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VANCOUVER, BC, Nov. 8, 2024 /CNW/ – Filo Corp. FIL (Nasdaq First North Growth Market: FIL) FLMMF (“Filo”, or the “Company”) announces its results for the three and nine months ended September 30, 2024. PDF Version

Jamie Beck, President & CEO, commented, “We are very happy to have announced the Company’s transaction with BHP and Lundin Mining, which delivers compelling value to Filo’s shareholders. Our exploration success has been unmatched since the Company was originally spun-out in 2016, and now is the right moment to hand the project off to its next stewards to maximize the potential of this remarkable discovery. We are pleased to have recommenced our drilling program in September through the commendable efforts of our operating team. We now have all nine drilling rigs operating at site.”

Q3 2024 Highlights

During and subsequent to the third quarter of 2024, the Company’s highlights included:

• On July 29, 2024, the Company announced that it has entered into a binding arrangement agreement, as may be amended, supplemented or otherwise modified from time to time (the “Arrangement Agreement”) with BHP Investments Canada Inc. (“BHP”), a wholly-owned subsidiary of BHP Group Limited, and Lundin Mining Corporation (“Lundin Mining”, and together with BHP, the “Purchaser Parties”) whereby the Purchaser Parties will acquire all of the outstanding common shares of Filo that the Purchaser Parties and their respective affiliates do not already own through a plan of arrangement (the “Transaction”) for total consideration of approximately Canadian dollars (“$CAD”) 4.1 billion ($CAD 33.00/share) through a combination of cash and Lundin Mining shares. The Transaction is expected to be completed in the first quarter of 2025, subject to the satisfaction or waiver of closing conditions. Concurrent with entering into the Arrangement Agreement, Filo and each of the Purchaser Parties (or their affiliates) entered into a subscription agreement pursuant to which the Purchaser Parties subscribed for an aggregate of 3,484,848 Filo Shares at an issue price of $CAD 33.00 per Filo Share, or approximately $CAD 115.0 million in the aggregate (the “Concurrent Private Placement”). The Concurrent Private Placement was not conditional on completion of the Transaction and was completed on August 7, 2024. Please refer to the Company press releases dated July 29, 2024 and August 7, 2024 for more information;
• On September 26, 2024, the Company announced that the shareholders of the Company (the “Shareholders”), at the special meeting of Shareholders held that day (the “Meeting”), approved the Transaction. Please refer to the press release dated September 26, 2024 for more information;
• On October 8, 2024, the Company announced that it has obtained a final order from the Ontario Superior Court of Justice (Commercial List) approving the Transaction. Please refer to the press release dated October 8, 2024 for more information;
• The Company resumed drilling operations during September 2024 (halted in mid-April 2024), with all employees and contractors remobilized to the Project Site. During the three and nine months ended September 30, 2024 the Company drilled 1,766m and 18,441m, respectively.

2024 Drilling and Assay Results

Drilling and assay results disclosed by the Company during and subsequent to the nine months ended September 30, 2024 are summarized in Appendix 1 to this news release.

Outlook

Drilling activities recommenced at the Filo del Sol Project during the September 2024, and the Company and its drilling-related contractors have fully remobilized to site.

As a result of the shutdown of the drilling program, the Company is now expecting to drill between 30,000 and 35,000 metres during 2024, down from the original target of 40,000m. The focus of the 2024 program will remain exploration and resource growth with multiple step-out targets in all directions from zones of known mineralization, including both the Bonita and Aurora Zones. The Company continues to maintain a strong focus on improving drill productivity through a variety of initiatives.

Data collected from the current campaign is being used to develop a comprehensive geological model which will guide further exploration. The Company is continuing preliminary metallurgical testwork on the sulphide mineralization, as well as environmental and social baseline programs in support of future project permitting.

The Company’s plans and timelines are subject to equipment and staff availability, along with being able to operate safely and effectively and in accordance with the Company’s health and safety protocols.

Selected Financial Information

Effective January 1, 2024, the Company changed the functional currencies of its parent and subsidiary companies (see table below) to United States dollars (“$USD”). The Company also changed its presentation currency from $CAD to $USD. The changes were enacted to reflect changes in the composition of the Company’s contracts and monetary outlays being predominantly denominated in $USD. The change in functional currencies is being recognized prospectively. The change in presentation currency requires retrospective restatement of all prior periods presented in the financial statements. The amounts reported in the statement of financial position as at January 1, 2023 (derived from the consolidated statement of financial position as at December 31, 2022; not presented herein) and December 31, 2023 have been restated in $USD based on the closing exchange rates on December 31, 2022 and December 31, 2023, respectively. The statements of comprehensive loss (income), cash flows and changes in equity for the three and nine months ended September 30, 2023 have been restated in $USD based on the average exchange rate for the three and nine months ended September 30, 2023.

The $CAD/$USD exchange rates used to reflect the change in presentation currency were as follows:

 

Financial Results

During the three months ended September 30, 2024, exploration costs were lower as a result of the temporary halting of drilling operations at the Project site due to weather conditions. Costs in any particular period may also be impacted by other relevant factors, such as the financial position of the Company, other corporate initiatives, and the scope of planned exploration/project work.

Exploration and project investigation expenses for the three and nine months ended September 30, 2024 were $17.3 million and $70.3 million, respectively, compared to expenses of $27.3 million and $79.4 million incurred during the comparative periods in 2023. During the three and nine months ended September 30, 2024, the Company completed resource drilling of 1,766m and 18,441m, respectively, compared to 8,831m and 37,188m completed during the comparative periods in 2023. Drilling metres during the three and nine months ended September 30, 2024 were negatively impacted as a result of temporarily halting drilling operations at the Filo del Sol site (mid-April to mid-September 2024) due to poor weather conditions. During this time, the Company incurred standby costs with its contractors, who are specialized in high elevation operations, in order to be able to quickly to remobilize to the Project site when weather conditions permitted in September 2024.

For the three and nine months ended September 30, 2024, Filo incurred net losses of $17.9 million and $70.0 million, respectively (2023 – $17.4 million and $61.6 million), resulting mainly from operating losses of $21.6 million and $81.6 million, respectively (2023 – $29.6 million and $88.0 million). The operating losses were offset by net gains of $1.5 million and $7.6 million from the use of marketable securities (2023 – $10.2 million and $23.1 million). Exploration and project investigation costs are the primary driver of the operating losses, and for the three and nine months ended September 30, 2024, they accounted for approximately 80% and 86% of the operating losses (2023 – 92% and 90%). The Company expenses its exploration costs through the consolidated statement of comprehensive loss, except for mineral property option payments and mineral property acquisition costs, which are capitalized. The period-over-period decrease in net gains from the use of marketable securities is the result of a devaluation of the Argentinian peso that occurred in December 2023, following the results of the Argentinian federal election.

