Good afternoon. Dear listener, dear listeners, welcome to AUGA Group meeting with investors. I'm Amelia from Nasdaq Vilnius and I'll be moderating today's event. We will start with a presentation from the management, which will be followed by the Q&A session. Please be informed that this webinar is being recorded. As always, I encourage every one of you to ask questions during or after presentation in the Q&A section. With that said, I'm pleased to introduce today's presenter, Chief Financial Officer, Mindaugas Ambrasas. Mr. Ambrasas, please, the floor is yours and good luck.
Amelia, thank you for introduction and good afternoon, everyone. Thank you for joining our webinar. My name is Mindaugas, and I will go through results of AUGA Group for the first half of the year. As you probably already saw from published reports, overall results of the group for the first half of the year in terms of revenue, we were very similar to our sales results last year, EUR 33.9 million. In terms of profitability, we have quite nice growth. Maybe I just need shortly to explain what is the reason for such quite two different trends in terms of revenue and sales.
I think that's as a result of specific accounting in agriculture. Agriculture, as you know, it's really very important and big part of our group business. Due to that, our sales are mainly affected by last year's harvest. Because in the first half of the year, we're usually selling the remaining harvest from the previous season. As you know, last year's harvest was quite good. That's why there is no growth in terms of sales. If we talk about profitability, this year we already showing our expectations or profitability is based on expectations of this year's harvest. That's why it's two different trends.
As always, maybe let's go and discuss the segment by segment, and I will try to provide more details. What are the reasons behind all those figures. As always, let's start with crop growing, which is really the largest and really the most important segment in terms of result, and which really has the largest impact every year. As I said already, when we talk about results of crop growing segment at the end of second quarter, expectations are still quite bigger factor. If you talk about the figures, all the calculations are really done based on valuation of situation as we saw the situation at the end of June.
What I will try to do, maybe to describe in more details, how we see this year's harvest, how we saw this year's harvest at the end of the second quarter, and what were the developments in the last months. Because really, third quarter is very important in agriculture, and we have huge changes every year in terms of harvest during the quarter. If we talk about this year harvest, generally there are three key factors, and we want to evaluate also the forecasted result of forecasted harvest for the year.
We will have additional slide about the prices, but I can say in advance that we don't expect or we didn't have major changes in recent months in terms of pricing. If we talk about the costs, of course, due to all the situations which are happening, of course, we had to review forecasts of costs, and we had to increase, and the fact, of course, also was that factual costs and forecasted costs for the year, of course, were increased, given factual situation and our forecasts. This of course has a negative effect on value of biological assets or valuation of assets. The most important factor is, of course, yield.
I would say we were more optimistic about the yields couple of months ago than expectation was that this year should be, I would say, better than average year in terms of yield. Some of the developments we had in the last couple of months, weather because we had quite a lot of rain, quite a lot of cold, and this had some negative impacts on the yields. The situation, how we see it today, I would say that we are less optimistic. The first results from the harvest also show that instead of, as I said, maybe good year, I would say that this year we would have average harvest.
The first results from the harvest really prove this expectation to be right. Of course, we will provide more details, figures about the harvest only after the third quarter when we have actual figures of the harvest for this season. To sum up, as I said in the very beginning, first quarter is really the most important quarter in terms of resulting in agriculture because things which are happening, they can have huge negative and maybe sometimes positive effects on our harvest.
If you remember, you definitely remember that, and we had this huge loss in valuation of biological assets last year, which led to overall very poor financial year in terms of crop growing segment last year in our group. If just to give our expectations for this year, as I said, we saw that developments in the last couple of months they had some negative impact. I would say that we do not expect this continuous growth of gain on valuation in second half of the year the same we had in the first half of the year.
