Construction permit for railway to freight up to 55% market share requested by Verde

Singapore. Verde AgriTech Ltd (TSX: “NPK”) (“OTCMKTS: “VNPKF“) (“Verde” or the “Company”) is pleased to announce that it has filed a request with the National Land Transport Agency (“ANTT”, from Agência Nacional de Transportes Terrestres) for authorization to build a railway branch line (the “Railway”) to transport up to 50 million tonnes per year (“Mtpy”) of Verde’s multinutrient potassium products, BAKS® and K Forte®, sold internationally as Super Greensand®, (the “Product”).

The Railway will connect Verde’s facilities in São Gotardo to Ibiá, both municipalities in Minas Gerais state, where there is a railway node, part of the Ferrovia Centro Atlântica (“FCA“). FCA is the largest railroad network in Brazil, interconnecting seven states and the Federal District. The FCA railways are the main freight route between the Southeast, Northeast and Midwest regions in Brazil.[1]

“The Railway will be a major milestone on our way to mitigate Brazil’s dependency on imported potash. By connecting Verde’s potash mines, Brazil’s largest known deposit, to its main consumer centers, the Railway will give farmers access to an even more substantial volume of Product,” commented Cristiano Veloso, Verde’s founder, and CEO.

In 2021 Brazil’s consumption of potash (in K2O) was 7.92 million,[2] which is equivalent to 79.20 million tonnes of Verde’s Product. Currently, over 96% of Brazil’s potash is supplied by imports, mostly in the form of KCl, sold by the Canadian and Belarus-Russian duopoly. Verde has a combined measured and indicated mineral resource of 1.47 billion tonnes at 9.28% K2O and an inferred mineral resource of 1.85 billion tonnes at 8.60% K2O (using a 7.5% K2O cut-off grade).[3] This amounts to 295.70 million tonnes of potash in K2O.

Verde’s Plant 1 operates with a capacity of 0.6Mtpy and Plant 2 operates with a capacity of 1.2Mtpy, totalling 1.8Mtpy. With Plant 2’s nameplate capacity of 2.4Mtpy to be achieved after its ramp up is concluded, the Company’s overall production capacity will be 3 Mtpy. Construction of Plant 3 is expected for 2024, with an expected capacity of 10Mtpy.

Based on the studies for the Pre-Feasibility Study filed by the Company in 2022 (the “PFS”), Verde has determined the viability of using road haulage for distribution logistics of up to 23Mtpy of Product. A rail spur will only be necessary for logistics of production exceeding such amount.

The Railway Authorization Program (“Pro Trilhos“), approved in August 2021 by the Brazilian Federal Government,[4] allows the private sector to build and operate railroads, branches, yards and railroad terminals, with the objective of increasing the attractiveness of the private sector to make investments in railroads, whether “greenfields” (new ventures – railroads built from scratch) or “brownfields” (development that will use existing railroads, at least in part of the desired length).

 

Next Steps

The decision by ANTT and the Brazilian Ministry of Infrastructure is expected in the coming months. If the Authorization is granted, a contract between ANTT and Verde will be subsequently signed, authorizing the exploration of the Railway in a private regime. After that, the Company shall start the environmental and engineering studies for this project.

 

Capital Expenditure

The PFS estimates a CAPEX of US$283.02 million[5] for the construction of a railway from São Gotardo to Ibiá to transport up to 50Mtpy of Product. The total CAPEX estimated in the PFS for the 50Mtpy Scenario is US$ 553.99 million, which includes the railway branch line, processing costs, road improvement, licensing, technical studies and projects, land purchase, equipment, personnel mobilization and demobilization, and a 15% contingency amount.

As stated in the press release published by the Company on May 16, 2022,[6] the investment in the railway branch construction is expected to be assumed by the rail operator. Verde is studying the possibility of potential partnerships for technical support in the Railway implementation and logistics operation.

 

The table below shows the summary of the financial-economic analysis for the 50Mtpy Scenario:

50Mtpy Scenario

Description Unit Value
Proven and probable reserves million tonnes 1,297.66
K2O grade % 9.19
Capex US$ million 553.99
Operating cost US$/tonne of Product 8.06
General and Administrative Expenses US$/tonne of Product 2.01
Sustaining capital US$/tonne of Product 0.50
 
Product composition Unit K2O K2O + S K2O + S + Micronutrients
Product Sale Price US$/tonne of Product 74.05 84.79 92.05
NPV after-tax US$ billion 9.34 11.50 13.54
NPV discount rate % 8.00 8.00 8.00
IRR after-tax % 167.86 196.19 227.08
Cumulative Cash Flow US$ billion 22.74 28.04 32.98

 

 

About Verde AgriTech

Verde is an agricultural technology company that produces potash fertilizers. Our purpose is to improve the health of all people and the planet. Rooting our solutions in nature, we make agriculture healthier, more productive, and profitable.

Verde is a fully integrated company, from the mining and processing its main feedstock from its 100% owned mineral properties, to the Product sales processes, which also include direct technical advice for farmers, and distribution.

Verde’s focus on research and development has resulted in one patent and eight patents pending. Among its proprietary technologies are Cambridge Tech, 3D Alliance, MicroS Technology, N Keeper, and Bio Revolution.[7] Currently, the Company is fully licensed to produce up to 2.8 million tonnes per year of its multinutrient potassium fertilizers K Forte® and BAKS®, sold internationally as Super Greensand®.[8] By the end of 2022, it plans to become Brazil’s largest potash producer by capacity.[9] Verde has a combined measured and indicated mineral resource of 1.47 billion tonnes at 9.28% K2O and an inferred mineral resource of 1.85 billion tonnes at 8.60% K2O (using a 7.5% K2O cut-off grade).[10] This amounts to 295.70 million tonnes of potash in K2O. For context, in 2021 Brazil’s total consumption of potash in K2O was 7.92 million.[11]

Brazil ranks second in global potash demand and is its single largest importer, currently depending on external sources for over 96% of its potash needs. In 2021, potash accounted for approximately 2% of all Brazilian imports by dollar value.

 

Corporate Presentation

For further information on the Company, please view shareholders’ deck:

https://verde.docsend.com/view/9eftew2grqtk6wfr  

 

Investors Newsletter

Subscribe to receive the Company’s updates at:

http://cloud.marketing.verde.ag/InvestorsSubscription

The last edition of the newsletter can be accessed at: https://bit.ly/InvestorNewsletter_October-2022_

 

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:

  • the estimated amount and grade of Mineral Resources and Mineral Reserves;
  • the PFS representing a viable development option for the Project;
  • 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;
  • the estimated amount of future production, both produced and sold;
  • timing of disclosure for the PFS and recommendations from the Special Committee;
  • the Company’s competitive position in Brazil and demand for potash; and,
  • 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:

  • the presence of and continuity of resources and reserves at the Project at estimated grades;
  • 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;
  • the capacities and durability of various machinery and equipment;
  • the availability of personnel, machinery and equipment at estimated prices and within the estimated delivery times;
  • currency exchange rates;
  • Super Greensand® and K Forte® sales prices, market size and exchange rate assumed;
  • appropriate discount rates applied to the cash flows in the economic analysis;
  • tax rates and royalty rates applicable to the proposed mining operation;
  • the availability of acceptable financing under assumed structure and costs;
  • anticipated mining losses and dilution;
  • reasonable contingency requirements;
  • success in realizing proposed operations;
  • receipt of permits and other regulatory approvals on acceptable terms; and
  • the fulfilment of environmental assessment commitments and arrangements with local

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, Founder, Chairman & Chief Executive Officer

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

www.investor.verde.ag | www.supergreensand.com | www.verde.ag

 

[1] Source: https://www.fcatransforma.com.br/

[2] Source: Union of the Agricultural Fertilizers and Correctives Industry in the State of São Paulo (“SIACESP”, from Sindicato da Indústria de Fertilizantes e Corretivos Agropecuários no Estado de São Paulo).