Liquidity and Capital Resources

As at September 30, 2024, the Company had cash and cash equivalents of $100.1 million and net working capital of $85.5 million, compared to cash and cash equivalents of $81.7 million and net working capital of $65.8 million as at December 31, 2023. The increase in the Company’s cash and cash equivalents and net working capital is due to net proceeds of $83.2 million received as part of the Concurrent Private Placement, $1.9 million received on the partial disposition of certain Net Smelter Royalties held by the Company, and $2.7 million received from the exercise of stock options, offset by funds used in operations and for general corporate purposes, $1.7 million used in the acquisition of equipment and facilities for the Filo del Sol Project and $1.0 million used in the acquisition of mineral properties.

The Company will continue to deploy the majority of its treasury to fund ongoing advancement of the Filo del Sol Project, and to a lesser extent, for working capital and general corporate purposes.

About Filo del Sol

Filo del Sol is a high-sulphidation epithermal copper-gold-silver deposit associated with one or more large porphyry copper-gold systems. Overlapping mineralizing events combined with weathering effects, including supergene enrichment, have created several different styles of mineralization, including structurally controlled and breccia-hosted gold, manto-style high-grade silver (+/- copper) and high-grade supergene enriched copper within a broader envelope of disseminated, stockwork and breccia-hosted sulphide copper and gold mineralization. This complex geological history has created a heterogeneous orebody which is characterized by zones of very high-grade copper +/- gold +/- silver mineralization within a large envelope of more homogeneous, lower-grade mineralization.

Qualified Persons and Technical Information

The scientific and technical disclosure for the Filo del Sol Project included in this news release have been reviewed and approved by Bob Carmichael, B.A.Sc., P. Eng. (BC). Mr. Carmichael is Filo’s Vice-President of Exploration and a Qualified Person under National Instrument 43-101 Standards of Disclosure for Mineral Projects. (“NI 43-101”).

The field programs were carried out under the supervision of the Mr. Carmichael. Whole core was transported to the Company’s core processing facility located near Rodeo, Argentina, and all sampling activities were carried out there. Diamond drill core was sampled in two metre intervals (except where shortened by geological contacts) using a rock saw for sulphide mineralization. Oxide mineralization was cut with a core splitter in order to prevent dissolution of water-soluble copper minerals during the wet sawing process. Core diameter is a mix of PQ, HQ and NQ depending on the depth of the drill hole. Samples were bagged and tagged at camp, and packaged for shipment by truck to Mendoza, Argentina.

Samples were delivered to the ALS preparation laboratory in Mendoza where they were crushed and a 500g split was pulverized to 85% passing 200 mesh. The prepared samples were sent to either the ALS assay laboratory in Santiago, Chile or Lima, Peru for copper, gold and silver assays and multi-element ICP and sequential copper analyses. ALS is an accredited laboratory which is independent of the Corporation. Gold assays were by fire assay fusion with AAS finish on a 30 g sample. Copper and silver were assayed by atomic absorption following a four-acid digestion. Samples were also analyzed for 36 elements with ICP-ES up to drillhole FSDH053. Starting in August 2021 with drillhole FSDH054, the multielement analyses were changed to ME-MS61 which offers ultra low detection limits for 48 elements.  A sequential copper leach analysis was completed on each sample with copper greater than 500 ppm (0.05%). Copper and gold standards as well as blanks and duplicates (field, preparation and analysis) were randomly inserted into the sampling sequence for quality control. On average, 9% of the submitted samples are quality control samples. No data quality problems were indicated by the quality assurance/quality control program.

Mineralized zones within the Filo del Sol deposit are typically flat-lying, or bulk porphyry-style zones and drilled widths are interpreted to be very close to true widths.

Copper Equivalent is calculated based on US$ 3.00/lb Cu, US$ 1,500/oz Au and US$ 18/oz Ag, with 80% metallurgical recoveries assumed for all metals.  The formula is: CuEq % = Cu % + (0.7292 * Au g/t) + (0.0088 * Ag g/t).

About Filo Corp.

Filo is a Canadian exploration and development company focused on advancing its 100% owned Filo del Sol copper-gold-silver deposit located in San Juan Province, Argentina and adjacent Region III, Chile. The Company’s shares are listed on the TSX and Nasdaq First North Growth Market under the trading symbol “FIL”, and on the OTCQX under the symbol “FLMMF”. Filo is a member of the Lundin Group of Companies.

Additional Information

The Company’s condensed interim consolidated financial statements for the three and nine months ended September 30, 2024 and related management’s discussion and analysis are available on SEDAR+ at www.sedarplus.ca and the Company’s website at www.filocorp.com.

The Company’s certified adviser on the Nasdaq First North Growth Market is Bergs Securities AB, +46 8 506 51703, rutger.ahlerup@bergssecurities.se.

The information contained in this news release was accurate at the time of dissemination but may be superseded by subsequent news release(s). The Company is under no obligation, nor does it intend to update or revise the forward-looking information, whether as a result of new information, future events or otherwise.

This information was submitted by Filo Corp. for publication, through the agency of the contact person set out below, on November 8, 2024 at 05:00 pm EDT.

On behalf of Filo,

Jamie Beck
President and CEO

APPENDIX 1 – 2024 DRILLING AND ASSAY RESULTS

Drilling and assay results disclosed by the Company during and subsequent to the nine months ended September 30, 2024 are summarized in the following table:

Additional information on these drilling results is disclosed in the Corporation’s press releases. As of the date of this press release, holes FSDH099, FSDH107, FSDH110, FSDH112, FSDH113 and FSDH116 have been completed with assays pending. Results in the above table for FSDH112 are partial results to the depth the hole was at when the drilling program was temporarily suspended. It was subsequently completed to a final depth of 1,379m. Assay results for these holes will be released as they are received, analyzed and confirmed by the Company.

Cautionary Note Regarding Forward-Looking Statements

Certain statements made and information contained herein in the news release constitutes “forward-looking information” and “forward-looking statements” within the meaning of applicable securities legislation (collectively, “forward-looking information”). The forward-looking information contained in this news release is based on information available to the Company as of the date of this news release. Except as required under applicable securities legislation, the Company does not intend, and does not assume any obligation, to update this forward-looking information. Generally, this forward-looking information can frequently, but not always, be identified by use of forward-looking terminology such as “plans”, “expects” or “does not expect”, “is expected”, “budget”, “scheduled”, “estimates”, “forecasts”, “intends”, “projects”, “budgets”, “assumes”, “strategy”, “goals”, “objectives”, “potential”, “possible”, “anticipates” or “does not anticipate”, or “believes”, or variations of such words and phrases or statements that certain actions, events, conditions or results “will”, “may”, “could”, “would”, “should”, “might” or “will be taken”, “will occur” or “will be achieved” or the negative connotations thereof. All statements other than statements of historical fact may be forward-looking statements.

