SHARE IN FOCUS: Disappointing profit outlook pushes Verbio to annual low

FRANKFURT (dpa-AFX) – The biopower manufacturer Verbio (VERBIO Vereinigte BioEnergie) upset investors on Tuesday with weak figures for the past financial year and a disappointing profit outlook. Many investors pulled the ripcord, and at times the stock collapsed by more than 14 percent to 32.94 euros, reaching a low since May. Investors experienced an even worse moment at the end of April, when the share listed in the SDAX small cap index fell to its previous annual low of EUR 29.93 after months of decline. Verbio was also disappointed at the time and lowered its outlook for the financial year that has now ended due to its problems.

On the one hand, Verbio is struggling with high energy and raw material costs, and on the other hand, the Leipzig company is suffering from falling sales prices. Constantin Hesse from the analysis company Jefferies spoke on Tuesday of a very disappointing profit outlook, which was primarily due to the lower biodiesel prices. From his point of view, imports from Asia, “which were probably incorrectly labeled”, are particularly detrimental to the current price level. For this reason, Verbio’s operating result is likely to remain at a low level in the new financial year, said Hesse.

However, the industry expert did have some positive things to say about the final quarter of the last financial year – he spoke of solid revenues that were even higher than the market’s expectations. Meanwhile, the operating result was as expected. Overall, the operating result for the year fell even more sharply than he had feared.

According to one trader, Verbio’s forecast for the new year is still well below market expectations, even at the high end of the range. Many investors apparently also find it negative that the biofuel manufacturer is expecting a clearly negative cash flow due to high investments. This generally reduces the prospect of decent shareholder returns.

In general, Verbio investors have had to endure some disappointments in recent months. After two years of dramatic price increases, things are now consistently declining again. In November 2022, the share came close to its previous record of 88.10 euros from April of the same year, but has since lost around two thirds of its value to date. In the year to date alone, the paper is now down around 44 percent, making it one of the biggest SDax losers./tav/ag/men

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