LUXEMBOURG, March 19, 2015 /PRNewswire/ -- Adecoagro S.A.
(NYSE: AGRO, Bloomberg: AGRO US,
Reuters: AGRO.K), one of the leading agricultural companies in
South America, announced today its
results for the fourth quarter and twelve month period ended on
December 31, 2014. The financial
information contained in this press release is based on unaudited
condensed consolidated interim financial statements presented in
U.S. dollars and prepared in accordance with International
Financial Reporting Standards (IFRS).
Financial & Operational Highlights:
Adecoagro recorded an Adjusted EBITDA(1) of
$215.5 million in 2014, 19.3% higher
than 2013. Adjusted EBITDA margin(1) in 2014 reached
31.0% compared to 28.9% in 2013. In 9M14, Adjusted EBITDA was
$177.8 million, 55.7% higher than in
9M13. Adjusted EBITDA margin grew to 36.3% from 24.7%.
Gross sales in 2014 reached $723.0
million, 12.2% higher than 2013.
Net Income in 2014 stood at $2.4
million, $28.3 million higher
than 2013.
The Sugar, Ethanol and Energy business‟ fourth quarter of 2014
marked the conclusion of the 2014/15 sugarcane harvest. Adjusted
EBITDA reached $59.4 million, 69.0%
higher than 4Q13. Adjusted EBITDA margin increased from 32.6% to
41.9%.
On a full year basis, operational milling efficiencies coupled
with favorable weather allowed our mills to crush a total of 7.2
million tons, reaching full utilization of nominal crushing
capacity. Adjusted EBITDA reached $153.5
million, marking a 33.2% increase over 2013. Adjusted EBITDA
margin expanded to 40.5% from 38.8% in the previous year.
The improvement in financial performance during 4Q14 and 2014 is
primarily explained by (i) our strategy of aggressively expanding
our sugarcane plantation; (ii) a 31.7% increase in cogeneration
efficiency ratio which reached an average of 61.6 KWh exported per
ton of sugarcane, one of the highest in the industry; (iii) a 12.5%
year-over-year increase in sugarcane yields and a 3.1% growth in
TRS content; (iii) a 12.7% expansion in crushing volumes resulting
in higher sugar, ethanol and energy production and sales volumes;
(iii) a 64.6% increase in realized energy prices measured in USD;
and (iv) enhanced production efficiencies and operational leverage
in our cluster, which dilutes our sugarcane production costs.
Operating and financial performance was partially offset by (i)
lower sugar and ethanol realized prices in USD terms; and (ii) the
execution of an ethanol carry strategy to capture higher
inter-harvest prices, postponing sales and margins to 1Q15.
The Farming and Land Transformation businesses‟ Adjusted EBITDA
in 4Q14 was negative $15.0 million,
compared to $38.5 million in 4Q13.
This decrease was primarily driven by (i) an $11.0 million loss from the mark-to-market of
commodity derivative hedges, driven by the rebound in commodity
prices during 4Q14; (ii) a $3.6
million non-cash loss generated by the fair value of the
2014/15 rice crop; (iii) lower commodity prices; and (iv) timing of
farm sales: in 2013 we generated gains from farm sales in the
fourth quarter, while in 2014 gains were generated in the second
quarter.
On a full year basis, Adjusted EBITDA was $85.2 million, relatively in line with 2013.
Results were mainly driven by enhanced operational and financial
performance in our crops, rice and dairy segments; offset by lower
soybean, corn and wheat prices.
Net Income in 2014 totaled $2.4
million, $28.2 million higher
than in 2013. Net income was achieved through (i) operational and
financial improvements in the Sugar & Ethanol business; (ii) a
$12.5 million improvement in
financial results, mainly related to lower foreign currency losses;
and partially offset by (iii) a $21.2
million increase in depreciation related to the ramp up of
the Ivinhema mill; and (iv) a $15.4
million increase in income tax resulting from a $45.4 million increase in profit before tax.
Despite accrued income tax charges, the utilization of carry
forward losses resulted in actual tax payments of $0.4 million.
Strategy Execution
Sugar, Ethanol & Energy Expansion
As of the date of this release, the construction of the second
phase of the Ivinhema mill is almost complete, adding 3.0 million
tons of crushing capacity to our cluster. Ivinhema began crushing
on March 16, with a daily milling
capacity of 20,000 tons, and is expected to reach final capacity of
25,000 tons per day by mid April. To supply our new capacity with
quality raw material, we successfully planted 36,267 hectares of
sugarcane in 2014, 40.8% higher than 2013. We have essentially
completed the construction of our cluster in Mato Grosso do Sul. We expect to expand
capacity by 1.0 million tons of capacity during 2016/2017, mainly
consisting in planting additional sugarcane and extending the
harvest season from early March to year end.
Preparations for the start of the harvest
During January and February 2015,
our Sugar, Ethanol & Energy teams were fully focused on the
inter-harvest maintenance of the industrial milling equipment and
agricultural machinery. All reparations and improvements have been
accomplished on schedule. We have also implemented various training
programs for our employees, seeking to continue improving
operational performance. The efficient inter-harvest and the fact
that we have sufficient sugarcane has allowed us to anticipate the
commencement of the harvest: Angelica and Ivinhema began crushing
on March 11 and March 16, respectively.
In the Farming business, our operational teams are ready to
begin the harvest of summer crops (corn and soybean). Harvest
contractors have been hired in each farm and operating protocols
have been revised and adjusted. Farm roads have been improved in
order to minimize logistic disruptions during harvest.
(1) Adjusted EBITDA is defined as
consolidated profit from operations before financing and taxation,
depreciation, amortization and unrealized changes in fair value of
long-term biological assets (sugarcane, coffee and cattle) plus the
gains or losses from disposals of non-controlling interests in
subsidiaries. Adjusted EBIT is defined as consolidated profit
from operations before financing and taxation, and unrealized
changes in fair value of long-term biological assets (sugarcane,
coffee and cattle) plus the gains or losses from disposals of
non-controlling interests in subsidiaries. Adjusted EBITDA margin
and Adjusted EBIT margin are calculated as a percentage of net
sales.
To read the full 4Q14 earnings release, please access
www.adecoagro.com. A conference call to discuss 4Q14 results will
be held on March 20, 2015 with live
webcast through the internet:
4Q14 Conference Call
March 20,
2015
11 a.m. (US
EST)
12 p.m. (Buenos Aires)
12 p.m. (Sao Paulo time)
4 p.m. (Luxembourg time)
Tel: (877) 317-6776
Participants calling from the US
Tel: +1 (412) 317-6776
Participants calling from other countries
Access Code: Adecoagro
Investor Relations Department
Charlie Boero Hughes
CFO
Hernan Walker
IR Manager
Email: ir@adecoagro.com
Tel: +54 (11) 4836-8651
About Adecoagro:
Adecoagro is a leading agricultural company in South America. Adecoagro owns over 257
thousand hectares of farmland and several industrial facilities
spread across the most productive regions of Argentina, Brazil and Uruguay, where it produces over 1.3 million
tons of agricultural products including corn, wheat, soybeans,
rice, dairy products, sugar, ethanol and electricity among
others.
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SOURCE Adecoagro S.A.