The Company believes that the expectations reflected in the forward-looking information included in this news release are reasonable, but no assurance can be given that these expectations will prove to be correct and such forward-looking information should not be unduly relied upon.  Information contained in this news release is as of the date of this press release. In particular, this press release contains forward-looking information pertaining to the consummation and timing of the Transaction; the satisfaction of the conditions precedent to the Transaction; and discussion of future plans, projects, objectives, estimates and forecasts and the timing related thereto; assumptions made in the interpretation of drill results, geology, grade, geochemistry, potential implications of geophysics interpretations, and continuity of mineral deposits; expectations regarding access and demand for equipment, skilled labour and services needed for exploration and development of mineral properties; and that activities will not be adversely disrupted or impeded by exploration, development, operating, regulatory, political, community, economic, environmental and/or healthy and safety risks.  In addition, this news release may contain forward-looking statements or information pertaining to: potential exploration upside at the Filo del Sol Project, including the extent and significance of the porphyry copper-gold system underlying the current Mineral Resource and the prospectivity of exploration targets; exploration and development plans and expenditures, including a transition to year-round operations and the timing thereof; the ability of the Company’s operating protocol to continue to meet government-mandated health and safety guidelines enabling it to conduct its field programs as planned; the success of future exploration activities; potential for resource expansion; ability to build shareholder value; expectations with regard to adding to its Mineral Reserves or Resources through exploration; expectations with respect to the conversion of inferred resources to an indicated resources classification; ability to execute planned work programs; plans or ability to add additional drill rigs; timing or anticipated results of an update to the mineral resource estimate for Filo del Sol; government regulation of mining activities; environmental risks; unanticipated reclamation expenses; title disputes or claims; limitations on insurance coverage; and other risks and uncertainties.

Statements relating to “mineral resources” are deemed to be forward-looking information, as they involve the implied assessment, based on certain estimates and assumptions that the mineral resources described can be profitably produced in the future.

The forward-looking statements contained in this news release are made as at the date of this news release and Filo does not undertake any obligations to publicly update and/or revise any of the included forward-looking statements, whether as a result of additional information, future events and/or otherwise, except as may be required by applicable securities laws. Forward-looking information is provided for the purpose of providing information about management’s current expectations and plans and allowing investors and others to get a better understanding of the Company’s operating environment. Forward-looking information is based on certain assumptions that the Company believes are reasonable, including that the current price of and demand for commodities will be sustained or will improve, the supply of commodities will remain stable, that the general business and economic conditions will not change in a material adverse manner, that financing will be available if and when needed on reasonable terms and that the Company will not experience any material labour dispute, accident, or failure of plant or equipment. These factors are not, and should not be construed as being, exhaustive. Although the Company has attempted to identify important factors that would cause actual results to differ materially from those contained in forward-looking information, there may be other factors that cause results not to be as anticipated, estimated, or intended. There can be no assurance that such statements will prove to be accurate, as actual results and future events could differ materially from those anticipated in such statements, including failure to receive the required regulatory approvals to effect the Transaction; changes in laws, regulations and government practices; risks pertaining to the outbreak of the global pandemics; government regulation of mining operations; environmental risks; and other risks and uncertainties disclosed in the Company’s periodic filings with Canadian securities regulators and in other Company reports and documents filed with applicable securities regulatory authorities from time to time, including the Company’s Annual Information Form available under the Company’s profile at www.sedarplus.ca. All the forward-looking information contained in this document is qualified by these cautionary statements. Readers are cautioned not to place undue reliance on forward-looking information due to the inherent uncertainty thereof.

In addition to the foregoing, there are a number of risks, uncertainties and assumptions relating to the Transaction which may have a material and adverse impact on the future operating results and financial performance of the Company and could cause actual events to differ materially from those described in forward-looking statements related to the Company, including those risk factors set out under “Risk Factors” of the Company’s management information circular dated August 26, 2024 (the “Circular”). The foregoing is qualified in its entirety by the full text of the Arrangement Agreement and the Circular, copies of which can be found under the Company’s issuer profile on SEDAR+ at www.sedarplus.ca. Shareholders are encouraged to read the Arrangement Agreement and the Circular in their entirety.

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SOURCE Filo Corp.

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JIANGYIN, China, Nov. 8, 2024 /PRNewswire/ — Li Bang International Corporation Inc. LBGJ (the “Company” or “Li Bang“), a company engaged in designing, developing, producing, and selling stainless steel commercial kitchen equipment in China, today announced its financial results for the fiscal year ended June 30, 2024.

Mr. Feng Huang, Chief Executive Officer & Chairman of the Board, commented, “Despite a challenging economic environment, fiscal year 2024 was a year of important strategic progress for Li Bang. We focused on expanding our footprint in the high-end hotel kitchen equipment sector and broadened our reach to emerging regions such as Chongqing and Xi’an. Additionally, in October 2024, we successfully completed our initial public offering and achieved a listing on the Nasdaq Capital Market under the ticker symbol ‘LBGJ.’ This significant milestone enhances our global competitiveness and reinforces our commitment to long-term growth.”

“Looking ahead, we plan to allocate funds strategically towards plant construction, equipment procurement, marketing, and innovation to drive product quality and operational efficiency. Our ongoing investments in research and development will allow us to continue delivering cutting-edge and cost-effective solutions to our clients. We remain committed to delivering high-quality products and generating sustainable value for our shareholders, and we are confident in our ability to strengthen our market position,” concluded Mr. Feng Huang.

Fiscal Year 2024 Financial Results

Revenue

Total revenue was $10.8 million for fiscal year 2024, which decreased by 22.9% from $14.0 million for fiscal year 2023.

• Revenue from project sales was $10.4 million for fiscal year 2024, decreased 23.2% from $13.6 million for fiscal year 2023. The decrease was primarily due to: 1) the slow-down of the China’s economy that negatively impacted the number of projects; 2) the change in the project-mix as a number of the Company expanded into high-end hotel kitchen projects and a number of them were in-progress as of June 30, 2024, and 3) average revenue per project decreased by $53,138 to $114,529 for the year ended June 30, 2024 from $167,667 for 2023. Lower average revenue per project was the result of the Company’s decision to strategically attract potential customers in the central and western regions of China, such as Chongqing and Xian and enhance brand awareness by lowering its project quotations.
• Revenues from retail sales was $367,976 for fiscal year 2024, decreased by 13.1% from $423,527 for fiscal year 2023. The change in retail revenues is due primarily to the slowdown of the China economy.