Definitely we won't have the same situation we had last year that we had this huge loss and huge negative changes in condition of biological assets. Just to elaborate on prices, as always, we are showing the graph of prices of wheat in Ukraine and Germany. I think all you know that trend, the prices were growing rapidly starting from last year, and growth continued for, I would say six to seven months this year. Recently we had some decrease in prices, first of all, in conventional products, but this trend also with some lag shown in organic products as well.
As I said previously, we don't expect that this change will have substantial effects on our forecasted value of the harvest. First of all, the trend is slightly different for different crops. For example, here we are showing the trend of wheat. If we talk about crops, for example, these beans, the trend is slightly different. There is no drop in prices, and the growth of prices continues. The more important factor for us, as always, we started contracting harvest in the second quarter. As for end of August, 76% of forecasted harvest is already contracted. If you remember from our previous presentations, you know, we have those two types of crops we are growing.
For some of them, sugar beet is the most like clearest example. We have long-term agreement and long-term cooperation. The prices and formula of prices is generally fixed. If to exclude such agreements, and just pick like normal crops we are selling in the market, already 69% of the harvest, future forecast harvest is already contracted. In average, if we calculate prices of the harvest we had last year and the prices we are having in our contract this year, in average we have 58% higher prices in 2022. This, as I said, is major reason why we are quite optimistic about this year's result in crop growing segment.
Even some changes in upcoming months, they won't have a big impact on the results of the segment because the harvest is already contracted. Just to sum up on the results of the segment for first half of the year, I can say that outlook is quite positive at the moment. Of course, you know, we could calculate final result of the segment after the harvest only. The third quarter is really the most important for us. In terms of weather for the harvest, it was quite a good season and quite good weather to do the harvest. Unfortunately, some months before that were not the best ones in terms of weather.
Nevertheless, you can see that gain on revaluation, it's almost EUR 7 million, so it's quite an improvement comparing to the year ago. What is also, I think, big move forward for us, that we have better results from sales activities. You know, first of all, of course, increasing prices also help us with that. But I think that this internal transactions write-offs they are in a lower level this year, and that was also focused from the group, which improved the results from the sales and also was one of the factors why overall result for the segment had improved. Dairy, another important segment for us.
I would say we are quite positive about the actual results of the segment as well. From the start, maybe just two important factors which really affect our results. Here you see the two different stories. If we talk about milk yields, we for the last, I would say year, we are quite positive about yield development. You know, we were telling even in the same investor presentations that we expect this trend to continue. If you look at this graph, you can say that we have quite poor results in the second quarter because yields fell 4% year-on-year.
This was, I would say, a difficult decision by the group, because we had made the decision that, due to poor harvest last year, we were lacking some of the ingredients. We had an alternative to buy those ingredients in the market with very high prices, which could drive our costs substantially just to maintain the high milk yields. As an alternative, don't have this ingredient, so if you have lower quality of feed. We understood that because of that, our yields will suffer.
This is temporary, because after this season harvest, you know, the components are back to feed menu, and we expect that milk yields should get back to the same level which were in beginning of the year, of course, depending on seasonality. Generally, this was like logical decision. We knew what could be consequences of the decision, and we also know how this will get back to the situation we had previously. The second story is about the prices. This is yet another reason why, as I said, we are quite optimistic about the results of the segment, because here's the same story if we talk about prices from, I would say, almost all commodities.
Price of raw milk was really growing in the first half of the year. This continued in July as well. On average, it's 20% growth, but in the recent months, this growth even more substantial. If you just go to the figures, overall figures of the segment, you know, we already reached, I would say, optimum amount of herd. We are running at full capacity our production facilities. Growing production volumes, increasing prices, they were the main drivers which really led to profitability of the segment for the six months of the year. We expect this trend to continue for the second half as well. Mushroom.
Almost a year, we were talking about some problems in the segment. For almost a year we were talking about the problems in production. If you remember, we had several reasons for decrease in production last year. We had COVID situation, we had some problems with diseases, high temperature, which led to significant drop in production volumes in the first quarter last year. We had a quite long way to recover from this problem. Right now we can say that in the second quarter, you know, we are generally on the level which is acceptable. Generally those production challenges we had for almost 12 months are mainly solved. Unfortunately we have another problem, and I'll be back to that.
