WINNIPEG, MANITOBA, CANADA — Ag Growth International Inc. (AGI) saw record levels of trade sales and earnings before income, tax, depreciation and amortization (EBITDA) for the year ended Dec. 31.
For the year, the company reported EBITDA of C$148.2 million for 2018, up from C$121.2 million and trade sales of C$934 million, up from C$750.3 million. In the fourth quarter, EBITDA was C$28 million, up from C$19.7 million and trade sales were C$214.2 million, up from C$167.7 million.
"A strong fourth quarter closed off a record year for AGI in 2018,” said Tim Close, president and chief executive officer of AGI. "We made significant progress against our 5-6-7 strategy throughout 2018, resulting in organic sales growth of 12.8%. We kicked off 2019 with three acquisitions as AGI added significantly to its Food platform and made two transformational additions, one to its technology platform and more recently to establish a solid platform in India. Moving into 2019, a prolonged winter has impacted projects and deliveries, pushing some sales into the second quarter, however we expect continued organic growth in 2019 augmented with significant contributions from acquisitions."
Trade sales and adjusted EBITDA increased significantly in the fourth quarter of 2018 due to strength in international markets, continued momentum in the Canadian Commercial market and contributions from acquisitions.
Adjusted EBITDA as a percentage of sales in the quarter reflected seasonal patterns and was consistent with 2017.
AGI Brazil posted a loss for the quarter, despite an increase in sales, largely due to a significant warranty provision related to damaged steel and expenses incurred in delivery and assembly as we improve our distribution model in Brazil, the company said.
Trade sales and adjusted EBITDA for the year ended Dec. 31, 2018 were at record levels, significantly exceeding 2017 results.
Farm sales increased over 2017 as higher sales in the U.S. and contributions from acquisitions more than offset an expected decrease in Canada from record 2017 levels. Continued momentum in the Canadian grain and fertilizer platforms along with robust international demand resulted in a significant increase in Commercial sales over the prior year.
Looking ahead to 2019, AGI anticipates sales and adjusted EBITDA will increase significantly.
Positive farm demand drivers in North America are expected to drive sales growth in grain storage systems and portable handling equipment. Commercial sales are expected to be very strong in Canada and internationally.
“Based on existing backlogs, quoting activity and positive demand drivers, management expects record results in 2019 and looks forward with excitement to the upcoming fiscal year,” AGI said.