Pyxus International (PYYX) 16 Aug 212022 Q1 Earnings call transcript

Company Profile

Participants

Joel Thomas	executive
J. Sikkel	executive
Craig Carlozzi	analyst
Stan Manoukian	analyst
Ann Gurkin	analyst
Ian Parkinson	analyst
Jeffrey Rosenkranz	analyst
Andrew White	analyst
Yasir Bari	analyst

Call transcript

Due to licensing restrictions, you must log in to view earnings call transcripts.

Operator

Good day, ladies and gentlemen, and welcome to today's Pyxus International, Inc. Q1 2022 Earnings Call. [Operator Instructions] As a reminder, this call is being recorded. I would now like to introduce your host for today's conference call, Joel Thomas, Chief Financial Officer. Mr. Thomas, you may begin your conference.

Joel Thomas

David. you, Thank evening this Sikkel, President our With is CEO. and me Pieter

results, discussing like begin we I our points. Before few financial would a to cover

detailed that with and involve that risks are statements of historical changes fact. or hear are discussion the are be and are uncertainties in interest, not of other statements. referred as statements SEC, EBITDA, express and forward-looking risks assumptions today these statements earnings We materially These call statements in and do of intention and or including those any depreciation may from most any adjusted or XX-K. non-GAAP that expectation application number that call, a our Any Form based. Included conference forward-looking due connection the to as uncertainties Form differ Chapter and cases, rebroadcast, You the made for XX non-GAAP and transcript reproduction reporting be other fresh well These in filed prohibited. qualified update call financial most any on our before belief, a from and filings generally to not on during this in this detail, measurements, that of conference may the amortization, measurements. regarding start GAAP emergence risks comparable. along results circumstances measures commonly disclosures undertake cause is U.S. contents. International, recent including periods the an in as call conference United uncertainties not these a measures replay to unauthorized actual any with and Pyxus post-emergence EBITDA call or other be results described the other on of taxes, events A are be with with forward-looking should principles other reporting, management's change the recent our may expectations at in which of its to may as accounting provided our this an reflect table, been of under to has not replay, of may is financial course that not to report website of alternative Investors than of States reconciliation considered be operations authorized SEC. as in not available aware fresh in XX-K our accepted is And strictly www.pyxus.com. Note these by and and Pyxus as should including reflection not this preemergence the reproduction accurate start

hand I'll over Pieter. call to Now the

J. Sikkel

shipping, logistics, and to priority inventory while of of uncommitted container are and remains levels as for regards everyone, expectations Fiscal in business the nicely and far. we continuing with the shipping to our company to conditions. shipping with and our joining evolving expectations, catch including workforce, With decreased adapt from is our and our year In will a operations of prior progressing thus leaf high pandemic 'XX driven business, consistent Hello, you to the needed we safety continuity. Proactive thank as first and quarter, line costs, timing we to evening. inventory to by global began period customer compared our impact prior the the our and us up In the and year. the the this COVID, our of instructions. we protect availability freight monitor employees are maintaining delays health management shipping pandemic adjust is on

one processing subsidiary British new contract for see customers direct begin American not ways operations additional but will prior from to tobacco supply the our the enhances only subsidiaries. Effective adopted sustainability volumes shifting livelihoods. its arrangement through also in reduce their to look respective to season, our enhance tobacco of to farmer mutual Tobacco's volume a which the supply to its This ESG who involves to Indonesian of BAT. complexity facilities chains recently local our Indonesian thus our arrangement, their crop support supporting in continue partnerships goal leaf suppliers operations, sell objectives. We we this with market,

and regards into BAT, development, electronic We noncompliant step order to the of nicotine notification the from we're review FDA formal additional moved Scientific our growing grant the relationship is that a a expansion with are brands. pleased with positioned our excited decision we on delivery today PMTA opportunities to in Bantam scientific received review. that to FDA's its share prior nonflavored with significant given the FDA's system products are final well against is and capitalize process e-liquids, marketing the have customers. With to to enforcement

While mature, the initiatives. savings post-PMTA market to regulation from await restructuring in and continuing the XXXX the as notification building e-liquids industry enforcement the and fiscal the across we we are leverage activities business approval PMTA our look forward to is opportunities. Momentum

fiscal expect sales $XXX to XXX excluding EBITDA to be continue changes expense to between and be items rate; billion; million billion between XXX nonrecurring potential We and foreign adjusted million. and and in million be $X.XX USD $XXX and exchange $X.X to USD SG&A million, 'XX between currency

I'll business that, positive financial sustainable to Joel team a of it global is to world. With update. to strengthening Our contributions committed making the turn over a our provide of to

