Consolidated Unaudited Interim Report of AS PRFoods for the 4th quarter and 12 months of 2022/2023 financial year

Consolidated Unaudited Interim Report of AS PRFoods for the 4th quarter and 12 months of 2022/2023 financial year

First year as fully transformed company has ended with moderate success. PRFoods regained profitability despite significantly lower revenues. Q4 revenues were less by 25% and full year by 53%, since we no longer have our Swedish or Finnish operations. Center of our operations is now UK and Estonian fish processing and farming.

We ended full year with 19,6 million Euro sales compared to 42,1 million last year, but more importantly, our previous year -1,6 million EBITDA loss was replaced with 0,3 million Euro profit, 118,75% improvement.

PRFoods first net profit in many years was 350,000 Euros (last year - 8,2 million loss). Two out of three of our operations: fish farming, Estonian processing and UK and fish farming were profitable. Estonian processing unit posted loss.

Our result could have been even better, but our exclusive seller in Finland decided to end the co-operation in May. While in short term it causes pain, in long term this will benefit us handsomely, since from 2024 we no longer are prohibited by non-competition in Finland, can sell directly to retailers and hope to regain several million Euros in sales already in 2024. High food prices in Estonia and governments plan to raise VAT will dampen demand in Estonia, rise inflation and also affect the competitiveness of Estonian industries. It is a challenge, but with new management in helm at Estonia, I am fully confident that Estonian processing operations will also be profitable next year.

I am extremely pleased that our UK business reached over 1 million Euros Ebitda again, after COVID crisis and now inflationary pressures. John Ross Jr continues to be best Scottish smoked salmon brand and the management has excelled again.

I am also very pleased to announce that our new fish farming licence application in Estonia has been approved and we expect to get the water usage permit in September 2023, meaning we can scale up our fish farming production already from 2024.

Q1 of current year is tough still for Estonia, UK forecast is promising and we expect historically best result from fish farming unit. Cashflow management remains a challenge. Unfortunately we were forced to sell off our profitable Swedish unit to fully repay group level bank loan, this unit could have helped us to regain profitability much faster at much higher level. Leverage is still too high for regained profitability and additional support from shareholders is needed.

We live in interesting times, and one challenge is replaced by another for most of the industries that are not protected or subsidised by government.

KEY RATIOS

INCOME STATEMENT

mln EUR (unless indicated otherwise)	4Q 2022/2023	12 mos 2021/2022	4Q 2021/2022	12 mos 2020/2021
Sales	4,0	19,6	5,3	42,1
Gross profit	0,4	3,6	0,5	3,1
EBITDA from operations	0,1	0,3	0,4	-1,2
EBITDA	0,1	0,3	-0,3	-1,6
EBIT	-0,3	-1,0	-1,1	-4,2
EBT	-0,5	0,4	-1,5	-8,2
Net profit (loss)	-0,5	0,35	-1,5	-8,2
Gross margin	9,9%	18,3%	10,0%	7,4%
Operational EBITDA margin	2,3%	1,6%	7,6%	-2,8%
EBITDA margin	2,3%	1,6%	-6,3%	-3,7%
EBIT margin	-7,6%	-5,0%	-21,3%	-9,9%
EBT margin	-12,7%	2,2%	-28,7%	-19,5%
Net margin	-12,3%	1,8%	-29,0%	-19,4%
Operating expense ratio	-21,3%	-24,0%	-25,8%	-17,1%

BALANCE SHEET

mln EUR unless indicated otherwise	30.06.2023	30.06.2022	30.06.2021
Net debt	16,9	24,7	22,4
Equity	7,5	8,1	15,8
Working capital	0,3	-3,2	-3,2
Assets	29,9	38,9	55,6
Liquidity ratio	1,1x	0,7x	0,8x
Equity ratio	25,1%	20,7%	28,4%
Gearing ratio	69,2%	75,4%	58,7%
Debt to total assets	0,7x	0,8x	0,7x
Net debt to operating EBITDA	54,9x	-14,5x	-17,9x
ROE	4,4%	-68,5%	-29,0%
ROA	1,0%	-17,3%	-9,2%

Consolidated Statement of Financial Position

EUR '000	30.06.2023	30.06.2022
ASSETS
Cash and cash equivalents	394	110
Receivables and prepayments	2 168	2 567
Inventories	1 861	2 196
Biological assets	772	3 003
Total current assets	5 195	7 876

Deferred tax assets	-	93
Long-term financial investments	381	229
Tangible assets	6 563	8 882
Intangible assets	17 718	21 837
Total non-current assets	24 662	31 041
TOTAL ASSETS	29 857	38 917

EQUITY AND LIABILITIES
Interest-bearing liabilities	1 793	7 094
Payables and prepayments	3 127	3 978
Total current liabilities	4 919	11 073

Interest-bearing liabilities	15 461	17 725
Payables and prepayments	-	204
Deferred tax liabilities	1 664	1 599
Government grants	318	265
Total non-current liabilities	17 442	19 792
TOTAL LIABILITIES	22 361	30 865

Share capital	7 737	7 737
Share premium	14 007	14 007
Treasury shares	- 390	- 390
Statutory capital reserve	51	51
Currency translation differences	549	839
Retained profit (loss)	-14 719	- 14 391
Equity attributable to parent	7 236	7 853
Non-controlling interest	259	199
TOTAL EQUITY	7 495	8 052
TOTAL EQUITY AND LIABILITIES	29 857	38 917

Consolidated Statement of Profit or Loss And Other Comprehensive Income

EUR '000	4Q 2022/2023	4Q 2021/2022	12m 2022/2023	12m 2021/2022
Revenue	3 993	5 250	19 578	42 128
Cost of goods sold	-3 599	-4 723	-16 003	-38 993
Gross profit	394	528	3 575	3 136

Operating expenses	-851	-1 354	-4 706	-7 207
Selling and distribution expenses	-755	-630	-2 691	-4 843
Administrative expenses	-96	-724	-2 015	-2 364
Other income / expense	152	443	150	307
Fair value adjustment on biological assets	0	-734	0	-420
Operating profit (loss)	-305	-1 117	-982	-4 184
Financial income / expenses	-203	-388	1 416	4 039
Profit (Loss) before tax	-508	-1 505	434	-8 223
Income tax	19	-20	87	63
Net profit (loss) for the period	-489	-1 525	347	-8 160

Net profit (loss) attributable to:
Owners of the Parent Company	-503	-1 502	319	-8 143
Non-controlling interests	13	-23	28	-17
Total net profit (loss) for the period	-489	-1 525	347	-8 160

Other comprehensive income (loss) that may subsequently be classified to profit or loss:
Foreign currency translation differences	288	148	-290	280
Total comprehensive income (expense)	-201	-1 377	57	-7 880

Total comprehensive income (expense) attributable to:
Owners of the Parent Company	-215	-1 354	29	-7 863
Non-controlling interests	13	-23	28	-17
Total comprehensive income (expense) for the period	-201	-1 377	57	-7 880

Profit (Loss) per share (EUR)	-0,01	-0,04	0,01	-0,21

Diluted profit (loss) per share (EUR)	-0,01	-0,03	0,01	-0,21