Sadot Group Inc. Q2 FY2024 earnings call

• Sadot Group had best quarter and six-month YTD performance, with significant net income and improved financial position.
• Focus on agri commodities market growth, expanding via Sadot Brazil and Canada; new subsidiaries complement existing operating centers.
• Farm operations serve as integral part of supply chain, with farming capabilities aiding trading.
• Actively divesting non-core restaurant assets: SuperFit Foods sold, Muscle Maker Grill converted to franchises, Pokémoto in negotiations; expected to reduce G&A expenses and generate cash for agri business.
• Industry trends like growing global demand for agri commodities, food security/sustainability, and sector consolidation support Sadot's strategy.

Consolidated revenues increased 9% to $175 million in Q2 2024. Sadot Agri-Foods contributed the majority of revenue with $173.3 million from 21 transactions across 8 countries. Legacy restaurant operations (held-for-sale) had $1.7 million in Q2 revenue. Net income was $2.4 million in Q2 2024, up from $190,000 in Q2 2023. EBITDA was $3.2 million in Q2 2024 vs. $656,000 in Q2 2023. Cash balance was $10 million and working capital surplus was $16.1 million, stronger than previous quarter.

• Sadot Brazil involved in trades, Sadot Canada expected to start executing trades in Q4, focusing on smaller container-sized trades with higher margins.
• July 2024 revenue was ~$61 million, with Q3 revenues anticipated to remain in $175 million to $200 million range.

• Exposed to market risk related to volatility in carbon offset units and food/feed commodities; managed through forward sales contracts and hedges.

Q: Can you elaborate on the potential growth opportunities in the $1.9 trillion global agri commodity market? And what is Sadot Group's strategy to capture a larger share of this market?

A: The global agri commodity market is a big opportunity. Sadot's strategy involves expanding trading operations via strategic initiatives like Sadot Brazil and Canada, diversifying geographic presence, and vertical integration into supply chain segments.

Q: When will Brazil and Canada contribute to the top-line revenue?

A: Sadot Brazil has been involved in trades, Sadot Canada is expected to start executing trades in Q4, focusing on smaller container-sized trades with higher margins.

Q: What does July revenue look like? And are you anticipating revenues to remain in the $175 million to $200 million range for Q3?

A: July 2024 revenue came in at approximately $61 million, continuing positive momentum, with Q3 revenues anticipated to remain in that range.

Q: Can I provide more details on the divestiture of the restaurant assets? What is the anticipated timeline and expected impact on the company's financials?

A: Actively divesting non-core restaurant assets; SuperFit Foods sold, Muscle Maker Grill converted to franchises, Pokémoto in negotiations. Expected to reduce G&A expenses and generate cash for agri business. Specific timelines for remaining divestitures being finalized.