[3] As per the National Instrument 43-101 Standards of Disclosure for Mineral Projects within Canada (“NI 43 -101”), filed on SEDAR in 2017. See the Pre-Feasibility Study at: https://investor.verde.ag/wp-content/uploads/2021/01/NI-43-101-Pre-Feasibility-Technical-Report-Cerrado-Verde-Project.pdf

[4] Source: https://www.gov.br/infraestrutura/pt-br/assuntos/transporte-terrestre_antigo/programa-de-autorizacoes-ferroviarias, regulated by Law 14.273, (December 23, 2021) and ANTT Resolution 5.987 (September 01, 2022).

[5] For further information, please see page 264 of the PFS: https://investor.verde.ag/wp-content/uploads/2022/05/NI-43-101-Pre-Feasibility-Technical-Report-for-the-Cerrado-Verde-Project.pdf

[6] See the press release at: https://investor.verde.ag/wp-content/uploads/2022/05/Verde-AgriTech-Press-Release-Pre-Feasibility-Results-May-16-2022.pdf

[7] Learn more about our technologies: https://verde.docsend.com/view/yvthnpuv8jx6g4r9

[8] See the release at: https://investor.verde.ag/2-5-million-tonnes-per-year-potash-mining-concession-granted-to-verde/

[9] See the release at: https://investor.verde.ag/verde-to-reach-3-million-tonnes-potash-production-capacity-in-2022/

[10] As per the National Instrument 43-101 Standards of Disclosure for Mineral Projects within Canada (“NI 43 -101”), filed on SEDAR in 2017. See the Pre-Feasibility Study at: https://investor.verde.ag/wp-content/uploads/2021/01/NI-43-101-Pre-Feasibility-Technical-Report-Cerrado-Verde-Project.pdf

[11] Union of the Agricultural Fertilizers and Correctives Industry, in the State of São Paulo (“SIACESP”, from Sindicato da Indústria de Fertilizantes e Corretivos Agropecuários, no Estado de São Paulo).

Verde is awarded easements for the 23Mtpy production scenario of its Pre-Feasibility Study

Singapore. Verde AgriTech Ltd (TSX: “NPK”) (“OTCMKTS: “VNPKF“) (the “Company”) is pleased to announce that the Brazilian National Mining Agency (“ANM”, from Agência Nacional de Mineração) has issued a set of orders granting Verde multiple easements over lands that will enable the Company to access and build the mines capable of jointly producing up to 23 million tonnes per year (“Mtpy”) of Verde’s multinutrient potassium products, BAKS® and K Forte®, sold internationally as Super Greensand®, (the “Product”) as detailed in its Pre-Feasibility Study (the “PFS”).[1]

An easement grants a right to cross or otherwise use someone else’s land for a specified purpose without the need to own the land. As in most jurisdictions, in Brazil the mineral right is separate from the right to surface land. Verde received multiple favorable decisions from the ANM determining that Verde is entitled to 1,439.25 hectares of easements, sufficient to enable the Company to implement the 23Mtpy scenario of its PFS, which has a subsequent scenario of 50Mtpy.

For further information on the PFS, please see the press release issued on May 16, 2022: https://investor.verde.ag/verde-announces-pre-feasibility-study/

“It is hard to overstate the importance of ANM’s determinations because it clears all land ownership hurdles for Verde. It is a major regulatory step towards achieving our proposed 50Mtpy production scenario. In essence, this is a major recognition of the urgency for Brazil to address its crippling economic dependency on imported potash,” declared Verde’s Founder, President & CEO Cristiano Veloso.

 

About Verde AgriTech

Verde is an agricultural technology company that produces potash fertilizers. Our purpose is to improve the health of all people and the planet. Rooting our solutions in nature, we make agriculture healthier, more productive, and profitable.

Verde is a fully integrated company, from the mining and processing its main feedstock from its 100% owned mineral properties, to the Product sales processes, which also include direct technical advice for farmers, and distribution.

Verde’s focus on research and development has resulted in one patent and eight patents pending. Among its proprietary technologies are Cambridge Tech, 3D Alliance, MicroS Technology, N Keeper, and Bio Revolution.[2] Currently, the Company is fully licensed to produce up to 2.8 million tonnes per year of its multinutrient potassium fertilizers K Forte® and BAKS®, sold internationally as Super Greensand®.[3] By the end of 2022, it plans to become Brazil’s largest potash producer by capacity.[4] Verde has a combined measured and indicated mineral resource of 1.47 billion tonnes at 9.28% K2O and an inferred mineral resource of 1.85 billion tonnes at 8.60% K2O (using a 7.5% K2O cut-off grade).[5] This amounts to 295.70 million tonnes of potash in K2O. For context, in 2021 Brazil’s total consumption of potash in K2O was 7.92 million.[6]

Brazil ranks second in global potash demand and is its single largest importer, currently depending on external sources for over 96% of its potash needs. In 2021, potash accounted for approximately 2% of all Brazilian imports by dollar value.

 

Corporate Presentation

For further information on the Company, please view shareholders’ deck:

https://verde.docsend.com/view/vtrrjcdhe7mz6c9b

 

Investors Newsletter

Subscribe to receive the Company’s updates at:

http://cloud.marketing.verde.ag/InvestorsSubscription

The last edition of the newsletter can be accessed at: https://bit.ly/InvestorNewsletter_October2022_

 

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:

  • the estimated amount and grade of Mineral Resources and Mineral Reserves;
  • the PFS representing a viable development option for the Project;
  • 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;
  • the estimated amount of future production, both produced and sold;
  • timing of disclosure for the PFS and recommendations from the Special Committee;
  • the Company’s competitive position in Brazil and demand for potash; and,
  • 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:

  • the presence of and continuity of resources and reserves at the Project at estimated grades;
  • 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;
  • the capacities and durability of various machinery and equipment;
  • the availability of personnel, machinery and equipment at estimated prices and within the estimated delivery times;
  • currency exchange rates;
  • Super Greensand® and K Forte® sales prices, market size and exchange rate assumed;
  • appropriate discount rates applied to the cash flows in the economic analysis;
  • tax rates and royalty rates applicable to the proposed mining operation;
  • the availability of acceptable financing under assumed structure and costs;
  • anticipated mining losses and dilution;
  • reasonable contingency requirements;
  • success in realizing proposed operations;
  • receipt of permits and other regulatory approvals on acceptable terms; and
  • the fulfilment of environmental assessment commitments and arrangements with local

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, Founder, Chairman & Chief Executive Officer

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

www.investor.verde.ag | www.supergreensand.com | www.verde.ag

 

[1] See the NI 43-101 Pre-Feasibility Technical Report for further information: https://investor.verde.ag/wp-content/uploads/2022/05/NI-43-101-Pre-Feasibility-Technical-Report-for-the-Cerrado-Verde-Project.pdf

[2] Learn more about our technologies: https://verde.docsend.com/view/yvthnpuv8jx6g4r9

[3] See the release at: https://investor.verde.ag/2-5-million-tonnes-per-year-potash-mining-concession-granted-to-verde/

[4] See the release at: https://investor.verde.ag/verde-to-reach-3-million-tonnes-potash-production-capacity-in-2022/

[5] As per the National Instrument 43-101 Standards of Disclosure for Mineral Projects within Canada (“NI 43 -101”), filed on SEDAR in 2017. See the Pre-Feasibility Study at: https://investor.verde.ag/wp-content/uploads/2021/01/NI-43-101-Pre-Feasibility-Technical-Report-Cerrado-Verde-Project.pdf

[6] Union of the Agricultural Fertilizers and Correctives Industry, in the State of São Paulo (“SIACESP”, from Sindicato da Indústria de Fertilizantes e Corretivos Agropecuários, no Estado de São Paulo).

