Good morning, dear listeners. Welcome to Akola Group investor relations conference. I'm Paulius from Nasdaq Vilnius, and I'll be moderating today's event. We'll start with the presentation from the management, which will be followed by the Q&A session. Please be informed that this webinar is being recorded and will be available for a rewatch on Nasdaq Baltic YouTube channel. As always, I encourage every one of you to share your questions in the Q&A section at the bottom of your screen, and you can submit them either anonymously or with your name. With that said, I'm pleased to introduce today's presenter, the Chief Financial Officer of Akola Group, Mažvydas Šileika. Mažvydas, please, the floor is yours. Thank you, Paulius. Good morning, everyone. Very nice to meet you today on the first day of winter, and welcome to the overview of activities and finance for three months of the financial year 2023-2024 of Linas Agro Group. It's probably the last webinar when we have the name Linas Agro Group, as we are very close to finalize and register the new name, Akola, which will be going forward the name of the group. So please bear in mind, of course, that there are some forward-looking statements and there are. This is only the current view of the company's management, based on some assumptions and current market conditions. I will be presenting today the agenda, but I would like to start first from the overview of group structure. Not many changes after the first quarter. Group still manages 69 companies or 69 subsidiaries based in the same geographies. We have completed, during the first quarter, acquisition of part of AUGA group. We bought a company called Grybai LT. That's the addition to the group structure. However, we are actually cleaning up a lot, the group structure, and we have at least five companies now under liquidation status. There are a few more coming in, so probably in the next few quarters, we will decrease the number of companies we manage. Basically, due to efficiency reasons, we are trying to merge the companies to manage them more efficiently. A snapshot how the group is performing, or how it performed, during the first quarter, we can see that, EBIT margin actually looks quite good. It's 5.24% for the first quarter versus 6.46-6.47 last year. However, it's much higher than five year average. Five year average is 3.1%, so rather it was a successful quarter. You can see that from profitability perspective, we have rebounded after quite difficult two quarters of the last financial year. And it looks good so far. If we look to other ratios, like price to earnings, which is calculated on a 12 month rolling basis, it stands at 19 versus almost two last year. Five year average is 3.37, so you can see that maybe in a sense, from the P/E perspective, the share is underappreciated. However you have- we have to take into account that twelve-month rolling basis takes into calculation the last two quarters of last financial year, which were really difficult for us and wasn't that successful. The same goes with return on capital employed. Rather it is, you know, a bit below five-year average, which is 6.1. First quarter is 4.2 calculated... 4.1, calculated on 12 month rolling basis. Last year, you know, we had an exceptional first quarter, and coming after a very great year, we have almost 19.4% return on capital employed, which is actually, you know, extraordinary. It's very hard to expect something like this going forward. Earnings per share, as well, calculated on 12 months rolling basis. It stands at six cents for the last 12 months, versus almost 70 cents last year. So the same reasons, even though first quarter, as I would assume, really successful, we have to take into account the last year's two quarters, which are really not helping us with the ratios here. Looking at the balance sheet, I think group still maintains a strong balance sheet. Total assets stands close to EUR 1 billion, still quite high. We are expecting that to decrease during the year because prices are going down for the main commodities we trade. However, first quarter still did not represent that too much because the receivables, which sit on our balance sheet are from previous years, so they are still quite expensive. But that is going down. We have added additional intangible assets, which now stands at EUR 10 million. That comes from the acquisition of Grybai LT. Our property, plant, and equipment as well increased by additional EUR 12 million-EUR 14 million due to acquisition of Grybai LT. So basically, you know, the balance sheet is changing a bit, but I think there will be more change going further into the year. Group has EUR 520 million of available lines and working capital facilities for this year, so we have funded the group properly for the financial year 2023/2024. We did EUR 9 million of CapEx. That's a substantial number; however, it is not that much for a group of ours. That mainly went into new plants and new equipment for the upcoming investment period. And of course, we have now a bit more of long-term debt. So long-term debts is 38% of the total debt portfolio, which for the first quarter stands at EUR 344 million. We had added some long-term debt when buying Grybai LT, so that's the addition on the debt. Capital ratio stands at 32%. Quite healthy, I would say. Equity has grown to EUR 340 million, and it's now more than EUR 300 million. And, you know, going to the end of the year or for the end year result, we expect the capital ratio to be above 35%. So 12 month rolling basis—a 12 month rolling basis, EBITDA is EUR 51 million. As I mentioned before, you know, there's a huge impact coming from the last