Good morning. Welcome, and thank you for joining the Orsero Q1 2026 results web call. At this time, I would like to turn the conference over to Mr. Paolo Prudenziati, Chairman of Orsero. Please go ahead, sir.
Hi. Good morning, everybody. Just one word before I pass the word, the speech to Raffaella. The company is happy, satisfactorily satisfied for all the different segment we are working on. On the top, I think the business model of the company is showing again that is very much resilient to any kind of problem. Now we have an additional work, but in despite of this, the business is still there, still consistent, still doing more or less like we've done last year. Now I pass the word to Raffaella.
Thank you, Paolo. Good morning, everyone, and thank you for joining us today. The first quarter of 2026 delivered a positive and solid start to the year, fully in line with our expectation. Group revenue reached around EUR 389 million, up 2.5% compared to Q1 last year. This growth was supported by both business unit, despite a complex market environment. Looking at distribution, performance was very solid. We saw higher volume and prices in several key categories such as exotic fruit, grapes, kiwi, and berries, more than offsetting expected lower banana volumes and weaker Mexican avocado prices. Coming back to our recent announcement on distribution, I'd like to briefly explain their strategic relevance. The exclusive lease agreement is a key element of our premium positioning.
It has attracted strong interest in the market, we believe it could create additional commercial opportunity over time. By contrast, the investment in Vigo is clearly about growth. We still see strong growth potential in Spain, especially in that region where competition is still limited. Turning to shipping, the quarter closed broadly in line with last year, despite a lower loading factor and some temporary operational issue. The situation has improved since April, with loading factors now well back in line with our expectation and even slightly ahead our initial forecasts. Moving on to profitability. Adjusted EBITDA was EUR 20.8 million, broadly in line with last year, with a stronger contribution from distribution offsetting lower profitability in shipping.
Adjusted net profit increased to EUR 8.3 million, supported by lower financial costs and a reduced negative impact from exchange rate. Our financial position remained very strong with net debt improved to EUR 103.8 million, driven by solid cash generation and good working capital management. Looking ahead, we remain fully focused on delivering our financial and economic targets. We are also continuing to work on selective external growth opportunities, as we have mentioned in previous call. We are approaching this process with care and discipline, investing time and effort to find the right target, the right people, and the right value. We will continue to update you as we move forward. Thank you. I now turn it over to Matteo.
Thank you, Raffaella. Thank you, Paolo, and good morning, everybody. Thanks for joining the call. I will go a bit more in detail. We start with the economic and financial response for the quarter. The CapEx investment are in line with expectation, strengthening the group's distribution footprint through upgrades to building and equipment across all our warehouses, especially in Italy, where we are investing to enlarge our fresh capacity in Verona. And obviously, Spain, as Raffaella just mentioned, and France. It's very interesting because we are now employing our capital exactly when we see opportunity of growth, and we are working on delivering added-value processes and products to our clients.
Fresh- cut is one of the top picks. As Raffaella said, after the quarter, we closed the transaction with the new distribution platform in Vigo, in the north of Spain. This will benefit the whole Iberian Peninsula operation, because from Vigo, we can serve Portugal as well in the north part where we are less present. Lychee business was already highlighted by Raffaella. This is a milestone for our added value product gamma, and we are sure we're gonna be able to create additional opportunities through lychee all over Europe. The interest rate situation is well in line with our expectation, our gross debt is established on the long term.
This is created to define, let's say, a stable interest rate value and to grant to the group the financial stability to grow. On May 13, Orsero shareholder received a dividend of EUR 0.005 per share in cash, and a dividend in kind through the allocation of one Orsero share every 172 shares held by the registered shareholders. The market context in Euro is seeing an inflation rate around 2.5% up to March 2026, up from 1.9% in February. With unprocessed food inflation, that actually is what is concerning or benefiting us, growing from 3.5% in December 2025 to 4.1% in March 2026.
The group results in this context are marking an increase in prices. This is always not only related to the inflation, but is specifically related to our mix that is growing in value quarter by quarter. The volumes are almost unchanged versus Q1 2025, but this is only because we decided not to participate to certain tenders, specifically in France, Portugal, and Italy. Following our strategy where banana business is a stable one, is a business that we want to continue to have, but with a portion of selected clients that we decide to serve or not depending on the market condition, not to lose money on the business. The distribution business unit, the sales growth is around 2% versus Q1 2025.
