Equipment supplier Ag Growth International (AGI) reported first-quarter adjusted profit of C$5 million ($0.27 adjusted profit per share) on trade sales of $216.2 million, compared to the year-ago $11.5 million ($0.70 per share) and $214.1 million, respectively. AGI said profit decreased largely due to higher tax expense, the result of an income tax recovery in first-quarter 2018, and non-cash interest expense related to AGI’s credit facility renewal in fourth-quarter 2018 and AGI’s 2014 debentures.
First-quarter adjusted EBITDA held near even with year-ago levels, at $30.6 million versus $30.7 million. The company said EBITDA remained consistent despite the impact of a long winter and the timing of international sales.
“A very busy first quarter saw us close three important acquisitions,” said AGI President and CEO Tim Close. “Our platform acquisition of Milltec in India provided AGI with expertise in rice milling solutions as well as a deep management team, beginning a new era for AGI given the significant growth opportunities in the rice vertical and in India and Southeast Asia.
“The Bin Manager sensor network and Field Data Manager tools, brought together in IntelliFarms’ SureTrack grain management solution, opens new ways for us to add unique value for our customers and further differentiate AGI. The acquisition of Improtech expanded our Food platform and provided AGI with additional expertise within the food and beverage industry,” added Close.
Going forward, AGI said its outlook is positive, with healthy backlogs in key businesses.
In North America, AGI said successive large crops have resulted in sustained demand for AGI Farm equipment, particularly for portable grain handling equipment, while sales and backlogs of grain drying and aeration equipment have benefited from market share growth and wet conditions throughout North America.
Orders for grain storage systems in the U.S. have been negatively impacted by difficult winter conditions, but management anticipates backlogs to grow in the near-term as U.S. farmers remain incentivized to add storage due to low commodity prices and a shortfall in existing storage capacity.