Cost of Revenue

Cost of revenue was $8.1 million for fiscal year 2024, decreased by 1.9% from $8.2 million for fiscal year 2023, which was in line with the decrease of total revenue.

Gross Profit and Profit Margin

Gross profit was $2.7 million for fiscal year 2024, decreased by 53.0% from $5.8 million for fiscal year 2023.

Profit margin was 25.1% for fiscal year 2024, decreased by 16.0% from 41.1% for fiscal year 2023.

Operating Expenses

Operating expenses were $4.4 million for fiscal year 2024, decreased by 1.9% from $4.5 million for fiscal year 2023.

• Selling expenses were $831,252 for fiscal year 2024, increased by 27.8%, from $650,268 for fiscal year 2023. The increase was mainly due to: the increase in compensation of sales personnel, market expansion fees and design fees.
• General and administrative expenses were $2.5 million for fiscal year 2024, decreased by 5.2% from $2.6 million for fiscal year 2023. The decrease was mainly due to: a) employee salary decreased by $182,535; b) depreciation expense decreased by $22,146; net of c) entertainment expenses increased by $68,895.
• Bad debt expense was $1.1 million for fiscal year 2024, decreased by 10.6%, from $1.2 million for fiscal year 2023. The decrease was mainly due to the collection of the accounts receivables from previous projects.

Net Income (Loss)

Net loss was $1.4 million for fiscal year 2024, compared to net income of $0.6 million for fiscal year 2023.

Basic and Diluted Earnings/(Loss) per Share

Basic and diluted loss per share was $0.08 for fiscal year 2024, compared to earnings per share of $0.04 for fiscal year 2023.

Financial Condition

As of June 30, 2024, the Company had cash of $153,914, increased from $76,019 as of June 30, 2023.

Net cash used in operating activities was $646,479 in fiscal year 2024, compared to $634,414 in fiscal year 2023.

Net cash used in investing activities was $87,189 in fiscal year 2024, compared to $2,912,979 in fiscal year 2023.

Net cash provided by financing activities was $419,486 in fiscal year 2024, compared to $3,944,347 in fiscal year 2023.

Recent Development

On October 23, 2024, the Company completed its initial public offering (the “Offering”) of 1,520,000 ordinary shares, at a price of $4.00 per ordinary share. The gross proceeds were $6.08 million from the Offering, before deducting underwriting discounts and other related expenses. The Company’s ordinary shares began trading on the Nasdaq Capital Market on October 23, 2024, under the ticker symbol “LBGJ.”

About Li Bang International Corporation Inc.

Li Bang International Corporation Inc. specializes in the independently research, development, production, and sale of stainless steel commercial kitchen equipment under its own “Li Bang” brand in China. In addition to its product offerings, the Company provides comprehensive services from early-stage design of commercial kitchen appliances to equipment installation and after-sales maintenance. Committed to innovation and high-quality, the Company uses modern production facilities and state-of-the-art procedures and strives to become a first-class commercial kitchen appliance manufacturer in China. The Company’s long-term vision is to establish itself as a household name, synonymous with the products it manufactures. For more information, please visit the company’s website at https://ir.libangco.cn.

Forward-Looking Statements

Certain statements in this announcement are forward-looking statements. These forward-looking statements involve known and unknown risks and uncertainties and are based on the Company’s current expectations and projections about future events that the Company believes may affect its financial condition, results of operations, business strategy and financial needs. Investors can find many (but not all) of these statements by the use of words such as “believe,” “may,” “will,” “estimate,” “continue,” “anticipate,” “intend,” “expect,” or other similar expressions in this prospectus. The Company undertakes no obligation to update or revise publicly any forward-looking statements to reflect subsequent occurring events or circumstances, or changes in its expectations, except as may be required by law. Although the Company believes that the expectations expressed in these forward-looking statements are reasonable, it cannot assure you that such expectations will turn out to be correct, and the Company cautions investors that actual results may differ materially from the anticipated results and encourages investors to review other factors that may affect its future results in the Company’s registration statement and other filings with the SEC.

For more information, please contact:

Li Bang International Corporation Inc.
Investor Relations Department
Email: libangsales@libangco.com

Ascent Investor Relations LLC
Tina Xiao
Phone: +1-646-932-7242
Email: investors@ascent-ir.com

 

 

 

 

 

 

 

 

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SOURCE Li Bang International Corporation Inc.

(All figures are in Canadian dollars, unless stated otherwise. Average exchange rate in Q3 2024: C$1.00 = R$4.06)

SINGAPORE, Nov. 08, 2024 (GLOBE NEWSWIRE) — Verde Agritech Ltd (TSX: “NPK”) (OTCMKTS: “VNPKF”) (“Verde” or the “Company“) announces its financial results for the period ended September 30, 2024 (“Q2 2024“).

Despite a slight reduction in delivered volumes, financial results for the third quarter of 2024 have shown an improvement compared to Q3 2023. The Company sold 100,986 tons in Q3 2024, down from 108,000 tons in Q3 2023. Nevertheless, Verde achieved a 33% reduction in net loss.

In recent months, the Brazilian agricultural sector has continued to experience the compounded effects of higher input costs and subsequent decline in commodity prices. Which was further pressured by elevated interest rates in Brazil, which has created significant challenges for farmers and led to record levels of insolvency rates across the sector and impacted both agricultural producers and its supply chain. Additionally, tightened credit conditions have made financing increasingly difficult for farmers, thus reducing their purchasing capacity.

“As we continue to navigate a challenging market, we remain focused on strategic milestones that will shape our future,” said Cristiano Veloso, Founder and CEO of Verde Agritech. “In the coming days, we anticipate sharing significant updates, including the debt renegotiation status, progress on the reassey of historical drilling and an independent mineral resource calculation for our Man of War rare earths project. Additionally, we expect to initiate the spin-off process for our rare earths asset.”

Recent developments and subsequent events

Loan Renegotiation

On October 02, 2024, Verde announced that it had successfully renegotiated with banks holding 73% of its outstanding loans. Following this action, the Company expected the remaining five creditor banks to accept the same terms or face a 75% debt reduction through a court order, as per applicable Brazilian legislation. Under the renegotiated agreement, the repayment term is extended to 120 months, with principal repayments suspended for 18 months. Crucially, 90% of the principal will be repaid on a staged schedule, starting after 55 months. The deal is anticipated to yield cash savings of R$115 million over the next 24 months. Additionally, all interest payments are suspended for 18 months, followed by an average nominal interest payment based on Brazil’s CDI (Certificado de Depósito Interbancário) plus 2.08%¹.

