ADAMA Reports First Quarter 2025 Results

PR Newswire

BEIJING and TEL AVIV, Israel, April 28, 2025

Positive net profit reported for Q1 2025

BEIJING and TEL AVIV, Israel, April 28, 2025 /PRNewswire/ -- ADAMA Ltd. (the "Company") (SZSE: 000553), today reported its financial results for the first quarter ended March 31(st) , 2025.

First Quarter 2025 Highlights:

   -- Sales down 5% (-4% in RMB; -3% in CER) to $1,000 million, mainly 
      reflecting stable volume and 4% decrease in prices 
 
   -- Adjusted gross profit up 5% to $303 million, representing an improvement 
      of gross margin from 27.2% in Q1 2024 to 30.3% in Q1 2025, mainly 
      reflecting the benefits of lower costs 
 
   -- Adjusted EBITDA up 21% to $160 million representing an improvement of 
      EBITDA margin from 12.5% in Q1 2024 to 16.0% in Q1 2025 
 
   -- Adjusted net income of $44 million compared to a loss of $10 million in 
      Q1 2024; Reported net income up to $21 million from a loss of $32 million 
      in Q1 2024 
 
   -- Operating cash flow improved by $75 million; -$29 million in Q1 2025 vs. 
      -$103 million in Q1 2024 
 
   -- Free cash flow improved by $108 million, -$86 million in Q1 2025 vs. 
      -$194 million in Q1 2024 

Gaël Hili, President and CEO of ADAMA, said, "I'm encouraged to see additional positive data, which can be attributed to the ongoing implementation of ADAMA's Fight Forward strategic transformation plan. In addition to improved operational and free cash flow and continued growth of adjusted gross profit and EBITDA and their margins, in Q1 2025 we saw a positive quarterly net profit. I congratulate ADAMA's team for their efforts to improve operational efficiencies. Despite challenging market conditions, I'm optimistic our recent achievements provide momentum towards further success as we focus on providing long-term value both to our investors and to farmers throughout the world."

 
Table 1. Financial Performance Summary 
------------------------------------------------------------------------------- 
              As Reported          Adjustments                Adjusted 
            ----------------  ---------------------  -------------------------- 
             Q1        Q1                Q1    Q1      Q1        Q1        % 
 USD (m)     2025     2024    % Change  2025   2024    2025     2024     Change 
----------  ------  --------  --------  ----  -----  -------  --------  ------- 
Revenues    1,000    1,057     (5 %)     -      -     1,000    1,057     (5 %) 
            ------  --------  --------  ----  -----  -------  --------  ------- 
Gross 
 profit        272       256       6 %    31     32      303       288      5 % 
 % of 
  sales     27.2 %    24.2 %                          30.3 %    27.2 % 
----------  ------  --------  --------  ----  -----  -------  --------  ------- 
Operating 
 income 
 $(EBIT)$         70        51      38 %    26     21       96        72     34 % 
 % of 
  sales      7.0 %     4.8 %                           9.6 %     6.8 % 
----------  ------  --------  --------  ----  -----  -------  --------  ------- 
Income 
 (loss) 
 before 
 taxes          18      (21)              23     23       42         2   2189 % 
 % of 
  sales      1.8 %   (2.0 %)                           4.2 %     0.2 % 
----------  ------  --------  --------  ----  -----  -------  --------  ------- 
Net Income 
 (loss)         21      (32)              23     22       44      (10) 
 % of 
  sales      2.1 %   (3.0 %)                           4.4 %   (0.9 %) 
----------  ------  --------  --------  ----  -----  -------  --------  ------- 
EPS 
 - USD      0.0090  (0.0138)                         0. 0188  (0.0042) 
 - RMB      0.0649  (0.0977)                          0.1350  (0.0297) 
----------  ------  --------  --------  ----  -----  -------  --------  ------- 
EBITDA         144       120      19 %    16     12      160       132     21 % 
 % of 
  sales     14.4 %    11.4 %                          16.0 %    12.5 % 
----------  ------  --------  --------  ----  -----  -------  --------  ------- 
 

Notes:

   -- "As Reported" denotes the Company's financial statements according to the 
      Accounting Standards for Business Enterprises and the implementation 
      guidance, interpretations and other relevant provisions issued or revised 
      subsequently by the Chinese Ministry of Finance (the "MoF) (collectively 
      referred to as "ASBE"). Note that in the reported financial statements, 
      according to the ASBE guidelines [IAS 37], certain items (specifically 
      certain transportation costs and certain idleness charges) are classified 
      under COGS. Please see the appendix to this release for further 
      information. 
 
