Verde Agritech Ltd · TSX:NPK
Verde Agritech — Q3 2022 Earnings Presentation
27 slides from Verde Agritech's earnings presentation, Nov 1, 2022
Slide 1: Q3 2022 Update
Q3 2022 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 Ltd’s (
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Buy Super Greensand® at Amazon: 5% OFF coupon (USA): 05NOVINVEST Canada: Sold Out The discount codes are valid through December 14, 2022 The codes are limited to a single unit per order and to a single order. 3 VERDE AGRITECH
Slide 4: Summary
Summary 05 Q3 2022 Highlights 06 Q3 2022 Financial Statements 07 Operational Summary 08 Key Metrics 09 SG&A Expenses 11 Other Highlights 12 Sales Channels 13 Summary of Interest-Bearing Loans 14 2022 Guidance 16 Brazilian Economic Scenario 17 Potassium Chloride and Diesel vs Oil Prices 18 Appendix 1
Slide 5: Summary
Summary • Because of road issues limiting the logistics corridor to Plant 2, from September 09, 2022 to October 19, 2022, which is now resolved, peak season purchase orders had to be turned down. • Despite that, the growth experienced throughout Q3 2022 reflects yet again the efforts and dedication
Slide 6: Q3 2022 Highlights
Q3 2022 Highlights Cash Ability to generate significant free cash flow in the long term. Cash utilised from investing activities increased in Q3 2022, to $13.8M compared to $0.8M in Q3 2021. Trade and other receivables increased 252% in Q3 2022, to $29.0M compared to $8.2M in Q3 2021. Total loans fo
Slide 7: Q3 2022 Financial Statements
Q3 2022 Financial Statements All amounts in CAD $’000 Q3 2022 Q3 2021 %Δ 2022 YTD 2021 YTD %Δ Revenue 27,269 10,651 156% 63,434 16,858 276% Production costs (6,069) (2,452) 148% (14,055) (4,440) 217% Gross Profit 21,200 8,199 159% 49,379 12,418 298% Gross Margin 78% 77% N/A 78% 74% N/A Sales and pro
Slide 8: Operational Summary
Operational Summary All amounts in CAD $’000 Q3 2022 Q3 2021 %Δ 2022 YTD 2021 YTD %Δ Tonnes sold ‘000 189 154 23% 503 266 89% Revenue per tonne sold $ 144 69 108% 126 63 99% Production cost per tonne sold $ (32) (16) 101% (28) (17) 67% Gross Profit per tonne sold $ 112 52 114% 98 47 110% Gross Margi
Slide 9: Key Metrics Quarterly
Key Metrics Quarterly Sales (Tonnes) Revenue (‘000 CAD) 202,255 200000 189,548 30000 27,269 24,861 153,674 150000 134,350 20000 111,667 105,769 100000 96,233 11,304 10,651 10,851 71,183 62,895 10000 56,585 50000 5,376 32,221 3,956 23,600 20,641 2,492 3,055 16,558 2,209 831 1,329 1,491 10,170 9,007 5
Slide 10: Key Metrics Yearly
Key Metrics Yearly Sales (Tonnes) Revenue (‘000 CAD) 800,000 100,000 1 1 700,000 90,000 86,618 700,000 80,000 600,000 70,000 Q3 500,000 Q3 60,000 400,133 400,000 50,000 Q2 40,000 300,000 243,707 Q2 30,000 27,710 200,000 119,809 20,000 Q1 100,000 9,167 Q1 10,000 6,029 29,648 1,358 - - 2018 2019 2020
Slide 11: Key Metrics Yearly
Key Metrics Yearly EBTIDA (‘000 CAD) Earning / loss per share (CAD) 33,500 31,291 1 0.55 0.50 1 28,500 0.45 23,500 Q3 Q3 0.35 18,500 Q2 0.25 Q2 13,500 8,500 0.15 6,450 Q1 0.07 Q1 3,500 1,591 0.05 (1,444) 25 0.01 (0.04) (0.02) (1,500) 2018 2019 2020 2021 2022 (0.05) 2018 2019 2020 2021 2022 1 - Targe
Slide 12: Sales, General and Administrative Expenses
