CERES GLOBAL AG CORP. REPORTS FOURTH QUARTER AND STRONG YEAR END RESULTS FOR FISCAL YEAR 2022

MINNEAPOLIS, Sept. 9, 2022 /CNW/ - Ceres Global Ag Corp. (TSX: CRP) ("Ceres" or the "Corporation") today announced its financial and operating results for the quarter and year ended June 30, 2022. All amounts are in U.S. dollars unless otherwise noted.

Highlights for the fourth quarter and fiscal year ended 30 June 2022
(Comparisons to the fourth quarter and fiscal year ended 30 June 2021)

• Strong annual results driven by strong performance across core operations, consistent volumes and effective risk management;
• Annual gross profit and income from operations grew by more than 100% compared to fiscal year 2021, adjusted net income grew by 76% compared to fiscal year 2021;  
• Fourth quarter gross profit, income from operations and net income were all down, due to lower ending inventories across the industry and less volume merchandized and traded;
• At June 30, 2022, Ceres had $54.1 million in working capital compared to $39.2 million in working capital at June 30, 2021;
• Subsequent to quarter end, Carlos Paz was appointed CEO and President of the Corporation;
• On June 3, 2022, Ceres, through its wholly owned subsidiary, Riverland Ag, completed the purchase of Columbia Grain International, LLC's 50% membership interest in Berthold Farm Elevator, a grain originator and merchandiser with locations in Berthold, ND and Carpio, ND.;
• On June 20, 2022, the Corporation closed on the sale of St Agathe Bird Food facility and recognized a gain of $3.7 million;
• On June 24, 2022, Ceres announced the suspension of the crush plant project at Northgate and incurred a $25.9 million loss in the write-off of the applicable capital expenditures incurred to date.

CEO Commentary

"Ceres realized its strongest annual operating financial performance during FY2022. Our team was able to successfully navigate the price changes in grain and oilseed markets, industrial product volumes continued their upward trend in the supply chain segment and we realized attractive revenues in our seed and processing business." Carlos Paz, President and CEO of Ceres commented. "We have maintained our positive trajectory of financial performance increasing our revenue by 42% and income from operations by 170%, compared to FY2021."

Mr. Paz added, "Over the past quarter, we made meaningful progress on the growth strategy that we have been working towards for the past several years. We completed the acquisition of 50% ownership of Berthold Farmers Elevator, LLC and, subsequent to quarter end, completed the expansion of the grain elevator in Thief River Falls, early and on budget."

"During the quarter, we also announced the suspension of the Canola Crush plant at Northgate as we reexamine the economics of the project. We will be sure to update the market with our plans for a new project once they begin to take shape. In the meantime, Ceres remains focused on leveraging our network of assets to bring solutions to our customers and generate positive financial results."

Summary Financial and Operational Results

(in thousands of USD except per share amounts)	3-Months Ended June 30, 2022	3-Months Ended June 30, 2021	12-Months Ended June 30, 2022	12-Months Ended June 30, 2021
Revenue	278,150	196,929	1,060,941	748,204
Gross profit	3,693	8,756	55,875	24,918
Income from operations	(329)	3,875	23,973	8,865
Net income (loss)	(22,537)	11,733	(8,823)	12,044
Earnings (loss) per basic share	(0.73)	0.38	(0.29)	0.39
Adjusted net income^2	5,028	12,067	21,824	12,378
EBITDA1	2,724	5,477	32,038	14,808

 

1, 2. See the Non-IFRS Financial Measures and Reconciliations section

Outlook 

Mr. Paz continued, "In Q1 2023, we expect to see a rise in handled bushels as inventories were lower as we ended the 2021/2022 crop year. While unclear weather patterns are creating challenges around anticipating harvest conditions, supply and quality, Ceres and its network of partners are well positioned to manage any challenges that this season's crop delivers."

"More broadly, I am excited for the opportunities that lay ahead for 2023 and beyond," said Mr Paz. "As we reflect on the past several years, Ceres has been able to capitalize on creating new partnerships and focus on growth through acquisitions. As we enter the next year, our focus will shift from acquisitions to leveraging our existing partnerships, developing regenerative agriculture and supply chain solutions for our customers and utilizing our network of assets to maximize revenue generation."

Conference Call Details

Management of Ceres will host a conference call today, September 9, 2022, at 8:30 a.m. ET.  All interested parties can join the conference call by dialing 1-888-220-8451 or 1-647-484-0475. Please dial in 15 minutes prior to the call to secure a line.

A live audio webcast of the conference call will be available at: https://bit.ly/CERESQ42022. Please connect at least 15 minutes prior to the conference call to ensure adequate time for any software download that may be required to join the webcast. An archived replay of the webcast will be available for 90 days.

Non-IFRS Financial Measures and Reconciliation

^1. EBITDA (Earnings before Interest, Taxes, Depreciation and Amortization) is not a standardized financial measure prescribed by IFRS; however, it is a metric that is used by management to determine the Corporation's ability to service its debt and finance capital.

In calculating EBITDA, Ceres excludes gains and losses on property, plant and equipment, assets held for sale, and gains and losses on equity investments. Ceres may calculate EBITDA differently than other companies; therefore, Ceres' EBITDA may not be comparable to similar measures presented by other issuers.

Investors are cautioned that EBITDA should not be construed as an alternative to net income or loss, or to other standardized financial measures determined in accordance with IFRS and is not intended to represent cash flows or results of operations in accordance with IFRS. See the table below for the reconciliation of EBITDA.

