- Revenue: $209.6 million for Q4 2024, up by $3.9 million from the same period last year; $920.1 million for the fiscal year, down from $1 billion.
- Gross Profit: $5.4 million for Q4 2024, up 8.3% from Q4 last year; $35.2 million for the fiscal year, up 54.4% year-over-year.
- Net Income: Negative $501,000 for Q4 2024, up from negative $2.5 million in Q4 last year; $9.4 million for the fiscal year, compared to negative $7.9 million last year.
- Adjusted EBITDA: $2.9 million for Q4 2024, up 4.4%; $22.6 million for the fiscal year, up from $7.2 million last year.
- Adjusted Net Income: Negative $501,000 for Q4 2024, down from $1.5 million in Q4 last year; $9.6 million for the fiscal year, up from $2.8 million last year.
- Net Trading Margin: $42.2 million for the fiscal year, up 33.6% from the prior year.
- Supply Chain Service Revenue: $7.1 million for the fiscal year, down from $7.7 million last year.
- Net Seed and Processing Margin: $8 million for the fiscal year, up 21.1% from last year.
- General and Administrative Expenses: $18.4 million for the fiscal year, down 28% from last year.
- Interest Expense: $6.2 million for the fiscal year, mostly unchanged from last year.
- Income Tax Expense: $1.6 million for the fiscal year, compared to an income tax recovery of $865,000 last year.
- Working Capital: $62.3 million at the end of fiscal year 2024.
- Volumes Handled: 97.1 million bushels of grain and oilseed for the fiscal year, down from 102.9 million bushels last year.
- Farmers Grain Joint Venture Volumes: Increased by 12% for the fiscal year.
- Gateway Facility Volumes: Increased by 18% in 2024 compared to last year.
- Soybean Crush Volumes: Increased by 14% for the fiscal year.
Release Date: September 13, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- Achieved the second-best fiscal year performance in the company's history with full-year operating income of $16.8 million and net income of $9.4 million.
- Operational improvements at the Farmers Grain joint venture increased volumes handled by 12% this year.
- Record soybean crush volumes for fiscal year 2024, driven by proactive soybean procurement and increasing operational efficiencies.
- Gross profit rose 54.4% year-over-year to $35.2 million, the second highest on record.
- Significant strides in delivering regenerative agricultural solutions, including strategic partnerships with Trimex, Lavie Bio, and Miller Milling.
Negative Points
- Handled 5.5% fewer volumes this fiscal year, mainly due to the strategic divestment of the Port Colborne facility.
- Revenue decreased to $920.1 million from $1 billion due to lower commodity prices and bushels merchandised.
- Net income for Q4 was negative $501,000, although an improvement from negative $2.5 million in the same period last year.
- Supply chain service revenue decreased to $7.1 million from $7.7 million in 2023, mainly due to the sale of the Port Colborne facility.
- General and administrative expenses were $18.4 million, partially offset by higher incentive accruals in 2024.
Q & A Highlights
Q: Can you provide more details on the factors that contributed to the record soybean crush volumes this fiscal year?
A: (Carlos Paz, CEO) The record soybean crush volumes were primarily driven by our team's proactive soybean procurement and increasing operational efficiencies at the Jordan crush plant. This led to a 14% increase in yearly volumes, resulting in record-breaking volumes and margins.
Q: What were the main reasons behind the 5.5% decrease in volumes handled this fiscal year?
A: (Carlos Paz, CEO) The decrease in volumes handled was mainly due to our strategic divestment of the Port Colborne facility in Q3 2023. This move aimed at streamlining our asset footprint and optimizing our operations around our core products, accounting for a 4% reduction in handled volumes.
Q: How did the Farmers Grain joint venture perform this year?
A: (Carlos Paz, CEO) Operational improvements at our Farmers Grain joint venture increased volumes handled by 12% this year. This high efficiency resulted from our focus on recruiting top talent, securing freight capacity, and ensuring timely rail execution.
Q: Can you elaborate on the financial performance for the fiscal year?
A: (Blake Amundson, CFO) We achieved new record financial results this year, with gross profit rising 54.4% year-over-year to $35.2 million. Revenue was $920.1 million, down from $1 billion, due to lower commodity prices and bushels merchandised. Net income hit a new record, totaling $9.4 million, or $0.30 per share, compared to negative $7.9 million or negative $0.25 per share in the prior year.
Q: What are the expectations for the supply chain services segment next quarter?
A: (Carlos Paz, CEO) We anticipate increasing volumes due to competitor logistics challenges and increased demand for Northgate's transloading products, which should drive solid results for the segment next quarter.
Q: How is the company positioned to capitalize on the upcoming harvest season?
A: (Carlos Paz, CEO) Favorable weather in Canada and the US points to higher-than-average crop yields, which will allow us to maximize our storage capacity and volume across our network of assets. Our team will closely monitor crop developments to capitalize on market opportunities.
Q: Can you discuss the progress in the regenerative agriculture initiative?
A: (Carlos Paz, CEO) We made significant strides in our long-term strategy of delivering regenerative agricultural solutions. We announced several strategic partnerships, including collaborations with Trimex and Lavie Bio. We also expanded our partnership with Miller Milling to improve agronomic and environmental outcomes for wheat growers in North Dakota.
Q: What were the key strategic initiatives for fiscal year 2024?
A: (Carlos Paz, CEO) Our primary focus included identifying creative partnerships to expand grain origination, deploying regenerative agricultural solutions across the supply chain, and maximizing the earnings potential of our assets. Streamlining our asset footprint through strategic divestments was also crucial to achieving new record financial results.
Q: How did the seed retail and processing segment perform this year?
A: (Carlos Paz, CEO) The segment realized record soybean crush volumes for fiscal year 2024, driven by proactive soybean procurement and increasing operational efficiencies at the Jordan crush plant. This led to a 14% increase in yearly volumes and record-breaking margins.
Q: What are the company's plans for the next fiscal year?
A: (Carlos Paz, CEO) We aim to build on this year's momentum by continuing to execute our core strategies and delivering strong results for our shareholders. This includes maximizing storage capacity and volume, increasing supply chain service volumes, and maintaining high crush capacity utilization in the seed retail and processing segment.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
