Agrinos sales result in Q2 2014

Agrinos’ sales revenue amounted to $3.9 million in the second quarter, mainly explained by sales in the US and China. The operating income of negative $4.1 million in the second quarter, versus negative $7.2 million in the first quarter 2014 , reflects a shift in Agrinos’ strategy with sharper focus, reduced cost base and growing sales in certain markets.

 

The earnings before interest, taxes, depreciation and amortization (EBITDA) pre earn-out, were negative at $3.4 million in the quarter vs negative $6.5 million in the first quarter of 2014.

 

Agrinos develops, produces and markets biological crop inputs, also described as agricultural biologicals. The company has commercial market activities in the US, Brazil, China, India, Mexico, Spain and Malaysia/Indonesia.

 

The US and Brazil region operations are progressing according to the company’s growth ambitions. In this region Agrinos recorded total revenues of $2.0 million in the first half of 2014, compared with $2.0 million in the full year 2013 and $0.8 million in the full year 2012. The partnerships with third party distributors are developing positively and Agrinos’ technology is gaining traction at the end-user level. 

 

On the back of the positive development in the U.S and Brazil, Agrinos will step up its presence in the Americas by moving several corporate functions from Oslo, Norway to Davis, California and Dallas, Texas. While the transition of corporate functions from Oslo, Norway to the U.S. will take place during the remainder of the year and into 2015, Agrinos AS continues as the parent company listed on the Norwegian OTC market, and the Oslo office will continue as the corporate hub for leading Agrinos’ commercial operations in Europe and Asia.

 

In the Europe, Middle East and Asia (EMEA) region, Agrinos sold, shipped and collected on the first delivery to the company’s new partner in China, Kingenta Ecological Engineering Group Co Ltd. Kingenta is a Chinese compound and slow release fertilizer company listed on Shenzhen Stock Exchange. The company has a distribution network across China and a commercial launch of Agrinos’ products through Kingenta’s distribution network is planned for in the third quarter.

 

In the second quarter Agrinos’ distributors in Mexico reported deployment of approximately 260,000 units to end-users. While the distributors are continuing to roll-out substantial product volumes, they are still working to become profitable. Agrinos is currently exploring strategic options for its commercial operations in Mexico.

 

 

In line with the stated strategy, the company will continue to pursue growth in the US and select other markets, while expanding its R&D activities in the second half compared to the first half of the year. 

 

To bring key functions closer to the main market and align overhead costs with the underlying business activities and to optimize the cost base and the effectiveness of support functions, the company hasinitiated a transfer of corporate functions from Norway to the U.S.

 

Commercially, the company is experiencing progress within the US and select other markets, including China, and expects this progress to continue into the second half of the year.