Verde to Present at the Morgan Stanley Global Chemicals, Agriculture, and Packaging Conference

Singapore. Verde AgriTech Ltd (TSX: “NPK”) (“OTCMKTS: “VNPKF“) (the “Company”) is pleased to announce that it will be presenting at the Morgan Stanley Global Chemicals, Agriculture, and Packaging Conference (the “Conference”). The Conference will take place in Boston, MA, on November 8, 2022 and November 9, 2022, and Verde will be represented by its Founder, President & CEO, Mr. Cristiano Veloso.

After the Conference, Verde’s presentation will be available on the Company’s website at: https://investor.verde.ag/events/

About Verde AgriTech

Verde is an agricultural technology company that produces potash fertilizers. Our purpose is to improve the health of all people and the planet. Rooting our solutions in nature, we make agriculture healthier, more productive, and profitable.

Verde is a fully integrated Company: it mines and processes its main feedstock from its 100% owned mineral properties, then sells and distributes the Product.

Verde’s focus on research and development has resulted in one patent and eight patents pending. Among its proprietary technologies are Cambridge Tech, 3D Alliance, MicroS Technology, N Keeper, and Bio Revolution.[1] Currently, the Company is fully licensed to produce up to 2.8 million tonnes per year of its multinutrient potassium fertilizers K Forte® and BAKS®, sold internationally as Super Greensand®.[2] By the end of 2022, it plans to become Brazil’s largest potash producer by capacity.[3] Verde has a combined measured and indicated mineral resource of 1.47 billion tonnes at 9.28% K2O and an inferred mineral resource of 1.85 billion tonnes at 8.60% K2O (using a 7.5% K2O cut-off grade).[4] This amounts to 295.70 million tonnes of potash in K2O. For context, in 2021 Brazil’s total consumption of potash in K2O was 7.92 million[5].

Brazil ranks second in global potash demand and is its single largest importer, currently depending on external sources for over 96% of its potash needs. In 2021, potash accounted for approximately 2% of all Brazilian imports by dollar value.

 

Corporate Presentation

For further information on the Company, please view shareholders’ deck:

https://verde.docsend.com/view/idfhjyb9eyy6c6cd

 

Investors Newsletter

Subscribe to receive the Company’s updates at:

http://cloud.marketing.verde.ag/InvestorsSubscription

The last edition of the newsletter can be accessed at: https://bit.ly/InvestorsNL_August2022

 

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:

  • the estimated amount and grade of Mineral Resources and Mineral Reserves;
  • the PFS representing a viable development option for the Project;
  • 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;
  • the estimated amount of future production, both produced and sold;
  • timing of disclosure for the PFS and recommendations from the Special Committee;
  • the Company’s competitive position in Brazil and demand for potash; and,
  • 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:

  • the presence of and continuity of resources and reserves at the Project at estimated grades;
  • 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;
  • the capacities and durability of various machinery and equipment;
  • the availability of personnel, machinery and equipment at estimated prices and within the estimated delivery times;
  • currency exchange rates;
  • Super Greensand® and K Forte® sales prices, market size and exchange rate assumed;
  • appropriate discount rates applied to the cash flows in the economic analysis;
  • tax rates and royalty rates applicable to the proposed mining operation;
  • the availability of acceptable financing under assumed structure and costs;
  • anticipated mining losses and dilution;
  • reasonable contingency requirements;
  • success in realizing proposed operations;
  • receipt of permits and other regulatory approvals on acceptable terms; and
  • the fulfilment of environmental assessment commitments and arrangements with local

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, Founder, Chairman & Chief Executive Officer

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

www.investor.verde.ag | www.supergreensand.com | www.verde.ag

 

[1] Learn more about our technologies: https://verde.docsend.com/view/yvthnpuv8jx6g4r9

[2] See the release at: https://investor.verde.ag/2-5-million-tonnes-per-year-potash-mining-concession-granted-to-verde/

[3] See the release at: https://investor.verde.ag/verde-to-reach-3-million-tonnes-potash-production-capacity-in-2022/

[4] As per the National Instrument 43-101 Standards of Disclosure for Mineral Projects within Canada (“NI 43 -101”), filed on SEDAR in 2017. See the Pre-Feasibility Study at: https://investor.verde.ag/wp-content/uploads/2021/01/NI-43-101-Pre-Feasibility-Technical-Report-Cerrado-Verde-Project.pdf

[5] Union of the Agricultural Fertilizers and Correctives Industry, in the State of São Paulo (“SIACESP”, from Sindicato da Indústria de Fertilizantes e Corretivos Agropecuários, no Estado de São Paulo).

Luciana de Oliveira Cezar Coelho and Fernando Prezzotto Join Verde’s Board of Directors

Belo Horizonte, Brazil. Verde AgriTech Ltd (TSX: “NPK”) (“OTCMKTS: “VNPKF“) (the “Company”) is pleased to announce the appointment of Luciana de Oliveira Cezar Coelho and Fernando Prezzotto (the “Directors”) to its Board of Directors (the “Board”).

“As we start a carefully planned renewal of the Board, we welcome Mrs. Oliveira Cezar Coelho and Mr. Prezzotto, whose agricultural sector experience and deep understanding of Brazil will further strengthen Verde’s Board”, declared Verde’s Director, Renato Gomes.

“As someone with a career devoted to Brazilian agriculture and relevant technology, I am pleased to join Verde AgriTech because its mission of supplying a superior local source of potash and micronutrients to farmers is something I strongly believe in and know that I can add value to”, commented Fernando Prezzotto.

“I am pleased to be the first woman to join the Board of Verde. As a board member at Raízen, Brazil’s largest agricultural producer by land coverage, I know very well the importance of fertilizers to agriculture’s supply chain. Verde is ideally positioned to be Brazil’s leader in its segment of that market and I will do my best to ensure that happens”, proclaimed Luciana Oliveira Cezar Coelho.

“At Verde, we know that there is strength in diversity, a principle that we adopt across all levels of the Company, from our mine pits to our executives. Mrs. Oliveira Cezar Coelho is the the first female director of the Board, representing an important step toward gender equality. Today, approximately 60% of the administrative staff, including corporate, marketing, finance and human resources, are women. The percentage of women in leadership positions, such as managers and coordinators, is 41%. Overall, including more physically demanding mine and plant laborers, women comprise 31% of all Verde’s employees, compared to a global industry average of 8% to 17%[1]”, celebrated Verde’s Founder, President & CEO, Cristiano Veloso.