two quarters of last financial year. And then, you know, the debt ratios come a bit higher due to that reason. Net debt to EBITDA stands at 6.5 almost, and net readily marketable inventory adjusted debt to EBITDA stands around 4. So we are still in line with our long-term target, but of course, we feel pressure due to the group performance last year. So things we did during this quarter, you know, group has adopted a new strategy last financial year. And one of the things we wanted to make to simplify our reporting segments, and we want to streamline them better to you, to investors, and represent how the management of the group thinks of the different segments and the different markets and the different industries we are in. So the main simplification comes that everything around the farmer and grains and things we trade from the farmers are put into one segment, and now it's called Partners for Farmers. So Grains, Oilseeds, and Feeds from last reporting and Products and Services for Farmers now is merged into one, Partners for Farmers. And that's the segment which we represent, which is connected with grain trade, oilseed trade, feedstock trade, and everything we sell to farmers. So that's everything about Farming and farmers, which we are trying to service. So that's now a big segment, but now it's be much more simplified. That's how we see and how we manage the business. And other changes are a bit not that radical. Agricultural Production, we remain to Farming, which is another a significant and important business line for the group. And we have expanded the food products category. We want to represent it better, and now we call it Food Production, and you will see that there are more information regarding our different food segments into that. Others remains the same, you know, basically still remain a segment which is called Others. These are small businesses which we will, along the way, move to one or another segment, or they are still under development. But basically now, instead of four segments, we have three, and these are the main strategic segments which, you know, we as management are looking at, and that's how we are developing the group. So when talking about revenue, we delivered less revenue this quarter. We have EUR 420 million in terms of revenue, versus EUR 590 million last year. And it goes both. We traded less quantities, so we traded around 200,000 less of quantities. And those commodities or the quantities we traded were also cheaper. Prices are decreasing, so you can see that in our revenue mix. But that's of course, you know, goes, goes both ways. They are cheaper, and we traded less. We had a bit less activity on the grain side. We had less activity on the raw material side. But rather than that, I would say, you know, it's a healthy quarter. You can also see how well we are repositioning the portfolio of the group. 24% of revenues are coming now from Food Production, versus 18% last year. So, you know, we're really delivering on our strategy to increase the food portfolio in terms of group sales and profitability, and I think we will continue to do that during the year. As you see, the group is still primarily a trader because 79%, and that's the, you know, the intrinsic business, the business the group started. 79% of the sales come from trading or everything which is connected with Farming, with farmers, and servicing the farmers, and trading the grains out of the, and raw materials. So revenue is down, but volume is down, but I think if we move later on, we move forward to profitability, we see that it's better. So even with lower sales and quantities traded, we have really good gross profitability for the first quarter. We earned EUR 48 million of gross profit this quarter versus 56 last year. It's lower. However, you know, last first quarter was really extraordinary, and it's also, you know, due to all the situation with the war in Ukraine, was very evident that year. The volatility persist in the market. It's not gone, but this quarter was somewhat a bit more moderate, so a bit calmer. But looking forward, of course, the war in Ukraine and the situation in the Middle East is not helping. It might influence in one or other or another way the possible group results. So gross profit margin for the first quarter is 11.5%, and you can see historically, for the last three years, we did not have such a high gross profitability. So that's really good. And you can see that 33% of the gross profit comes now from Food Production versus 14% last year. And that's a very good impact for the gross profitability as well. It's one of the reasons. 70% of the gross profit comes from Partners for Farmers segment. That means, you know, trading and servicing farmers. However, you know, Farming part is struggling a bit this quarter because we have sold less quantities. And the quantities came a bit lower pricing because we also have the pressure from the cost coming from the last year's fertilizer prices. We wanted to show a bit of a dynamic, you know, how the gross profitability acted historically. So you can see that the last. Usually the first quarter and the last quarters are the most profitable for us, except last year, we had a very unsuccessful end of the year. But rather than that, previously, both in 2021, 2022, and 2021, first quarter profitability was somewhere closer to final year-end profitability. It's hard to say how it will be this year, but maybe this correlation will give you some idea how the group performs during the year. You can also see that second and first quarter is usually a bit slower for us, and usually the profitability is also lower. If you compare to five year