As we said, the increase in volume and prices for high-value added category in Europe was particularly for exotic fruits, kiwi fruit, and berries. Then as we said, counterbalanced by lower banana volumes and lower prices of Mexican avocados. Actually, Mexican avocados, we're seeing a market that is completely different in terms of pricing compared to last year, so we have to face a period of 2025 first quarter that was exceptional. The volumes are above last year, so this is a good KPI for us. Obviously, we have to stay with the prices that the U.S. market is giving to the Mexican volumes.
The adjusted EBITDA margin comes in with 4.42% versus 4.35% Q1, thanks to the high-value added product contribution. Shipping business unit, the sales are performing in line with our expectation, thanks to a more favorable schedule and to rebilling of low-sulfur fuel related surcharges related to environmental compliance, particular EU ETS. As we said, we always said in the shipping, we are well covered vis-a-vis the bunkering price increase, thanks to the commercial contract that we have with third parties and thanks to our hedging strategy performed last year. Adjusted EBITDA is around EUR 7 million, representing 23.7% of net sales, decreasing compared to last year due to a lower loading factor.
As Raffaella said, we are seeing since April an inversion of trend, we're confident to have a good performance for the end of first half. Now going to the consolidated net profit bridge. This year we have a consolidated adjusted net profit that is passing from EUR 8.1 million to EUR 8.3 million comparing the two quarters.
The main effect is a decreased EBITDA of EUR 0.7 million, additional D&A and provision of EUR 0.4 million, a better performance on the financial side and share of profit from our non-controlling interest by EUR 1 million, and a positive tax effect of EUR 0.3 million for the fact that we had a better result on the distribution in the country where we still have tax asset to use to offset our tax contribution.
This year we adjusted a bit more the net profit and the EBITDA compared with last year. Just because we had at the beginning of the year a stop of the four vessels that needed to fulfill the schedule to charter two additional spot vessels that are coming in with EUR 1 million additional non-recurring costs that we are offsetting because it's not gonna be again suffered during the year. In terms of net equity variance, the net equity is passing from EUR 274.5 million end of 2025 to EUR 284.6 million first quarter of 2026. The main effect is the net profit of the period, EUR 6.5 million.
A positive effect on the hedging reserves, for EUR 3.5 million, mainly related to the bunker hedging and other effects that are negligible. In terms of net financial position, excluding IFRS 16, the performance is very positive. End of last year, we closed our balance sheet with EUR 49.7 million. We had EUR 9.8 million positive cash flow, a negligible net working capital variance, - EUR 0.2 million. Operating CapEx for EUR 2.9 million, well in line with our expectation and forecast, and a positive mark- to- market effect of EUR 5.4 million. The net financial position without counting IFRS 16 principle is EUR 37.5 million, and adding the IFRS 16 effect, we are touching the EUR 103.8 million .
As Raffaella said, we are confident to achieve our financial economic targets for the end of the year. We will keep you posted on the evolution quarter by quarter to be more precise on our expectation on the guidance 2026. Now I will leave the rest of the time for the Q&A session. Thank you.
Thank you, sir. We will now begin the question and answer session. To enter the queue for questions, please click on the Q&A icon on the left side of your screen. When announced, please click Continue on the pop-up window. If you're connected on audio only, press star and one on your telephone. The first question comes from Gabriele Berti of Intesa Sanpaolo.
Hello, good morning, everyone. Thanks for the presentation. First question on the new Vigo hub. If I'm not wrong, you indicated the potential to triple revenues in the area, which currently stand at around EUR 12 million, if I'm not wrong. What is the realistic timeframe to achieve this target? More in general, which is the role the platform will play in strengthening your coverage in northwest of Spain and Portugal? Then on Madagascar lychee contract, could you provide more details on expected volumes, duration of the agreement, and the geographic scope of the distribution in Europe? It would be also helpful if you can provide any indication on the impact you expect from the contract.
Lastly, on shipping, you mentioned, probably extraordinary maintenance, issue during the quarter. Has this now been completed? Should we expect any further, impacts in Q2 or non-recurring cost, during the year?