The Board is now composed of four independent directors, Alysson Paolinelli, Fernando Prezzotto, Luciana de Oliveira Cezar Coelho and Renato Gomes, with Mr. Veloso as sole executive director.

The Board will soon update the composition of the Audit, Compensation, Corporate Governance and Nominating committees.

About Luciana de Oliveira Cezar Coelho

Mrs. Oliveira Cezar Coelho is the founding and managing partner of STS GAEA Capital and board member in multiple companies with billion-plus market valuation. She has over 20 years of experience in mergers and acquisitions, corporate restructuring, debt and equity capital markets, financial restructuring and private equity investment.

Before founding STS GAEA in 2013, Mrs. Oliveira Cezar Coelho was a founding partner of STK Capital, an asset management company focused on public equities, and of Virtus BR Partners, a financial advisory boutique. Prior to Virtus, Mrs. Oliveira Cezar Coelho’s experiences include: Managing Director responsible for the coverage of clients in the industrial segment at Banco Santander; Managing Director of the industrials and conglomerates advisory group at ABN Amro; Vice President in the investment banking division of Merrill Lynch in São Paulo and in the merger and acquisitions group of Merrill Lynch in New York; Associate in the merger and acquisitions group of Lehman Brothers in New York.

Currently, Mrs. Oliveira Cezar Coelho is also a member of the Board of Directors and of the Audit Committee of Raízen S.A., an energy company that produces sugarcane and ethanol, also acting in fuel distribution, renewable energy generation, and lubricants sectors, being the second largest fuel distribution company in Brazil[2]; member of the Board of Directors and of the Audit & Risk Committee of Energisa S.A., a publicly traded holding company, that operates in the generation and commercialization of electricity in Brazil, in addition to being the fifth largest energy distribution group in the country in number of clients[3]; member of the Board of Directors of Restoque S.A., a Brazilian retail company focused on the sale of high-end clothing, accessories, and cosmetics, with stores divided into six brands[4]; member of the Board of Directors of LPS Brasil S.A. (Lopes), Brazilian company that provides services in the real estates sector, such as brokerage and consultancy for projects and finance[5]; and member of the Harvard Global Advisory Council.

She is also co-founder of the Instituto República.org, co-founder and vice president of the Instituto Vassouras Cultural, member of the Center for Debate of Public Policy (CDPP), member of the Executive Committee of Prep – Program – Lemann Foundation, member of the Women Corporate Directors (WCD) and certified for membership of Fiscal Committee by the Brazilian Institute of Corporate Governance (IBGC). Previously, she served as a member of the Board of Directors of Norte Energia S.A. (Belo Monte Hydroelectric Complex), Entalpia Participações S.A. (Unicoba) and Instituto República.org.

Mrs. Oliveira Cezar Coelho has a Bachelor’s degree in Economics from the Federal University of Rio de Janeiro (UFRJ), a Master’s degree in Economics from the Catholic University of Rio de Janeiro (PUC-RJ), and a Ph.D. in Economics in the fields of Finance, Game Theory and Contract Theory from Harvard University.

 

About Fernando Prezzotto

Fernando João Prezzotto is a serial entrepreneur focused on innovative solutions for agribusiness. In 2021 he was elected by Ernst & Young the entrepreneur of the year in Brazil. He is the founder and CEO of SEMPRE AgTech,  focused on the genetic improvement of plants, on the research of transgenic events and on the creation of eco-friendly biopesticides with RNAi technology and other gene editing techniques. It operates mainly in Brazil and in some South American countries, having a significant share in the corn hybrids market.[6]  He is also the founder and CEO of Produce, a company that provides agricultural inputs and technical services to producers of all crops, with over 3,800 sales consultants throughout Brazil.[7] Mr. Prezzoto acts as a mentor and entrepreneur of Endeavor,[8] an acceleration network for companies, present in over 40 markets around the world. He is an angel investor in multiple startups, with a focus on emerging markets. In addition to his corporate activities, Mr. Prezzoto is also a farmer with ongoing agricultural production.

Mr. Prezzotto holds a degree in Business Administration, with specializations from Harvard Business School, University of California and Tel Aviv University.

 

About Verde AgriTech

Verde is an agricultural technology company that produces potash fertilizers. Our purpose is to improve the health of all people and the planet. Rooting our solutions in nature, we make agriculture healthier, more productive, and profitable.

Verde is a fully integrated Company: it mines and processes its main feedstock from its 100% owned mineral properties, then sells and distributes the Product.

Verde’s focus on research and development has resulted in one patent and eight patents pending. Among its proprietary technologies are Cambridge Tech, 3D Alliance, MicroS Technology, N Keeper, and Bio Revolution.[9] Currently, the Company is fully licensed to produce up to 2.8 million tonnes per year of its multinutrient potassium fertilizers K Forte® and BAKS®, sold internationally as Super Greensand®.[10] By the end of 2022, it plans to become Brazil’s largest potash producer by capacity.[11] Verde has a combined measured and indicated mineral resource of 1.47 billion tonnes at 9.28% K2O and an inferred mineral resource of 1.85 billion tonnes at 8.60% K2O (using a 7.5% K2O cut-off grade).[12] This amounts to 295.70 million tonnes of potash in K2O. For context, in 2021 Brazil’s total consumption of potash in K2O was 7.92 million[13].

Brazil ranks second in global potash demand and is its single largest importer, currently depending on external sources for over 96% of its potash needs. In 2021, potash accounted for approximately 2% of all Brazilian imports by dollar value.

 

Corporate Presentation

For further information on the Company, please view shareholders’ deck:

https://verde.docsend.com/view/k425izamysda5q6s

 

Investors Newsletter

Subscribe to receive the Company’s updates at:

http://cloud.marketing.verde.ag/InvestorsSubscription

The last edition of the newsletter can be accessed at: https://bit.ly/InvestorsNL-August2022

 

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:

  • the estimated amount and grade of Mineral Resources and Mineral Reserves;
  • the PFS representing a viable development option for the Project;
  • 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;
  • the estimated amount of future production, both produced and sold;
  • timing of disclosure for the PFS and recommendations from the Special Committee;
  • the Company’s competitive position in Brazil and demand for potash; and,
  • 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:

  • the presence of and continuity of resources and reserves at the Project at estimated grades;
  • 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;
  • the capacities and durability of various machinery and equipment;
  • the availability of personnel, machinery and equipment at estimated prices and within the estimated delivery times;
  • currency exchange rates;
  • Super Greensand® and K Forte® sales prices, market size and exchange rate assumed;
  • appropriate discount rates applied to the cash flows in the economic analysis;
  • tax rates and royalty rates applicable to the proposed mining operation;
  • the availability of acceptable financing under assumed structure and costs;
  • anticipated mining losses and dilution;
  • reasonable contingency requirements;
  • success in realizing proposed operations;
  • receipt of permits and other regulatory approvals on acceptable terms; and
  • the fulfilment of environmental assessment commitments and arrangements with local

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, Founder, Chairman & Chief Executive Officer

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

www.investor.verde.ag | www.supergreensand.com | www.verde.ag

 

[1] See McKinsey & Company, Why women are leaving the mining industry and what mining companies can do about it, September 2021, available at: https://www.mckinsey.com/industries/metals-and-mining/our-insights/why-women-are-leaving-the-mining-industry-and-what-mining-companies-can-do-about-it.

