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Bioceres Crop Solutions Reports Fiscal Second Quarter 2022 Financial and Operational Results

·13 min read

2Q22 Comparable Revenues up 89% YoY – Baseline Business Adjusted EBITDA up 48% in the first two quarters, reaching $61.8M LTM

HB4 Wheat maintains performance as grower exposure increases more than 8X. Brazil regulatory approval and inventory levels in place for 4Q22 limited launch

HB4 Wheat opportunity estimated at $195M at peak revenues in current market, with incremental EBITDA target of $15-20M set for FY2024

ROSARIO, Argentina, February 10, 2022--(BUSINESS WIRE)--Bioceres Crop Solutions Corp. ("Bioceres") (NASDAQ: BIOX), a fully integrated provider of crop productivity solutions designed to enable the transition of agriculture towards carbon neutrality, has reported financial results for the second quarter 2022, ended December 31, 2021. Financial results are expressed in US dollars and are presented in accordance with International Financial Reporting Standards. All comparisons in this announcement are year-over-year ("YoY"), unless otherwise noted.

FISCAL SECOND QUARTER FINANCIAL HIGHLIGHTS

  • Comparable Revenues increased 89% in 2Q22, to $90.3 million, up from $47.7 million in the year-ago quarter, resulting in an accumulated growth of 72% year to date. Growth in revenues was mainly driven by inoculants across various geographies globally, seed treatment packs in South America, and a successful high-season marketing of micro-beaded fertilizers in Argentina. The combined growth in Europe and the United States reached 146% YoY during the quarter.

  • Comparable Gross Profit for the quarter was up 69%, compared to the year-ago quarter, reaching $42.2 million. Year-to-date comparable gross profit reached $70.1 million, up 56% compared to fiscal year 2021. With all regions' nominally growing contributions to gross profit compared to the year-ago quarter, Europe and the United States stood out, representing approximately 15% of total gross profit, up from 11% in 2Q21.

  • LTM Adjusted EBITDA for the Baseline Business, which excludes HB4 pre-launch costs, reached $61.8 million, up 46% compared to the year-ago metric, and 15% on a quarterly sequential basis. LTM HB4 pre-launch expenses comprised of SG&A, inventory ramp-up and data acquisition costs, totaled $6.2 million - inclusive of a $1.9 million negative IAS29 accounting adjustment to HB4 grain inventories - leading to a reported LTM Adjusted EBITDA of $55.6 million. HB4 pre-launch costs are expensed as incurred and accounted for in SG&A and Other Income or Loss, both line items with an impact in reported Adjusted EBITDA. Upon completion of the harvest season, HB4 Wheat seed inventory has reached the required level for a limited commercial launch, stabilizing the run rate of inventory ramp-up costs.

  • Bioceres’ subsidiary Rizobacter Argentina S.A. completed a $20.0 million public offering of series VII corporate bonds, which mature in December 2024 and pay an annual nominal interest rate of 1.49%. Proceeds allowed Bioceres to maintain a strong liquidity position of $39.9 million by quarter-end and increased the long-term portion of total debt from 63% to 74%, stabilizing the average cost of debt at 7.1%. Net Financial Debt to LTM Adjusted EBITDA ratio decreased from 2.74x to 2.66x on a sequential basis.

FISCAL SECOND QUARTER HB4 HIGHLIGHTS

  • HB4 Wheat outyielded non-HB4 varieties, with a 12.8% average increase across all environments and locations. In targeted environments, representing more than one-third of all harvested hectares, the average yield improvement was 49%. 2nd generation varieties showed a 16% yield improvement in high yielding environments, when compared to 1st generation materials.

  • Brazil's regulatory authority, CTNBio, granted the import approval for HB4 wheat flour for animal and human consumption in November 2021. This approval is a major milestone in Bioceres’ mission to build agricultural systems that enhance carbon sequestration and climate resiliency, and a necessary step for a commercial launch in the upcoming planting season.

  • Estimations based on growers’ feedback, portfolio of varieties and seed multiplication plans set EBITDA target for HB4 Wheat at $15-20 million for FY2024. Opportunity peak estimated at 2.3 million hectares and $195 million in revenues for the Company in current market.

  • Rollout of new HB4 Soy varieties affected by reduction in late season plantings due to severe drought conditions during December. Top-performing 3rd generation HB4 varieties planted at 100% of available inventory, while 2nd generation materials planted on 60% of planned hectares. 1st generation varieties fully discontinued as indicated in 4Q21. Shift towards new varieties expected to unlock further yield gains going forward.

