Forafric Global PLC

Forafric Global PLC operates as an integrated, global business focused on the purchase, storage, transport, processing, and sale of agricultural commodities and commodity products, primarily flour, semolina, pasta, and couscous ¹. The company's core operations are concentrated in the large and growing African food market, particularly in Morocco, where most of its facilities and customers are located ². The business model is centered on processing wheat into staple food products, with revenue generation directly tied to the volume and pricing of these processed goods. The company serves wholesale food manufacturers and distributors ³.

The company's competitive positioning in the Moroccan market is described as a leader in the wheat milling business, boasting a milling capacity of 3,700 tons per day ⁴. This leadership position is stated to provide better access to raw materials, improved productivity, and leverage from its two main brands, MayMouna and Tria ⁵. MayMouna is positioned as a popular brand for Moroccan households, known for innovation and diversified product ranges in soft and durum wheat products, while Tria is a highly respected brand for industrial clients in Morocco, known for packaged flour, precooked couscous, and packaged pasta ⁶. Raw material costs, primarily wheat, constitute up to 90% of total costs, making efficient procurement a key to profitability ⁷. The company's total volume of 338,472 tons per year as of December 31, 2025, is cited as providing significant bargaining power with international wheat providers ⁸.

For the fiscal year ended December 31, 2025, Forafric Global PLC reported total revenues of $176.488 million ⁹, a significant decrease from $274.223 million in the prior year ¹⁰. Cost of sales amounted to $158.091 million ¹¹, down from $246.891 million in 2024 ¹². This resulted in a gross profit of $18.397 million ¹³, a decline from $27.332 million in the previous year ¹⁴. The gross margin for 2025 was approximately 10.4% ($18.397 million / $176.488 million), compared to approximately 9.9% ($27.332 million / $274.223 million) in 2024. Operating expenses were $21.952 million ¹⁵, a decrease from $35.093 million in 2024 ¹⁶. The company recorded an operating loss from continuing operations of $3.555 million ¹⁷, an improvement from an operating loss of $7.761 million in 2024 ¹⁸. Net loss for the year was $13.790 million ¹⁹, an improvement from a net loss of $23.355 million in 2024 ²⁰. Diluted EPS from continuing operations was $(0.45) ²¹, compared to $(0.87) in 2024 ²². Cash and cash equivalents increased to $14.309 million as of December 31, 2025, from $12.231 million in 2024 ²³. Total long-term debt, including current portion, was $26.394 million ²⁴ as of December 31, 2025, compared to $17.751 million in 2024 ²⁵.

Year-over-year, revenues from continuing operations decreased by $97.735 million, or 35.6% ²⁶, primarily due to a decrease in crushed volume for both soft wheat and durum wheat in Morocco, attributed to a lack of working capital financing ²⁷. Soft wheat sales decreased by $64.954 million, or 30.2% ²⁸, while durum wheat sales saw a more substantial decline of $21.180 million, or 77.2% ²⁹, largely due to the planned asset disposal of a semolina crushing facility ³⁰. Couscous and pasta sales also decreased by $9.624 million, or 35.6% ³¹. Cost of sales decreased by $88.800 million, or 36.0% ³², in line with the reduction in crushed volume. Gross profit decreased by $8.935 million, or 32.7% ³³. Selling, general and administrative expenses decreased by $13.141 million, or 37.4% ³⁴, primarily due to decreased activity in Morocco ³⁵. Operating income for the Soft Wheat segment improved to $2.378 million in 2025 from a loss of $1.208 million in 2024 ³⁶, while Durum Wheat operating loss increased to $2.438 million from $1.996 million ³⁷, and Couscous and Pasta operating income improved to $2.137 million from a loss of $1.612 million ³⁸.

