WINNIPEG, MANITOBA, CANADA — AGI reported record sales and adjusted earnings before interest, taxes and depreciation for the first quarter ended March 31, on strong orders and clear strategic priorities.

“We are pleased to see the momentum from a banner 2022 carryover into a strong start for 2023,” said Paul Householder, president and chief executive officer of AGI. “With several of our key operational excellence initiatives and growth strategies gaining traction, we are optimistic about the potential to continue our growth trajectory in 2023. Supported by a strong order book, clear strategic priorities, and the organization settling into a more disciplined operating cadence, we have increased our full year guidance for 2023. We look forward to tackling new challenges and enjoying more successes through the year.”

The company reported adjusted EBITDA of C$48 million, an increase of 16% year-over-year. Sales grew 19% to C$347 million.

This was the sixth consecutive quarter of record results.

“As we continue to focus on our strategic priorities, which include profitable organic growth, operational excellence, and balance sheet discipline, we are excited about the long-term growth potential of our business,” AGI said.

AGI management increased the full year 2023 adjusted EBITDA guidance to C$265 million, up from the previous estimate of C$260 million. The order book is up 7% year-over-year, supporting the prospect of growth through 2023, the company said.  

“The first quarter was a major success for several of our most important balance sheet priorities,” said Jim Rudyk, chief financial officer of AGI. “Our adjusted EBITDA growth and prudent use of credit facilities combined to help the net debt leverage ratio tick downwards again. We are on-track to get this metric toward the three-times level by the end of 2023. In addition, our initiatives targeted at optimizing working capital have shown tremendous progress versus last year, particularly in terms of managing our inventory. The year is off to a great start and we look forward to continuing the trend throughout the year.”

For the commercial segment, first-quarter sales and adjusted EBITDA increased 17% and 10%, respectively. Sales growth was driven by activity in Asia Pacific and South America markets.

Adjusted EBITDA margin was impacted by the anticipated slowdown in the Food platform as well as a larger-than-usual mix of buy-resell third-party components on a number of large commercial projects that typically have lower margins. These trends are expected to return to normalized levels toward the end of 2023 based on ongoing efforts to strengthen the order book.

Internationally, the growth in the Brazil and India regions continued to be robust in the first quarter. Annual sales growth of 9% and 19% year-over-year, respectively, highlights the importance of the regional diversification strategy and the benefits of the company’s investments in developing market positions within these critical agricultural regions, AGI said.