Verde AgriTech Q2 Revenue Falls 29%, Net Loss Widens

Verde AgriTech Ltd (TSX: NPK | OTCQX: VNPKF) has reported its financial and operating results for the second quarter ended June 30, 2026, indicating a significant decline in revenue due to increased selectivity in fertilizer purchasing and tight credit conditions within the Brazilian agricultural sector. The company's Q2 revenue decreased by 29% to CAD 3.4 million, down from CAD 4.8 million in the same period last year. Concurrently, the net loss expanded to CAD 3.6 million, compared to CAD 2.4 million in Q2 2025.

Reberth Machado, CEO of Verde, noted that fertilizer affordability, restrictive financing, and the expected return on each application increasingly shaped purchasing decisions in Brazilian agriculture. In this challenging environment, Verde's strategy focuses on understanding customer priorities more precisely, directing efforts toward the most relevant opportunities, and shortening the path from technical validation to commercial adoption. Sales volume saw a 42% year-over-year decrease, falling to 46,709 tons from 80,354 tons.

Despite the difficult market conditions, Verde AgriTech managed to maintain resilient unit profitability. Excluding product delivery freight revenue, the average revenue per ton increased to CAD 40 from CAD 38. Similarly, the average gross profit per ton rose to CAD 23 from CAD 22. Gross profit for the quarter was CAD 2.6 million, a 25% decrease from CAD 3.5 million in Q2 2025. Earnings Before Interest, Taxes, Depreciation, and Amortization (EBITDA), before non-cash items, widened its loss from negative CAD 0.2 million to negative CAD 1.2 million.

The macroeconomic environment in Brazil, characterized by high interest rates and restricted financing, directly impacted customer purchasing power, thereby affecting the company's operational results. In response, the company successfully reduced sales and marketing and general and administrative expenses by 10% to CAD 1.75 million, aided by workforce reductions and contract renegotiations. However, these savings were offset by lower gross profit and a CAD 0.5 million allowance for expected credit losses, primarily related to a customer entering judicial reorganization.

CEO Machado emphasized that since assuming his role, his priority has been to engage directly with Verde's major clients, strategic B2B customers, and well-renowned agronomic advisers across Brazil. He also added that the company is seeking a stronger presence at major industry events, particularly in sugarcane, where he has extensive operating experience and longstanding relationships, and in composting-related segments, where Verde's products have a synergistic fit. These strategic engagements are expected to sharpen how the company prioritizes accounts, deploys commercial resources, and develops new business with clear criteria for pricing, credit, and resource allocation.