MINNEAPOLIS, MN, Nov. 14, 2017 /CNW/ - Ceres Global Ag Corp.
(TSX: CRP) ("Ceres" or the "Corporation") today announced its
financial and operational results for the three-month period ended
September 30, 2017. All amounts are
in U.S. currency unless otherwise noted.
CEO Commentary
"Despite a delayed harvest and an increasingly challenging
environment for our industry overall, we managed to improve gross
margins by $1.2 million vs. the same
quarter a year ago," said Robert
Day, President and Chief Executive Officer of Ceres.
"Volumes for the quarter were less than initially anticipated,
however, margins were better year on year, which was made possible
by the learning and skill-building that was obtained from the
significant increase in volume last fiscal year."
"Our goal is to be recognized by our customers as providing
superior service and to be compensated fairly for doing so," Mr.
Day continued. "Through consistent purchase and supply of raw
materials, value-added products and supply chain services we are
moving closer to that goal."
Summary Financial and Operational Results
(in thousands of
USD except per
share and bushels handled)
|
Three months
ended
September 30, 2017
|
Three months
ended
September 30, 2016
|
Revenue
|
$130,638
|
$155,927
|
Gross profit
(loss)
|
$3,063
|
$1,871
|
EBITDA1
|
$1,523
|
$744
|
Income (loss) from
operations
|
$519
|
$(605)
|
Net income
(loss)
|
$(806)
|
$(1,356)
|
Earnings (loss) per
share - Basic
|
$(0.03)
|
$(0.05)
|
Total bushels handled
and
merchandized
|
27.2
million
|
35.0
million
|
Financial and Operating Highlights for Q1 FY2018
- Generated revenue of $130.6
million, a 16% decrease from Q1 FY2017.
- Increased gross profit 64% to $3.1
million from Q1 FY2017 due to increased storage and rental
income.
- Handled 50% more third-party bushels of grain and oilseed
compared to Q1 FY2017.
- Total number of bushels handled and merchandised decreased by
22% as a result of a late harvest season.
- Increased income (loss) from operations $1.1 million compared to Q1 FY2017.
- Generated $13.6 million cash flow
from operations, a 172% increase from Q1 FY2017.
- The previously disclosed trial by jury of the Scoular
litigation was delayed and is now expected to start in Q3
FY2018.
Outlook
Mr. Day continued, "The summer droughts across the U.S. upper
Midwest and prairies in Canada
generated widely varied crop qualities and yields. As a
result, trade flows are slightly different from what was expected
and we are adapting to those changes. Specifically, we are
handling less volume vs. a year ago, but we're focusing on trade
flows where margins are most attractive, which we expect will lead
to a better result overall."
"At Northgate, early stage volumes in our partnership with Koch
Fertilizer Canada have exceeded expectations," Mr. Day added. "Our
state of the art infrastructure is providing Koch's customers with
the most efficient turnaround times in the industry, and in many
cases those same trucks are first hauling grain before picking up
fertilizer. Meanwhile, liquid natural gas volumes have been better
than expected as the market has been spurred on by U.S.
demand."
Conference Call Details
Ceres will hold a conference
call to discuss its Q1 FY2018 financial and operational results on
Wednesday, November 15, 2017 at
1:00 pm ET. Robert Day, Ceres' President and CEO, and
Kyle Egbert, Ceres' CFO, will
co-chair the conference call.
All interested parties can join the conference call by dialing
1-888-231-8191 or 647-427-7450, conference ID: 6699717. Please dial
in 15 minutes prior to the call to secure a line. The conference
call will be archived for replay until Wednesday, November 29, 2017 at midnight ET. To access the archived conference
call, please dial 1-855-859-2056 and enter the encore code
6699717.
Non-IFRS Financial Measures
1EBITDA (Earnings before Interest, Taxes,
Depreciation and Amortization) is not a standardized financial
measure prescribed by IFRS; however, is one metric that is used by
management to determine the Corporation's ability to service its
debt and finance capital. EBITDA excludes gains and losses on
property, plant and equipment and assets held for sale, as these
items are considered to be non-reoccurring in nature.
In calculating EBITDA, Ceres excludes its share of the net
income (loss) from investments in associates and the gain (loss) on
sale or impairment of property, plant and equipment. 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
alternatives to net income or loss, or to other standardized
financial measures determined in accordance with IFRS, and are not
intended to represent cash flows or results of operations in
accordance with IFRS.
About Ceres Global Ag Corp. (ceresglobalagcorp.com)
Headquartered in Minneapolis,
Ceres Global Ag Corp. is focused on two primary businesses: a Grain
Storage, Handling and Merchandising unit; and a Commodity Logistics
unit.
Ceres operates in two business units, one of which is a grain
storage, handling, and merchandising unit anchored by a collection
of six (6) grain storage and handling assets in Minnesota, Saskatchewan and Ontario having aggregate storage capacity of
approximately 34.4 million bushels.
Ceres' Commodity Logistics unit is focused on the development of
a Commodity Logistics Centre in Northgate, SK. The Northgate
Commodities Logistics Centre is a state-of-the-art grain,
agriculture services and oilfield supplies transloading site.
Ceres also has a 25% interest in Stewart Southern Railway Inc.,
a short-line railway with a range of 130 kilometres that operates
in South-eastern Saskatchewan, and
a 17% interest in Canterra Seed Holdings Ltd, a Canadian-based seed
development company.
Cautionary Notice: 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 September 30, 2017. 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
ability of Ceres to successfully defend the claim by The Scoular
Corporation, 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.