MINNEAPOLIS, Sept. 9,
2022 /CNW/ - Ceres Global Ag Corp. (TSX: CRP)
("Ceres" or the "Corporation") today announced its
financial and operating results for the quarter and year ended
June 30, 2022. All amounts are in
U.S. dollars unless otherwise noted.
Highlights for the fourth quarter and fiscal year ended
30 June 2022
(Comparisons to
the fourth quarter and fiscal year ended 30
June 2021)
- Strong annual results driven by strong performance across core
operations, consistent volumes and effective risk management;
- Annual gross profit and income from operations grew by more
than 100% compared to fiscal year 2021, adjusted net income grew by
76% compared to fiscal year 2021;
- Fourth quarter gross profit, income from operations and net
income were all down, due to lower ending inventories across the
industry and less volume merchandized and traded;
- At June 30, 2022, Ceres had
$54.1 million in working capital
compared to $39.2 million in working
capital at June 30, 2021;
- Subsequent to quarter end, Carlos
Paz was appointed CEO and President of the Corporation;
- On June 3, 2022, Ceres, through
its wholly owned subsidiary, Riverland Ag, completed the purchase
of Columbia Grain International, LLC's 50% membership interest in
Berthold Farm Elevator, a grain originator and merchandiser with
locations in Berthold, ND and
Carpio, ND.;
- On June 20, 2022, the Corporation
closed on the sale of St Agathe Bird Food facility and recognized a
gain of $3.7 million;
- On June 24, 2022, Ceres announced
the suspension of the crush plant project at Northgate and incurred
a $25.9 million loss in the write-off
of the applicable capital expenditures incurred to date.
CEO Commentary
"Ceres realized its strongest annual operating financial
performance during FY2022. Our team was able to successfully
navigate the price changes in grain and oilseed markets, industrial
product volumes continued their upward trend in the supply chain
segment and we realized attractive revenues in our seed and
processing business." Carlos Paz,
President and CEO of Ceres commented. "We have maintained our
positive trajectory of financial performance increasing our revenue
by 42% and income from operations by 170%, compared to FY2021."
Mr. Paz added, "Over the past quarter, we made meaningful
progress on the growth strategy that we have been working towards
for the past several years. We completed the acquisition of 50%
ownership of Berthold Farmers Elevator, LLC and, subsequent to
quarter end, completed the expansion of the grain elevator in
Thief River Falls, early and on
budget."
"During the quarter, we also announced the suspension of the
Canola Crush plant at Northgate as we reexamine the economics of
the project. We will be sure to update the market with our plans
for a new project once they begin to take shape. In the meantime,
Ceres remains focused on leveraging our network of assets to bring
solutions to our customers and generate positive financial
results."
Summary Financial and Operational
Results
(in thousands of
USD except per share
amounts)
|
3-Months
Ended June 30, 2022
|
3-Months
Ended June 30, 2021
|
12-Months
Ended June 30, 2022
|
12-Months
Ended June 30, 2021
|
Revenue
|
278,150
|
196,929
|
1,060,941
|
748,204
|
Gross profit
|
3,693
|
8,756
|
55,875
|
24,918
|
Income from
operations
|
(329)
|
3,875
|
23,973
|
8,865
|
Net income
(loss)
|
(22,537)
|
11,733
|
(8,823)
|
12,044
|
Earnings (loss) per
basic share
|
(0.73)
|
0.38
|
(0.29)
|
0.39
|
Adjusted net
income2
|
5,028
|
12,067
|
21,824
|
12,378
|
EBITDA1
|
2,724
|
5,477
|
32,038
|
14,808
|
1, 2. See the
Non-IFRS Financial Measures and Reconciliations
section
|
Outlook
Mr. Paz continued, "In Q1 2023, we expect to see a rise in
handled bushels as inventories were lower as we ended the 2021/2022
crop year. While unclear weather patterns are creating challenges
around anticipating harvest conditions, supply and quality, Ceres
and its network of partners are well positioned to manage any
challenges that this season's crop delivers."
"More broadly, I am excited for the opportunities that lay ahead
for 2023 and beyond," said Mr Paz. "As we reflect on the past
several years, Ceres has been able to capitalize on creating new
partnerships and focus on growth through acquisitions. As we enter
the next year, our focus will shift from acquisitions to leveraging
our existing partnerships, developing regenerative agriculture and
supply chain solutions for our customers and utilizing our network
of assets to maximize revenue generation."