  • Alexandre Garcia joined the management team as Global Head of Seed Business to enhance focus on accessing and developing top performing genetics for the HB4 trait and new technologies. In his former position as Innovation and Research Director at TMG, a leading provider of soybean genetics for Latin America, Alexandre led the collaboration efforts on HB4 in Brazil since 2014. ​He completed a PhD in Agronomy at the State University of Maringa (Brazil) / University of Illinois (US), an MBA from Fundação Getulio Vargas (Brazil), and has more than 15 years of experience in the seed business.

MANAGEMENT REVIEW

Mr. Federico Trucco, Chief Executive Officer of Bioceres, commented: "We are thrilled to report a record setting quarter for our Company, with comparable revenues at $90.3 million and LTM Adjusted EBITDA at $61.8 million, excluding HB4 pre-launch costs. Our very strong performance during the second quarter contributed to a 72% growth in revenues year-to-date, with robust growth across all three business segments. We are also very proud to report that our combined growth in Europe and the United States (at 146% for the period) places these important geographies close to 10% of our global revenues, a huge step forward in our international diversification strategy".

"On the HB4 front, I would like to mention the announcement in November by the Brazilian National Biosafety Commission (CTNBio), that decided unanimously to approve the import certification for HB4 wheat flour for human and animal consumption in that country. This approval is a major milestone and a key step in Bioceres’ mission to build agricultural systems that enhance carbon sequestration and climate resiliency, and is a necessary step for a commercial launch in the upcoming planting season. We are now in a position to estimate an incremental EBITDA contribution for HB4 Wheat of $15-20M for fiscal year 24", concluded Trucco.

Mr. Enrique Lopez Lecube, Chief Financial Officer of Bioceres, added, "We had a great quarter that built on top of the momentum our business had experienced in previous quarters; LTM adjusted EBITDA excluding HB4 pre-launch costs grew 46% year over year and 15% on a sequential basis. The main drivers behind the quarter’s numbers were a remarkable commercial performance and market penetration of scaling technologies. Micro-beaded fertilizers delivered record growth, while inoculants and seed treatment pack sales were outstanding in North America and Europe. It is exciting to think about the prospect of adding to this business the EBITDA target we have now set for HB4 Wheat."

"During the quarter we further fortified our balance sheet with a $20 million issuance of 3-year maturity corporate bonds in our subsidiary Rizobacter. The strong financial performance of our baseline business combined with a stable debt structure and liquidity position provides a solid foundation for growth," concluded Lecube.

Key Operational Metrics (In millions of US dollars, unless where otherwise stated)

Table 1: Key Financial Metrics

2Q22

As Reported

% Change

Revenue by Segment

2Q21

2Q22

Reported

Comparable1

Crop Protection

27.1

47.3

75%

76%

Seed and Integrated Products

12.5

16.1

29%

26%

Crop Nutrition

9.2

29.3

218%

212%

Total Revenue

48.7

92.7

90%

89%

Gross Profit

23.7

37.3

58%

69%

Gross Margin

48.6%

40.3%

(827 bps)

(563 bps)

Adjusted EBITDA

14.3

19.7

38%

HB4 pre-launch costs

0.2

3.0

1461%

Baseline Business Adjusted EBITDA

14.5

22.7

57%

Baseline Business Adjusted EBITDA Margin

29.7%

24.5%

(524 bps)

1. Comparable excludes the impact of IAS29 as discussed in more detail on page 15.

Table 2: HB4 Wheat Metrics

Hectares

Number of Varieties

Growers

Contributed goods1

FY20 7,000

FY20 2 (1st Gen)

FY20 25

FY20 1.4M

FY21 53,000

FY21 3 (1st Gen)

FY21 225

FY21 6.4M

657%

4 (2nd Gen)

800%

303%

Table 3: HB4 Soy Metrics

Hectares

Number of Varieties

Growers

Contributed goods1

FY21 23,000

FY21 4 (1st Gen)

FY21 148

FY21 2.2M

FY22 23,000

3 (2nd Gen)

FY22 102

FY22 2.0M

-%

FY22 3 (2nd Gen)

(31%)

(10%)

9 (3rd Gen)

1 Metric will be used to account for and track the underlying economic performance of our HB4 Wheat and HB4 Soy Program ahead of reporting HB4 revenues and related accounting measures. By publishing the level of contributed goods, the investment community can also use this information to better gauge our progress.