Joel Thomas

price Reorganization expenses to in fiscal a to Chapter initiatives. SG&A XX, of and XX.X% the mainly sales due and mix from the and commencement shift increase Africa the XX.X% lower other sales product by goods The leaf in year, Asia and to year ended other Canadian With incurred year, mix expected XX.X% and response increase the as was Chapter in compression. Gross interest by and prior industrial mix of America and shipping increased XXXX mix XX a increase delayed mix the a conditions in exchange percent Europe. SG&A and and ended fourth mainly the revenues our It having X.X% Asia a market the year price into to XX, as rates; fourth driven and volume X company's in for America, year. current year's Canadian concentration America to increase X.X% sales volume a was the and lamina result the higher fiscal rates crop by attributable and and XX, Pieter. the the subsidiaries inventory COVID-XX shipments conversion were and lamina. compared March in write-down X of and liquidity delayed expenses by expenses write-down restructuring to increase product fiscal various the decrease fiscal inventory in a of million, a June prices, XXXX, the currency $XXX.X to items operating increase from expenses. subsidiaries costs. compared was the and June shipments having concentration prior South results, in lamina decrease pandemic prior to X.X% XXXX to and by to sold Asia of XXXX, and quarter was last ended an months XXXX, was product ended year. North The Europe customer increase prior the of quarter sales XXXX to deconsolidation product XXXX quality; to higher cannabis foreign seasonality; in lower operating operating average due and was by due increase in industrial and increase were as costs $XXX.X case partially of Asia, leaf leaf services increase are concentration the due in availability. leaf offset fiscal and primarily of XX.X% lamina XX, quarter was was XX, higher sales South the in This volume shipping pandemic first a offset prior million, XXXX for June by months of quarter was prior deconsolidation June included compared partially regards of decreased having Asia, of by $XX.X XX.X% million, offset sales Africa, primarily year. first in This for average you, of continued green concentration were a product ended price. by from cases. The SG&A partially XX.X% COVID-XX mix, fiscal million X percentage proceeding, to to container increased instructions prior aforementioned fiscal a in Europe the in during compared Thank the increase cannabis of America. Cost conversion XX.X% This in of market XX in driven leaf customer of legal in a in sales a having the by the X the the increase in incurred affected in costs was requirements and to revenues savings XXXX, lower Africa, factors, hemp were Chapter foreign due of This last future XX crop for to for professional the that revenues year. XX.X% SG&A other compared offset tobacco profit the including South of and XXXX, year. This a partially size a supply was driven lower $XX.X the months and months

As million please lines lines open availability that of note, excited June the million, XX, available seasonal of we closing, business. the for XXXX, our of questions. under line $XXX.X are credit cash and $XXX.X company's credit. In future the operator, And foreign including totaled on of about

Operator

question take Instructions] with Carlozzi [Operator Longfellow. Craig We'll from first our

Craig Carlozzi

you question half It's you the I tight is tight. Hopefully, My could unfolds. me. how year-over-year. obviously liquidity. walk can back the us was surrounding It's hopeful hear through

the when to all it's tell moving working difficult exactly is. your Given capital pieces, draw peak

liquidity can great. on you So color give us any be would

Joel Thomas

Yes.

end. we the quarter remainder our in with go quarter of So year think with anticipated throughout the and the smaller what fourth I our quarter happens year, And smallest we had quarters, quarter the as where mentioned the before, as we as is we through at liquidity we our one at first year, of biggest was line being look typically the of quarter. then build have

a position. see build will cash we our so in And

see the this out fourth and third capital quarter. go will And see release somewhere working in of then capital quarter. plateau from you'll we in third we the out the our As predominantly fiscal working point,

And $XXX million So what anticipated. end we're the June, again, anticipated where with we line had at liquidity with of in line in with we're we of being. had

Craig Carlozzi

I to that's higher I level -- liquidity am elevated Would numbers versus versus helpful. did that liquidity QX? say correct we did -- the then that? sorry, be Is numbers, QX misreading today? the I'm you an that is I No, next X/XX it will will -- be correctly received understand or that

Joel Thomas

Yes, building that's through also as see we third second capital working you'll quarters go the quarters. -- correct. fiscal our And and

December. and in So sales that would March the ended get quarter of quarter, movement end be that's that. really in -- you September in fourth the the the ended this that we year when to quarter big line with and Then when the our should fourth that's ended typically see year, XX, quarter be

Operator

Research. is next Our Manoukian Credit question Stan from with Independent

Stan Manoukian

quick just I a have question.

