Lavoro Reports Fiscal Fourth Quarter 2024 Earnings Results¹

Core Insights - Lavoro Limited reported FY2024 revenue of $1.89 billion, a 5% increase year-over-year, driven by market share gains and sales volume growth despite deflationary input price pressures [1][6] - The company experienced a net loss of $154.6 million for FY2024, significantly higher than the previous year's loss of $43.7 million, attributed to declining gross profit and increased finance costs [4][6] - Adjusted EBITDA for FY2024 was $53.4 million, down from $150.1 million in the prior year, reflecting lower gross profit and higher operating expenses [5][6] Financial Performance - FY2024 gross profit decreased by 19% to $268.4 million, with gross margins compressing by 430 basis points to 14.2% due to input price deflation and an unfavorable product mix [3][4] - In 4Q24, consolidated revenue increased by 2% year-over-year to $271.1 million, with Grains revenue growing by 41% to $68.3 million, while Inputs revenue declined by 6% to $202.8 million [8][13] - The Crop Care segment saw a revenue increase of 87% to $19.9 million in 4Q24, driven by strong performance in specialty fertilizers [27][29] Segment Analysis - Brazil Ag Retail segment revenue decreased by 2% to $192.5 million in 4Q24, with Inputs revenue declining by 16% to $124.8 million [17][21] - Latam Ag Retail segment revenue increased by 5% to $65.2 million, with gross profit rising by 10% to $10.4 million [23][24] - Crop Care segment gross profit declined by 29% to $5.8 million in 4Q24, with gross margins dropping to 28.9% from 75.9% in the prior year [28][29] Outlook - For FY2025, Lavoro expects Brazil's Ag inputs retail market to decline by approximately 10%, with projected consolidated revenue between R$8.60 billion and R$9.20 billion [31][32] - The company anticipates Adjusted EBITDA growth relative to FY2024, despite the challenging market conditions [31][32]