Bioceres faces headwinds but remains optimistic on growth By Investing.com

Bioceres Crop Solutions (NYSE: NASDAQ:), an agricultural biotechnology company, reported a decrease in total revenues for its fiscal third quarter of 2024, with figures dropping to $84 million, a 10% decline from the previous year. Despite the downturn, the company recorded a net income of $9.8 million and an adjusted EBITDA of $21.1 million. The earnings call highlighted the company’s strategic optimism, fueled by regulatory approvals in Brazil and anticipated growth in profitability, particularly in its Seed and Integrated Products segment.

Key Takeaways

• Bioceres Crop Solutions reported a 10% drop in Q3 total revenues year-over-year, earning $84 million.
• Net income stood at $9.8 million, with adjusted EBITDA reaching $21.1 million.
• The company’s financial debt was reduced to $242.8 million from $250 million the previous year.
• Positive developments in Brazil, including the first regulatory approval for Burkholderia bio-control solutions and favorable feedback on HB4 soy varieties, are expected to drive future growth.
• Bioceres anticipates a significant improvement in Q4 profitability, with a projected double-digit growth.

Company Outlook

• Bioceres expects to compensate for delayed sales and is targeting double-digit growth in profitability.
• The company is optimistic about the HB4 wheat program, expecting a $15 million EBITDA contribution.
• Regulatory approvals in Brazil and the US for bio-control solutions are anticipated to enhance cost competitiveness and market effectiveness.

Bearish Highlights

• The company acknowledged a decrease in total revenues and earnings, primarily due to the Syngenta distribution agreement’s impact on the previous year’s quarter.
• Excessive rains in Argentina have delayed the soy harvest, though normalization is expected soon.
• Bioceres is experiencing headwinds in the bio-protection market in the US and Brazil due to various factors.

Bullish Highlights

• The approval of bio-insecticidal solutions by Brazil’s Ministry of Agriculture and Livestock is seen as a significant milestone.
• Positive feedback from farmers in Brazil for the first two HB4 soy varieties suggests strong market acceptance.
• The company plans to enter the Brazilian market with a new technology and expects US approval for a lower rate version in the coming months.

Misses

• The company is still waiting for USDA approval for in-country production of HB4 wheat, which has been delayed.
• The…