[2] See: https://www.raizen.com.br/sobre-a-raizen/quem-somos/meus-numeros

[3] See: http://grupoenergisa.com.br/Paginas/home.aspx

[4] See: https://www.restoque.com.br/a-companhia/marcas/

[5] See: https://ri.lopes.com.br/show.aspx?idCanal=CzBbfspg5ckMYH7ffHwDTg==

[6] See: https://catalogo.sempre.agr.br/

[7] See: https://www.produce.agr.br/#/sobre-nos

[8] See: https://endeavor.org.br/quem-somos/

[9] Learn more about our technologies: https://verde.docsend.com/view/yvthnpuv8jx6g4r9

[10] See the release at: https://investor.verde.ag/2-5-million-tonnes-per-year-potash-mining-concession-granted-to-verde/

[11] See the release at: https://investor.verde.ag/verde-to-reach-3-million-tonnes-potash-production-capacity-in-2022/

[12] As per the National Instrument 43-101 Standards of Disclosure for Mineral Projects within Canada (“NI 43 -101”), filed on SEDAR in 2017. See the Pre-Feasibility Study at: https://investor.verde.ag/wp-content/uploads/2021/01/NI-43-101-Pre-Feasibility-Technical-Report-Cerrado-Verde-Project.pdf

[13] Union of the Agricultural Fertilizers and Correctives Industry, in the State of São Paulo (“SIACESP”, from Sindicato da Indústria de Fertilizantes e Corretivos Agropecuários, no Estado de São Paulo).

Verde announces strategic sales partnership with Lavoro, Latin America’s largest distributor of agricultural inputs

Belo Horizonte, Brazil. Verde AgriTech Ltd (TSX: “NPK”) (“Verde” or the “Company”) is pleased to announce that it has entered a strategic partnership with Grupo Lavoro (“Lavoro”), the largest distributor of agricultural inputs in Latin America, to more swiftly open up new markets for Verde’s multinutrient potassium products, BAKS® and K Forte® sold internationally as Super Greensand® (the “Product”) in Brazil (the “Partnership”).

Lavoro operates over 190 stores, staffed by 2,500 employees in Brazil, many of whom are agronomists and farming specialists who work closely with its over 55,000 clients. Lavoro will be a distributor of Verde’s Products.

“There is an increasing demand for products that enable more sustainable food production methods. We are therefore proud to now offer Verde AgriTech’s Products to our portfolio, expanding the options for our clients”, commented Roberto Rosa, Lavoro’s Purchasing Director.

“Over the years, Verde has assembled a formidable sales team that supports our clients from the first contact all the way through to a successful harvest. Lavoro embodies many of our team’s values and competencies, but with a reach beyond Verde’s current geographical scope.  Furthermore, Lavoro’s track record in promoting biological products in Brazil will help accelerate the successful uptake of K Forte-Bio Revolution, helping enable the fourth agricultural revolution through microorganisms across Brazil”, commented Cristiano Veloso, Verde’s founder, and CEO.

The Company’s 2022 guidance updated upwards on May 03, 2022[1] provides for sales of 1,000,000 tonnes of Verde’s Product, with revenue of C$109.09 million, EBITDA of C$49.06 million and net earnings per share (“EPS”) of C$0.87. The 2023 guidance provides for sales of 2,000,000 tonnes.

Verde currently operates Plant 1 with a capacity of 0.6 million tonnes per year (“Mtpy”). Plant 2 is on track for commissioning in Q3 2022 with an additional capacity of 2.4Mtpy. With Plant 2, the Company’s overall production capacity is expected to be 3,000,000 tpy, establishing Verde as Brazil’s largest potash producer by capacity. Plant 3’s construction is planned for 2023, and is expected to add 10Mtpy, which will allow the Company to produce up to 16.4% of the current national demand for potash.

Verde has a combined measured and indicated mineral resource of 1.47 billion tonnes at 9.28% K2O and an inferred mineral resource of 1.85 billion tonnes at 8.60% K2O (using a 7.5% K2O cut-off grade).[2] This amounts to 295.70 million tonnes of potash in K2O, sufficient to supply Brazil’s potash demand for generations. In 2021 Brazil’s total consumption of potash in K2O was 7.92 million.[3]

With over 6,000 clients since 2017, the Company achieved an Earned Growth Rate[4] of 165% in 2021, compared to 61% in 2020, demonstrating a higher client repurchase rate and successful client referrals in Brazil, Canada, China, Thailand, Paraguay, and the Unites States.

Through its proprietary technologies – Cambridge Tech, 3D Alliance, MicroS Technology, N Keeper, and Bio Revolution[5] – used in the development of its Products, Verde was able to achieve a triple-digit growth in revenue and sales in the last years. With the launch of Bio Revolution, Verde’s technology that enables the incorporation of microorganisms to its Product, the Company expects to become a world leader at offering a cost-efficient platform for adding microorganisms to agriculture, boosting plant productivity while improving soil biodiversity.

Verde’s Plant 1 is already endowed with a facility for deploying Bio Revolution. At Plant 2, currently under construction, a proportionally larger Bio Revolution facility will be built, and its operations will start by the end of the year.

 

About Lavoro

Lavoro was created through the acquisitions and mergers of more than 20 large and medium-sized distributors, under the control of the Pátria Investimentos, a leading investment firm focused on Latin America with combined assets under management of $27.6 billion, based in Rio de Janeiro, Brazil.[6] With more than 190 stores in Brazil and Colombia, Lavoro Group stands as the largest distributor of agricultural inputs in Latin America, with over 55,000 clients across the continent.

Selling its own agrochemicals, foliar fertilizers, and biological inputs brands, the company’s revenue reaches R$ 7.5 billion, maintaining an accelerated annual growth. Lavoro has over 55,000 customers, with stablished physical and digital presence in the main agricultural regions of Latin America. In addition to the strong presence in agribusiness, with a specialized team for technical visits and direct contact with customers, Lavoro also created an online platform to serve producers, agronomists, and other agribusiness professionals, which places the company as one of the pioneers in the agricultural input segment in the digital area.

Lavoro’s portfolio includes seeds, fertilizers, pesticides, foliar fertilizers and biological inputs leading brands, among other innovative products for agriculture and livestock. The main crops are: soybeans, corn, cotton, coffee, beans, rice, sugarcane, wheat, citrus and pastures.

As a member of Rede Brasil Pacto Global (Brazil Global Compact Network), Lavoro Group is committed to the objectives of sustainable development. Its management is oriented towards building a positive legacy, in an ethical and friendly manner for people and the environment, considering environmental, social and governance aspects in all its operations.

 

About Verde AgriTech

Verde is an agricultural technology company that produces potash fertilizers. Our purpose is to improve the health of all people and the planet. Rooting our solutions in nature, we make agriculture healthier, more productive, and profitable.

Verde is a fully integrated company, from the mining and processing its main feedstock from its 100% owned mineral properties, to the Product sales processes, which also include direct technical advice for farmers, and distribution.