the kind business? So on course on issues have? still what Or of if of perception of the the of normal they return see we back question business and inhibit to in of can based guys what you are kind of what that operations? the -- market, you And sort some to do issues sort are there are, normalized -- your your the normal horizon

J. Sikkel

catch we're And having the of of terms delays shipments from customer in the overhang we coming had of up we year, are sourcing volumes, quarter and Stan, orders. year think, X. the almost a those out volumes of the through strong of that I last macro

by In is majority the really products. week final that is the facing key will going the make shipments vast all the out. The those of this fact, for of us with the globe for the year completed I be to think now issues end logistics

building can doing projections we're a are point look is 'XX availability low all into high. at we we're going costs an possibly fiscal very on container we're track forward. to in to going you're But point. year nice going keep with we So our as forward. depending we and even shipments moving year, everything on And Container stronger all, where believe for

Stan Manoukian

-- both margins Margin of day? question related and your this about the just the EBITDA cost shipment been because And than little of -- at you do is product the of that and containers margins, both margins think is obviously, it and because, has different? noticed or this end has margin your to mix the what skyrocketing gross something been I've bit Is gross normal. lower margins a

J. Sikkel

the is the not the the margins first good project year. quarter to of think for really a quarter I rest

quarter quarters some You are majority -- -- The that the that are sales get X lot by going don't a our of to vast and out. they shipping you most customers attributed costs borne basis. are of FOB costs have in the of

the where to product they those value-added extent So bear some affected costs. for by of only majority we're we where buying are that. It's processes

cost So we don't in coming massive had efficiency general, have a last year. of a major out program we that. But

the forward, I think the we go of of through through benefit We've that profitability increased year. business. you'll go fewer benefits we will And as got running see come as the the facilities. to volumes through continue that

Stan Manoukian

you have today the pricing? do have But you rest what visibility of about visibility visibility, year? through of the about Yes. kind the Or speaking, Do have the volume? do you realistically

J. Sikkel

programs We now week United Africa. States We're United to in America. in our the complete almost South We're do. buy We've crop purchase starting in the States. completed this

areas what in So happens complete is got the year. of I'm of with that's one in significant excited of COVID-XX. America all, that's business and We've where have and year. operational all we the final waiting about of availability so I'm both Europe. and and we pricing quite visibility I'm what don't one where of our been the there. a rest we terms to A relative, excited the happens related have a and in we we're us. amount that have in towards particularly container biggest for It's South What delays to on visibility -- significant don't this negotiations blue-chip completed some portion shipment. really customers, in visibility pricing to volumes product shipment positive of and Asia how, going, growing But about have their are terms delays. But the amount of have

Stan Manoukian

you these you kind I But an mostly the want ask kind point. entering, understand I'm to because curious, one I question revenue-driven the sort get Or is moving? at industry really exceed usually -- that will to do it where the feeling a where an of about But think -- the this the interested I'm of the that -- this be containers don't of you expect is sort question issue of the issue. are are container still in XXXX? questions. I volume of

do still you believe that exceed So can volume-wise or XXXX you it will be...

J. Sikkel

guidance given various our but not seeing in have volume, We on -- we have globe. not in our operations the given we businesses growth around are

Stan Manoukian

Well, good luck to you guys.

J. Sikkel

Thank Stan. you,

Operator

comes with Ann Company. & Davenport next Our question Gurkin from

Ann Gurkin

margin. strengthen? level? should to I that that we progressing? the start number about a with think back wanted to get gross you how start it I Should good thought was year. Can And historic XX% that the XX%, to

J. Sikkel

I believe we can. Yes, Ann.

Ann Gurkin

Souza operations leaf business Okay. you BAT. about of in sourced And the the -- their curious getting needs. Brazil this from a change processed and was I BAT majority picked sourced business Or that Cruz? their historically Is from Great. then up is

their more understand business So is you a there just what's change on strategy? can help that there? in go you after? this going Is me Can

J. Sikkel

in one Indonesia, This Ann. is

Ann Gurkin

yes. Indonesia,

J. Sikkel

So yes, of product this -- contracted the taking we where over domestic domestic are farmers. is from sourcing sourcing various

purchasing, So to across. we've sales We're and shipment processing doing and those BAT. the farmers novated

our there. factory -- through will come So -- that and all processing factory

nice it's business So for a us.

aspirations something talking farmer very think that This make, of I the really about think companies and it both positive. of commitments reducing we And world. global for can the terms we we've -- in I around all foresaw ESG sustainability, forward. this been combines complexity, is some we in went operations we think to something in the continue sourcing different -- happen around progress is very, as and time I countries in markets that different that would

Ann Gurkin

it think could do Brazil? you to So progress

J. Sikkel

to around about I'm different announce comments companies origins. something ready -- not we'll when operations make about these are going to something, Obviously, globe. both announce are the other

Ann Gurkin

And BAT? quarter the this then that on incremental when fourth from guidance out call, did include Okay. put your Great. business you

J. Sikkel

it No, did not.

