Sadot Group Inc. Q1 FY2025 earnings call

• David Hanna introduced himself as Interim CEO effective June 2, 2025, with experience in rapid-growth companies and global agri foods operations. • Jennifer Black highlighted Q1 2025 financials, including fourth consecutive profitable quarter, revenue growth of 24.1% from Q1 2024, improved net income, and EBITDA increase. • SG&A expenses increased due to reclassifying certain costs. • Company continues to reinvest cash into aggregate commodity trading business to drive growth and acquire strategic assets. • Pokémoto chain continues to open new locations with 41 open and ~60 franchise agreements sold but not open.

Sadot agri foods revenue was $132.2 million in Q1 2025. Revenue increased by $25.7 million (24.1%) compared to Q1 2024. Net income attributable to Sadot Group improved to $0.9 million in Q1 2025 from a $0.3 million net loss in Q1 2024. EBITDA rose to $2.5 million compared to $0.1 million in the prior period. SG&A expenses were $3.1 million, an increase of over $1.7 million compared to last year. The company had a cash balance of $1.9 million and a working capital surplus of $21.9 million. Agri foods segment contributed the majority of revenue, with commodity trading representing over 99% of total company-wide revenue.

• Strategies to improve gross margins include focusing on containerized specialty crops like pulses, lentils, beans, and sesame seeds, and pursuing fee-based management services agreements like the pet food ingredients processing business in Canada. • Progress on the sale of restaurants with multiple parties interested, finalizing a new LOI with a qualified buyer, and Pokémoto chain continuing to expand with new locations opening in the coming months.

• Tariffs globally could impact competitiveness of product origins, but company believes tariffs do not have a significant material impact on Sadot's business due to global sourcing and distribution. • Complexities of global operations, including international rules, customs, time zones, and translations, pose challenges that the company must manage.

Q: Can you comment with an update on the general tariff environment and how it affects Sadot's business?

A: David Hanna stated tariffs will not have a significant material impact on Sadot as the majority of revenue is generated outside the U.S. and products are food-related where tariffs are usually passed through.

Q: How have the tariffs between U.S. and China impacted the business directly?

A: David Hanna said China's demand shift for soybeans from U.S. to Brazil has created new opportunities which Sadot is studying to capitalize on.

Q: The company's gross margins have been less than 1%. How are you going to improve those margins?

A: David Hanna mentioned focusing on containerized specialty crops like pulses, lentils, beans, and sesame seeds, and a management services agreement for a pet food ingredients processing business in Canada to improve margins.

Q: Please provide an update on the sale of the restaurant process.

A: David Hanna said sale of restaurants is taking longer than anticipated but making progress with multiple parties interested, Pokémoto chain continuing to open new locations, and Q1 net income for restaurant division was positive $107,000