Release Date: February 26, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- EBITDA increased by 35.2% to $23.1 million, indicating strong financial performance.
- Plant-based milks segment achieved record EBITDA of $23.1 million, showcasing robust growth.
- Milklab brand revenue grew by 6.8%, reflecting successful brand expansion.
- Dairy and nutritionals segment turned around with a positive EBITDA of $2.2 million, compared to a loss in the previous period.
- Net revenue increased by $16.9 million to $296.7 million, demonstrating overall business growth.
Negative Points
- Net loss after tax was $27.7 million, including a $32.3 million adjustment for convertible notes.
- Global dairy market conditions negatively impacted bulk cream prices, reducing EBITDA by $4 million.
- Lactoferrin production disruptions led to a 37% decrease in sales, affecting profitability.
- Export revenues declined by 3%, highlighting challenges in international markets.
- Higher inventories at the end of December due to supply chain disruptions, indicating inefficiencies.
Q & A Highlights
Q: What factors would impact the convertible note fair value adjustments? Would it be the interest rate set by the RBA?
A: Peter Myers, Noumi Ltd - Chief Financial Officer: The notes have a conversion option, cash payment requirements, and repayment provisions, making them a complex financial instrument. They are valued independently each reporting period, considering factors like discount rates (reflecting the cost of capital in markets), time to maturity, cash interest payments, and the valuation of the option component.
Q: What percentage of group revenues come from the distribution of Milklab products in McDonald's outlets?
A: Michael Perich, Noumi Ltd - Chief Executive Officer: McDonald's is an important customer, but we manage and monitor the concentration of all our customers. We ensure supply across many different distributors in the market for our Milklab brand, though no specific percentage was provided.
Q: Could you talk about your cost expectations going forward, e.g., salary, freight, energy, etc.?
A: Michael Perich, Noumi Ltd - Chief Executive Officer: We continue to monitor cost pressures, ensuring operational efficiencies and reducing wastages. We are aware of potential future cost increases from utilities, wages, and supply chain, and we are working to offset these through improved practices.
Q: Could you remind us what happened with the lactoferrin production disruption?
A: Michael Perich, Noumi Ltd - Chief Executive Officer: The disruption was due to overall volume and supply of milk, as lactoferrin is an output of milk processed. There were also specification changes being worked through, causing a timing issue in the first half.
Q: Could you provide more detail on the lactoferrin production disruption, including root causes, timing, and corrective actions?
A: Michael Perich, Noumi Ltd - Chief Executive Officer: We are focused on ensuring high-specification lactoferrin quality. The disruptions were managed to maintain product quality, and we are confident in our future position.
Q: What are the key strategic priorities for Noumi Ltd moving forward?
A: Michael Perich, Noumi Ltd - Chief Executive Officer: Our strategy includes completing the dairy nutritionals turnaround, accelerating plant-based milks growth, delivering a world-class supply chain, embedding a high-performance culture, and building future growth platforms. These priorities aim to drive shareholder value.
Q: How is Noumi Ltd addressing the challenges in the Australian dairy industry?
A: Michael Perich, Noumi Ltd - Chief Executive Officer: We focus on operational efficiencies, product mix favoring higher-margin products, and strong customer relationships. Despite global dairy market challenges, we are in a stronger position due to our improvements.
Q: What is the outlook for Noumi Ltd's plant-based milk segment?
A: Michael Perich, Noumi Ltd - Chief Executive Officer: The plant-based milk segment is in the growth phase, with strong performance expected to continue. We are investing in growth domestically and internationally, leveraging the strength of our Milklab range.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