Ann Gurkin

timing the QX? Did into include it QX from shipment

J. Sikkel

did delays -- still the didn't built the year. for -- were It certainly have shipment we we in year. expectations into this have of year normalized -- We of the COVID terms we had

Ann Gurkin

year. the Into

You outlook? had on 'XX QX fiscal delays from into coming

J. Sikkel

into We 'XX... QX had

Ann Gurkin

that I'm QX... curious what

J. Sikkel

That's we've do. and we'll from QX or fiscal in quarters 'XX X 'XX And first that, we into recovered 'XX potentially have well. overhangs 'XX as into the then Yes. fiscal

Ann Gurkin

Okay.

I'm And sorry, I I find that. Okay. is Great. the apologize. year? CapEx then the for what couldn't

J. Sikkel

we... sure I'm not

Joel Thomas

will of there sort It of normal certain projects. in put that in XX% to we've depending in before Yes. range range our be XX% on sort that out

still but the mainly, of -- it's same. sort So

Ann Gurkin

that to business? additional Does -- BAT this include investments that does absorb

Joel Thomas

be from this will -- some CapEx. There

So...

J. Sikkel

capital, And there's it's involved of we working a to nothing But yes, obviously, little disclose. that bit in need that.

Ann Gurkin

from over And increase? like to up What went is that it $X behind QX. increase? is What now. debt long-term your Okay. looks then up that behind QX You're billion

Joel Thomas

timing the it our laid just $XXX additional -- of But and debt brought we'll and in back year, we out. will million capital It's then in probably this and come across additional footnote. Yes. the out that's used that some be it's

So we're fiscal that try actually the on looking of the to this during repayment course year. sometime start to

Ann Gurkin

asset through or debt improvement how working You'll back? How flow that sales we pay get capital generation? -- cash that or in

Joel Thomas

and tobacco. Remember, overhang it's had some primarily at the of some we buy Yes, working then opportunities capital. to 'XX Yes. some also end additional

kind the the all we've came that of for additional those that's together, loans and genesis So utilized.

Ann Gurkin

excited why afraid creeping about under see it's going to That's asking $X back it was that. was to I I I'm start so billion. Okay. up.

Okay.

Joel Thomas

no. No,

Ann Gurkin

in How on terms the as vapor like looks question opportunities last on longer And are business think noncombustible products, the products, thinking positioning manage then environment you customers of just you term, maybe leaf side to focus on to my a the serving how business products? as noncombustible the you of are changing pick of up what vaping and kind they heat-not-burn is your the side? customer navigating about business, technologies,

J. Sikkel

Well, I heat-not-burn is we that. the supply as for our products, there well. Obviously, products mean a multitude a answer customers' multipronged including of to

as next-generation I think this traditional supply of on also focus their at products well products. chains for look in of customers the helps they terms how

we've situations excited, announced e-liquids, call, Stage or just Bantam gains X we're and share and So also in opportunity, therefore, there's our we've significant involved similar announced products. what that this for Indonesia. We're to during process as know, you just obviously, PMTA our of in actually, moved to we

of move particularly the stage. by with completed a e-liquid before that few of companies, be the one that's we're tank the kind obviously, FDA open So X because And products has the deadline. to to lot to X-year September

to see and many in hoping market. But blue excited what have supply about chain. chips. we're customers different own particularly So e-liquid We happens additional to that, as their we of supply our enforcement supply for We part to the products.

significant So potential we've partnerships we've and to BXC. with well. to science, grow business that got with seeing continue we're BXB as that And established

So heat-not-burn we're we and with we're -- significant from have coverage projects various leaf other customers, see through our -- opportunity. that supply good got we've through e-liquid we through chain

Operator

Ian next Parkinson Polygon. from Our with comes question

Ian Parkinson

Two questions.

and is division there breakeven. So have and one if of the the nontobacco results the -- them even and margin I is, division, the is that focus think second overall at the with And of been SG&A. in-sourcing roughly the -- Indonesia. been nontobacco My then Can you at that had the understanding more gross negative the you comment look BAT? magnitude on deal question

on you're you expecting full the what business. just of So the part year from comment that for can

J. Sikkel

Yes.