(in thousands of USD)	3-Months Ended June 30, 2022	3-Months Ended June 30, 2021	12-Months Ended June 30, 2022	12-Months Ended June 30, 2021
Net income (loss) for the period	(22,537)	11,733	(8,823)	12,044
Interest expense	1,126	1,596	4,770	5,243
Amortization of intangible assets	66	65	263	262
Income tax (recovery)	(345)	(9,712)	5,906	(9,768)
Share of net (income) loss in investment in associates	577	67	802	369
Depreciation and amortization	1,658	1,728	6,960	6,695
Gain (loss) on property, plant and equipment	(3,725)	-	(3,744)	(37)
Crush plant impairment	25,904	-	25,904	-
EBITDA	2,724	5,477	32,038	14,808

^2. Adjusted net income is not a standardized financial measure prescribed by IFRS; however, it is a metric that the Corporation believes can provide useful information to investors and shareholders as it can be used to evaluate the performance of the business. Adjusted net income excludes major one-time write offs as well as legal fees that relate to special matters. See the table below for the reconciliation of adjusted net income.

(in thousands of USD)	3-Months Ended June 30, 2022	3-Months Ended June 30, 2021	12-Months Ended June 30, 2022	12-Months Ended June 30, 2021
Net income (loss) for the period	(22,537)	11,733	(8,823)	12,044
Crush plant impairment	25,904	-	25,904	-
Special matters legal expense	1,661	334	4,743	334
Adjusted net income	5,028	12,067	21,824	12,378

About Ceres Global Ag Corp.

Ceres and its subsidiaries add value across agricultural, energy and industrial supply chains through efficient sourcing, storing, transporting and marketing of high‐quality agricultural commodities, value‐ added products and raw materials. Leveraging its network of commodity logistics centers and team of industry experts, Ceres connects farmers to customers around the world.

Ceres is headquartered in Minneapolis, Minnesota, and together with its affiliated companies, operates 12 locations across Saskatchewan, Manitoba, Ontario, and Minnesota. These facilities have an aggregate grain and oilseed storage capacity of approximately 31 million bushels.

Ceres has a 50% interest in Savage Riverport, LLC (a joint venture with Consolidated Grain and Barge Co.), a 50% interest in Berthold Farmers Elevator, LLC (a joint venture with The Berthold Farmers Elevator Company), a 50% interest in Farmers Grain, LLC (a joint venture with Farmer's Cooperative Grain and Seed Association), a 50% interest in Gateway Energy Terminal (an unincorporated joint venture with Steel Reef Infrastructure Corp.), a 25% interest in Stewart Southern Railway Inc. (a short‐line railway located in southeast Saskatchewan with a range of 130 kilometers), and a 17% interest in Canterra Seed Holdings Ltd. (a Canada‐based seed development company).

For more information about Ceres, please visit www.ceresglobalagcorp.com

Forward-looking Statements

This news release contains "forward-looking information" within the meaning of applicable Canadian securities legislation and United States securities laws. Forward-looking information may include, but is not limited to, statements regarding future operations and results, anticipated business prospects and financial performance of Ceres and its subsidiaries, including the plans, costs, timing and capital for the further development of the Northgate Commodities Logistics Centre, expectations or projections about the future, strategies and goals for growth, expected and future cash flows, costs, planned capital expenditures, regulatory change, general economic political and market conditions anticipated capital projects, construction and completion dates, operating and financial results, critical accounting estimates, the expected financial and operational consequences of future commitments. Generally, forward-looking information can be identified by the use of forward-looking terminology such as "plans", "expects" or "does not expect", "is expected", "budget", "scheduled", "estimates", "forecasts", "intends", "anticipates" or "does not anticipate", "believes", "may have implications" or variations of such words and phrases or statements that certain actions, events or results "may", "could", "would", "might", or "will be taken", "occur", or "be achieved". Forward-looking information is based on the opinions and estimates of management at the date the information is made and is based on a number of assumptions and subject to a variety of risks and uncertainties and other factors that could cause actual events or results to differ materially from those projected in the forward-looking information. Key assumptions upon which such forward-looking information is based are listed in the "Forward-Looking Information" section of the MD&A for the period ended December 31, 2021. Many such assumptions are based on factors and events that are not within the control of Ceres and there is no assurance they will prove to be correct. Factors that could cause actual results to vary materially from results anticipated by such forward-looking information include, among others, risks related to weather, politics and governments, changes in environmental and other laws and regulations, competitive factors in agricultural, food processing and feed sectors, construction and completion of capital projects, labour, equipment and material costs, access to capital markets, interest and currency exchange rates, technological developments, global and local economic conditions, the ability of Ceres to successfully implement strategic initiatives and whether such strategic initiatives will yield the expected benefits, the operating performance of the Corporation's assets, the availability and price of commodities and regulatory environment, processes and decisions. Although Ceres has attempted to identify important factors that could cause actual actions, events or results to differ materially from those described in forward-looking information, there may be other factors that cause actions, events or results that are not anticipated, estimated or intended. There can be no assurance that forward-looking information will prove to be accurate, as actual results and future events could differ materially from those anticipated in such information. Ceres undertakes no obligation to update forward-looking information if circumstances or management's estimates or opinions should change, except as required by applicable securities laws. The reader is cautioned not to place undue reliance on forward-looking information.

SOURCE Ceres Global Ag Corp.

Carlos Paz, President and Chief Executive Officer, Ceres Global Ag Corp., 1-647-484-0475, [email protected]; Anna Speyer, Investor Relations Manager, NATIONAL Capital Markets, 416-848-1376, [email protected]