Verde Agritech Ltd · TSX:NPK
Verde Agritech — Q4 2021 Earnings Presentation
25 slides from Verde Agritech's earnings presentation, April 2022
Slide 1: Q4 & FY 2021 Update
Q4 & FY 2021 Update 1
Slide 2: Disclaimer
DISCLAIMER If you are risk averse don’t buy our stock. Don’t rely on anything on this We are not good enough for you to invest if you: presentation. This presentation contains certain forward-looking information, which includes but is not limited to, statements with respect to Verde AgriTech Plc’s (
Slide 3: Agenda
DISCLAIMER Highlights 05 Key Objectives 06 Q4 & FY 2021 Financial Statements 07 Operational Summary 08 Key Metrics 09 SG&A Expenses 11 Other Highlights 12 Financial Summary 13 Summary of Interest-Bearing Loans 14 Brazilian Economic Scenario 15 Sales Growth and Guidance 17 Appendix 20 3 VERDE AGRITEC
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Slide 5: Q4 & FY 2021 Highlights Summary
Q4 & FY 2021 Highlights Summary Up to 2021, Verde was producing and selling a relatively new product, so the Company’s Cash Ability to generate significant free cash flow in the long term. guidance was limited to volume and revenue. For 2022, Verde announced its EBITDA and Cash utilised from investi
Slide 6: 2021 Key Objectives and 2022 Key Objectives
2021 Key Objetives 2022 Key Objetives Achieve 10% of the Company’s total sales as BAKS®: Reach Plant 2’s commercial production by Q3 2022. BAKS® accounted for 9.8% of the total volume sold in 2021. BAKS® demand outstripped Verde’s Expand Plant 2’s operational capacity from 1,200,000 to 2,400,000 tpy
Slide 7: Q4 & FY 2021 Financial Statements
Q4 & FY 2021 Financial Statements All amounts in CAD $’000, except percentages Q4 2021 Q4 2020 YoY FY 2021 FY 2020 YoY Revenue 10,851 2,209 391% 27,709 9,167 202% Production costs (2,691) (912) 195% (7,131) (3,515) 103% Gross Profit 8,160 1,297 529% 20,578 5,652 264% Gross Margin 75% 59% N/A 74% 62%
Slide 8: Operational Summary
Operational Summary All amounts in CAD, except percentages Q4 2021 Q4 2020 YoY FY 2021 FY 2020 YoY Tonnes sold ‘000 134 57 137% 400 244 64% Revenue per tonne sold $ 81 39 107% 69 38 84% Production cost per tonne sold $ (20) (16) 24% (18) (14) 24% Gross Profit per tonne sold $ 61 23 165% 51 23 122% G
Slide 9: Key Metrics Quarterly
Key Metrics Quarterly Sales (Tonnes) Revenue (‘000 CAD) 153,674 10,651 10,851 140000 10000 134,350 120000 8000 105,769 100000 96,233 6000 80000 5,376 71,183 62,895 60000 56,585 3,956 4000 3,055 40000 2,492 32,221 2,209 2000 1,491 23,600 1,329 20,641 20000 16,558 831 666 692 10,170 9,007 510 154 1,09
Slide 10: Key Metrics Yearly
Key Metrics Yearly Sales (Tonnes) Revenue (‘000 CAD) 450,000 30,000 27,710 400,133 400,000 25,000 350,000 300,000 20,000 250,000 243,707 15,000 200,000 150,000 10,000 9,167 119,809 100,000 6,029 5,000 50,000 29,648 1,358 - - 2018 2019 2020 2021 2018 2019 2020 2021 10 VERDE AGRITECH
Slide 11: Sales, General and Administrative Expenses
Sales, General and Administrative Expenses All amounts in CAD $’000, except percentages Q4 2021 Q4 2020 YoY FY 2021 FY 2020 YoY Sales Expenses Sales and marketing expenses (577) (179) 222% (1,818) (975) 86% Fees paid to sales agents (203) (16) 1150% (464) (162) 185% Product delivery freight expenses
Slide 12: Other Highlights
Other Highlights FOB vs CIF (tonnes) General Expenses (C$’000) 450,000 0 400,133 -200 400,000 -162 -400 350,000 -600 -464 300,000 -800 243,707 250,000 206,941 212,025 -1,000 193,192 -975 200,000 -1,200 -1,149 150,000 -1,400 100,000 -1,600 -1,621 50,000 31,682 -1,800 -1,818 0 -2,000 FY 2021 FY 2020 G
Slide 13: Q4 & FY 2021 Financial Summary