Sales, General and Administrative Expenses All amounts in CAD $’000, except Q3 2022 Q3 2021 %Δ YTD 2022 YTD 2021 %Δ percentages Sales Expenses Sales and marketing expenses (1,385) (600) 131% (2,919) (1,241) 135% Fees paid to sales agents (481) (189) 155% (976) (260) 275% Product delivery freight exp
Slide 13: Other Highlights
Other Highlights FOB vs CIF (tonnes) General Expenses (C$’000) 210,000 0 189,548 -27 -5 -134 -82 180,000 -180 -291 153,674 -500 148,024 150,000 -512 -667 120,000 -1000 90,000 -1096 77,161 76,513 -1500 60,000 41,524 30,000 -2000 -1,970 0 General Legal, IT/Software Taxes and Total General administrati
Slide 14: Sales Channels
Sales Channels Sales channels quarterly (% of total sales) Sales channels yearly (% of total sales) 63% 60% 56% 60% 54% 50% 42% 40% 37% 40% 34% 26% 20% 20% 13% 11% 8% 8% 0% 0% Q3 2022 Q3 2021 YTD 2022 YTD 2021 Direct Sales Sales Agents Distributors Direct Sales Sales Agents Distributors VERDE AGRITE
Slide 15: Summary of Interest-Bearing Loans and Borrowings
Summary of Interest-Bearing Loans and Borrowings Part 1: Total Grace period Term Loan value Balance at Sep 30, Repayable Lender Loan start date Purpose by interest (months) (months) (R$’000) 2022 (C$’000) payable* Votorantim Sep, 2022 Working capital 12 30 10,000 2,539 Mar, 2025 *CDI+5.10% Brazil Se
Slide 16: Summary of Interest-Bearing Loans and Borrowings
Summary of Interest-Bearing Loans and Borrowings Part 2: Total Loan start Grace period Term Loan value Balance at Sep 30, Repayable Lender Purpose by interest date (months) (months) (R$’000) 2022 (C$’000) payable* Santander Feb, 2022 Equipment 03 36 888 226 Feb, 2025 * CDI + 4,60% Santander Feb, 202
Slide 17: 2022 Guidance
2022 guidance Verde achieved is EPS, EBITDA, revenue and sales guidance for Q3 2022. The table below compares the Company’s 2022 to 2021 results. Period Year EPS (C$) EBITDA¹ (C$’000) Revenue (C$’000) Sales (tonnes) 2021 -0.04 -887 831 16,558 Q1 2022 0.06 3,678 11,304 111,667 %Δ N/A N/A 1260% 574% 2
Slide 18: Brazilian Economic Scenario
USD/BRL Exchange Rate Brazilian Economic Scenario 5.80 5.60 5.37 Brazilian Real versus US Dollar 5.40 5.25 5.28 5.24 5.16 5.14 5.20 5.00 From January to March 2022, the Brazilian Real 4.80 devalued by 0.4% in relation to US Dollar, compared 4.60 to the same period of 2020. 4.40 4.20 As of November 1
Slide 19: Potassium Chloride Price, Diesel and Crude Oil Prices
Potassium Chloride Price CIF MG (USD) Fluctuations in potassium chloride CIF (Minas Gerais) prices 1400 1200 1050 990 1000 772 875 900 KCl CIF (Minas Gerais) KCl CIF (Minas Gerais) 748 775 800 690 695718 655 Lowest Price Highest Price 515 600 Q3 2022 US$640 US$1,050 400 200 Q3 2021 US$605 US$790 0 %
Slide 20: Appendix
Appendix 20
Slide 21: 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 22: 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 23: 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 24: 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 24 24 VERDE AGRITECH
Slide 25: 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
Slide 26: 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 27: TSX: NPK | OTCMKTS: VNPKF
TSX: NPK | OTCMKTS: VNPKF investor.verde.ag 27