Verde’s focus on research and development has resulted in one patent and eight patents pending. Among its proprietary technologies are Cambridge Tech, 3D Alliance, MicroS Technology, N Keeper, and Bio Revolution.[7] Currently, the Company is fully licensed to produce up to 2.8 million tonnes per year of its multinutrient potassium fertilizers K Forte® and BAKS®, sold internationally as Super Greensand®.[8] By the end of 2022, it plans to become Brazil’s largest potash producer by capacity.[9] Verde has a combined measured and indicated mineral resource of 1.47 billion tonnes at 9.28% K2O and an inferred mineral resource of 1.85 billion tonnes at 8.60% K2O (using a 7.5% K2O cut-off grade).[10] This amounts to 295.70 million tonnes of potash in K2O. For context, in 2021 Brazil’s total consumption of potash in K2O was 7.92 million.[11]

Brazil ranks second in global potash demand and is its single largest importer, currently depending on external sources for over 96% of its potash needs. In 2021, potash accounted for approximately 2% of all Brazilian imports by dollar value.

 

Corporate Presentation

For further information on the Company, please view shareholders’ deck:

https://verde.docsend.com/view/e5nbd7y8x6erq6mn

 

Investors Newsletter

Subscribe to receive the Company’s updates at:

http://cloud.marketing.verde.ag/InvestorsSubscription

The last edition of the newsletter can be accessed at: https://bit.ly/InvestorsNL-July2022

 

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:

  • the estimated amount and grade of Mineral Resources and Mineral Reserves;
  • the PFS representing a viable development option for the Project;
  • 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;
  • the estimated amount of future production, both produced and sold;
  • timing of disclosure for the PFS and recommendations from the Special Committee;
  • the Company’s competitive position in Brazil and demand for potash; and,
  • 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:

  • the presence of and continuity of resources and reserves at the Project at estimated grades;
  • 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;
  • the capacities and durability of various machinery and equipment;
  • the availability of personnel, machinery and equipment at estimated prices and within the estimated delivery times;
  • currency exchange rates;
  • Super Greensand® and K Forte® sales prices, market size and exchange rate assumed;
  • appropriate discount rates applied to the cash flows in the economic analysis;
  • tax rates and royalty rates applicable to the proposed mining operation;
  • the availability of acceptable financing under assumed structure and costs;
  • anticipated mining losses and dilution;
  • reasonable contingency requirements;
  • success in realizing proposed operations;
  • receipt of permits and other regulatory approvals on acceptable terms; and
  • the fulfilment of environmental assessment commitments and arrangements with local

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, Founder, Chairman & Chief Executive Officer

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

www.investor.verde.ag | www.supergreensand.com | www.verde.ag

 

[1] See release at: https://investor.verde.ag/verdes-2022-guidance-and-two-year-outlook-revised-upwards/

[2] As per the National Instrument 43-101 Standards of Disclosure for Mineral Projects within Canada (“NI 43 -101”), filed on SEDAR in 2017. See the Pre-Feasibility Study at: https://investor.verde.ag/wp-content/uploads/2021/01/NI-43-101-Pre-Feasibility-Technical-Report-Cerrado-Verde-Project.pdf

[3] Union of the Agricultural Fertilizers and Correctives Industry, in the State of São Paulo (“SIACESP”, from Sindicato da Indústria de Fertilizantes e Corretivos Agropecuários, no Estado de São Paulo).

[4] The Earned Growth Rate measures the sales growth by volume generated by returning customers and new client purchases made by existing clients’ referrals. See press release at: https://investor.verde.ag/verde-doubles-year-on-year-earned-growth-rate/

[5] Learn more about our technologies: https://verde.docsend.com/view/yvthnpuv8jx6g4r9

[6] See: https://ir.patria.com/.

[7] Learn more about our technologies: https://verde.docsend.com/view/yvthnpuv8jx6g4r9

[8] See the release at: https://investor.verde.ag/2-5-million-tonnes-per-year-potash-mining-concession-granted-to-verde/

[9] See the release at: https://investor.verde.ag/verde-to-reach-3-million-tonnes-potash-production-capacity-in-2022/

[10] As per the National Instrument 43-101 Standards of Disclosure for Mineral Projects within Canada (“NI 43 -101”), filed on SEDAR in 2017. See the Pre-Feasibility Study at: https://investor.verde.ag/wp-content/uploads/2021/01/NI-43-101-Pre-Feasibility-Technical-Report-Cerrado-Verde-Project.pdf

[11] Union of the Agricultural Fertilizers and Correctives Industry, in the State of São Paulo (“SIACESP”, from Sindicato da Indústria de Fertilizantes e Corretivos Agropecuários, no Estado de São Paulo).

Verde achieves 782% EBITDA and 362% revenue growths in Q2 2022

Belo Horizonte, Brazil. Verde AgriTech Ltd (TSX: “NPK”) (“Verde” or the “Company”) is pleased to announce its financial results for the second quarter of 2022 (“Q2 2022”).

 

Q2 2022 Financials

  • Revenue increased by 362% in Q2 2022, to $24,861,000 compared to $5,376,000 in Q2 2021.
  • Revenue in Brazilian Real (“R$”) increased by 327% in Q2 2022, to R$99,185,000 compared to R$23,215,000 in Q2 2021.
  • Sales of Verde’s multinutrient potassium products, BAKS® and K Forte® sold internationally as Super Greensand® (the “Product”) by volume increased by 112% in Q2 2022, to 202,255 tonnes, compared to 95,551 tonnes sold in Q2 2021.
  • Gross margin increased to 79% in Q2 2022, compared to 72% in Q2 2021.
  • EBITDA before non-cash events increased by 782% in Q2 2022 to $10,765,000, compared to $1,220,000 in Q2 2021.
  • Net profit increased by 3426% in Q2 2022, to $9,625,000 compared to $273,000 in Q2 2021.

 

Subsequent Events

  • In July 2022 the Company concluded its re-domiciliation to Singapore, pursuant to which the new Singaporean company, Verde AgriTech Ltd, became the holding company of de UK company Verde AgriTech Plc. Verde’s trading symbols did not change, continuing as “NPK” on the TSX.[1]

“Verde’s growth over Q2 2022 was underpinned by increased productivity and the market’s growing demand for our Product. I would like to congratulate our team for their efforts and contributions during this period. We trust that our expanding production and market presence will lead us to meet our goals for the year and continue to create sustainable long-term value for Verde’s stakeholders,” declared Verde’s Founder, President & CEO, Cristiano Veloso.

 

Plant 2 Update

Plant 2 is expected to be commissioned in August 2022, revving up to an initial production capacity of 1.2 million tonnes per year (“tpy”).[2] Plant 2’s full capacity of 2,400,000 tpy is expected to be reached in early Q4 2022, four times Verde’s Plant 1 current production capacity of 600,000 tpy.

