decrease from the prior year, but margin improved by 50 basis points to 6.4%.

• Free cash flow positive for the fifth consecutive quarter, though Q1 2025 free cash flow was $1.2 million, down from $5.0 million in Q1 2024.

• Adjusted gross profit was $13.8 million, down 14.8% year-over-year; adjusted gross profit margin slightly increased to 8.9%.

Outlook and guidance

• Expect a more back-weighted earnings profile in 2025 as Lackawanna works through higher-cost 2024 raw sugar inputs.

• New refineries in Hamilton and University Park are expected to be operational in late 2025 and early 2026, increasing production capacity and supply responsiveness.

• Confident in the trajectory of 2025 results, with a breakout 2026 expected as two new refineries come online.

• Management remains focused on optimizing refining operations, managing supply chain costs, and expanding commercial relationships.