Verbio (VBK) Q2 24/25 earnings summary

Executive summary

• Achieved record or increased production volumes in ethanol, RNG, and biomethane, driven by improved utilization at key plants, despite operational and technical challenges, especially in the U.S.

• Revenue declined 17% year-over-year to EUR 751.6 million for H1 2024/2025, with EBITDA and net result falling sharply due to lower product margins and weak GHG quota prices.

• Biodiesel segment delivered strong or improved margins and stable production, supported by effective margin management and favorable rapeseed oil purchases.

• Major growth projects, including the ethenolysis plant in Bitterfeld, are progressing, with first renewable molecules expected in 2026.

• The German GHG quota market remains challenging due to oversupply and fraud, but stabilization measures and regulatory amendments are underway.

Financial highlights

• H1 2024/25 EBITDA was EUR 14.3 million, down from EUR 74.9 million or EUR 97.0 million year-over-year, with Q2 EBITDA rebounding to EUR 20.8 million or EUR 26.1 million from negative Q1.

• Net debt increased to EUR 97 million at December 31, 2024, mainly due to ongoing investments.

• Capital expenditures for H1 were EUR 61.9 million or EUR 62 million, with equity ratio stable near 65%.

• Operating cash flow remained positive but declined to EUR 6.2 million, mainly due to higher inventories.

Outlook and guidance

• EBITDA guidance for FY 2024/2025 was revised downward to a mid double-digit million euro range due to technical issues at the Nevada plant and slow GHG quota price recovery.

• Net financial debt is expected to remain capped at or below EUR 190 million.

• Management anticipates GHG quota price recovery to accelerate over the course of the year and significant market improvement in 2025.

• Focus is shifting to free cash flow growth, plant modernization, and cost-out investments, with strategic growth projects under review.