Just to add to the production because additional information for those who are following results of our group and mushroom segment. In the first quarter, we usually have a hike in sales. We also have just additional activity in the first quarter, mainly then there is a mushroom forest mushroom season, so we have this activity when we are reselling forest mushrooms. This have an additional positive effect on our sales and results for the first quarter. The additional activity and then of course production of mushrooms we are doing is the core business and that's where we are focusing. As I said, we I think solved the problem we had for the last 12 months. Unfortunately, you know, now we are facing a new problem.
I don't think I will surprise anyone, but energy costs they really hurt us and started to hurt us in the first half, especially in the second half, of the year. Energy is quite important for us. Energy and transportation accounts almost 17% of total costs. Because for example, you know, we are using cooling during summer in our mushroom production facility because the temperature should be lower. Of course this is really important driver in terms of our profitability. As you can see from the graph, in the first six months of the year. Our costs for energy and transportation, they grew by almost EUR 1.9 million to be exact.
This was really a huge problem for us because, I would say, our expectation was that, you know, we would have to work and try to compensate this increasing costs by review of our prices. Unfortunately, looking at our figures six months, we have to say that we were not successful in this task. Average price of the products we sold increased only 3% year-on-year for the six months of the year. You know, we really didn't reach our target and we didn't reach the prices, you know, which would be sufficient to at least keep the same profitability we had last year.
What happened, because yes, we had quite a few negotiations with our customers, retailers in the Baltics and then Scandinavia, and, you know, we have increase of prices in our general agreement. When you look at the final results and final average price of the sales, it depends on several things, you know. It's not only about the price, but it's also about some discounts, about some additional marketing activities. It's also if you're not selling everything in the retail market, but you have to sell at least part in the processing. This has a huge effect on your average price. Overall, you know, we were not successful in this task, and that's like the main reason why results of the segment really struggled.
Just to move to financial results of the segment. As I said, because of the reasons I mentioned earlier, for the six months of the year, we have gross loss of more than EUR 300,000. Of course, this is like an acceptable result for us. If you just compare results for six months to the last year, this difference of almost EUR 900,000 is really generally the same effect we have in energy and transportation costs. What we are planning to do and what is the plan, how we can change the situation? In short-term, of course, we have to continue with negotiations for price changes.
We have to continue working to increase our average sales price, and there is some room there. You know, we if we were more optimistic about this just a quarter ago, so actual results show that, you know, this is not an easy path. We also continuing control of energy consumption, because if you just compare our energy consumption in the mushroom segment year-on-year, we see that electricity gas consumption has decreased by 24%. It's really based on some technological things we are doing, organizational things we are doing. Unfortunately, even with such a decrease in consumption, we still have this huge increase in costs.
What is, like, the reason why we expect slightly better results in upcoming season? Like, the fact that energy consumption is just lower in the colder season. This could give some positive effect, of course, but still there is a question what the energy prices will be in general. Because now we don't have fixed agreement for energy costs, so we are still using spot market price for that. But we also working on long-term solutions how to solve the problems we are facing and get the segment back on the profitability.
You know, we are working and looking at the possibilities to invest into renewable energy production, which of course will help us save some costs in energy production. Secondly, group is already developing biomethane production projects. Production of biomethane will also give us, you know, cheaper energy source. This mushroom growing segment could also benefit from these projects when they will be completed. Overall, as I said, really unsatisfactory results of the segment. But you know, there are no very clear and solutions how we can change those results around. It really depends on the situation in the energy market.
You know, we have things to do, how we see and we can improve the situation in the short-term and in the longer-term as well. FMCG, that's also a segment which maybe requires more attention and more comments. Because if you can see from the figures, for the six months in sales of EUR 2.7 million, and this is very modest growth comparing to our sales in six months last year, only 5%. So definitely that was what we planned and expected in terms of growth of sales this year. We can, I think, already state that due to several reasons, inflation and recession expectations, problems in the logistics.