During the reported period, the company undertook several significant operational developments. In July 2023, it acquired 90% of Société Industrielle de Minoterie du Sud (SIMS), a soft wheat milling company in Marrakesh, Morocco, for approximately $56,000 in cash and noncontrolling interest, and assumed $5.3 million in debt ³⁹. In April 2024, a 10-year long-term lease agreement was signed through its subsidiary Epidor to rent a mill in Meknes, Morocco, with annual rental fees starting at $692,308 for the first five years ⁴⁰. As part of a new balance sheet strengthening strategy with a Morocco and soft wheat focus, the company divested non-core assets. This included the sale of part of its ownership in Moulins du Sahel Mali S.A. (MDS Mali), Moulin du Sahel Burkina (MDS BF), and Grands Moulins du Tenere Niger (MDS Niger) to Millcorp Geneva SA for $15.7 million on June 30, 2025 ⁴¹. Following this, the company retained a 51% controlling interest in MDS Mali and MDS Burkina, and a 25% minority interest in MDS Niger ⁴². On November 5, 2025, the company sold its 100% subsidiary Prodela, engaged in animal feeding, to Millcorp for approximately $1 million ⁴³. Additionally, on August 8, 2025, the company sold its 100% subsidiary Finalog SA, dedicated to storage in Casablanca, Morocco, for $8.3 million ⁴⁴. In March 2026, subsequent to the fiscal year-end, the company completed the sale of all long-term assets of a durum wheat mill in Casablanca, Morocco, with a capacity of 240 tons per day, for $18.7 million ⁴⁵.

Management is actively pursuing several potential sources of additional financing, including negotiations with investors and financial institutions, alongside exploring cost-reduction initiatives and the potential sale or strategic restructuring of certain assets ⁴⁶. As part of these initiatives, the company completed the sale of a wholly owned subsidiary engaged in logistics activities in August 2025 for proceeds of $8.3 million ⁴⁷ and the sale of long-term assets related to a durum wheat milling operation in March 2026 for proceeds of $18.7 million ⁴⁸.

A major growth area for the company is its strategic expansion initiative, announced on April 23, 2026, to complement its core agribusiness operations by pursuing opportunities in defense, food security, and energy infrastructure ⁴⁹. This expansion will be executed through joint ventures, partnerships, and selective investments, with a disciplined approach to capital allocation ⁵⁰. In defense, the company is exploring a partnership-led approach focusing on advanced defense and security technologies, including artificial intelligence, unmanned aerial vehicles, counter-UAV/anti-drone laser systems, and related platforms, aiming to position itself as a regional platform for deployment and commercialization ⁵¹. For food security, the company intends to broaden its role across the agricultural value chain by expanding beyond traditional milling into higher-value activities such as origination, trading, and distribution, to support supply-chain resilience and capture additional commercial opportunities ⁵². In the energy sector, the company is evaluating opportunities aligned with growing regional demand for reliable and scalable power solutions, with potential projects supporting industrial activity, including its own operations, and contributing to broader infrastructure development in its core markets ⁵³. These initiatives are currently at an early stage and are expected to require new capabilities, regulatory clearances, and counterparties ⁵⁴.

The company's operational outlook includes a new balance sheet strengthening strategy, adopted in February 2025, with a focus on Morocco and soft wheat ⁵⁵. This strategy involves divesting non-core assets, specifically those outside of Morocco, durum wheat-focused businesses, and logistics activities in Morocco, with the expectation that these divestments will strengthen the balance sheet and significantly improve the working capital position ⁵⁶. The company aims to maintain its industrial cost below $30 per ton produced by monitoring energy, equipment usage, logistics, human resources, and financial costs ⁵⁷.

Planned capital allocation includes ongoing capital expenditures for property, plant, and equipment, which amounted to $517 thousand in 2025 ⁵⁸. The company also made additions to intangible assets totaling $451 thousand in 2025 ⁵⁹. The company does not anticipate paying dividends for the foreseeable future, as it expects to continue operating at a loss and intends to retain most, if not all, available funds and future earnings to fund business development and growth ⁶⁰.