year, even get but it. we we particular that be will it from next the accretive specific -- be as operation, cycles and significant we're will this about shipping more through operation, Indonesia, excited but for it the more given think guidance that I haven't year

Joel Thomas

those segment, the don't One, have question, other those don't have operating of on for you that Ian, other couple segment, then services a And in a things. included numbers. the in and Purilum breakout and you results products included through second in that income

in So pickup. not there, it's equity Purilum is

to got always at you looking So that factor into that.

we've to to LCM then about some goods out of that. And related CBD of lastly, to was continue hemp just increase related cost come in worked sold million Additionally, hemp a included to small the $X.X that business. there as overhang number,

up And so part of that will -- hopefully the cleaned year. get during cured the mid

helping those to there. top as that PMTAs that Pieter are over should pieces So about well. And at some and any see and great related talked the segment you the profitability on that, the time the line rate, that news way then be

happening So a of there. things simultaneously lot

Ian Parkinson

Okay.

through, So the more think when -- we're thinking of you about the nontobacco annualized annualized if we have the what rate washing some for do stuff those run side? is

Joel Thomas

Yes.

we provided a happening any right we've lot of now. that. guidance regards So But to with see positive again, things not

be be And third top as time should some over of further in we second, the in as quarter the costs into the that building coming fourth experienced the we've quarters get as line well. first and should

Ian Parkinson

is then QX, year And for moved sales but a There's last magnitude. provide think of it quantification Just from think sales sales? of slipped about Or this? some help one, any you Okay. indication QX. into that that don't million last us the QX, think gave of sales QX of QX some Is $XX you $XX I into slipped? that from of you that comment million

J. Sikkel

a About in less quarter X. quarter and the remainder X, bit shipped half than in little

Ian Parkinson

QX, have sales the how much slipped QX sales from QX higher if How interpret -- been? Right. into should no would had I

Joel Thomas

And Yes. QX have QX, quarter. fairly -- have $XX we related first the on historically in -- we in that a occurring I don't roughly XXXX sales is that COVID much know the moved right that focused into small a lot occurred the XXXX. to quarter. overhang we're now from And million so the

that last, in that into little third at second, should a And through so coming second and But as we $XXX primarily generally over it, quarter. out in be the call just look could be the third bit the quarter, little maybe remainder be million bit a quarter. the speaking, drifting the should

Ian Parkinson

you. Got

progress. Pleasing Okay.

So congratulations, guys.

Joel Thomas

Ian. you, Thank

J. Sikkel

Thank you.

Operator

comes from question next Our Rosenkranz with Jeff Management. Shelton Capital

Jeffrey Rosenkranz

to EBITDA guidance, basis? EBITDA $XXX on $XXX what would a million for first that your So correspond annual to question leaf million,

Joel Thomas

That's consolidated guidance related segments. to we provided separate basically. the provided guidance not various -- We've Yes.

Jeffrey Rosenkranz

to million it say, million would than it $XXX only? $XXX Suffice be the leaf Okay. for higher to

Joel Thomas

laid little while come we back into when well. watching is leaf is the and back Leaf Pieter we 'XX. more come about improved a where anticipating strong. But 'XX. that ago, get performing a we're performance of we're to 'XX, pretty We'll right over end stepping very as stone 'XX And out now, talk believe

So...

Jeffrey Rosenkranz

higher Right. guess, appreciate No, than current $XXX in the 'XX million million, off I hemp noise if working drag to -- is year, of $XXX in drag $XXX fiscal to consolidated fiscal other would the a other -- some from from for million million, bit leaf given and the that meant year I I businesses. of -- the $XXX there's guidance other current EBITDA of for fiscal the some of the be some

Joel Thomas

Yes. Leaf improvements 'XX. We've improving of year-over-year 'XX. the substantially provided Again, to segments. separate from guidance we pretty related 'XX 'XX from to anticipate any is not to

Jeffrey Rosenkranz

Okay...

Joel Thomas

guidance. But other were guidance on provide have allocations would of things do if segment you to SG&A and to you that

So...