You know, our orders from export clients, they are lower from what we expected, and we believe that this year's growth plan will not be met. If you look at the graph, you can see what is the deviation of our sales per quarter. We already mentioned this last year, but we really see that seasonality of sales is increasing, especially in our export markets. U.S. Is the biggest driver there. As we had really large part of our sales in the first quarter last year, generally that will be the same story in 2022 as well. We don't expect like decrease in activities.
If in the beginning of the year we had, I would say, quite ambitious targets in growth, so unfortunately we see that these targets will not be achieved this year. You know, if we talk about growth, so like modest one but not the one we would like to have. Another thing to consider of course is decrease in our profitability, and this is quite substantial decrease if you compare our results last year to this year. It's by almost 71%, and we have very similar volumes in terms of business. Increasing the costs, that was also the main driver for that change. In this segment, I would say we are more optimistic comparing to our mushroom growing segment.
A big part of our sales are quite seasonal. If you talk about our sales to US M arkets, maybe partly Japan, you generally doing sales or doing contracts once a year. Of course, in this situation, reviewing of prices, it's not like a fast thing to do, and it really took time before the pricing was reviewed and increased in order to compensate those growing costs. We believe that we will already see increase in prices and in actually increase in profitability in the third quarter this year. The sales we're already doing to US M arket, they are in substantially higher price level comparing to the same sales to the same customers we did this year.
That's why, as I said, I believe that, you know, situation it's really better compared to situation in our mushroom growing segment. We see realistic possibility to increase the prices and at least to get back at least partially to the same profitability level we were last year. Another important reason why we will not meet our growth, let's say, target and why we don't have this growth in sales this year, unfortunately we are missing some of our FMCG products. You can see from the slide that our flour and dairy products were generally missing for the full year and you couldn't find these products in the shops in Lithuania and Baltic.
We have some problems with our partners, the companies we outsource production of those products. We don't expect that these products will be back to the sales soon. This is quite important because for example dairy products, they accounted for almost 10% of FMCG sales in first quarter of 2021. Now we're generally missing this part of our product portfolio, and of course this is also quite important reason and big reason why there is no growth in this sales. If we look at products category we have in sales, so we have a little bit higher growth than you saw in overall figures.
Part of missing product was own products, you know, leads to a situation that overall growth is really modest. What we are planning to do here, the group is really working on relaunching even broader dairy products basket. You know, we will provide more information to investors and to the market, and we will have more details about the timeline, about the product range, about the partners, et cetera. This is in, I would say, quite near future plans, so and this is where quite a big focus of our group is on today. Just to sum up our activities by our segment.
Here is just a visual presentation where the deviation of EBITDA is coming from in terms of our business segments. You know, we have a positive development in crop growing segment. We also have positive development in dairy. Unfortunately, mushrooms and FMCG are not performing that well. It's not only behind what we know we planned, but also behind results we had last year. Some other important information, we were saying this for several presentations already, that we believe that 2022 will be very important for AUGA group.
Not only that we want to improve our results and the financial results and get back from this very poor results we had last year, but also this year will be very important for us because we are trying to implement several important technological projects, which could be very important for future our AUGA group and our strategy implementation. Just a short update on the situation of this project and what are like our plans right now. If you remember that first project is biomethane infrastructure, and the group was planning in the beginning of the year that we will have 3 facilities producing biomethane by the end of the year. Due to you know problems in supply chain logistics, we still you know developing this.
We're still building those facilities, but we just believe that some of them will be slightly behind the schedule. Currently we are quite optimistic that at least one of the units will operate by the end of the year. I think the plan for remaining two is really very end of the year and or beginning of the next year. The plan is still there that those three facilities will be operating with slight delay in time frame. Specialized feed technology. This technology was in the testing phase, and testing phase continues. First tests we did, they showed some promising results, but obviously we are still working on technology itself. No major news in this project.