 

2022 Guidance

On May 03, 2022, Verde announced an increase in its 2022 and 2023 guidance,[3] as initially published on January 10, 2022.[4] The Group’s targets are detailed on a quarterly basis, to reflect the market demand’s seasonality, with the original and revised 2022 detailed below:

Period Q1 2022 Q2 2022 Q3 2022 Q4 2022 FY 2022
Guidance Original Jan 2022 Achieved in Q1 2022 Original Jan 2022 Revised May 2022 Achieved in Q2 2022 Original Jan 2022 Revised May 2022 Original Jan 2022 Revised May 2022 Original Jan 2022 Revised May 2022
EPS (C$) 0.02 0.06 0.18 0.21 0.19 0.25 0.35 0.06 0.25 0.50 0.87
EBITDA (C$’000)[5] 1,358 3,678 10,155 11,808 10,765 13,414 19,259 3,506 14,319 28,434 49,065
Revenue (C$’000) 10,070 11,304 21,954 22,902 24,861 27,228 40,121 13,011 34,769 72,263 109,097
Sales target (tonnes) 115,000 111,667 200,000 200,000 202,255 250,000 353,718 135,000 334,615 700,000 1,000,000

 

The 2022 guidance is underpinned by the following assumptions:

  • Average Brazilian Real (“R$”) to Canadian Dollar exchange rate: C$1.00 = R$4.40
  • Verde’s Product CIF and FOB average price for the full year, including delivered orders, committed orders and projected orders: C$109 per tonne
  • Sales Incoterms: 50% CIF and 50% FOB
  • Sales channels: 40% direct sales and 60% indirect sales

 

The revised guidance already contemplated a 55% increase in diesel prices. However, during Q2 2022, the real average diesel price increased by an additional 23%, for a total of 78% year-on-year increase. This negatively impacted Verde’s EBITDA and EPS as compared to the revised guidance. Q2 2022 revenue and sales were, however, higher than expected for the period. For Q3 and Q4 2022, the Company expects it will meet the overall revised guidance for the year.

 

2023 Guidance

For 2023, Verde’s updated sales volume target is 2,000,000 tonnes. This target represents a potential 100% growth Year-on-Year (“YoY”).

 

Period FY 2023
Guidance Original Jan 2022 Revised May 2022
Sales target (tonnes) 1,400,000 2,000,000

 

Selected Annual Financial Information

The table below summarizes Q2 2022 financial results compared to Q2 2021, and provides information about 2022 and 2021 year-to-date (“YTD”):

 

All amounts in CAD $’000 Q2 2022 Q2 2021 YTD 2022 YTD 2021
Tonnes sold ‘000 202 96 314 113
Revenue per tonne sold $ 123 56 115 55
Production cost per tonne sold $ (26) (16) (25) (18)
Gross Profit per tonne sold $ 97 40 90 37
Gross Margin 79% 72% 78% 68%
 
Revenue 24,861 5,376 36,165 6,207
Production costs (5,332) (1,498) (7,987) (1,988)
Gross Profit 19,529 3,878 28,178 4,219
Gross Margin 79% 72% 78% 68%
Sales and product delivery freight expenses (8,110) (2,236) (12,041) (2,767)
General and administrative expenses (655) (422) (1,696) (1,119)
EBITDA (1) 10,765 1,220 14,441 333
Share Based and Bonus Payments (Non-Cash Event) (2) (40) (693) (104) (1,514)
Depreciation and Amortisation (2) (38) (10) (64) (16)
Profit on disposal of plant and equipment (2) 9
Operating Profit / (loss) after non-cash events 10,686 (517) 14,273 (1,188)
Interest Income/Expense (245) (56) (430) (131)
Net Profit / (Loss) before tax 10,441 (461) 13,843 (1,319)
Income tax (3) (816) (188) (1,186) (219)
Net Profit / (Loss) 9,625 273 12,657 (1,538)

(1) – Non GAAP measure

(2) – Included in General and Administrative expenses in financial statements

(3) – 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 CIF (Minas Gerais) prices.

The table below summaries these changes:

 

Change % 6 months ended Jun 30, 2022 6 months ended Jun 30, 2021
Canadian Dollar (C$) Average Exchange Rate -8% R$3.99 R$4.32
Potassium Chloride CIF (Minas Gerais) Lowest Price(1) +167% US$1,040 US$390
Potassium Chloride CIF (Minas Gerais) Highest Price(1) +129% US$1,270 US$555

(1) – Source: Acerto Limited Report.

Net Profits and EPS

The Group generated a net profit of $9,625,000 for Q2 2022, an increase of $9,352,000 compared to $273,000 for Q2 2021. The basic earnings per share was $0.189 for Q2 2022, compared to $0.005 for Q2 2021.

 

Product Sales

Sales by volume increased by 112% in Q2 2022, to 202,255 tonnes sold compared to 95,551 tonnes sold in Q2 2021.

 

Revenue

Revenue from sales increased by 362% in Q2 2022, to $24,861,000 from the sale of 202,255 tonnes of the Product, at $123 per tonne sold; compared to $5,376,000 in Q2 2021 from the sale of 95,551 tonnes of the Product, at $56 per tonne sold.

Revenue per tonne excluding freight expenses (FOB price) improved by 137% in Q2 2022, to $88 compared to $37 in Q2 2021.

Revenue per tonne in Q2 2022 was higher than Q2 2021 mainly due to:

  1. Product volume sold as CIF (Cost Insurance and Freight) increased from 43% of total sales in Q2 2021 to 68% in Q2 2022.
  2. Potassium Chloride CIF (Minas Gerais) price increased from US$390-555 per tonne in Q2 2021 to US$1,040-1,270 per tonne in Q2 2022 (as reported by Acerto Limited, a market intelligence firm).

 

Production costs

Production costs include all direct costs from mining, processing, and the addition of other nutrients to the Product, such as Sulphur and Boron. Production costs also include the logistics costs from the mine to the plant and related salaries.

Production costs increased by 256% in Q2 2022, to $5,332,000 compared to $1,498,000 in Q2 2021. This was due to a 112% increase in volume sold, from 95,551 tonnes in Q2 2021 to 202,255 tonnes in Q2 2022. Cost per tonne increased by 68% in Q2 2022, to $26 compared to $16 in Q2 2021. This increase was mainly driven by a 78% increase in the diesel price for the period and the increase of Product sold in big bags, rather than bulk, which has a higher per tonne cost.

 

Sales Expenses

CAD $’000 3 months ended Jun 30, 2022 3 months ended Jun 30, 2021 6 months ended Jun 30, 2022 6 months ended Jun 30, 2021
Sales and marketing expenses (711) (347) (1,533) (641)
Fees paid to independent sales agents (359) (63) (495) (71)
Product delivery freight expenses (7,040) (1,826) (10,013) (2,055)
Total (8,110) (2,236) (12,041) (2,767)

 

Sales and marketing expenses

Sales and marketing expenses include employees’ salaries, car rentals, travel within Brazil, hotel expenses, customer relationship management (CRM) software licenses, and the promotion of the Product in marketing events.

Expenses increased by 104% in Q2 2022, to $711,000 compared to $348,000 in Q2 2021, mainly due to a further expansion of Verde’s sales and marketing team, with professional headcount in the team increasing from an average of 50 in Q2 2021 to 70 in Q2 2022, and due to additional investments in media as a strategy to attract new customers This increase is in line with the Group’s accelerated growth strategy.

 

Fees paid to independent sales agents

As part of Verde’s marketing and sales strategy, the Group pays out commissions to its independent sales agents.

Fees paid to independent sales agents increased by 474% in Q2 2022, to $359,000 compared to $63,000 in Q2 2021, due to sales price and volume increase.

Product delivery freight expenses

Product delivery freight expenses increased by 286% in Q2 2022, to $7,040,000 compared to $1,826,000 in Q2 2021, as the Group has significantly increased the volume sold as CIF (Cost Insurance and Freight), up from 43% of total sales in Q2 2022 to 68% Q2 2022, and due higher fuel prices, which increased 78% in Q2 2022 compared to Q2 2021.