Conference Call Details
Management of Ceres will host a conference call today,
September 9, 2022, at 8:30 a.m. ET. All interested parties can
join the conference call by dialing 1-888-220-8451 or
1-647-484-0475. Please dial in 15 minutes prior to the call to
secure a line.
A live audio webcast of the conference call will be available
at: https://bit.ly/CERESQ42022. 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 and
Reconciliation
1. EBITDA (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 gains and losses on
property, plant and equipment, assets held for sale, and gains and
losses on equity investments. Ceres may calculate EBITDA
differently than other companies; therefore, Ceres' EBITDA may not
be comparable to similar measures presented by other issuers.
Investors are cautioned that EBITDA should not be construed as
an alternative to net income or loss, or to other standardized
financial measures determined in accordance with IFRS and is not
intended to represent cash flows or results of operations in
accordance with IFRS. See the table below for the reconciliation of
EBITDA.
(in thousands of
USD)
|
3-Months
Ended June 30, 2022
|
3-Months
Ended June 30, 2021
|
12-Months
Ended June 30, 2022
|
12-Months
Ended June 30, 2021
|
Net income (loss) for
the period
|
(22,537)
|
11,733
|
(8,823)
|
12,044
|
Interest
expense
|
1,126
|
1,596
|
4,770
|
5,243
|
Amortization of
intangible assets
|
66
|
65
|
263
|
262
|
Income tax
(recovery)
|
(345)
|
(9,712)
|
5,906
|
(9,768)
|
Share of net (income)
loss in investment in
associates
|
577
|
67
|
802
|
369
|
Depreciation
and amortization
|
1,658
|
1,728
|
6,960
|
6,695
|
Gain (loss) on
property, plant and
equipment
|
(3,725)
|
-
|
(3,744)
|
(37)
|
Crush plant
impairment
|
25,904
|
-
|
25,904
|
-
|
EBITDA
|
2,724
|
5,477
|
32,038
|
14,808
|
2. Adjusted net income is not a standardized
financial measure prescribed by IFRS; however, it is a metric that
the Corporation believes can provide useful information to
investors and shareholders as it can be used to evaluate the
performance of the business. Adjusted net income excludes major
one-time write offs as well as legal fees that relate to special
matters. See the table below for the reconciliation of adjusted net
income.
(in thousands of
USD)
|
3-Months
Ended June 30, 2022
|
3-Months
Ended June 30, 2021
|
12-Months
Ended June 30, 2022
|
12-Months
Ended June 30, 2021
|
Net income (loss) for
the period
|
(22,537)
|
11,733
|
(8,823)
|
12,044
|
Crush plant
impairment
|
25,904
|
-
|
25,904
|
-
|
Special matters legal
expense
|
1,661
|
334
|
4,743
|
334
|
Adjusted net
income
|
5,028
|
12,067
|
21,824
|
12,378
|
About Ceres Global Ag
Corp.
Ceres and its subsidiaries add value across agricultural, energy
and industrial supply chains through efficient sourcing, storing,
transporting and marketing of high‐quality agricultural
commodities, value‐ added products and raw materials. Leveraging
its network of commodity logistics centers and team of industry
experts, Ceres connects farmers to customers around the world.
Ceres is headquartered in Minneapolis,
Minnesota, and together with its affiliated companies,
operates 12 locations across Saskatchewan, Manitoba, Ontario, and Minnesota. These facilities have an aggregate
grain and oilseed storage capacity of approximately 31 million
bushels.
Ceres has a 50% interest in Savage Riverport, LLC (a joint
venture with Consolidated Grain and Barge Co.), a 50% interest in
Berthold Farmers Elevator, LLC (a joint venture with The Berthold
Farmers Elevator Company), a 50% interest in Farmers Grain,
LLC (a joint venture with Farmer's Cooperative Grain and Seed
Association), a 50% interest in Gateway Energy
Terminal (an unincorporated joint venture with Steel Reef
Infrastructure Corp.), 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 Canada‐based
seed development company).
For more information about Ceres, please visit
www.ceresglobalagcorp.com
Forward-looking
Statements
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, 2021. 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
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.