Jeffrey Rosenkranz

Understood.

year benefiting saw the current this that improvement where year that to then fiscal further had And year saying the improvement to from fiscal some benefit? fact fiscal even fiscal even be you're expect year, last you with carryover, current fiscal from the the above current year the point year, Okay. you carryover so that next is next will an that carryover fiscal is

Joel Thomas

it's quarter horizon year But in guidance opportunities we ourselves right and year. we our the plan, going year lot fiscal quarter, a next and definitive that middle the for just we of fiscal 'XX, the we'll a And much the the and guidance very line provide first -- see once out now, -- provide more the We'll appropriate. we're get fiscal with to we we're year. It's right as and end this of through rebuilding the see when well, second now, a of in see on so. Yes. in

Jeffrey Rosenkranz

medium the -- say, on that. appreciate local structure soon medium shareholders. your optimize you time? the to, couple you to of capital to either and short any the a Thank you over efforts the put question. Like, place optimize borrowing in find with goals your either large of your lenders explanation that I term on relationships you Do for in opportunities color your your with new -- borrowings? and in sort or or see world new shed financing can let's Last around improve markets, just or improve and Okay. your

Joel Thomas

Yes.

So through last lenders well been tremendous. support working support. very us off, it there's first had the we our execute positioned. And has that reorganization been that year, it year And restructuring did was think on this together I the we're and to putting great the from or and I whether we think helping for offshore plan

we the used look year, strengthen can at the on As plan the we our capital then and think is on about be further basis, structure we're structure. believe optimizing we to go-forward execute that capital a ways the credit that enhance for to capable full can points of one there of key metrics the hit And hitting. obviously, those,

look a into and are see year. we of from that things good have at lot this last there further year, opportunities So to think strengthening year of next we a and end happened this of the going lot to year as

we're to where the structure about the now excited credit metrics sitting we're seeing in that improvements way further. the feed we're go the then capital business, and the and improve to So out right our those and ability

Operator

our from Nut with question Capital. Tree Andrew take We'll White next

Andrew White

for Just one me.

way it's if where -- I so there's, high history. like, mean it's it. recent right to been at periods at as level relative quarter, this I dollars, higher, be that look FX know the look doesn't much you there's but -- to of there's most it's prices, little it and and inventory a the not look Your might

is now your Is is seasonality, wouldn't think so tied should normal? about, trying I commenting, you -- the Or the And any in was understand extra just of capital is I this mind high? point what it level think low? there? For to Is but sort you trying if up it to year, be? it right there inventory where it

Joel Thomas

pretty versus so sitting okay? the $XXX is the think prior important look to period range uncommitted this year-over-year, million, number, year-over-year, based million. at have the XX% good million I $XX.X end, a And in Yes. and actually are don't okay? inventory, of dynamics range our that we position been in million we some that I -- if point through. But we've of in $XX we while at million, would $XXX that expect about are That's but key think, lower very on of a at here down you We're a we $XX same of provide a working year specific up dramatically

a think inventory in uncommitted in right now, and line So position with we're our good very expectations. sitting I

very So going. and where where we are feel good we about we're

Andrew White

it. Got

like So you're be. you of not you don't normal it's on inventory you're tons where sitting of to right want sort in now, a level inventory --

J. Sikkel

packed get the inventory. ready that positive to to -- We're the with are we very in uncommitted it so Right the to particularly go committed. need the year, to It's the where main of now, this order to logistics low We out this levels. we're and make year, part the at the get can now it for it. we at and about actually customer time is we us need thing major book of done

in I falls we're That's started purchased looking vessel that's -- a get the end one us falls that. We this to year market for the shipped on negatively. being year. down to down, the to forward of product got to We've that got And week. say So good -- pandemic and more customers. to It getting whole to indications purchase major before the falls hopefully, able We've didn't really mean this this U.S. the that product the tobacco.

Joel Thomas

low right uncommitted record again, inventory now. And

J. Sikkel

the It's lowest it. actually seen key. That's I've

Andrew White

one. just I could ask Maybe another

supposed the and to about few got move regarding think your ways this ship types come that I of that you and that these availability you, you've are in and scenario of freight which opposing of As the volumes questions you issues think guidance up different into but Asia envisioned, a we're shipments you things, last got forces negative. there's year so these helps year,

add you of if all but whole I And you and like of this sort the a add -- up those better sort whole backdrop sort generally say a understand this conditions that, of drag about like up this together? you so because be Or earnings? still conditions, of in you to is all they -- of just COVID do than Or they given the business I the stuff are you of think guess, average when stuff? your and out would average -- momentum for the the how you net

Joel Thomas

Yes.

that it's is are effects to when impacted demanding. think position than some a in are still improvement year, we COVID general related the okay? there customers of consider -- But seeing related carry-on all So related And so and to issues those, of that and are board are think better were we we last overall you timing year shipment, improvements what we theme, out the there this the transportation. of I to across

of related so improvements And that okay? through something some of seeing it's we we're of we're the really building COVID and we're having off whatever, to stone as variant the what of challenges outside generally see but improving, way, crazy a some things where stepping to 'XX been we to 'XX. seeing But were 'XX, along happens navigate we is have or existing, of -- Given are speaking, 'XX and now. in sort right that's --

general gradual are things improvement and looking So good.

