MINNEAPOLIS, MN, Feb. 13, 2018 /CNW/ - Ceres Global Ag Corp.
(TSX: CRP) ("Ceres" or the "Corporation") today announced its
financial and operating results for the three and six months ended
December 31, 2017. All amounts are in
U.S. currency unless otherwise noted.
CEO Commentary
"Due to increased focus on our
strengths as a company and adding value to our customers, we
improved adjusted net income by more than $700 thousand and gross margins by $1.4 million vs. the same quarter a year ago,"
said Robert Day, President and Chief
Executive Officer of Ceres. "Volumes for the quarter were down as
we passed on less attractive business at low or negative margins,
which is reflective of the challenging environment our industry
continues to face."
"Our vision is to profitably grow by being the most trusted and
valued partner to quality-conscious customers," Mr. Day continued.
"Through consistent focus on customer needs, operational excellence
and investment in skill-building, we are turning that vision into a
reality."
Summary Financial and Operational Results
(in thousands of
USD except per
share and bushels handled)
|
3-Months Ended
December 31,
2017
|
3-Months Ended
December 31,
2016
|
6-Months Ended
December 31,
2017
|
6-Months Ended
December 31,
2016
|
Revenue
|
$89,569
|
$131,838
|
$220,208
|
$287,765
|
Gross
profit
|
$4,283
|
$2,870
|
$7,346
|
$4,741
|
EBITDA1
|
$2,333
|
$2,003
|
$3,857
|
$2,747
|
Income from
operations
|
$1,162
|
$779
|
$1,681
|
$174
|
Net income
(loss)
|
$224
|
$(153)
|
$(582)
|
$(1,509)
|
Earnings (loss) per
basic share
|
$0.01
|
$(0.01)
|
$(0.02)
|
$(0.06)
|
Adjusted net
income2
|
$765
|
$35
|
$869
|
$(1,014)
|
Total bushels handled
and merchandized
|
17.0
million
|
24.6
million
|
44.2
million
|
59.6
million
|
Financial and Operational Highlights for Q2 FY2018
- Generated revenue of $89.6
million, a 32% decrease from Q2 FY2017.
- Increased gross profit 49% to $4.3
million from Q2 FY2017 due to increased storage and rental
income and logistics and transloading revenue.
- Total number of bushels handled and merchandised decreased by
31% as a result of challenging margins in the broader market.
- Increased income from operations 49% to $1.2 million compared to Q2 FY2017.
- Generated $22.1 million cash flow
from operations, a 45% increase from Q2 FY2017.
- The previously disclosed trial by jury of the Scoular
litigation was delayed and has yet to be scheduled: the trial date
is expected to be sometime in Q4 FY2018.
Outlook
Mr. Day continued, "While we remain focused on execution and
maximizing short-term results, we are also making progress around
reshaping our physical infrastructure in order to more
competitively originate products and consistently create value for
our end-use customers. Over the course of 2018, we anticipate
the environment will continue to be challenging; however, we expect
year over year results to steadily improve as we execute on our
plan to add new assets and lower costs. Together these actions will
broaden our network and lower cost per unit handled at the same
time."
"At Northgate, organic growth of existing transload operations
continues to meet or exceed expectations," Mr. Day added. "Over the
next six to twelve months, we expect to add a number of new product
lines from the energy and industrial products sectors, which will
significantly help returns for shareholders."
Conference Call Details
Ceres will hold a conference
call to discuss its Q2 FY2018 financial and operational results on
Wednesday, February 14, 2018 at
9:00 am ET. Robert Day, Ceres' President and CEO, and
Kyle Egbert, Ceres' CFO, will
co-chair the conference call.
All interested parties can join the conference call by dialing
1-888-231-8191 or 647-427-7450, conference ID: 3689406. Please dial
in 15 minutes prior to the call to secure a line. The conference
call will be archived for replay until Wednesday, February 28, 2018 at midnight ET. To access the archived conference
call, please dial 1-855-859-2056 and enter the encore code
3689406.
A live audio webcast of the conference call will be available
at: http://event.on24.com/r.htm?e=1590860&s=1&k=02B67624FC4AE8F17CC0D2F665B80508.
Please connect at least 15 minutes prior to the conference call
to ensure adequate time for any software download that may be
required to join the webcast. An archived replay of the webcast
will be available for 90 days.
Non-IFRS Financial Measures
1EBITDA
(Earnings before Interest, Taxes, Depreciation and Amortization) is
not a standardized financial measure prescribed by IFRS; however,
it is a metric that is used by management to determine the
Corporation's ability to service its debt and finance capital.