   -- Relevant income statement items contained in this release are also 
      presented on an "Adjusted" basis, which exclude items that are of a 
      transitory or non-cash/non-operational nature that do not impact the 
      ongoing performance of the business, and reflect the way the Company's 
      management and the Board of Directors view the performance of the Company 
      internally. The Company believes that excluding the effects of these 
      items from its operating results allows management and investors to 
      effectively compare the true underlying financial performance of its 
      business from period to period and against its global peers. A detailed 
      summary of these adjustments appears in the appendix below. 
 
   -- The number of shares used to calculate both basic and diluted earnings 
      per share in both Q1 2025 and 2024 is 2,329.8 million shares. 
 
   -- In this table and all tables in this release numbers may not sum due to 
      rounding. 

The General Crop Protection $(CP)$ Market Environment

Continuing the trend from 2024, key commodity crop prices remained subdued in Q1 2025, pressuring farmer income, despite some ease in the prices of inputs.

While channel inventory levels continue to ease following pandemic-era stockpiling, the high-interest rate environment coupled with ample product supply driven by significant over-capacity production of active ingredients in China, continue to contribute to low active ingredient ("AI") prices and a just-in-time purchasing approach by the channel.[1]

Portfolio Development Update

In Q1 2025, ADAMA continued to register and launch multiple new products in markets across the globe, adding on to its differentiated product portfolio. As part of the Fight Forward plan, the Company is focused on improving its overall portfolio mix, particularly by targeting the Value Innovation segment, with the intent of improving value delivered to all stakeholders.

In Q1 2025, launches of differentiated products included:

   -- Cazado in Canada: A novel OD herbicide formulation combining Pinoxaden 
      and Thiencarbazone-methyl, offering wheat growers the first in-crop 
      solution to effectively control wild oats and proactively combat grassy 
      weed resistance. 
 
   -- Prothioconazole-based Products Expansion: ADAMA continued to extend its 
      Prothioconazole-based portfolio, launching several combination and solo 
      formulations across EU and other key markets. Products such as Forapro$(R)$, 
      Maganic, PYRADRA(R), AVASTEL(R), and Soratel(R) leverage ADAMA's 
      proprietary Asorbital(R) Formulation Technology for enhanced uptake and 
      systemic performance. Additionally, Maxentis(R)--a unique combination of 
      Prothioconazole and Azoxystrobin--was introduced to provide 
      broad-spectrum disease protection across multiple crops. 
 
   -- Gengfule in China: A powerful pre-emergent herbicide combining 
      S-metolachlor and Flumioxazin, utilizing TOV oil dispersion formulation 
      technology to offer broad-spectrum weed control with significant residual 
      effect. 
 
   -- Stemper in the United Kingdom and Denmark: A Trinexapac-ethyl formulation 
      that enhances crop resilience and lodging resistance, supporting improved 
      harvest outcomes for cereal growers. 
 
   -- Timeline FX in Romania and Poland, a post-emergence triple-active 
      herbicide combining Pinoxaden, Florasulam, and Fluroxypyr. This 
      combination offers broad-spectrum control of both broadleaf and grassy 
      weeds in cereal crops, providing farmers with an effective tool to manage 
      weed resistance and enhance crop yields. 

Registrations of differentiated products during Q1 2025 included:

   -- Temper More: Registered in the US. This new highly effective EW herbicide 
      formulation was developed using ADAMA's proprietary SESGAMA platform. It 
      combines Glufosinate-ammonium and S-metolachlor for a dual mode of action, 
      providing broad-spectrum burndown weed control and robust residual 
      control of grass and small-seeded broadleaf weeds. 
 
   -- Metamitron: Newly registered active ingredient in the US with both fruit 
      thinning and herbicide activities, depending of the formulation. 
 
   -- Brevis: Registered in the US, this highly effective fruit thinner based 
      on Metamitron offers a powerful solution for managing flowering and 
      fruiting on pome fruits. 
 
   -- Klinner: Registered in Brazil, this three-way mixture of Picoxystrobin, 
      Prothioconazole and Mancozeb is formulated using a unique technology that 
      enables broad-spectrum control of foliar diseases in soybeans. 
 
   -- Lince: Registered in Brazil. A WG formulation combining Atrazine and 
      Mesotrione, delivering effective control of a broad spectrum of weeds in 
      corn and sugarcane. 

In addition, notable patents granted during Q1 2025 included:

   -- New Zealand: A patent was granted for SESGAMA's proprietary formulation 
      technology. 
 
   -- China: A patent was granted for the proprietary formulation of Sierra(R) 
 
   -- Australia: A patent was granted for the proprietary formulation of 
      Zulu(R) XT 

Geopolitical Situation

(MORE TO FOLLOW) Dow Jones Newswires

April 28, 2025 08:41 ET (12:41 GMT)