Andrew White

Yes.

you lot which this it we're That's want of like, I in year? get because you of question year's volumes to is, all trying sounds But had. so. course, the last think your at guys to really like there's do right I is, are don't answer overearning that, to a

J. Sikkel

don't I is to some able total core we've in in We've been seeing give each guidance additional which volumes additional say of think can strong each we What the operating, purchase. growth I seeing -- volumes we that seen are that demand. markets the We're on we are specific don't obviously, very customer in component. procured.

have little to markets still in We those very left sell.

we're already contracting so for and demand, becomes and logistics year the it customer same in time, that stage regards stage a on. to crop for the issue year. At this planning So sizes next we're forecasting in

see a we of terms see progression of underlying because And the -- taking overhangs vertical come the base. for new we other So definitely of in the of we we of opportunities our can that we're We're customer growing. here are announced, Indonesia will go growing logistics and multitude and direction. And a transportation on forward. steady reversal because COVID-related we there issues. of positive that, all that in in the integration the with opportunities But as

and underlying yes, I So else, the on are shipping a and delays everything of say we COVID noise will definitely positive very trajectory.

Andrew White

day, quarter. Have a your good next and with of rest the luck good

Joel Thomas

Andrew. you, Thank

Operator

with We'll Intermarket. next take Yasir our Bari from question

Yasir Bari

the about -- got want or or like sort It first you that did be And the situation I been of would that were sounded in question, on revenue I so shipping the confirm, you realized recognized it's you million but rest million that of $XX think the deferred in QX? just confident $XXX had. asked, say to So you QX. you the

Joel Thomas

Yes.

So about QX. a there QX, in $XX And that bit remainder through anticipate little overhang, just of that, was in QX. coming over the we maybe million,

$XXX go million to there. over just So still

J. Sikkel

the is converting... But --

Yasir Bari

days because -- through? of come that is most you're out expectation of the terms in an what confidence kind seeing of on it's Or it have is And shipping and of do we're you've you XX based XX such it seen situation? June --

J. Sikkel

we've leave. the the vessels and loaded -- leave Like, the containers seen vessels

Yasir Bari

we Okay. these all One, shutting to follow the headlines things hear Then these down. ports Chinese just or couple that. from see on a -- of around --

one I saw week. last Does that you? think impact we

J. Sikkel

point, It some much China issue. a but big way in. Yes, to weeks, disruptions, uptick couple there wasn't has restricted because so the in low We the seen it China country out of an is were that, of very severely shipments travel shipments the out. of variant. But delayed expensive Delta actually going had is moment. recent it in Leaving we've on a both and by up related complex few a picking but the been going weeks. at a very moment not in The at and

that, issues shipments that the continue. travel restricted will particularly while and is But leaving country. domestically play within can hoping that to related and we're cause China, still So

Yasir Bari

ships China. your ships your certain more times is business to have you another to told would behind you you guess, asked next -- COVID Okay. that moving? time way, seasonal the just traveling, you are of plan? in December, somewhat the is -- when like, -- was I year is that about especially us think that the And during when in according year When you the would that there everything I important are go if that

J. Sikkel

Yes, particularly of I wish. Yes, movements, big a quarter from There's some quarter towards us. always Asia our markets. X for big is directional several

are going January globe. the is not Asia us. But and time for important logistics to March affecting just back. It's issues frame to these that very So

routes. Asia -- is moment. shipping problematic But of the profitable they've heightened demand, at obviously this effectively the to been lines number more the as vessels seen have moving

per container So attracting or if Africa so going going United Europe or $XX,XXX why Europe to to can container that you from on. States, would have to Europe $X,XXX the China from Argentina and get from you

from seen we've it, sailings reduced areas So managing as other through complex. it We're is but extremely well.