In calculating EBITDA, Ceres excludes its share of the net
income (loss) from investments in associates and the gain (loss) on
sale or impairment of property, plant and equipment. Ceres may
calculate EBITDA differently than other companies; therefore,
Ceres' EBITDA may not be comparable to similar measures presented
by other issuers.
2Adjusted net income is not a standardized financial
measure prescribed by IFRS; however, it is a metric that is used by
management to determine the Corporation's profitability excluding
non-reoccurring events.
In calculating adjusted net income, Ceres excludes gain (loss)
on sale or impairment of property, plant and equipment, income
(loss) from investments in associates, revaluation of warrants and
legal expense related to ongoing litigation. Ceres may calculate
adjusted net income differently than other companies; therefore,
Ceres' Adjusted Net Income may not be comparable to similar
measures presented by other issuers.
Investors are cautioned that EBITDA and adjusted net income
should not be construed as alternatives to net income or loss, or
to other standardized financial measures determined in accordance
with IFRS, and are not intended to represent cash flows or results
of operations in accordance with IFRS.
About Ceres Global Ag Corp. (ceresglobalagcorp.com)
Through its network of commodity logistics centers and team of
industry experts, Ceres Global Ag Corp. procures and provides North
American agricultural commodities & value added products,
industrial products, fertilizer, energy products and reliable
supply chain logistics services to customers worldwide.
Ceres operates six locations, Duluth,
MN; Minneapolis, MN;
Savage, MN; Shakopee, MN; Northgate, Saskatchewan; and Port Colborne, Ontario, and is headquartered
in Minneapolis, MN. Its
wholly-owned facilities throughout North
America have an aggregate grain and oilseed storage capacity
of approximately 34.4 million bushels.
Ceres also has a 25% interest in Stewart Southern Railway Inc.,
a short-line railway located in southeast Saskatchewan with a range of 130 kilometers,
and a 17% interest in Canterra Seed Holdings Ltd, a Canadian-based
seed development company.
Cautionary Notice: This news release contains
"forward-looking information" within the meaning of applicable
Canadian securities legislation and United States securities laws. Forward-looking
information may include, but is not limited to, statements
regarding future operations and results, anticipated business
prospects and financial performance of Ceres and its subsidiaries,
including the plans, costs, timing and capital for the further
development of the Northgate Commodities Logistics Centre,
expectations or projections about the future, strategies and goals
for growth, expected and future cash flows, costs, planned capital
expenditures, regulatory change, general economic political and
market conditions anticipated capital projects, construction and
completion dates, operating and financial results, critical
accounting estimates, the expected financial and operational
consequences of future commitments. Generally,
forward-looking information can be identified by the use of
forward-looking terminology such as "plans", "expects" or "does not
expect", "is expected", "budget", "scheduled", "estimates",
"forecasts", "intends", "anticipates" or "does not anticipate",
"believes", "may have implications" or variations of such words and
phrases or statements that certain actions, events or results
"may", "could", "would", "might", or "will be taken", "occur", or
"be achieved". Forward-looking information is based on the opinions
and estimates of management at the date the information is made,
and is based on a number of assumptions and subject to a variety of
risks and uncertainties and other factors that could cause actual
events or results to differ materially from those projected in the
forward-looking information. Key assumptions upon which such
forward-looking information is based are listed in the
"Forward-Looking Information" section of the MD&A for the
period ended December 31, 2017. Many
such assumptions are based on factors and events that are not
within the control of Ceres and there is no assurance they will
prove to be correct. Factors that could cause actual results to
vary materially from results anticipated by such forward-looking
information include, among others, risks related to weather,
politics and governments, changes in environmental and other laws
and regulations, competitive factors in agricultural, food
processing and feed sectors, construction and completion of capital
projects, labour, equipment and material costs, access to capital
markets, interest and currency exchange rates, technological
developments, global and local economic conditions, the ability of
Ceres to successfully implement strategic initiatives and whether
such strategic initiatives will yield the expected benefits, the
ability of Ceres to successfully defend the claim by The Scoular
Corporation, the operating performance of the Corporation's assets,
the availability and price of commodities and regulatory
environment, processes and decisions. Although Ceres has attempted
to identify important factors that could cause actual actions,
events or results to differ materially from those described in
forward-looking information, there may be other factors that cause
actions, events or results that are not anticipated, estimated or
intended. There can be no assurance that forward-looking
information will prove to be accurate, as actual results and future
events could differ materially from those anticipated in such
information. Ceres undertakes no obligation to update
forward-looking information if circumstances or management's
estimates or opinions should change, except as required by
applicable securities laws. The reader is cautioned not to place
undue reliance on forward-looking information.
SOURCE Ceres Global Ag Corp.