Management explicitly flagged several structural headwinds and execution risks to its growth plan. The proposed sale of a controlling interest in Forafric Maroc SA to Cap Holding, while having received antitrust approval, remains subject to additional conditions, including board approval and other customary closing conditions, with no assurance of completion on anticipated terms or timeline ⁶¹. The strategic expansion into defense, food security, and energy is at an early stage and may not achieve intended benefits, exposing the company to new and heightened risks due to requirements for new capabilities, regulatory clearances, and reliance on third parties for joint ventures and partnerships ⁶². Many potential opportunities for this expansion are in the Middle East and North Africa, regions where geopolitical instability, conflict, sanctions, export controls, procurement rules, currency controls, local-content requirements, tax, and other policy changes may disrupt operations, delay approvals, restrict counterparties, and adversely affect project timing and returns ⁶³. The company also acknowledges that its risk management strategies may not be effective in achieving anticipated efficiencies, savings, and other benefits from cost reduction, margin improvement, and business optimization initiatives ⁶⁴.

Forafric Global PLC faces material risks including fluctuations in agricultural commodity and raw material prices, transportation costs, energy prices, interest rates, and foreign currency exchange rates, all of which are outside of its control and can directly impact margins, as raw materials account for up to 90% of total cost ⁶⁵. The business is highly dependent on obtaining quality raw materials, and disruptions in distribution and logistical systems, particularly freight costs, could adversely affect results ⁶⁶. Supply and demand imbalances in the Moroccan flour mill market, characterized by supply capacity exceeding demand, could force the company to compete on price and reduce margins ⁶⁷. Global and regional economic downturns, including recessionary conditions, may reduce demand for agricultural commodities ⁶⁸. Operating globally and in emerging markets, including Eastern Europe, Asia-Pacific, the Middle East, and Africa, exposes the company to volatile international economic, political, and market conditions, changes in laws and regulations, sovereign risk, exchange controls, and geopolitical instability ⁶⁹. A significant portion of operations and sales are in Morocco, making the business vulnerable to natural disasters, economic downturns, civil unrest, or political instability in the country ⁷⁰. The international price of wheat, influenced by weather and strategies of major producers, is a main risk, as variations in acquisition price cannot be directly passed on to selling prices of finished products ⁷¹. The company has incurred net losses of $13.8 million, $23.4 million, and $12.5 million for the years ended December 31, 2025, 2024, and 2023, respectively, and as of December 31, 2025, had an accumulated deficit of $154.6 million, raising substantial doubt about its ability to continue as a going concern ⁷². The company is a capital-intensive business, depending on cash from operations and external financing, and an inability to secure sufficient funding could limit operations and growth ⁷³. Furthermore, the company is currently subject to legal proceedings initiated by Crédit Agricole du Maroc (CAM) for the immediate repayment of $42 million in outstanding credit facilities, although a settlement agreement is in process ⁷⁴.

Management's message to shareholders emphasizes a strategic pivot towards strengthening the balance sheet and focusing on core operations while exploring new growth avenues. The company has explicitly stated its active pursuit of additional financing, including negotiations with investors and financial institutions, and exploring cost-reduction initiatives and potential asset sales ⁷⁵. This is underscored by the completed sale of a logistics subsidiary in August 2025 for $8.3 million ⁷⁶ and the sale of durum wheat milling assets in March 2026 for $18.7 million ⁷⁷. A key strategic priority is the new balance sheet strengthening strategy, adopted in February 2025, which involves divesting non-core assets outside of Morocco, durum wheat-focused businesses, and logistics activities to improve working capital ⁷⁸. Another strategic priority is the announced expansion initiative into defense, food security, and energy infrastructure, to be pursued through joint ventures, partnerships, and selective investments ⁷⁹. This initiative aims to complement core agribusiness operations and capitalize on opportunities central to economic resilience and national security in core regions ⁸⁰. Management also highlights its commitment to sustainable growth, consolidating its position as a benchmark business group, and operating as a sound, innovative, sustainable, and responsible enterprise ⁸¹.