Rare Earths

On October 07, 2024, the Company announced that 4,708 hectares of its mineral concessions are prospective for Magnetic Rare Earths mineralization, following a review of historical drill holes. MREs, including Praseodymium, Neodymium, Dysprosium, and Terbium, are in high demand due to their crucial role in the energy transition and these elements are also essential components in the production of high-performance magnets used in electric vehicles, wind turbines, and other green technologies. Results from 15 additional drill holes revealed a 65-meter mineralized zone with grades of up to 4,209 ppm TREO and 975 ppm MREO.²

On October 29, 2024, Verde announced significant assay results from over 1,500 meters of exploration, identifying rare earth elements with concentrations reaching up to 12,487 ppm TREO and 3,357 ppm MREO. Results from 13 additional drill holes revealed an 89-meter mineralized zone with grades of up to 3,706 ppm TREO and 839 ppm MREO.³

Second Quarter 2024 Highlights

Operational and Financial Highlights

• Sales in Q3 2024 were 100,986 tons, compared to 108,000 tons in Q3 2023.
• Revenue in Q3 2024 was $7.1 million, compared to $9.4 million in Q3 2023.
• Cash and other receivables held by the Company in Q3 2024 were $14.7 million, compared to $25.4 million in Q3 2023.
• EBITDA before non-cash events was -$0.03 million in Q3 2024, compared to -$0.62 million in Q3 2023.
• Net loss in Q3 2024 was -$2.33 million, compared to -$3.46 million net loss in Q3 2023.

Other Highlights

• Product sold in Q3 2024 has the potential to capture up to 12,111 tons of carbon dioxide (“CO₂“) from the atmosphere via Enhanced Rock Weathering (“ERW”).⁴ The potential net amount of carbon captured, represented by carbon dioxide removal (“CDR”), is estimated at 8,126 tons of CO₂.⁵ In addition to the carbon removal potential, Verde’s Q3 2024 sales avoided the emissions of 4,659 tons of CO₂e, by substituting potassium chloride (“KCl”) fertilizers⁶.
• Combining the potential carbon removal and carbon emissions avoided by the use our Product since the start of production in 2018, Verde’s total impact stands at 292,613 tons of CO_2.⁷
• 8,004 tons of chloride have been prevented from being applied into soil Q3 2024, by farmers who used the Product in lieu of KCl fertilizers.⁸ A total of 168,039 tons of chloride have been prevented from being applied into soils by Verde’s customers since the Company started the production.⁹

Guidance Update

In recent months, Brazil’s agricultural sector has continued to feel reel from the effects of past challenges, when farmers took on significant debt during a period of high input prices followed by a steep commodity price drop. Now, with higher interest rates, farmers are experiencing heightened financial strain, and insolvency filings have reached record levels across the sector, impacting both farmers and distributors of agricultural inputs. This environment has also triggered a credit crunch, making financing increasingly difficult for agricultural producers. To mitigate risks associated with this tightening credit market, Verde has adopted conservative sales practices, limiting exposure to credit risk. Consequently, in light of these conditions, investors are advised not to rely on the financial guidance for fiscal year 2024.

Q3 2024 in Review

Agricultural Market

The price of potassium chloride (KCl) decreased by approximately 8% during the quarter and by 13% compared to the same period last year¹⁰, intensifying competitive pressure from lower-priced imports. This downward pricing trend, along with a more conservative purchasing approach adopted by farmers¹¹, is driven by macroeconomic uncertainties such as elevated interest rates¹², that led to significant delays in fertilizer purchases across the agricultural sector, causing a postponement in fertilizer demand¹³. Typically, the Brazilian market sees an uptick in fertilizer purchases by mid-year; however, this quarter experienced a notable decline as farmers deferred investments, anticipating improvements in both economic and climatic conditions¹⁴.

In addition, adverse weather conditions, including prolonged drought periods followed by delayed rains¹⁵, further impacted the Company’s operations in the third quarter of 2024. The extended dry spells disrupted agricultural cycles, slowing down demand for fertilizers and affecting crop readiness across key regions. These challenging conditions added another layer of complexity to an already cautious market, dampening overall sales performance for the period.

In Q3 2024, the Brazilian potash fertilizer market was under pressure due to ongoing macroeconomic and environmental challenges¹⁶. Potassium chloride (KCl) average prices were US$297 per ton¹⁷, marking a 13.57% decrease from Q3 2023, continuing the downward trend observed since the peak in 2022. This decline was primarily driven by an oversupply in global markets and weaker demand in key emerging economies, including Brazil¹⁸. Despite the lower potash prices, farmers were cautious in making purchases due to persistent economic uncertainties, high-interest rates, and limited access to credit¹⁹.

Global market competition

In 2024, Brazil continues to face elevated interest rates, impacting the financing conditions for both companies and farmers. The current SELIC interest rate is 11.25%. The Central Bank of Brazil projects the SELIC rate to be 11.75% by the end of 2024, 11.50% by the end of 2025, and 9.75% by the end of 2026.²⁰ Annual inflation forecasts stand at 4.5% for 2024 and 4.0% for 2025.²¹

Brazilian farmers have continued to struggle with limited working capital amid challenging market conditions in 2024. They have increasingly sought input suppliers offering the most favorable payment terms and interest rates, allowing them to defer payment until after the harvest, typically between 9 to 12 months later. However, Verde’s ability to provide financing with longer tenors remains considerably lower compared to international players²², making its terms less competitive for its customers. Unlike its competitors, Verde does not have the option to incur most of its cost of debt in US dollar-denominated liabilities.

Verde’s average cost of debt is 15.0% per annum. To incentivize sales, the Company offers its customers a credit line that charges a spread to its finance costs to comprise operational costs, provisions, and expected credit losses, leading to an average lending cost of 17.5% for credit-based purchases. While this approach is necessary in the agricultural sector, it increases the risk of non-payment for suppliers such as fertilizer companies, reflecting the heightened financial pressures within the sector.

Currency exchange rate

The Canadian dollar valuated by 3.5% versus Brazilian Real in Q2 2024 compared to the same period from last year.²³

Q3 2024 Results Conference Call 

The Company will host a conference call on Tuesday, November 12, 2024, at 09:00 am Eastern Time, to discuss Q3 2024 results and provide an update. Subscribe using the link below and receive the conference details by email.   

The questions must be submitted in advance through the following link up to 48 hours before the conference call: https://bit.ly/Q3-2024-Results-Presentation-Questions

The Company’s first second financial statements and related notes for the period ended September 30, 2024 are available to the public on SEDAR at www.sedar.com and the Company’s website at www.investor.verde.ag/.

Results of Operations

The following table provides information about the three and nine months ended September 30, 2024 as compared to the three and nine months ended September 30, 2023. All amounts in CAD $’000.

