Verbio (VBK) Q4 23/24 earnings summary

Executive summary

• Achieved record production: over 1 million tonnes of liquid biofuels and more than 1.1 TWh RNG, resulting in 4.4 million tonnes of CO2 savings in FY 2023/24, despite a challenging market environment.

• Advanced growth initiatives with commercial ethanol and RNG production in Nevada, expanded capacity in South Bend, and launched a trading unit in Geneva to optimize global flows.

• Progressed on strategic projects, including a specialty chemicals facility in Bitterfeld and continued expansion in North America.

Financial highlights

• Full-year EBITDA reached €121.6 million, down from €240.3 million in the prior year, but in line with revised guidance, impacted by market factors, fraudulent Chinese biodiesel imports, and US growth investments.

• Q4 EBITDA was €39.5 million, showing strong year-over-year and sequential improvement due to widening biodiesel spreads and higher bioethanol margins.

• Net debt increased to €32.9 million at year-end, mainly from over €180 million in growth investments; equity ratio remained strong at 67.4%.

• Revenue for Q4 declined to €197 million due to accounting changes and processing contracts in Canada, but EBITDA margin improved.

• Significant improvement in cash generation year-over-year, offset by focused growth investments.

Outlook and guidance

• FY 2024/25 EBITDA guidance set at €120–160 million, implying up to 15% growth at the midpoint.

• Maximum net debt expected at €190 million for FY 2024/25, with CapEx focused on South Bend and Bitterfeld projects.

• Biodiesel, bioethanol, and biomethane capacities to remain stable or increase, with high utilization rates projected; North America expected to be EBITDA positive, with gains partly offset by negative GHG quota impacts.

• Anticipates higher plant utilization and stable ethanol margins in Europe, with further increases in RNG production; biodiesel margins expected to fall due to tight vegetable oil markets.