AgroFresh Solutions sees 15% growth in net sales
Jordi Ferre, Chief Executive Officer, commented, "First quarter results reflect the health of our business and give us confidence that our new operations focus and enhanced financial discipline are yielding results. We grew revenues for the second consecutive quarter, with growth of 15 percent in the first quarter compared to the prior year period.
"Of particular note, we increased market share in the highly competitive Argentina market that saw two new competitors enter the market, further evidence that our new marketing initiatives, geographic and product diversification efforts, and introduction of the SmartFresh Quality SystemTM are strengthening our reputation as the industry leader. Additionally, we saw double-digit growth on sales of Harvista as compared to the first quarter of 2016.
"Our strong top line growth led to overall financial results that were significantly improved from a year ago. As we continue to implement our growth strategy, it is encouraging that we have the support of Dow and Avenue Capital, who have not only exhibited their high degree of confidence by agreeing to make available up to $100 million in loans for approved acquisitions but have also improved our financial flexibility through our recently announced agreements.”
Financial Highlights for the First Quarter
Net sales for the first quarter of 2017 were up 15 percent versus the first quarter of 2016, primarily due to SmartFresh growth in Brazil and Chile as well as Harvista growth in Argentina.
Stable margins, as gross profit of 82 percent was in-line with the first quarter of 2016.
Research and development costs of $3 million were $1 million less than in the first quarter of 2016, reflecting more targeted research activities.
Selling, general and administrative expenses of $16 million were reduced by over $3 million from a year ago due to efficiency and productivity improvements.
Interest expense of $10 million was $5 million less than in the first quarter of 2016, driven by lower accretion of contingent consideration.
Katherine Harper, CFO, said, “The new year is off to a strong start with improved top and bottom line performance. Consolidated margins were consistent with the first quarter of 2016 and continue to primarily reflect the impact of our evolving product mix and additional investment in growth initiatives. Over time, we expect to achieve better performance by driving down operating expenses."
"We expect the full year average run rate for SG&A to be $11 million per quarter. Our asset-light model, attractive cash flow and $85 million cash balance, together with the potential for up to $100 million acquisition support from Dow and Avenue, provide us with extensive financial resources to capitalize on the growth opportunities in the rapidly emerging food preservation and waste reduction space.”
source: businesswire.com