Climate Change Data

Environmental Metrics

ESG Focus Areas

• Sustainable agriculture
• Regenerative fertilizer
• Zero-waste manufacturing

Environmental Achievements

• Developed a sustainable alternative to synthetic fertilizers
• Zero-waste, chemical-free manufacturing process

Social Achievements

• Created key new commercial partnerships in its supply chain and distribution channels
• Successfully capitalized on key government funding programs related to research and development activities (up to $7 million from Emissions Reduction Alberta)

Governance Achievements

• Diligent cost control and disciplined working capital management, resulting in significant reductions in selling, general and administration expenses

Climate Goals & Targets

Environmental Challenges

• Lower fertilizer pricing compared to record highs in 2022
• Higher cost inventory carried over from 2022
• Seasonal variation in the fourth quarter where certain customers deferred purchasing decisions until the spring
• Limited operating history
• Negative operating cash flow
• Relatively undeveloped market and distribution channels for products
• Highly competitive fertilizer manufacturing industry
• Complex and customized manufacturing process
• Risk of product liability claims
• Potential for product recalls
• Dependence on a limited number of vendors for raw materials
• Vulnerability to adverse weather conditions
• Risks associated with potential acquisitions
• Electricity price volatility
• Dependence on key personnel
• Potential conflicts of interest
• Uncertainty regarding future financing
• Uncertainty regarding future profitability
• Risks associated with managing growth

Mitigation Strategies

• Streamlining base blended fertilizer business and improving production quality and volume of granulated fertilizer
• Holding lower average inventory levels to limit financial exposure to commodity fluctuations
• Increasing production of granulated fertilizer and increasing awareness and demand for regenerative fertilizer products
• Improving gross profit and gross profit percentage through higher pricing for granulated fertilizer and lower average inventory costs
• Diligent cost control and restructuring initiatives across all back-office and overhead functions
• Developing strong relationships throughout its supply chain to manage input costs
• Expanding granulated fertilizer business to offset seasonality
• Regular reviews of existing customers’ credit performance and individual customer trade receivables
• Maintaining insurance coverage
• Investing in research and development
• Pursuing strategic acquisitions
• Managing growth through debt and equity capital structure
• Implementing and improving operational and financial systems

Supply Chain Management

Climate-Related Risks & Opportunities

Physical Risks

• Adverse weather conditions

Sustainable Products & Innovation

• Biologically-active regenerative fertilizer products

Environmental Metrics

ESG Focus Areas

• Regenerative agriculture
• Sustainable fertilizer solutions

Environmental Achievements

• Developed a sustainable alternative to synthetic fertilizers that enhances overall soil function and biology

Social Achievements

• Strong repeat business from existing customer base
• Added net new high-value customers to grow and diversify its overall sales and distribution network

Governance Achievements

• Not disclosed

Climate Goals & Targets

Environmental Challenges

• Lower revenues, sales volumes, and margins in the Company’s blended fertilizer product compared to the same period in the prior year due to seasonal fluctuations in crop nutrient requirements and prioritization of long-term, high-value customers
• Limited operating history
• Negative operating cash flow
• Need for additional financing to fund facility upgrades
• Relatively undeveloped market and distribution channels for products
• Highly competitive fertilizer manufacturing industry
• Complex and customized manufacturing process
• Risk of product liability claims
• Potential for product recalls
• Dependence on a limited number of raw material vendors
• Risks associated with potential acquisitions
• Volatility in electricity prices
• Dependence on key personnel
• Potential conflicts of interest
• Uncertainty regarding future financing
• Uncertainty regarding future profitability
• Risks associated with managing growth
• Volatility in securities markets
• Government regulations

Mitigation Strategies

• Prioritizing long-term, high-value customers
• Shifting sales mix towards higher-margin granulated fertilizer
• Seeking financing for Beiseker facility upgrade
• Improving granulated fertilizer production and sales
• Strong working capital management
• Continuous evaluation of ways to be more efficient in support functions
• Regular reviews of existing customers’ credit performance
• Continuous review of individual customer trade receivables
• Maintaining adequate insurance coverage
• Conducting reasonable due diligence in connection with strategic acquisitions
• Managing growth effectively by implementing and improving operational and financial systems

Supply Chain Management

Supplier Audits: Not disclosed

Responsible Procurement

• Not disclosed

Climate-Related Risks & Opportunities

Physical Risks

• Adverse weather conditions

Transition Risks

• Not disclosed

Opportunities

• Not disclosed

Reporting Standards

Frameworks Used: Null

Certifications: Null

Third-party Assurance: Not disclosed

UN Sustainable Development Goals

• Not disclosed

Not disclosed

Sustainable Products & Innovation

• Regenerative fertilizer products

Awards & Recognition

• Not disclosed