All amounts in CAD $’000	3 months ended Sep 30, 2024		3 months ended Sep, 2023		9 months ended Sep 30, 2024		9 months ended Sep 30, 2023
Tons sold ‘000	101		108		271		323
Average Revenue per ton sold $$	71		87		69		95
Average Production cost per ton sold $	(18	)	(28	)	(20	)	(24	)
Average Gross Profit per ton sold $ s	53		59		49		71
Gross Margin	75	%	67	%	71	%	75	%
Revenue	7,161		9,375		18,709		30,805
Production costs(1)	(1,830	)	(3,056	)	(5,316	)	(7,680	)
Gross Profit	5,331		6,319		13,393		23,125
Gross Margin	74	%	67	%	72	%	75	%
Sales and marketing expenses	(895	)	(695	)	(2,844	)	(3,026	)
Product delivery freight expenses	(2,630	)	(3,919	)	(6,767	)	(11,509	)
General and administrative expenses	(1,839	)	(2,328	)	(4,485	)	(5,142	)
EBITDA (2)	(33	)	(623	)	(703	)	3,448
Share Based and Bonus Payments (Non-Cash Event)(3)	(104	)	(261	)	(2,146	)	(145	)
Depreciation, Amortisation and P/L on disposal of plant and equipment (3)	(758	)	(973	)	(2,479	)	(2,852	)
Operating Profit after non-cash events	(895	)	(1,857	)	(5,328	)	451
Interest Income/Expense (4)	(1,431	)	(1,593	)	(4,372	)	(3,586	)
Net Profit before tax	(2,326	)	(3,450	)	(9,700	)	(3,135	)
Income tax (5)	(10	)	(14	)	(27	)	(196	)
Net Profit	(2,336	)	(3,464	)	(9,727	)	(3,331	)

_{⁽¹⁾ – Non GAAP measure
⁽²⁾ – Included in General and Administrative expenses in financial statements
⁽³⁾ – Included in General and Administrative expenses and Cost of Sales in financial statements
⁽⁴⁾ – Please see Summary of Interest-Bearing Loans and Borrowings notes
⁽⁵⁾ – Please see Income Tax notes}

External Factors

Revenue and costs are affected by external factors including changes in the exchange rates between the C$ and R$ along with fluctuations in potassium chloride spot CFR Brazil, agricultural commodities prices, interest rates, among other factors. For further details, please refer to the Q3 2024 Review section:

Financial and operating results

In Q3 2024, revenue from sales decreased by 24%, alongside an 18% reduction in the average revenue per ton compared to the same period in 2023. When excluding freight expenses (FOB price), the average revenue per ton declined by 11% year-over-year, primarily driven by a reduction in KCl prices. This decrease was partially offset by improvements in the product mix, reflecting a higher proportion of premium products compared to Q3 2023.

Sales declined by 6% in Q3 2024 compared to Q3 2023, due to the conditions outlined in the Q3 2024 Review section.

As a consequence of the points mentioned above, the Company’s EBITDA before non-cash events was -$0.03 million in Q3 2024 compared to -$0.62 million in Q3 2023.

The Company generated a net loss of -$2.3 million in Q3 2024, compared to a net loss of -$3.5 million in Q3 2023.

Basic loss per share was $0.044 for Q3 2024, compared to earnings of $0.066 for Q3 2023.

Production Costs

In Q3 2024, production costs per ton decreased by 36% compared to Q3 2023, primarily due to an optimized sales mix and increased production from Plant 2, which contributed 25% of total sales.

Sales, General and Administrative Expenses:

SG&A represents a non-operating segment that includes corporate and administrative functions, essential for supporting the Company’s operating segments.

Sales Expenses

CAD $’000	3 months ended		3 months ended		9 months ended		9 months ended
	Sep 30, 2024		Sep 30, 2023		Sep 30, 2024		Sep 30, 2023
Sales and marketing expenses	(825	)	(890	)	(2.558	)	(2,990	)
Fees paid to independent sales agents	(70	)	195		(286	)	(36	)
Total	(895	)	(695	)	(2.844	)	(3,026	)

Sales and marketing expenses cover salaries for employees, car rentals, domestic travel in Brazil, hotel accommodations, and Product promotion at marketing events.

As part of its marketing and sales strategy, Verde compensates independent sales agents through commission-based remuneration. In Q3 2023, commission expenses showed a credit balance of $195,000 following a $249,000 provision reversal, which contributed significantly to the credit balance that quarter. Excluding this one-time adjustment, commission expenses in 2024 have remained consistent with prior levels, reflecting Verde’s stable approach to sales compensation.

Product delivery freight expenses

Expenses decreased by 33% in the third quarter of 2024 compared to the same period last year. The volume sold as CIF (Cost Insurance and Freight) in Q3 2024 represented 72% of total sales, compared to 78% in Q3 2023.

General and Administrative Expenses

CAD $’000	3 months ended Sep 30, 2024		3 months ended Sep 30, 2023		9 months ended Sep 30, 2024		9 months ended Sep 30, 2023
General administrative expenses	(682	)	(1,203	)	(2.083	)	(2,983	)
Allowance for expected credit losses	(785	)	(563	)	(1.018	)	(592	)
Legal, professional, consultancy and audit costs	(262	)	(332	)	(905	)	(939	)
IT/Software expenses	(99	)	(190	)	(427	)	(532	)
Taxes and licenses fees	(11	)	(40	)	(52	)	(96	)
Total	(1.839	)	(2,328	)	(4.485	)	(5,142	)

General administrative expenses include general office expenses, rent, bank fees, insurance, foreign exchange variances and remuneration of executives, directors of the Board and administrative staff. General administrative decreased by 43% compared to the same period last year, due to a reduction in leasing expenses, such as water trucks and metallic structures to support operations.

In the third quarter of 2023, we experienced a significant reduction in the number of employees, which led to an increase in severance payments. Consequently, expenses in Q3 2024 were lower than Q3 2023.

According to Verde’s sales policy, any customer payments that are overdue for more than 12 months must be provisioned for. The increase in the allowance for expected credit losses in Q3 2024 compared to Q3 2023 is attributed to the financial constraints faced by farmers, which are a result of low prices for agricultural commodities, among other factors, as outlined in the Q3 2024 Review section.

Legal, professional, and audit costs comprise fees for accounting, audit, and regulatory services. Consultancy fees include expenses related to external consultants in Brazil, covering accounting services, patent processing, legal fees, and regulatory consulting. In 2024, these expenses were reduced as a result of the internalization of accounting functions and a decrease in audit costs.

IT/Software expenses include software licenses such as Microsoft Office, Customer Relationship Management (“CRM”) software and Enterprise Resource Planning (ERP). Expenses decreased by 48% in Q3 2024 compared to the same period last year due to a decrease in costs associated with the Company’s CRM software.