Regarding our tractor, as we said in the very beginning of the year, the plan was to build the first batch and assemble the first batch of tractors by the end of the year by fourth quarter. The same problems with logistics with supply of some spare parts, it created some challenges. What we are doing right now, I think we are focusing on smaller batch. Currently the plan is to have three tractors running and working in our fields by the end of the year.
Because you know this really we want to make sure that you know technology works and our cooperation with assembling partner works so that we are able to assemble all spare parts required and we have technology in place. You know it's more important to have smaller batch working instead of trying to build a bigger batch but this will require more time. Once again project runs according to plan with some delay in time. Another important just maybe news to share that I think some of you know that AUGA group was one of the few companies which introduced a stock option program for employees three years ago.
This year was the first year when employees got actual shares. After three years from initial agreement towards the realization of those stock options for employee. A little bit more than 2 million shares were distributed to almost 170 current and former employees, and this amounted to almost 1% of current equity. This you know has very small change on shareholder structures. In a longer period, we really believe that you know we have shareholder structure with employees you know which are really motivated for the company to succeed, and will increase liquidity of the shares in the longer perspective.
Maybe in a shorter perspective, of course, it puts some pressure on the pricing of shares as well. As always, just information about our share performance, where you can find all information, financial results, figures in Excel format and disclaimer. I think that's it from my side, and I would be happy to answer your questions.
Thank you very much for the comprehensive presentation. Indeed, we're moving to the Q&A part. Before beginning, I would like to remind all the attendees that you are very welcome to send in your questions in the Q&A box of your screen, and you can send them in also anonymously. The first question would be as following: Where are the biggest bottlenecks for the company going forward? Thank you.
Thank you for the question. It's really very good and very difficult question to answer because there are, I think, lots of things we need to change and improve. If we talk about our daily business. I still believe that we have potential to improve. You know, I'm not even talking about mushroom segment, but we still see huge potential in the FMCG sales. We still believe that there is potential to improve our dairy results. Crop growing really depends year-on-year on the season, so it's really difficult to comment on that. The most important thing right now for the group is I would say that there is the success of those projects we are currently developing.
Because we believe that these projects are really important for our future. If we could prove that they are working in smaller batches in our other fields, so it's just a matter how to find the ways how to, you know, expand them, how to commercialize. Just to be more specific, you know, if we have those three tractors running, so you know, we will have possibility not only, you know, to have this production in our group. We also have savings in terms of fossil fuel consumption.
This is really important just to find a way how not only to have like three or five tractors working in the field, but how we can really expand these operations and how we can structure, organize, and maybe to change all the tractors which are operated in our group, and how we can share this technology and knowledge to other farmers in Ukraine and other markets as well. I think successful development of the projects we are currently doing, and even more importantly, finding way how to commercialize if they are successful, that's the biggest problem that our group has today.
Thank you very much for your answer. The next question would be as following. Why has growth in FMCG segment stopped?
I think the question was answered during the presentation. Generally, you know, we would say. We can say that we had decrease in sales because some of the products were missing. But we also didn't have the growth we wanted to have and expected to have just because of consumer and retailer opinion about the future, you know. If there is an expectation about recession, an expectation about inflation. Of course, orders are slightly lower than we expected and planned.
Mm-hmm. Thank you very much. Let's move on. The next question would be: what should change that mushroom segment would return into profit?
I think another question, and we also touched it during the presentation. Just to sum up, in terms of the problem we had last year, production, I believe that we already on the level, which is okay. Now we have two major areas which need to be improved, or we need to find a solution how to change that. First of all is pricing. You know, we would be very optimistic that it will be easy to change pricing in retail shelves. I would say that we need to work more on our product portfolio.