Thank you. Thank you, Gabriele. Good morning. I will start from the Vigo hub. You're right. The new Vigo hub is a strategic path of growth for Spain, because actually you know that in the Iberian Peninsula we have two companies. Sorry. One is Hermanos Fernández serving Spain, and the other one is Eurofrutas serving Portugal. I'm sorry. Actually, we were not really covering the north of Spain and the north of Portugal, so the Galician areas that is really on the border of the Portugal between Portugal and Spain. The new hub is a state-of-the-art hub. It already has a team because we bought basically the warehouse and the team that were working there, so it's around 20 people.
We already have in place a total integration with the ERP system of Hermanos Fernández and Eurofrutas. We have in place the commercial team, the operative team, and everything that we need to start working. Actually the warehouse is already operative, and we are having direct sales since a couple of weeks in the region. The size of the hub is 5,000 square meters, and the hub will be dedicated to added-value products. As Raffaella said, that area of Spain is a populated one. It is really strategic because of the port situation there. We have the Vigo port that is one of the main hub for the importation of fruit and vegetables from the Atlantic coast.
Actually, if you look at the map, is one of the first stop a vessel can make to reach Europe. It's a very strategic place. The competition there is always present because we're working in a commodity space, is not as strong as it is in other region in the Iberian Peninsula. We think that we will be able to reach between EUR 35 million and EUR 40 million revenues in a three-year time. Hopefully, sooner, this is with that contingency approach as we always take our expectation at the moment. Most important is that the hub will not be used to ripen bananas, to deliver added value products, and processes to our retailers and to the wholesale market.
Together with the hub in Vigo, we bought as well two point of sales in the wholesale market of Vigo that following our strategy is really core because we always try to have a good balance between retailers and wholesale market. I pass through the Madagascar lychee. First of all, the Madagascar lychee is a new contract that we took, and the situation of the importing of Madagascar lychee in Europe is quite unique because there are only two importers for the whole Europe areas. We took the place of one of the two after, I think almost 30 years.
By definition, if we will be able to perform well for our partners in Madagascar and for ourselves, the contract is a long-term one, so we're looking forward to maintain this position, I would say forever, but forever means long term. Normally the volumes allows the two importer to have between EUR 20 million and EUR 23 million-EUR 24 million revenues each importer during the months of December and January. The campaign will be split mainly in December for the Christmas season, but it's lasting up to the end of January. The campaign will be split in two different years, let's say.
Normally the business is an intense one in terms of logistic effort, organizational effort, and commercial effort because it's a lot of volume coming in a short period. It will be needed to organize the shipping as well for the importation. We have a key capability to do that because as you know, we are integrated with the shipping activity. It's not a business that anyone can run. In terms of result, it's always difficult in the fruit and vegetable business to forecast a result, especially the first year where you're working with a new category. Historically speaking, the business used to be quite profitable for the importers.
It's not now the right time to be precise because we are starting to work, but we have a very good expectation for the turnover and profitability results related to the lychee. Gabriele, can you please raise again the third question? Was it about the shipping? Am I right?
Yeah, yeah. I was asking about the extraordinary maintenance you had during the quarter, and I was wondering if now it has been completed or we should expect any operational impacts or recurring costs during second Q?
Okay. Okay. Yes. No, yeah, I confirm the situation was one-off otherwise the adjustment is not fair on the figures. You know, we consider the problem totally solved. Exactly to solve the problem and to, let's say to be able then to deliver a normal year, let's say, that's why we decided to absorb over EUR 1 million of extraordinary costs because we prefer to idle two spot vessels in order to be able to correctly maintenance, make the maintenance to the vessel, stopping them one week each. Sometimes it's needed to do that.
It happened in the past, is nothing, super relevant, but obviously, being vessels and being on the sea and wanting to continue to have a weekly service for us, for our volumes and for our partners, obviously, when we had to take this decision, we look at the situation with a strategic approach, and we prefer to bear some additional one-off costs, but to fix the problem instead of continuing to operate the schedule, decreasing the one-off costs, but then having, let's say, recurring issue that normally, are cutting more profits compared to the one-off one. I confirm to you that, the situation is solved.
Thank you, Matteo.
