Norofert reports net profit of 1.85 million RON in the first half of 2024

Norofert, leader in regenerative agriculture research and one of the most significant input producers in Romania, listed on the Bucharest Stock Exchange on the AeRO market, ended the first half of 2024 with a revenue of RON 21.04 million, marking a 4.27 percent increase compared to the same period in 2023.

The net profit recorded in the first semester of 2024 was RON 1.85 million, down from the same period in 2023 but above budgeted levels. Additionally, Norofert ended the half of the year with a cash position of RON 1.09 million, an increase from the previous year, indicating improved liquidity and the company’s capacity to support future development opportunities.

Vlad Popescu, President of the Board, Norofert: „We remain firmly committed to strategic investments aimed at development and strengthening long-term profitability. Since our listing on the stock exchange, we have invested over EUR 17 million in our research and production capabilities in the input sector and agricultural farming and in expanding into international markets. In the first part of the year, we completed the production line in the USA and signed a distribution contract for the regions of South Dakota, North Dakota, and Minnesota. Recently, we announced our entry into the Brazilian market. Norofert’s strategy focuses on two pillars: developing adaptable solutions through continuous innovation and international expansion.”

Key consolidated figures for H1 2024:

• The Group’s fixed assets increased by nearly 26 percent to RON 27.6 million, primarily due to investments in irrigation systems and the research laboratory. These assets are essential for the company’s development strategy, enabling the production of a broader range of products and ensuring a better competitive position in the market.
• Receivables decreased by approximately 26 percent to RON 38.8 million, with the company maintaining a high collection rate (over 96 percent) despite the agricultural sector facing a very challenging year.
• Total liabilities declined by nearly 4 percent compared to last year’s period, reaching RON 62.4 million, due to early repayments of certain credit facilities.
• Operating revenues reached RON 25.1 million, down about 4 percent year-on-year. Farming activity performed weaker in the first half, but revenues are expected to rise in the second half as harvests begin processing.
• Operating expenses increased by nearly 5 percent compared to the previous year, totaling approximately RON 21 million, mainly influenced by rising material costs for crop establishment inputs.
• Under the conditions mentioned above, the net result recorded is RON 1.8 million, down 40 percent compared to the result recorded in the first half of 2023.

Announced investments in the first six months of 2024

In Romania: The company announced the completion of the first phase of the research laboratory in Filipeștii de Pădure and secured a loan of RON 4.1 million, through the IMM INVEST Plus program to purchase pivot irrigation systems and equipment. The funds are being used to finalize the irrigation system on 340 hectares out of the 1,000 hectares operated under organic management at the Zimnicea Farm. The total value of the investment project is approximately RON 4.9 million, with the company’s contribution from its sources being 15 percent.

In the USA: Norofert inaugurated a production line in Watertown, South Dakota, in May 2024, with a capacity of 8,000 liters per day. This facility allows the company to produce specialized inputs for soil health and foliar nutrition, utilizing bacteria produced in the Filipeștii de Pădure laboratory. The investment of EUR 250,000 for assembling the input production line was carried out through Norofert AG, a company established in partnership with Gary Lamb, an entrepreneur with over 30 years of experience in agribusiness in the Midwest, USA. Additionally, the company signed a distribution contract with one of the major distributors in Watertown, covering the regions of South Dakota, North Dakota, and Minnesota.

Financial results for the first half of 2024 are presented according to RAS (Romanian Accounting Standards) and under IFRS (International Financial Reporting Standards). The group’s consolidated results include the performance of the parent company, Norofert S.A., as well as that of the 100 percent owned subsidiary Agroprod CEV S.R.L. Agroprod CEV cultivates 1,000 hectares of agricultural land under organic management in Zimnicea, Teleorman County. The consolidation also includes 51 percent of the results from NOROFER AG LLC.