Share Based, Equity and Bonus Payments (Non-Cash Event)

Share Based, Equity and Bonus Payments (Non-Cash Events) encompass expenses associated with stock options granted to employees and directors, as well as equity compensation and non-cash bonuses awarded to key management personnel. In Q3 2024, the costs associated with share-based payments were -$0.1 million compared to -$0.2 million for the same period last year. This variance was primarily due to new options issuance.

Liquidity and Cash Flows

For additional details see the consolidated statements of cash flows for the quarters ended September 30, 2024, and September 30, 2023 in the quarterly financial statements.

Cash received from / (used for):  CAD $’000		3 months ended Sep 30, 2024		3 months ended Sep 30, 2023		9 months ended Sep 30, 2024		9 months ended Sep, 2023
Operating activities		1,500		(9,216	)	(1,671	)	(16,090	)
Investing activities		(377	)	504		950		(1,985	)
Financing activities		(556	)	11,883		(3,291	)	25,823

On September 30, 2024, the Company held cash of $3.4 million, a decrease of $5.8 million on the same period in 2023.

Operating activities

In agricultural sales, credit transactions are common due to the cyclical nature of farming income, which sees fluctuations with seasonal highs during harvests and lows during planting. This cycle necessitates that farmers have access to essential inputs like seeds, fertilizers, and pesticides ahead of their selling season. To accommodate this, credit terms are offered, allowing farmers to procure these inputs in advance and align their payments with their revenue cycle.

The Company’s credit terms vary according to the needs of its clients, tailored to the specific requirements of each farmer. This includes considerations such as the crop cycle, creditworthiness, and other relevant factors, with terms extending up to 360 days upon shipment depending on the period of year. This strategy ensures farmers have the necessary resources for each planting season, while Verde secures its financial interests through aligned payment schedules.

In Q3 2024, net cash utilized in operating activities increased to $11.0 million, compared to -$9.21 million utilized in Q3 2023.

Trade and other receivables decreased by 30% in Q3 2024, to $11.3 million compared to $16.1 million in Q3 2023. This is expected as the Company had lower revenues from sales in the quarter.

Investing activities

Cash utilized in investing activities decreased to -$0.9 million in Q3 2024, compared to $0.5 million in Q3 2023. This reduction was primarily due to investments made in the Company’s ongoing projects.

Financing activities

Cash utilized in financing activities decreased to -$12.4 million in Q3 2024, compared to $11.9 million in Q3 2023. This shift was primarily due to additional loans acquired during 2023, which increased financing inflows in that period.

Financial condition

The Company’s current assets decreased to $11.7 million in Q3 2024, compared to $28.2 million in Q3 2023. Current liabilities increased to $19.0 million in Q3 2024, compared to $10.9 million in Q3 2023; providing a working capital deficit of $13.3 million in Q3 2024, compared to the working capital surplus of $17.1 million in Q3 2023.

About Verde Agritech

Verde Agritech is dedicated to advancing sustainable agriculture through the innovation of specialty multi-nutrient potassium fertilizers. Our mission is to increase agricultural productivity, enhance soil health, and significantly contribute to environmental sustainability. Utilizing our unique position in Brazil, we harness proprietary technologies to develop solutions that not only meet the immediate needs of farmers but also address global challenges such as food security and climate change. Our commitment to carbon capture and the production of eco-friendly fertilizers underscores our vision for a future where agriculture contributes positively to the health of our planet.

For more information on how we are leading the way towards sustainable agriculture and climate change mitigation in Brazil, visit our website at https://verde.ag/en/home/.

Corporate Presentation

For further information on the Company, please view shareholders’ deck: https://investor.verde.ag/wp-content/uploads/2024/09/Corporate-presentation-Verde-AgriTech-September-2024.pdf

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Cautionary Language and Forward-Looking Statements

All Mineral Reserve and Mineral Resources estimates reported by the Company were estimated in accordance with the Canadian National Instrument 43-101 and the Canadian Institute of Mining, Metallurgy, and Petroleum Definition Standards (May 10, 2014). These standards differ significantly from the requirements of the U.S. Securities and Exchange Commission. Mineral Resources which are not Mineral Reserves do not have demonstrated economic viability.

This document contains “forward-looking information” within the meaning of Canadian securities legislation and “forward-looking statements” within the meaning of the United States Private Securities Litigation Reform Act of 1995. This information and these statements, referred to herein as “forward-looking statements” are made as of the date of this document. Forward-looking statements relate to future events or future performance and reflect current estimates, predictions, expectations or beliefs regarding future events and include, but are not limited to, statements with respect to:

	(i)		the estimated amount and grade of Mineral Resources and Mineral Reserves;
	(ii)		the estimated amount of CO2 removal per ton of rock;
	(iii)		the PFS representing a viable development option for the Project;
	(iv)		estimates of the capital costs of constructing mine facilities and bringing a mine into production, of sustaining capital and the duration of financing payback periods;
	(v)		the estimated amount of future production, both produced and sold;
	(vi)		timing of disclosure for the PFS and recommendations from the Special Committee;
	(vii)		the Company’s competitive position in Brazil and demand for potash; and,
	(viii)		estimates of operating costs and total costs, net cash flow, net present value and economic returns from an operating mine.

Any statements that express or involve discussions with respect to predictions, expectations, beliefs, plans, projections, objectives or future events or performance (often, but not always, using words or phrases such as “expects”, “anticipates”, “plans”, “projects”, “estimates”, “envisages”, “assumes”, “intends”, “strategy”, “goals”, “objectives” or variations thereof or stating that certain actions, events or results “may”, “could”, “would”, “might” or “will” be taken, occur or be achieved, or the negative of any of these terms and similar expressions) are not statements of historical fact and may be forward-looking statements.

All forward-looking statements are based on Verde’s or its consultants’ current beliefs as well as various assumptions made by them and information currently available to them. The most significant assumptions are set forth above, but generally these assumptions include, but are not limited to:

	(i)		the presence of and continuity of resources and reserves at the Project at estimated grades;
	(ii)		the estimation of CO2 removal based on the chemical and mineralogical composition of assumed resources and reserves;
	(iii)		the geotechnical and metallurgical characteristics of rock conforming to sampled results; including the quantities of water and the quality of the water that must be diverted or treated during mining operations;
	(iv)		the capacities and durability of various machinery and equipment;
	(v)		the availability of personnel, machinery and equipment at estimated prices and within the estimated delivery times;
	(vi)		currency exchange rates;
	(vii)		Super Greensand® and K Forte® sales prices, market size and exchange rate assumed;
	(viii)		appropriate discount rates applied to the cash flows in the economic analysis;
	(ix)		tax rates and royalty rates applicable to the proposed mining operation;
	(x)		the availability of acceptable financing under assumed structure and costs;
	(xi)		anticipated mining losses and dilution;
	(xii)		reasonable contingency requirements;
	(xiii)		success in realizing proposed operations;
	(xiv)		receipt of permits and other regulatory approvals on acceptable terms; and
	(xv)		the fulfilment of environmental assessment commitments and arrangements with local communities.

