VERBIO Reports Downturn in Q3 Earnings Amid Volatile Market Conditions

On May 14, 2024, VERBIO released its financial results for Q3 2023/24, observing a decrease in earnings before interest, taxes, depreciation, and amortisation (EBITDA) to EUR 82.1 million, down by 62% from the previous year's EUR 213.5 million. The drop was attributed to lower sales prices and start-up costs for their U.S. expansion projects, even as production and sales volumes hit record highs.

The company reported a net financial debt of EUR 55.0 million as of March 31, 2024, a significant shift from a net financial asset position earlier in June 2023. Despite these challenges, Group revenue for the initial three quarters dropped by 13% year-on-year, amounting to EUR 1,318.1 million, largely due to reduced sales prices for biofuels.

Specifically, during Q3 2023/24, VERBIO achieved EBITDA of EUR 7.3 million, a stark reduction compared to EUR 43.2 million in Q3 2022/23. The company cited further decline in product margins and lower green-house gas (GHG) premiums as primary reasons for the downturn. However, amidst these financial pressures, VERBIO stays optimistic about Q4, projecting significant improvements from measures like better product margins and increased operational efficiency at the South Bend plant in Indiana.

Additionally, VERBIO's growth ventures in the U.S., particularly in South Bend and Nevada, Iowa, are progressing well with increases in production and nearing commercial output at the Nevada biorefinery. The company's shift towards these new markets is seen as pivotal in stabilizing earnings amidst fluctuating European markets.