Yasir Bari

Or that chain, Is it. the it the problem, not now that given fair? huge is a our Got to that are between business? issues logistics, fair seasonality not and QX say global supply container of

J. Sikkel

and we that we #X every think mean every at No. I risk single moment. look single I That's at this face the the week. probably day

see I North X.X that it. getting teams this cost. are I the a our up through I whether also wouldn't months. in year actually product one we availability about conditions hits second hurricane and Carolina in But in last solid is The were But they of worse year than managing next say are from can progression shipping wake out. terms

had us take through success things was months everyone won't States, a on find. I United you could now if global vessel XX we we having problem that -- that. in some ready we if order it And Christmas, or specifically conversation you so to get any have it up the facilities regarding early that year could don't -- see all order don't the the shipping this with the better because want product industries. so. for this for ordered if you shipment you But to -- as have arrive, another multiple It's of could way. our for for we and not of in something it purchased, processed spare open advantage did One and container And we've

Yasir Bari

you No, the that's -- Or Yes. from that XXXX situation something just you could see already related, the in some you you guessing you for overhang shipping that I guess earlier, some Pieter, visibility that into on helpful. somewhat on mentioned world? have is is 'XX. Is reason? that based

J. Sikkel

global at we not situation COVID our we gave that not be, at when guidance, in at return that the thought that looked we we our 'XX. think we I when fiscal we logistics looked looked we where this year financial and assume would would normal when time -- and at to

drop without forecast. and some will So But we assumed, quarter that will into into that -- I X COVID, quarter our into built of we've had would -- go normal That, the we got... what, year. have X next moment, suspect we in at potentially happen a may year that,

Yasir Bari

course, course. normal normal That's that's Right. a

J. Sikkel

a risk. always, yes, normal, But quarter a have when is That's you such always X, that big yes.

Yasir Bari

Right.

Okay.

more, X Just think I one...

J. Sikkel

The underlying going. are orders strong. is We strong. like quality. -- and high business where The first are let me the say orders on that it's The again, that, the

Yasir Bari

by coffee, tobacco impacted easy. is question One -- Two Got was of in that any is, Brazil probably hear Brazil? that the news weather more. in affected the there's fairly We for The -- the certain it. crop conditions example, from is just this by extreme freeze.

J. Sikkel

crop X Yes. the was before hit The had weeks in frost tobacco region. coffee actually we

planting. fields southern we part the frost had was we the occur in it actually, protect that northern potential had farmers we and their to The farmers the for beds than did South, the but So was for interesting. Brazil -- part. stopped of time seed actually And prepare and colder with

from frost so And no Brazil. damage have in we abnormal

Yasir Bari

the I cash would related it. I'm this, trying Obviously, But the sheet, Got question. look then from term up to trying and leftover look at this about fees, the that guess of not bankruptcy maybe the in last associated the off-line term notes much on the not couple we similar Then And of balance but cash went am in the sits cash of a okay, figure FIGR over bit say, those cash draw the to or at sheet. where period. where or just loan payable, it's to that and sits? out trying the talked exit good balance too. delayed sitting mean there's build working and -- is where the missing because -- years hear. I it in what that in Joel, as we into I foreign kind et I'm of That's but cetera. But I some the inventory are follow years. lines a much for similar from burn, inventory, it business in in the that little your to that that I'm also bloated, -- I can follow not to relative the loan. bigger I where to and was business capital sheet, balance less maybe burned is some down, and have either your of how just periods time last you the terms that

Joel Thomas

Yes, sure.

receivables million there. year-over-year, receivables So about again, up. you've $XX.X you're million that at $XX.X looking if trade inventories, are if up about your we're at looking got you're

million your course, look as payable, there. your you're to banks are go at same accounts And $XXX.X you've $XX got quarter If year-over-year, of then, end, well down that down down payable about you and notes million. probably

But time. that's so same really are, versus movements out, cash and debt just brought pieces when the the majority okay, And the pieces that where you've those kind got the all I've played the look we moving at of at new you that of in.

Yasir Bari

it. Got

come at feel then supposed lastly, that about inventory but versus happy inventory lot inventory holding got question, more still are but looks such position. I is Obviously, just to inventory think at you that? holding component. you right? some this $XXX more think that's kilos Despite $XXX guess, your inventories are -- small, just the you your year there? deferred dollar the your kilos you that a know And revenue million, someone QX, of in in I I that, more That's of Okay. million actually $XXX last about asked you in million if

J. Sikkel

There more Yes. there. in some kilos are

Joel Thomas

and then, impact that there appreciated number a that Yes, currencies of the year-over-year of we're were to exposed inventory. in that

result, we kilos. have yes, a more As

Operator

the or today's to back any question-and-answer conference That time, session. closing will remarks. I concludes for additional at Thomas, you turn Mr. this

Joel Thomas

on David, this p.m. conference for The thank for Thank Again, August playback for you. thank call. for you will joining through call XX. interested available our call Saturday, X evening. remain participating persons any in our you

Operator

call. Thank today's participation. for concludes your This you

You may now disconnect.

We use cookies on this site to provide a more responsive and personalized service. Continuing to browse, clicking I Agree, or closing this banner indicates agreement. See our Cookie Policy for more information.