Generally, as I mentioned, there is a huge difference in pricing if we sell everything as a fresh product in retail and if we sell the product for processing. You know, if we can optimize our product portfolio, we can achieve better profitability and better average price. That's the focus for us. Secondly, of course, we need to find the solution how to at least somehow control the effect of energy price increase because this side of the business, it's really difficult to control. You know, of course, we could have long-term contract a year ago and we would be quite lucky with the decision.
Unfortunately, the contract we had, it ended at the very end of last year, and we've had this huge increase in prices very rapid. We didn't manage to fix the price in, let's say, acceptable level. Now we have this dependency and we think of it as a fact. As I said, renewable energy is one alternative. Biomethane we are producing is a second option, how at least we can control the costs and in that way help our mushroom growing business to improve the result.
Thank you for your comprehensive answer. Let's move on. Another attendee is asking: How much increasing interest rates is expected to increase finance costs in the next three years?
It's difficult to answer the question without knowing what will be interest rates for the next three years. Depending on the season and our trading lines, we have almost EUR 25 million-EUR 40 million of loan portfolio from the banks reporting interest rate. You know, one increase by 1%, it increase our cost by EUR 300,000-EUR 400,000 per year. Of course, this is important and big cost line and this is something to consider in future.
Thank you. Could you please comment on what is the quality of this season's crops?
Overall, as I said during the presentation, if we talk about the harvest in total, yes, expectation of total harvest had decreased slightly, you know, we would expect yields would be let's say average. If the question is about the quality of crops itself, yes, though in the market, we could hear some opinions that quality of crops is quite poor in conventional farming. I would say from the harvest we already having that we see that the quality is not that bad. Generally, we don't have a situation we had in, I think 2020 when, you know, yields were quite okay, but the quality at least of wheat was very poor, so part of the wheat was poor quality and resulted in lower selling price.
That's not the case for the year. We are quite happy with the quality of harvest we have for this year, at least from the first crops we harvest.
Thank you. Let's move on. Another question would be, why is the total area of cultivated land decreasing year by year, for instance, 2022 as compared to 2021 and 2020? What is your strategy in changing the area of land in the future?
Okay, thank you. The question, total area of cultivated land, really changes year to year. Because if you remember, only part of the land we are cultivating we own, around 11%, and the rest is rented, leased from unrelated parties. Generally, you know, we have this change every year that some of land we just had our rental agreement run out, and maybe we decided not to continue. Maybe they found another company or person to use land. I would say this is like a natural process. To be more specific on the situation, this year, so yes, we didn't prolong rent of some land plots where we are not as successful in cultivating our business.
We decided because it was like located further from our bases, so we decided not to continue our operations there and maybe to focus in areas where we are more successful. There is no like strategy changes. We still continue as we do today. The decrease was just related to the fact that some of the agreements we have, they run out, and then we didn't follow them.
Thank you for your answer. We are still receiving quite a few questions, so let's continue. What is the overall situation with your debt, and do you experience any problems? Thank you.
Okay. If the second part about the problems is only about the debt, we don't experience problems with our creditors at the moment. Maybe to elaborate on that. When we had really poor results last year, we had lots of open discussions with our creditors. I really just using this opportunity also, you know, could maybe thank them for the support and understanding, because from all of them, we really got the waivers, because we breached some financial covenants. We got some additional support immediately. If you remember in the beginning of the year, we even signed some additional financing agreement. I think the overall situation is that everyone understands that our ratios will change after the third quarter only.
Because if you calculate the covenants, usually calculate for like rolling 12 months. As we had very poor first quarter last year, you know, we will have full picture only after third quarter this year. They of course are waiting for our results. We of course are waiting for our results. As we said in the presentation, you know, we believe that our results will definitely improve this year. The situation will be much better than we were like last year. Of course, if we manage to find the solution with our creditors in a very poor situation last year. I definitely believe that we will continue our cooperation and the situation will improve.
Mm-hmm. Thank you very much. Are there any plans to improve performance of the most important segments of the group? Meaning crops segment.