For a full version of Bioceres Fiscal Second Quarter 2022 Earnings Release, click here.

FISCAL SECOND QUARTER 2022 EARNINGS CONFERENCE CALL

Bioceres Chairman & Chief Executive Officer Federico Trucco, Chief Financial Officer Enrique Lopez Lecube and Head of Investor Relations Rodrigo Krause will host the conference call followed by a question-and-answer session. The conference call will be accompanied by a presentation, which can be viewed during the webcast or accessed via the investor relations section of the company’s website here.

To access the call, please use the following information:

Date:

Thursday, February 10, 2022

Time:

8:30 a.m. EST, 5:30 a.m. PST

Toll Free dial-in number:

1-844-200-6205

Toll/International dial-in number:

1-929-526-1599

Conference ID:

510191

Webcast:

Click here

Please call the conference telephone number 5-10 minutes prior to the start time. An operator will register your name and organization. If you have difficulty connecting with the conference call, please contact MZ Group at +1 (949) 491-8235.

The conference call will be broadcast live and available for replay here and via the investor relations section of the company’s website here.

A replay of the call will be available through February 17, 2022 following the conference.

Toll Free Replay Number:

1-866-813-9403

International Replay Number:

+44 204 525 0658

Replay ID:

510901

About Bioceres Crop Solutions Corp.

Bioceres Crop Solutions Corp. (NASDAQ: BIOX) is a fully integrated provider of crop productivity technologies designed to enable the transition of agriculture towards carbon neutrality. To do this, Bioceres’ solutions create economic incentives for farmers and other stakeholders to adopt environmentally friendlier production practices. The Company has a unique biotech platform with high-impact, patented technologies for seeds and microbial ag-inputs, as well as next generation Crop Nutrition and Protection solutions. Through its HB4® program, the Company is bringing digital solutions to support growers’ decisions and provide end-to-end traceability for production outputs. For more information, visit here.

Forward-Looking Statements

This communication includes "forward-looking statements" within the meaning of the "safe harbor" provisions of the United States Private Securities Litigation Reform Act of 1995. Forward-looking statements may be identified by the use of words such as "forecast," "intend," "seek," "target," "anticipate," "believe," "expect," "estimate," "plan," "outlook," and "project" and other similar expressions that predict or indicate future events or trends or that are not statements of historical matters. Such forward-looking statements include estimated financial information and, among others, statements related to the expected or potential impact of the novel coronavirus (COVID-19) pandemic, and the related responses by governments, clients and the Company, on our business, financial condition, liquidity position and results of operations, and any such forward-looking statements, whether concerning the COVID-19 pandemic or otherwise, involve risks, assumptions and uncertainties. These forward-looking statements include, but are not limited to, whether (i) the health and safety measures implemented to safeguard employees and assure business continuity will be successful, (ii) the uncertainty related to COVID-19 in the farming community will be short lived, and (iii) we will be able to coordinate efforts to ramp up inventories. Such forward-looking statements are based on management’s reasonable current assumptions, expectations, plans and forecasts regarding the Company’s current or future results and future business and economic conditions more generally. Such forward-looking statements involve risks, uncertainties and other factors, which may cause the actual results, levels of activity, performance or achievement of the Company to be materially different from any future results expressed or implied by such forward-looking statements, and there can be no assurance that actual results will not differ materially from management’s expectations or could affect the Company’s ability to achieve its strategic goals, including the uncertainties relating to the impact of COVID-19 on the Company’s business, operations, liquidity and financial results and the other factors that are described in the sections entitled "Risk Factors" in the Company's Securities and Exchange Commission filings updated from time to time. The preceding list is not intended to be an exhaustive list of all of our forward-looking statements. Therefore, you should not rely on any of these forward-looking statements as predictions of future events. All forward-looking statements contained in this release are qualified in their entirety by this cautionary statement. Forward-looking statements speak only as of the date they are or were made, and the Company does not intend to update or otherwise revise the forward-looking statements to reflect events or circumstances after the date of this release or to reflect the occurrence of unanticipated events, except as required by law.