The next question comes from Andrea Bonfà of Banca Akros.
Hello, good morning to everybody. Most of my question have been answered. I would like to maybe to ask you if you can elaborate, what's the state of the art in term of inflation in general? You mentioned something during your presentation. Can you elaborate a little bit more on the state of the art of inflation for your industry, and what are your expectation? Generally, in inflation cost, in the, let's say agriculture world, is the first one to, let's say, to appear and, with the COVID pandemic has set, your industry is very able to manage and to pass over this cost. I would like to have your, maybe any inputs or opinion on that. Thank you very much.
Good morning, Andrea. Yes, actually, our vision on inflation, it's a pure forecast because by the end of the quarter, as you know, the conflict just started, we saw some speculation specifically on the energies input, specifically the bunker, the oil price and all the related derivatives and the energy cost. As we all know, the situation is continuing and it's difficult to forecast when it will be ended. Actually, we are seeing a situation where a higher inflation is coming and this will be related to the transport cost and to the energy cost. In our vision, the problem is already there, even if it's not really showing up now.
This is really because most of the goods that are shipped to Europe and all over the world carried by the liners. Normally, the Bunker Adjustment Factor that the liner uses is not weekly as we do, because we always try to be totally current and on time vis-a-vis the market condition. They normally apply a monthly BAF or a quarterly BAF, a quarterly reviewed BAF, Bunker Adjustment Factor. This will cause a lag of timing in the impact of the cost. We see beginning Q3 a massive impact due to the increasing cost of transportation. Obviously, we are transferring all our vision to our client.
When it comes to seasonal fruit or that we can manage on weekly or daily prices, we are confident to be able to transfer the inflation without speculating, but just doing our job as we did during COVID. Obviously, all the inflation and eventual disruption that we will have again on the container capacity worldwide being integrated with the shipping, we're well positioned to absorb it and eventually taking advantage, if possible, on that side. But this is mainly what we are seeing that is happening. The inflation now is still, let's say, under control, but we see a situation that will get worse in the second part of the year.
As a group and as a business, we are an anti-cyclical one. We are well prepared and the business model is well prepared to absorb the impact because of our gamma product, because of our shipping integration, and because of the fact that we are well-covered on the energy, well-hedged on the energy external input for the next month, and with the energy on the warehouse as well, in the next year. It's not a comfortable situation because it's always something that we have to handle in a day by day, but surely, we are well-positioned to perform. This is what I can tell you so far.
Okay. Thank you very much. If I may, do you see those potential fallout effect of rerouting some supplies of products? You were mentioning, I think, in the past, oranges from South Africa or anyway other product that instead of going to the Persian Gulf, they are rerouting to Europe, and dampening prices or something like that.
Actually, as always, the main effect, the main impact, is on the bananas and will be on the bananas because certain multinationals that are exposed to the Middle East market are, let's say, the first reaction when you have the fruit on the vessels, and then you have to sell the fruit somewhere, is to, let's say, to turn the goal and to go to Europe instead of Middle East. Surely the situation will be. The market will be adjusted from time to time. In banana, there are supplies where we see the worst effect at the moment.
The typical good stock market that we see in the first month of the year is not there this year. Being the situation of Europe, 70% related to tenders with retailers, then let's say the impact is not massive, but it's mainly on bananas. Going on the overseas campaign like South African citrus, there are some phytosanitary issues that can block a massive volume from South Africa to come to Europe because we have stricter rules in Europe compared to Middle East. It's possible that some flows will come in with additional volume in Europe. Those are products that we work in consignment.
At the end of the day, we will be discussing with our partners in production in order to understand which is the right volume to have in Europe, but being able to maintain a certain level of pricing. If our partners will ask us to absorb more volume, we will be working for them for sure, because this is our role in the market. Obviously, we will protect our commission. We don't really see being the business model of the group well-balanced on the consignment pricing model on the overseas campaign. We look at our business as a protected one.
Okay. Thank you very much.
Gentlemen, Ms. Orsero , there are no questions registered at this time.
Okay. Thank you very much to everybody for joining the call, and we'll continue to work to deliver the best result that we can as a group. We keep in touch and we will discuss again for the first half result in September. Thank you very much.
Thank you.
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