In This Article:
Release Date: November 12, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
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Verde AgriTech Ltd (VNPKF) has implemented cost reduction strategies, resulting in a decrease in general and administrative expenses by 21% in the quarter.
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The company has successfully renegotiated 92% of its debt, moving most of it to long-term, which will help stabilize financials.
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Verde AgriTech Ltd (VNPKF) is focusing on developing the market to fully utilize its 3 million tons of production capacity without additional CapEx.
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The company is actively working on carbon footprint reduction, which could provide a competitive edge in the future.
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Verde AgriTech Ltd (VNPKF) is exploring opportunities to monetize its rare earth assets, potentially creating additional value for shareholders.
Negative Points
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The Brazilian agricultural market is facing high interest rates, which are detrimental to farmers and the agriculture sector.
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There is a significant increase in bankruptcy protections among farmers and distributors, impacting Verde AgriTech Ltd (VNPKF)'s credit policies and sales.
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The company is experiencing challenges in collecting sales from previous years due to the unstable credit situation in Brazil.
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Verde AgriTech Ltd (VNPKF) has seen a reduction in sales volume and revenue, with a decrease in average revenue per ton.
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The market conditions have made it difficult for the company to offer competitive credit terms, affecting its ability to close sales.
Q & A Highlights
Q: How is Verde AgriTech addressing the issue of losing customers due to consultants' affiliations with other fertilizer producers? A: Christian Geloso, CEO, explained that Verde AgriTech is actively engaging with key consultants in target areas through face-to-face communication to address any issues. Despite some consultants having commercial relationships with other suppliers, Verde is focusing on technical merits and relationship-building to reverse this trend.
Q: Is Verde AgriTech considering focusing on organic growers further away from their current focus areas? A: Christian Geloso, CEO, stated that while they are addressing organic growers, the market in Brazil is currently small. The company is focusing on larger markets with higher demand potential but remains committed to serving organic farmers as part of their broader strategy.
Q: What is Verde AgriTech's strategy for managing credit risks in the current challenging market environment? A: Felipe Paci, CFO, highlighted that Verde has become conservative in offering credit due to increased bankruptcy protections among farmers and distributors. The company is focusing on stricter credit policies to mitigate risks and ensure financial stability.