I don't think I fully understand the question. There are always plans to improve the performance because I don't think, you know, we are satisfied with existing results and, you know, we believe that that's maximum what we can achieve. There are some technological things, some of the things we are in the testing phase. There is no obvious solution in agriculture or some very specific projects we need to implement in order to automatically achieve better results. Of course, I think this is the segment where we believe results could be better. We are working on that, and, you know, hopefully we can achieve that.
Thank you for your answer. Let's continue. Why is it so hard to raise prices for the mushroom segment? Do not all growers face the same cost increase? Are some selling at a loss or do international competitors have a cost advantage?
I think, you know, problem in the price increase in the segment is really competition. First of all, it's not always easy to increase the price with the retailers. Our almost, you know, majority of our customers are the largest retailers in the Baltics and Scandinavia, so I don't think they are the ones who really like increasing prices for the consumer. Of course, I think the situation has changed. More importantly for us, we really face competition from Polish producers. We believe that Polish producers in some areas they have competitive advantage due to lowering value of Polish zlotys.
You know, you could say that energy costs should be similar, but there are some state support mechanisms in Poland we are missing here in Lithuania. Generally, yeah, well, they have some competitive advantages comparing to us. That is the reason why, you know, it's not that easy to increase the prices in our export products.
Thank you for your answer. How would the biomethane be used to improve AUGA group's financial position?
I will not provide specific numbers, but you know, the biomethane production facilities, they will be able to produce the amount of biogas which should be enough for all our internal consumption if we talk about fully using our biogas tractor in our daily activities. Of course, today, you know, if we are planning to build three tractors, so we will have you know, additional biogas to sell. Having in mind current energy prices, this should be quite a good business case just stand alone as well.
Thank you very much. I see that we have two more questions remaining, so if you, as attendee have an additional question, please send it in, now. The next question would be. Would it be possible to get a rough estimate of the investments for the full year 2022?
I think I will not present a specific number, but what I could comment that of course, after very poor financial results last year, our possibilities to invest were quite limited. The investments this year will be lower we had in 2021, because all the projects we started we had to start in the spring in order to finish them by the end of the year. The same goes to next year projects, you know. If we will start and finance them after the harvest is done, you know, we will have only very small or the first steps from the project implemented. It will not be shown in our.
It will have very small effect on our financial reports. Overall, investment amount will be really lower than we had last year. I think the most important thing that we did, we really tried to find all required resources to those most important projects which are related to our strategy and new technologies. Those projects had financing, which is needed at least to have this minimal implementation ready by the end of the year. Yeah, maybe we are slightly late with some of them, but that was the main target, and I think we were able to achieve that.
Thank you for your answer. It seems that the last question for today will be: When do you expect that biomethane initiatives, plants and tractors will start to have a material positive effect on the financial results of the group? For instance, if 10 tractors, fleet planned for Q4 make a significant cost reduction or not?
You know, we are planning to have tractor and biomethane facilities starting to operate from the first, let's say, quarter next year. Okay, you can have those tractors working in last quarter, but if you have like full impact, so you could say first quarter next year. In terms of our agricultural activities, of course, the first quarter, you know, you do very limited number of work, so in terms of tractors there will be not significant effect. If you are producing the biogas, but of course we have to consider that technologically it takes one to two months to start producing biomethane from the facilities. Generally still the first quarter will have the first effect. The full effect we will see on the second quarter next year.
Because, you know, if we have tractors and we start using them, we can easily change some of the tractors. For example, we are currently renting every year. You know, this will have very clear and rapid effect on financial results and strategy.
Thank you very much. As all the questions are answered, on behalf of AUGA Group and Nasdaq Vilnius, thank you everyone for joining us today. The recording, as always, will be available on Nasdaq Baltic YouTube channel. Have a good day, everyone, and goodbye.
Thank you.
The recording has stopped. Goodbye.