SGD subsidiary expands into high-value soil products market

MIAMI - Safe and Green Development Corporation (NASDAQ:SGD) announced today that its subsidiary, Resource Group US Holdings LLC, is expanding operations to produce premium potting media and soil substrates using advanced milling technology. According to InvestingPro data, the company currently generates modest revenue of $0.18 million in the last twelve months, operating with negative gross margins of approximately -10.5%.

The company plans to utilize Microtec milling technology through an exclusive license to convert woody and vegetative waste into refined soil products. According to the company’s press release statement, these products will be marketed under the "Renewable Earth" brand.

Resource Group aims to access markets where product pricing can reach approximately $150 per ton, which the company claims could be up to five times the value of traditional compost offerings.

"This product represents a potential fundamental revaluation of organic waste as a resource," said Tony Cialone, CEO of Resource Group in the announcement.

The company expects delivery and installation of the Microtec mill to be completed in the third quarter of 2025. The technology is described as a patented German-engineered system with over 90 global installations.

Safe and Green Development Corporation CEO David Villarreal stated that the company intends to "unlock a scalable, environmentally responsible business model with attractive margins."

The subsidiary currently operates an 80-acre organics processing facility in Florida that processes source-separated green waste. The expansion represents an attempt to move beyond commodity compost into potentially higher-margin soil products for horticulture, agriculture, and consumer landscaping sectors.

Safe and Green Development Corporation, formed in 2021, primarily focuses on real estate development projects across the United States, with emphasis on future green housing developments. Financial metrics from InvestingPro reveal the company operates with a high debt-to-equity ratio of 69.77, while its stock has declined by approximately 89% over the past year. InvestingPro subscribers have access to 16 additional key insights about SGD’s financial health and market position.

In other recent news, Safe and Green Development Corporation (SGD) has completed the acquisition of Resource Group US Holdings LLC, a company focused on converting organic green waste into engineered soil and mulch products. This acquisition is a strategic move for SGD, aimed at expanding its portfolio of environmentally friendly solutions and increasing revenue-generating activities. Resource Group brings with it advanced technologies, including its proprietary SURGRO™ technology, which aligns with emerging "peat-free" regulations. The acquisition terms included issuing shares of common stock and Series A Convertible Preferred Stock to Resource Group’s equity holders, along with promissory notes. CEO David Villarreal emphasized that despite recent stock volatility, the acquisition is on track, with only standard closing procedures and an audit remaining. Villarreal also projected pro forma revenues of approximately $25 million for 2025, highlighting the potential financial benefits of the acquisition. The transaction details will be outlined in a proxy statement to be filed with the SEC, which will be available for investors and security holders to review.

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