Q4 & FY 2021 Financial Summary Re v e n u e Revenue from sales for Q4 2021 was $10.85M from the sale of 134.35K tonnes, 27.7M from the sale of 400.13K tonnes for FY 2021. Despite the devaluation of the Brazilian Real against the Canadian Dollar, revenue per tonne was higher mainly due to three facto
Slide 14: Summary of Interest-Bearing Loans and Borrowings
Summary of Interest-Bearing Loans and Borrowings Balance at Dec Lender Grace period Loan value Total interest Loan start date Purpose Term (months) 31, 2021 Repayable by (security ref) (months) (R$$’000) payable* (C$’000) Brasil Dec, 2021 Working capital 06 36 5,000 1,289 Dec, 2024 * CDI + 2.92% San
Slide 15: Brazilian Economic Scenario
USD/BRL Exchange Rate Brazilian Economic Scenario 5.70 5.65 5.63 5.60 5.54 5.56 5.50 Brazilian Real versus US Dollar 5.40 5.42 5.30 From January to December 2021, the Brazilian Real 5.20 5.15 devalued by 5% in relation to US Dollar, compared to the 5.10 5.00 same period of 2020. 4.90 4.80 As of Apri
Slide 16: Potassium Chloride Price
Potassium Chloride Price Fluctuations in potassium chloride CIF (Minas Gerais) prices CIF MG (USD) 900 KCl CIF (Minas Gerais) KCl CIF (Minas Gerais) 800 Lowest Price1 Highest Price1 700 Q4 2021 US$760 US$850 600 500 Q4 2020 US$315 US$320 400 % +141% +165% 300 FY 2021 US$315 US$850 200 100 FY 2020 US
Slide 17: 2022 and 2023 guidance
2022 and 2023 guidance The Company’s 2022 target is detailed on a quarterly basis, reflecting the market demand's seasonality, as follows: Period Q1 2022 Q2 2022 Q3 2022 Q4 2022 FY 2022 Sales target (tonnes) 115,000 200,000 250,000 135,000 700,000 Revenue (C$’000) 10,070 21,954 27,228 13,011 72,263
Slide 18: Appendix
Appendix 19
Slide 19: Earned Growth Rate
Earned Growth Rate Earned Growth Rate (“EGR”) is an accounting-based methodology that provides companies with an objective, data-driven connection between customer success, repeat and expanded purchases, word-of-mouth recommendations, a positive company culture, and business results. It gauges custo
Slide 20: Environmental
Environmental Verde’s production process is sustainable. The processing does not require tailings dams, nor does it generate any waste by products. In sum, the ore recovery rate is 100%. The mined area is mainly composed of degraded pasturelands that, once mined, Verde transforms into tropical fores
Slide 21: Potassium Chloride Replacement
Potassium Chloride Replacement Potassium salt fertilizers are soil biodiversity’s number 1 enemy. The average farmer applies 200 kg of potassium chloride to the soil per hectare per year. This is equivalent to the application of 1,600 litres of bleach as far as killing soil biodiversity.¹ The world
Slide 22: Cultivando Amor Project
Cultivando Amor Project Cultivando Amor is an initiative from Verde, in which there is a partner charity institution for each of the project’s member cities. For each hectare in the region that is cultivated with BAKS® or K Forte®, Verde donates part of the sales’ profits to the partner institution
Slide 23: Permit Status – Last 12 months
Permit Status – Last 12 months Mine Pit Date Category Status Event 2 February 10, 2022 Mining Granted 2,500,000 tpy Mining Concession 2 December 23, 2020 Environment Granted 2,500,000 tpy Preliminary, Installation and Operation License 2 November 03, 2020 Mining Granted 50,000 tpy Mining Permit 3 Au
Slide 24: Permit Summary
Permit Summary Under Brazilian law, a pit is fully permitted to mine when the Group holds both a Mining Concession/Permit and Environmental License for that area. Verde is fully permitted to mine 2,833,000 tpy and has submitted concurrent mining and environmental applications for an additional 2,500
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