 

General and Administrative Expenses

CAD $’000 3 months ended Jun 30, 2022 3 months ended Jun 30, 2021 6 months ended Jun 30, 2022 6 months ended Jun 30, 2021
General administrative expenses (389) (240) (799) (718)
Legal, professional, consultancy and audit costs (77) (106) (488) (265)
IT/Software expenses (185) (70) (390) (122)
Taxes and licenses fees (4) (6) (19) (14)
Total (655) (422) (1,696) (1,119)

 

General administrative expenses

These costs include general office expenses, rent, bank fees, insurance, foreign exchange variances and remuneration of executive and administrative staff in Brazil.

Expenses increased by 62% in Q2 2022, to $389,000 compared to $240,000 in Q2 2021 mainly due to increased salary costs as they include additional administrative employees, with professional headcount in the team increasing from an average of 47 in Q2 2021 to 128 in Q2 2022 to help support the Group’s growth.

 

Legal, professional, consultancy and audit costs

Legal and professional fees include legal, professional, consultancy fees along with accountancy, audit and regulatory costs. Consultancy fees are consultants employed in Brazil, such as accounting services, patent process, lawyer’s fees and regulatory consultants.

Expenses decreased by 28% in Q2 2022, to $77,000 compared to $106,000 in Q2 2021, due to lower expenses with environmental, legal, accounting, and IT consultancies.

 

IT/Software expenses

IT/Software expenses include software licenses such as Microsoft Office, Customer Relationship Management (CRM) software and enterprise resource planning (ERP).

Expenses increased by 166% in Q2 2022, to $185,000 compared to $70,000 in Q2 2022, mainly due to CRM and ERP consultants’ services.

 

Taxes and licences

Taxes and licence expenses include general taxes, product branding and licence costs.

Expenses decreased in Q2 2022, to $4,000 compared to $6,000 in Q2 2022.

 

Share Based and Bonus Payments (Non-Cash Event)

These costs represent the expense associated with stock options granted to employees and directors and non-cash bonuses paid to key management.

Share Based Payments costs decreased by 94% in Q2 2022, to $40,000 compared to $693,000 in Q2 2021.

 

Q2 2022 Results Conference Call

The Company will host a conference call on Tuesday, August 16, 2022, at 11:00 am Eastern Time, to discuss Q2 2022 results and provide an update. Subscribe using the link below and receive the conference details by email.

 

Date: Tuesday, August 16, 2022
Time: 11:00 am Eastern Time
Subscription link: https://bit.ly/Q2-2022_Results_Presentation

 

The questions can be submitted in advance through the following link up to 48 hours before the conference call: https://bit.ly/VerdeAgriTech-Q2_2022-questions

The Company’s first quarter financial statements and related notes for the period ended June 30, 2022 are available to the public on SEDAR at www.sedar.com and the Company’s website at www.investor.verde.ag/.

 

About Verde AgriTech

Verde is an agricultural technology Company that produces potash fertilizers. Our purpose is to improve the health of all people and the planet. Rooting our solutions in nature, we make agriculture healthier, more productive, and profitable.

Verde is a fully integrated Company:  it mines and processes its main feedstock from its 100% owned mineral properties, then sells and distributes the Product.

Verde’s focus on research and development has resulted in one patent and eight patents pending. Among its proprietary technologies are Cambridge Tech, 3D Alliance, MicroS Technology, N Keeper, and Bio Revolution.[6] Currently, the Company is fully licensed to produce up to 2.8 million tonnes per year of its multinutrient potassium fertilizers K Forte® and BAKS®, sold internationally as Super Greensand®.[7]

By the end of 2022, Verde aims to become Brazil’s largest potash producer by capacity.[8] Verde has a combined measured and indicated mineral resource of 1.47 billion tonnes at 9.28% K2O and an inferred mineral resource of 1.85 billion tonnes at 8.60% K2O (using a 7.5% K2O cut-off grade).[9] This amounts to 295.70 million tonnes of potash in K2O. For context, in 2021 Brazil’s total consumption of potash in K2O was 7.92 million.[10]

Brazil ranks second in global potash demand and is its single largest importer, currently depending on external sources for over 96% of its potash needs. In 2021, potash accounted for approximately 2% of all Brazilian imports by dollar value.

 

Corporate Presentation

For further information on the Company, please view shareholders’ deck: https://verde.docsend.com/view/5ci6p9mqv6dfbgmf

 

Investors Newsletter

Subscribe to receive the Company’s updates at:

http://cloud.marketing.verde.ag/InvestorsSubscription

The last edition of the newsletter can be accessed at:  https://bit.ly/InvestorsNL-June2022

 

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:

  • the estimated amount and grade of Mineral Resources and Mineral Reserves;
  • the PFS representing a viable development option for the Project;
  • 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;
  • the estimated amount of future production, both produced and sold;
  • timing of disclosure for the PFS and recommendations from the Special Committee;
  • the Company’s competitive position in Brazil and demand for potash; and,
  • 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:

  • the presence of and continuity of resources and reserves at the Project at estimated grades;
  • 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;
  • the capacities and durability of various machinery and equipment;
  • the availability of personnel, machinery and equipment at estimated prices and within the estimated delivery times;
  • currency exchange rates;
  • Super Greensand® and K Forte® sales prices, market size and exchange rate assumed;
  • appropriate discount rates applied to the cash flows in the economic analysis;
  • tax rates and royalty rates applicable to the proposed mining operation;
  • the availability of acceptable financing under assumed structure and costs;
  • anticipated mining losses and dilution;
  • reasonable contingency requirements;
  • success in realizing proposed operations;
  • receipt of permits and other regulatory approvals on acceptable terms; and
  • the fulfilment of environmental assessment commitments and arrangements with local

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, Founder, Chairman & Chief Executive Officer

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

www.investor.verde.ag | www.supergreensand.com | www.verde.ag

 

[1] See the press release at: https://investor.verde.ag/verde-announces-completion-of-redomiciliation-process-to-singapore/

[2] as announced by the Company in the press release published on March 03, 2022. See the release at: https://investor.verde.ag/verde-to-reach-3-million-tonnes-potash-production-capacity-in-2022/

[3] See the release at: https://investor.verde.ag/verdes-2022-guidance-and-two-year-outlook-revised-upwards/

[4] See the release at: https://investor.verde.ag/verde-announces-2022-guidance-and-two-year-outlook/

[5] Before non-cash events.

[6] Learn more about our technologies: https://verde.docsend.com/view/yvthnpuv8jx6g4r9

[7] See the release at: https://investor.verde.ag/2-5-million-tonnes-per-year-potash-mining-concession-granted-to-verde/

[8] See the release at: https://investor.verde.ag/verde-to-reach-3-million-tonnes-potash-production-capacity-in-2022/

[9] As per the National Instrument 43-101 Standards of Disclosure for Mineral Projects within Canada (“NI 43 -101”), filed on SEDAR in 2017. See the Pre-Feasibility Study at: https://investor.verde.ag/wp-content/uploads/2021/01/NI-43-101-Pre-Feasibility-Technical-Report-Cerrado-Verde-Project.pdf

[10] Union of the Agricultural Fertilizers and Correctives Industry, in the State of São Paulo (“SIACESP”, from Sindicato da Indústria de Fertilizantes e Corretivos Agropecuários, no Estado de São Paulo).