first quarter average profitability stands around 7.7%. So you can see that the first quarter, even with lower sale, was really, really successful. If we move to operating profit, we earned EUR 22 million versus EUR 38 million last year, so it is less. It comes from the sales and the gross profit. But if you look at the profitability, it's looking really good. It's 5.2% gross profit margin. Last year was better, 6.5%, but historically, it is better than two years ago and better than five year average. Five year average stands at 3.1%, which is a really good result for the first quarter. And you can see that the combination maintains, so we are earning more and more from Food Production. But you also can see that the profitability for first quarter is somewhere closer to the last quarter, except again, last year. Last year, both gross profit-wise and operating profit-wise, was slow or really bad in the last quarter. We will see how it goes this year. But I. As I mentioned before, with the gross profitability, usually second and third quarter is a bit, a bit slower for us, and you can see that from the slide, that it usually stands below first quarter and last quarter margins. So a bit of an intro to the new segment, Partners for Farmers. So what the segment covers, that covers everything, what was under grains, oilseeds, and feed, as well as products and services for farmers. So that's, of course, grain storage and grain preparation, compound feed production and feedstuff trade, that trade, that's grain, oilseed trade, logistic services, and then everything which we had under products and services for farmer. That's agricultural machinery, grains storage facility equipment, spare parts and services, of course, certified feed, fertilizers, plant protection products, and micronutrients. So that's now very easy to understand. That's everything about the farmer, where we are, you know, moving along the supply chain. So if we look to the results of the first quarter, so grain storage and logistics part, slightly higher quantities we collected through the elevator chain because we had quite a good harvest here in Lithuania. However, a higher income from drying services because the grains delivered were usually a bit more moisture. Grains and oilseeds trade. So as you know, as overall, we traded lower quantities, so we also traded lower quantities of grains and oilseeds. However, we can see higher gross profitability per ton of traded position, so that's adds to the good profitability of first quarter. However, I would really say that this is still a very volatile trade because Russia has a lot of grains this year. It had a record-high harvest, and it's exporting a lot, putting a lot of actually pressure in the market for the premiums going forward. So we will see how that is going to work out during the year and so on. So we traded almost 200,000 tons less in terms of quantities. Last year, it was close to 600,000. This year is 361,000 tons of grains and oilseeds. So, feed business. Strong results, of course, from compound feed category. However, we are a bit slower, and we have pressure on margins in raw material trade and feed additives. So that actually didn't help for the profitability. Last year, we delivered EUR 14 million in terms of gross profit. This year, it is six. But however, the quantities we traded are higher, so this is something which grew in terms of quantities. However, the pressure and profitability was there. Inputs category, quantities-wise, we have grew, and we increased the quantities we traded. Profitability of seeds and fertilizers was really similar to last year. The margins are good. However, plant protection and micronutrients category really has pressure from the pricing perspective due to several things. Of course, there is a surplus in the market. We feel very high competition on that, as well as that farmers are, you know, not willing to invest that more into the future harvest. They're still waiting and seeing how it will come out because, you know, the prices are not yet too good, and they are looking how the harvest will come out, come out after the winter period. Agricultural machinery, highly competitive market. We feel a bit of an oversupply in the market. Inventory is high in the market, so that's a bit of a pressure on the profitability. However, we maintained it in gross level, in the same level, EUR 4 million last year and EUR 4 million this year. So we are still quite competitive in the market. However, you know, the revenue pressure is there. We feel it, and it's there. So in terms of gross profit of the segment, last year, EUR 46 million versus EUR 34 million this year. The main changes, we have more than EUR 2 million in terms of gross profit from elevators. However, we have EUR 4 million less coming from inputs, and we then have EUR 2 million less from grains and oilseeds and more than EUR 8 million less from feed and raw materials trade. So in total, you know, we have EUR 12 million less in terms of gross profit. However, the profitability overall is better. It's 10.14% versus 9.3% last year. So a very dynamic segment, a very dynamic quarter for this segment. We will see how it goes forward. We still have four quarters to trade, so we will see how that will work out. Food products. So food products now represent all our food product production we have, and we also included first quarter also includes two months of Grybai LT activities. So that's the company we bought from AUGA group. And sales-wise, it was also a slower quarter, 97 million of sales this quarter, versus 101 million last year. In terms of quantities, it's also slower, but not that much. But if