Unaudited Consolidated Statement of Comprehensive Income (Figures in US dollars)

Three-month

period ended

12/31/2021

Three-month

period ended

12/31/2020

Six-month

period ended

12/31/2021

Six-month period

ended 12/31/2020

Total revenue

92,662,853

48,738,690

159,679,098

91,093,951

Cost of sales

(55,332,989)

(25,073,842)

(93,325,442)

(48,186,484)

Gross profit

37,329,864

23,664,848

66,353,656

42,907,467

% Gross profit

40%

49%

42%

47%

Operating expenses

(20,198,593)

(12,334,536)

(37,813,335)

(23,450,991)

Share of profit of JV

1,141,323

65,975

919,087

305,687

Other income or expenses, net

(571,365)

135,132

(1,717,982)

140,322

Operating profit

17,701,229

11,531,419

27,741,426

19,902,485

Finance result

(8,221,621)

(5,896,874)

(13,401,289)

(18,632,336)

Profit before income tax

9,479,608

5,634,545

14,340,137

1,270,149

Income tax

(4,141,102)

(3,835,587)

(6,736,415)

(5,841,453)

Profit/ (Loss) for the period

5,338,506

1,798,958

7,603,722

(4,571,304)

Other comprehensive profit / (loss)

5,472,717

658,996

11,201,854

795,127

Total comprehensive Profit / (Loss)

10,811,223

2,457,954

18,805,576

(3,776,177)

Profit / (loss) for the period attributable to:

Equity holders of the parent

3,427,093

648,193

4,301,230

(6,323,365)

Non-controlling interests

1,911,413

1,150,765

3,302,492

1,752,061

5,338,506

1,798,958

7,603,722

(4,571,304)

Total comprehensive income / (loss) attributable to:

Equity holders of the parent

7,660,743

1,244,596

13,382,802

(5,789,271)

Non-controlling interests

3,150,480

1,213,358

5,422,774

2,013,094

10,811,223

2,457,954

18,805,576

(3,776,177)

Unaudited Consolidated Statement of Financial Position (Figures in US dollars)

ASSETS

12/31/2021

06/30/2021

CURRENT ASSETS

Cash and cash equivalents

36,187,804

36,046,113

Other financial assets

3,696,803

11,161,398

Trade receivables

119,285,056

88,784,172

Other receivables

17,822,854

11,153,705

Income and minimum presumed income taxes recoverable

1,072,748

990,881

Inventories

87,308,712

61,037,551

Biological assets

8,142,920

2,315,838

Total current assets

273,516,897

211,489,658

NON-CURRENT ASSETS

Other financial assets

832,159

1,097,462

Trade receivables

121,234

135,739

Other receivables

1,810,645

2,543,142

Income and minimum presumed income taxes recoverable

31,112

12,589

Deferred tax assets

5,689,401

3,278,370

Investments in joint ventures and associates

34,054,957

30,657,173

Property, plant and equipment

48,946,555

47,954,596

Intangible assets

72,563,018

67,342,362

Goodwill

29,904,359

28,751,206

Right-of-use leased asset

1,488,608

1,327,660

Total non-current assets

195,442,048

183,100,299

Total assets

468,958,945

394,589,957

LIABILITIES

12/31/2021

06/30/2021

CURRENT LIABILITIES

Trade and other payables

107,583,347

72,091,408

Borrowings

48,141,499

76,785,857

Employee benefits and social security

6,472,078

4,680,078

Deferred revenue and advances from customers

7,110,046

6,277,313

Income tax payable

11,687,238

7,452,891

Lease liabilities

635,240

750,308

Total current liabilities

181,629,448

168,037,855

NON-CURRENT LIABILITIES

Borrowings

90,738,228

47,988,468

Government grants

-

784

Investments in joint ventures and associates

616,173

1,278,250

Deferred tax liabilities

24,597,731

25,699,495

Provisions

484,490

449,847

Consideration for acquisitions

12,443,071

11,790,533

Convertible notes

48,890,332

48,664,012

Lease liability

570,505

390,409

Total non-current liabilities

178,340,530

136,261,798

Total liabilities

359,969,978

304,299,653

EQUITY

Equity attributable to owners of the parent

81,743,560

67,743,242

Non-controlling interests

27,245,407

22,547,062

Total equity

108,988,967

90,290,304

Total equity and liabilities

468,958,945

394,589,957

View source version on businesswire.com: https://www.businesswire.com/news/home/20220210005420/en/

Contacts

Investor Relations Contact
Chris Tyson
Executive Vice President
MZ Group – MZ North America
(949) 491-8235
BIOX@mzgroup.us
www.mzgroup.us

Bioceres Crop Solutions
Rodrigo Krause
Head of Investor Relations
investorrelations@biocerescrops.com