Growing sales volumes boosted revenue and profits of AB Linas Agro Group for 9 months
Consolidated revenue of AB Linas Agro Group went 50% up during the nine months period of FY 2020/2021 to EUR 712 million. Sales volume in tons reached 2.38 million and was 43% more as compared to previous year.
The gross profit reached EUR 29.2 million and was 8% higher than a year before. Consolidated EBITDA was 44% higher and amounted to EUR 17.1 million. The operating profit was EUR 5.1 million or 75% higher.
Profit before taxes increased 4.5 times to EUR 2.99 million. The net profit attributable to the company went up 4 times to EUR 2.64 million.
As much as 1.8 million tons of grain and oilseed have been sold, or 67% more than in the same period last year. Trade in feedstuffs also increased by 21%. Total revenue from trade in grain, oilseeds and feedstuff grew by 75% year-on-year to EUR 534 million, and the operating profit was 17% lower and amounted to EUR 2.9 million.
“The total grain and rapeseed yield in all Baltic countries was a record high in 2020 and had a significant impact on the growth of our sales. The total sales volume of grain and oilseeds hit a record. Wheat sales increased by almost 95%, barley sales - by 99% and rapeseed sales by as much as 121%. Our elevator network in Lithuania and Latvia also collected record quantities of grain over nine months - 654 thousand tons, or 57% more than in the same period a year before. The decrease in profitability was significantly affected by EUR 1 million loss in derivatives,” Mažvydas Šileika, Finance Director of AB Linas Agro Group, commented the performance results of the largest business segment of the Group.
The Group's revenue from goods and services for farmers grew by 10% to EUR 116 million, and the operating profit was 143% higher and equal to EUR 4.5 million. Sales of certified seeds and plant care products increased by almost 4%, while sales of fertilizers decreased by the same amount. Sales of agricultural machinery and spare parts and services increased by more than a third, reaching EUR 44.3 million. EUR 3.3 million sales came from installation projects of grain preparation facilities and cattle farms, that was 12% more than in the previous year.
"It was a great year for agricultural companies: they sold 94 thousand tons of crop production or 28% more than last year. Although the number of dairy cows decreased by almost 6% due to the closure of one unprofitable milk production unit, the growth of milk yield in the other units increased volume of sold milk by 2% to almost 26 thousand tons. Total revenue from agricultural activities increased by 18% to EUR 28 million, operating profit amounted to EUR 1.4 million. Undoubtedly, the operating result was significantly affected by EUR 1.9 million profit, gained from the sale of the land holding companies in November, 2020,” said M. Šileika.
The ongoing restrictions in the HORECA segment related to the COVID-19 pandemic maintained the EU overproduction of chicken products in spring - as per European Commission, it will reach 13% in 2021. The Group's poultry companies did not increase production: they produced and sold as much poultry meat as in previous year. As a result of overproduction, chicken sales prices in the EU have remained low, whilst feedstuff for chicken feed have risen in price and increased the cost of poultry production. As a result, poultry business revenue fell 9% to EUR 52 million, and EUR 0.9 million operating loss was incurred.
"In the remaining quarter, we expect sales growth in the goods for farmers segment and a recovery in poultry business. We do not expect growth from other businesses due to the seasonality of the activity," said M. Šileika.
On the 1st of October, 2020 AB Linas Agro Group has signed agreements for acquisition of the blocks of shares of AB Kauno Grūdai, AB Kaišiadorių Paukštynas, AB Vilniaus Paukštynas and the related companies.
The approval of the transaction has already been expressed by the competition authorities of Latvia, Estonia, Poland and Russia, pending is the permission of The Competition Council of the Republic of Lithuania.
AB Linas Agro Group Consolidated unaudited Financial Statements and Interim Activity Report for the nine months period ended 31 March 2021
Mažvydas Šileika, Finance Director of AB Linas Agro Group
Mob. +370 619 19 403