Although management considers these assumptions to be reasonable based on information currently available to it, they may prove to be incorrect. Many forward-looking statements are made assuming the correctness of other forward looking statements, such as statements of net present value and internal rates of return, which are based on most of the other forward-looking statements and assumptions herein. The cost information is also prepared using current values, but the time for incurring the costs will be in the future and it is assumed costs will remain stable over the relevant period.

By their very nature, forward-looking statements involve inherent risks and uncertainties, both general and specific, and risks exist that estimates, forecasts, projections and other forward-looking statements will not be achieved or that assumptions do not reflect future experience. We caution readers not to place undue reliance on these forward-looking statements as a number of important factors could cause the actual outcomes to differ materially from the beliefs, plans, objectives, expectations, anticipations, estimates assumptions and intentions expressed in such forward-looking statements. These risk factors may be generally stated as the risk that the assumptions and estimates expressed above do not occur as forecast, but specifically include, without limitation: risks relating to variations in the mineral content within the material identified as Mineral Resources and Mineral Reserves from that predicted; variations in rates of recovery and extraction; the geotechnical characteristics of the rock mined or through which infrastructure is built differing from that predicted, the quantity of water that will need to be diverted or treated during mining operations being different from what is expected to be encountered during mining operations or post closure, or the rate of flow of the water being different; developments in world metals markets; risks relating to fluctuations in the Brazilian Real relative to the Canadian dollar; increases in the estimated capital and operating costs or unanticipated costs; difficulties attracting the necessary work force; increases in financing costs or adverse changes to the terms of available financing, if any; tax rates or royalties being greater than assumed; changes in development or mining plans due to changes in logistical, technical or other factors; changes in project parameters as plans continue to be refined; risks relating to receipt of regulatory approvals; delays in stakeholder negotiations; changes in regulations applying to the development, operation, and closure of mining operations from what currently exists; the effects of competition in the markets in which Verde operates; operational and infrastructure risks and the additional risks described in Verde’s Annual Information Form filed with SEDAR in Canada (available at www.sedar.com) for the year ended December 31, 2021. Verde cautions that the foregoing list of factors that may affect future results is not exhaustive.

When relying on our forward-looking statements to make decisions with respect to Verde, investors and others should carefully consider the foregoing factors and other uncertainties and potential events. Verde does not undertake to update any forward-looking statement, whether written or oral, that may be made from time to time by Verde or on our behalf, except as required by law.

For additional information please contact:

Cristiano Veloso, Chief Executive Officer and Founder

Tel: +55 (31) 3245 0205; Email: investor@verde.ag

www.verde.ag | www.investor.verde.ag

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¹ Learn more at: Verde Successfully Renegotiates Loans with Its Two Largest Creditors.

² Learn more at: High grade ionic absorption clay magnetic rare earths mineralization found in Verde’s historical drill holes.

³ Learn more at: Verde’s assays of over 1,500m of drilling find rare earths up to 12,487 ppm TREO and 3,357 ppm MREO.

⁴ Out of the total sales in Q3 2024, 100,925 tons were sold in compliance with our Monitoring, Verification, and Report (“MRV”) Protocol, qualifying them as potential carbon credits. The carbon capture potential of Verde’s products, through Enhanced Rock Weathering (ERW), is 120 kg CO₂e per ton of K Forte®. For further information, see “Verde’s Products Remove Carbon Dioxide From the Air“.

⁵ Net Carbon Dioxide Removal (CDR): volume of 1 ton of Long-Term CO₂ Removal, equivalent to 1 carbon credit.

⁶ K Forte® is a fertilizer produced in Brazil using national raw materials. Its production process has low energy consumption from renewable sources and, consequently, a low environmental and GHG emissions footprint. Whereas the high carbon footprint of KCl results from a complex production process, involving extraction, concentration, and granulation of KCl in addition to the long transportation distances to Brazil, given that 95% of the KCl consumed in the country is imported. 12Mt of K Forte® is equivalent to 2Mt of KCl in K₂O content. Emissions avoided are calculated as the difference between the weighted average emissions for KCl suppliers to produce, deliver, and apply their product in each customer’s city and the emissions determined according to K Forte®’s Life Cycle Assessment for its production, delivery, and application in each customer’s city.

⁷ From 2018 to Q3 2024, the Company has sold 1.94 million tons of Product, which can remove up to 229,294 tons of CO₂. Additionally, this amount of Product could potentially prevent up to 63,316 tons of CO₂ emissions.

⁸ Verde’s Product is a salinity and chloride-free replacement for KCl fertilizers. Potassium chloride is composed of approximately 46% of chloride, which can have biocidal effects when excessively applied to soils. According to Heide Hermary (Effects of some synthetic fertilizers on the soil ecosystem, 2007), applying 1 pound of potassium chloride to the soil is equivalent to applying 1 gallon of Clorox bleach, with regard to killing soil microorganisms. Soil microorganisms play a crucial role in agriculture by capturing and storing carbon in the soil, making a significant contribution to the global fight against climate change.

⁹ 1 ton of Product (10% K₂O) has 0.1 tons of K₂O, which is equivalent to 0.17 tons of potassium chloride (60% K₂O), containing 0.08 tons of chloride.

¹⁰ Source: Acerto Limited Report.

¹¹ Source: Verde Announces Q2 2024 results.

¹² As of September 30, 2024. Source: Brazilian Central Bank

¹³ Source: The planting of the 2024/25 season has begun, but the scenario still shows delays in fertilizer deliveries.

¹⁴ Source: The planting of the 2024/25 season has begun, but the scenario still shows delays in fertilizer deliveries.

¹⁵ Source: New crop soybean sowing in Brazil to be delayed due to lack of consistent rain: analysts.

¹⁶ Source: AMA Report.

¹⁷ Source:.Acerto Limited Report.

¹⁸ Source: AMA Report.

¹⁹ As of September 30, 2024. Source: Verde Announces Q2 2024 results

²⁰ As of September 30, 2024. Source: Brazilian Central Bank

²¹ As of September 30, Source: Brazilian Central Bank.

²² Verde’s normal credit term is 30 to 120 days upon shipment, depending on the period of the year, while competitors can provide 180-360 days to collect its payments.

²³ Source: Brazilian Central Bank.