you look overall, so the biggest winner this quarter is poultry business, as the profitability has restored. Finally, we have a healthy quarter for the poultry business after really hard three years. We have 10 million of gross profit, versus 7 million last year, and this is basically because the feed prices and energy prices are decreasing, and we can sustain the profitability in the market. Instant and ready to eat foods, profitability was also at record levels, illustrating basically a decline in cost. We also have that relief from cost in terms of energy and raw material prices. So instant products, we delivered additionally 1 million, so meaning EUR 4 million in gross profit versus EUR 3 million last year. Decreased profitability in flour category was offset with strong results in coating systems. So flour is basically, you know, a lot of under pressure in terms of pricing, but we managed actually to sustain the profitability of the category from coating systems or the, how we call it, breadcrumbs, which we sell mainly to export markets, and that helped to have a better profitability. Total gross profit margin, last year, 7.8%, this year, 16.4%, and that's of course a big increase and mainly due to poultry business rebound, and that helps a lot for overall the first quarter result as well. So that's a big impact coming from the first quarter that the poultry business is actually profitable this year and in a healthy position. We will see how that will continue throughout the year, as now we're coming to those cold waters, cold months, where we use more energy. But however, the prices so far looks all right in terms of gas prices. Feed prices also looking good so far. Hopefully, it won't change that much dramatically this year, and we won't have that high, high volatility which we saw before. Agricultural production, so very similar situation. Overall, you know, the harvest for 2023 will be or is in the calculations that 1% higher than five year average, so meaning it's a good, healthy harvest for Lithuania. However, it is slower in Estonia and Latvia. It is anticipated that the harvest will be 5%-10% lower there than the five year average. Our Farming companies, the group Farming companies, harvested 4% less crop than last year, mainly due to summer crop yields. We had that drought during June, partly May, which actually impacted the possible yields, but we were expecting that it might make more damage. It turned out to be actually a not that worse scenario. However, the profitability has decreased due to higher cost of goods sold, as the fertilizer prices, which we put to this harvest last year, was really on the higher end. So if we look at sales, so it's a EUR 4 million decrease, twelve million versus sixteen million last year. In terms of quantities, we traded almost 2,000 tons less of cereals this year than last year. In terms of milk tons, we increased a bit due to our, you know, productivity and efficiency. However, the milk raw milk prices are still very low and, you know, we are barely breaking even, so that doesn't help for overall segment profitability. When we compare the segment profit, gross profitability to last year, we can see that unfortunately for first quarter, we have a EUR -2.3 million. Milk is, as I mentioned, barely breaking even, around zero. However, I think, you know, we still have a lot of grain to sell and to trade, and possibly or hopefully the second and third quarter sales will be for higher prices, with better profitability and hopefully the quarter, the Agricultural Production segment will not be negative for the full year. However, you know, a big disclaimer here, we still have three quarters to trade, three quarters to work on, and we will see how that will end up. But you know, I truly believe that the milk prices might move in a favorable position for us, as now they are really not sustainable, not even for us, but for the overall farmers, and there has to be a change in the market in terms of milk prices as well. So hopefully it will come sooner rather than later. And that's more or less everything from my end. I really invite you to subscribe to our newsletter. You can do that on the link and go to our website, so you will have all the information coming from the group to you on actual basis. So really I invite you, encourage you to do that. Thank you very much, and I will take your questions now. Thank you very much with us for the comprehensive presentation. Now we will proceed with the questions. Before that, I would like to remind you that you can submit them in the question box at the bottom of your screen. So currently, we have one question, and let's try to answer it. When is the anticipated start date for production at the new factory in Alytus? So with Alytus factory, we are anticipating to start production in the first quarter of next financial year. So basically, the effect of that new factory will probably... Not probably, but will not come into this financial year. So that's next financial year. Thank you for the answer. And, another question just dropped in. Congratulations on the solid quarter. Could you please share an outlook for this financial year? Thanks. First of all, thank you very much. I think it was a really successful quarter. The group rebounded after really a difficult two quarters last year. It is, as I mentioned, still very hard to say how the year will turn out. I'm not, you know, in a position to give you a forward-looking questions here. We showed you the dynamics of how it might turn out or how it turned out historically. So we will see. It is, so far, you know, it is the volatility in the market still persists due to the war