What did happen in Q1 2021As has been noted in recent posts, while the Verde top line sales/revenue picture in 2021 Q1 actually continued the positive upward trend of the prior ten quarters (on a year-over-year quarterly comparison), it was the bottom line increased quarterly loss that actually broke the previous positive trend. So if sales and revenues were better, and the gross margin dollars and % improved, why did we suffer an increased loss in Q1 2021 over the results in Q1 2020?
Looking at the quarterly financial statements, the explanation is clearly in what happened within the General and Administrative expense category - expenditures mostly under the control of the Board and management. In local currency these expenses were R$2,062,000 in 2021 versus R$725,000 in 2020, and increase of 184% quarter over quarter.
When questioned about the what made up the 184% quarter over quarter increase, the CEO indicated this was because of "bonus payments", and has not provided any further details in spite of having been pushed to address this issue during recent online Q&A sessions. As one shareholder pointed out - what bonuses were earned in Q1, the lowest production/sales quarter of the year and why were they over R$1 million? Something about this explanation did not, and still does not, appear to make sense and warrants, I believe, a more forthcoming and detailed explanation from the Company's CFO or CEO. At the Q2 Q&A session perhaps?
Cheers,
S.