Ag Growth International Inc. (TSX: AFN) (“AGI”) has released its financial results for the first quarter of 2024, showcasing positive growth and improved profitability. The company reported revenue of $315 million, representing a 9% decrease compared to the previous year. However, adjusted EBITDA increased by 4% to $50 million, with an adjusted EBITDA margin of 15.9%.
The Farm segment of AGI experienced significant growth, with revenue and adjusted EBITDA increasing by 4% and 17% respectively. This growth was primarily driven by international markets, particularly in Brazil, where key projects were completed for customers. The Farm segment also benefited from manufacturing efficiency initiatives and effective revenue management.
On the other hand, the Commercial segment saw a decline in revenue and adjusted EBITDA, decreasing by 24% and 40% respectively. This decline was largely attributed to the international and Canadian markets. Internationally, revenue was impacted by a shift in project timing, with a stronger focus on the second half of the year. In Canada, a slowdown in customer activity contributed to the decrease in revenue. However, AGI remains optimistic, as the current order book for the Commercial segment is significantly higher year-over-year, particularly in international regions.
AGI’s President & CEO, Paul Householder, commented on the company’s first quarter results, stating that they are largely in line with expectations. He expressed confidence in AGI’s profitability levels and highlighted the strong activity levels across most areas of the company. Householder also acknowledged the cautious purchasing behavior in the North American Farm segment, which may impact second-quarter results.
AGI’s CFO, Jim Rudyk, emphasized the company’s focus on balance sheet metrics. While the net debt leverage ratio increased slightly quarter-over-quarter, it remains a priority for AGI to lower this ratio below 2.5x in 2024. Rudyk also mentioned ongoing financial analysis and strategic planning for potential growth investments.
With a near-record order book of $729 million and strong commercial activity internationally, AGI reaffirms its 2024 adjusted EBITDA guidance of at least $310 million. The company expects the majority of the year-over-year growth to occur in the second half of 2024, with first-half results anticipated to be lower compared to the previous year.
For more details on AGI’s first-quarter financial results, the company’s unaudited consolidated financial statements and management’s discussion and analysis (MD&A) can be accessed on SEDAR+ and AGI’s website.
AGI will also hold a conference call on April 30, 2024, to discuss its first-quarter results, providing an opportunity for investors and analysts to gain further insights into the company’s performance.
Ag Growth International’s first-quarter financial results show positive growth and improved profitability. While revenue decreased by 9% compared to the previous year, adjusted EBITDA increased by 4% to $50 million, with an adjusted EBITDA margin of 15.9%.
The Farm segment of AGI experienced significant growth, with revenue and adjusted EBITDA increasing by 4% and 17% respectively. This growth was driven by international markets, particularly in Brazil, where key projects were completed. Manufacturing efficiency initiatives and effective revenue management also contributed to the segment’s success.
However, the Commercial segment saw a decline in revenue and adjusted EBITDA, decreasing by 24% and 40% respectively. This decline was mainly due to the international and Canadian markets. Internationally, the revenue was impacted by a shift in project timing, focusing more on the second half of the year. In Canada, a slowdown in customer activity contributed to the decrease in revenue. Despite this, AGI remains optimistic as the order book for the Commercial segment is significantly higher year-over-year, particularly in international regions.
One key challenge AGI may face is cautious purchasing behavior in the North American Farm segment, which could impact second-quarter results. However, AGI’s President & CEO, Paul Householder, expressed confidence in the company’s profitability levels and highlighted strong activity levels across most areas of the company.
In terms of financial metrics, AGI remains focused on lowering its net debt leverage ratio below 2.5x by 2024. The company is also conducting ongoing financial analysis and strategic planning for potential growth investments.
AGI reaffirms its 2024 adjusted EBITDA guidance of at least $310 million, supported by a near-record order book of $729 million and strong commercial activity internationally. The company expects the majority of the year-over-year growth to occur in the second half of 2024, with first-half results anticipated to be lower compared to the previous year.
For more detailed information on AGI’s first-quarter financial results, investors can access the company’s unaudited consolidated financial statements and management’s discussion and analysis (MD&A) on SEDAR+ and AGI’s website. [link name](https://sedar.com/) [link name](https://www.aggrowth.com/)
AGI will also hold a conference call on April 30, 2024, providing an opportunity for investors and analysts to gain further insights into the company’s performance.