in Ukraine, and maybe this quarter was not felt that much, or it was, like I said, moderate. That's, you know, gave a bit of stability for the prices. But you know, the situation is always unfolding. We're closely monitoring the situation in the Middle East because any impact on the grain prices or the gas prices would of course then impact the group results. So we are taking risk management measures, you know, we are hedging, we are fixing prices where we can, taking all the caution positions. But of course, it is, the world is not going, you know, slower or calmer. It's still a very, you know, quite an extreme situation overall. Thank you for the answer, and we have another question. Any major investment plan ahead? What is the growth strategy going further? For this year, we communicated quite a lot. We are actually, you know, building a factory in Alytus, where we will double our instant noodle capacity. This year will be the development stage. Next year, we will start getting income from that. Another factor which we announced was the coating system or the breadcrumbs factory in Kėdainiai. That will probably take the development stage this financial year, and we'll start to see the income next year. The acquisition we made in July, so with that close, that's already in our balance sheet. We already are receiving the income from that acquisition. We deem to see that's a very successful one. You know, it adds to our food portfolio. It's already expanded our reach to clients and export markets as well. You know, we are selling now more to U.S. than we were doing that before. We're selling more to Japan than we were doing that before. So that's the main areas of development in the Food Production. We also announced, and we are building a seed factory in Latvia, that will take a bit more time than a year. The development stage we expect will take one and a- half year. So that's a bit down the road, but that's also a very quality improvement in our Partners for Farmers segment because seed production is an added value production, and that give more margin for us. We will cover better the Latvian and Estonian market from that production facility. That's the coming things. That's the coming things which we see. But the group, you know, strategy, which we communicated, and I will only reiterate, is that we want to be a leading company in the area of Partners for Farmers in all three Baltic states. We want to sustain and maintain that position. We want to have a profitable, sustainable, and stable market position in this area. That's where we want to excel and take the leadership position. Food production is where we are investing the most. As you understand, you know, we are either growing organically or making acquisitions. We have communicated that we are looking maybe to acquire something outside the Baltics. However, that can, you know, take time, because we need to make a lot of homework. We need to find a right target. But we are active here, and, you know, we are looking, and we will see how it goes. As soon as something pops out, we will communicate that in a timely manner, but that's only a part of a strategy, you know, where we are looking and where we are putting our attention. But that's, of course, that takes time. And that is the main areas. You know, we want to strengthen and we want to increase further on the Food Production part. As you can see, it gives stability and diversification to the group in terms of profitability, in terms of revenue streams. We want to make the group more stable, that, you know, it could be basically predicted better, you could, predict a better dividend stream to the shareholders as well. So that's, that's basically down the road. Thank you for the answer, Mažvydas. Another question just dropped in. "Thank you for the presentation. In the last financial report, there was a mention of a breach of covenants. Do you think this has been solved, and you aren't foreseeing breaches this year? Do you think more comfortable about the financial position of the company after this quarter? When will the Q1 report be available for download?" It will be available shortly after this presentation. I can answer that part, but go ahead, Mažvydas. Yes, the group was in breach of covenants due to not all covenants, some covenants. But we received waivers from our financing banks. So that's sorted out. There is no risk in connection with that one. We are good for first quarter, but I wouldn't like to comment going forward how that will look. We are putting all our effort to be in line of the covenants, that goes without saying, and we will see how the group profitability develops. The only thing is that, as you saw, every ratio of the group, which is calculated on 12 month rolling basis, is impacted by the last two quarters of last financial year. That's very natural. We can't avoid that. That's how the numbers turned out to be. We will see how the second and third quarter comes out, and how it will mitigate or how it will help group to restore all the ratios going forward. Thank you, Mažvydas, for the answer. So it seems that we've covered all of the questions so far. I'll give a minute or two to input any last thoughts, or anything that's on your mind. If you haven't sent in your question, please do so now. But as all questions are answered, on behalf of Linas Agro Group and Nasdaq Vilnius, thank you, everyone. It was a pleasure being with you today. The recording of the presentation will be available on Nasdaq Baltic YouTube channel. Mažvydas, thank you for a very informative conference. Have a great day, and goodbye. Thank you very much, everyone. Thank you for joining. Goodbye.