|
|
|
|
|
|
|
|
|
|
Crops - Highlights
|
|
|
|
|
|
|
|
|
|
metric
|
3Q18
|
3Q17
|
Chg %
|
9M18
|
9M17
|
Chg %
|
Gross Sales
|
$ thousands
|
34,804
|
59,201
|
(41.2)%
|
115,316
|
144,097
|
(20.0)%
|
|
|
tons
|
145,997
|
264,539
|
(44.8)%
|
465,864
|
667,414
|
(30.2)%
|
|
|
$ per ton
|
238.4
|
223.8
|
6.5%
|
247.5
|
215.9
|
14.6%
|
Adjusted EBITDA
|
$ thousands
|
12,786
|
2,628
|
386.5%
|
36,990
|
23,052
|
60.5%
|
Adjusted EBIT
|
$ thousands
|
12,481
|
2,280
|
447.4%
|
35,888
|
22,012
|
63.0%
|
Planted Area
|
hectares
|
192,507
|
185,149
|
3.97%
|
192,507
|
185,149
|
4.0%
|
Adjusted EBITDA in our Crops segment was $
37.0 million
in 9M18,
60.5%
higher compared to the same period of last year. This is mainly explained by a $10.6 million increase in Changes in Fair Value of Biological Assets and Agricultural Produce and Changes in Net Realizable Value, which reflects the margin recognized throughout the biological growth cycle and harvest of our crops. Higher margins are explained by (i) enhanced operating efficiencies, (ii) lower production costs, measured in U.S dollars, as a result of the depreciation of the Argentine Peso; and (iii) higher commodity prices in the local market as the drought in Argentina during the first quarter resulted in lower grain production putting pressure on supply and therefore, increasing domestic prices. These positive effects were partially offset by the $5.7 million negative mark-to-market of our crops hedge position.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Crops - Changes in Fair Value Breakdown - as of September 30, 2018
|
9M18
|
metric
|
Soy
|
Soy 2nd Crop
|
Corn
|
Corn 2nd Crop
|
Wheat
|
Sunflower
|
Cotton
|
Peanut
|
|
Total
|
|
|
|
|
|
|
|
|
|
|
|
2017/18 Harvest Year
|
|
|
|
|
|
|
|
|
|
|
Total Harvested Area
|
Hectares
|
54,768
|
|
23,030
|
|
44,777
|
|
11,549
|
|
35,519
|
|
2,863
|
|
3,132
|
|
9,375
|
|
185,013
|
|
Area harvested in previous periods
|
Hectares
|
—
|
|
—
|
|
—
|
|
—
|
|
34,213
|
|
—
|
|
—
|
|
—
|
|
34,213
|
|
Area harvested in current period
|
Hectares
|
54,768
|
|
23,030
|
|
44,777
|
|
11,549
|
|
1,306
|
|
2,863
|
|
3,132
|
|
9,375
|
|
150,800
|
|
Changes in Fair Value 9M18 from harvested area 2017/18 (i)
|
$ thousands
|
10,349
|
|
2,804
|
|
10,995
|
|
1,916
|
|
672
|
|
55
|
|
(61
|
)
|
85
|
|
26,814
|
|
2018/19 Harvest Year
|
|
|
|
|
|
|
|
|
|
|
Total Planted Area
|
Hectares
|
|
|
8,734
|
|
|
39,374
|
|
2,034
|
|
|
|
50,142
|
|
Area planted in initial growth stages
|
Hectares
|
|
|
|
|
|
|
|
|
—
|
|
Changes in Fair Value 9M18 from planted area 2018/19 (ii)
|
$ thousands
|
|
|
|
716
|
|
|
|
|
716
|
|
Total Changes in Fair Value in 9M18 (i+ii)
|
$ thousands
|
10,349
|
|
2,804
|
|
10,995
|
|
1,916
|
|
1,388
|
|
55
|
|
(61
|
)
|
85
|
|
27,530
|
|
The table above shows the gains or losses from crop production generated during 9M18. A total of
185,013
hectares were harvested in the 2017/18 crop. As of September 30, 2018, total Changes in Fair Value, which reflects the margin of both the crops that have already been harvested and the expected margin of those that are still on the ground with significant biological growth, was $
27.5 million
, compared to $13.6 million generated during the same period last year. As explained above, the main drivers for the increase in margins are (i) higher operating efficiencies, (ii) higher domestic prices; coupled with (iii) lower costs of production, measured in USD.
Planting activities related to the new 2018/19 crop are underway. We planted 39.7 thousand hectares of wheat, 10.5 thousand of corn, 3.0 thousandof sunflower, 2.5 thousand of soybeans and 3.2 thousand hectares of peanuts . Abundant rainfalls during this and the previous quarter have provided good soil humidity, necessary for planting activities.
As shown in the table below, crops sales year-to-date reached $
115.3 million
,
20.0%
below last year, primarily explained by lower selling volumes as a consequence of the drought that hit the country early in the year, significantly impacting achieved yields.
|
|
|
|
|
|
|
|
|
|
|
|
|
Crops - Gross Sales Breakdown
|
|
|
|
|
|
|
|
|
|
|
|
Amount ($ '000)
|
|
Volume
|
|
$ per unit
|
Crop
|
3Q18
|
3Q17
|
Chg %
|
|
3Q18
|
3Q17
|
Chg %
|
|
3Q18
|
3Q17
|
Chg %
|
Soybean
|
21,297
|
26,213
|
(18.8)%
|
|
71,942
|
86,408
|
(16.7)%
|
|
296
|
303
|
(2.4)%
|
Corn
(1)
|
9,910
|
23,784
|
(58.3)%
|
|
66,042
|
158,609
|
(58.4)%
|
|
150
|
150
|
0.1%
|
Wheat
(2)
|
1,279
|
555
|
130.5%
|
|
6,397
|
4,078
|
56.9%
|
|
200
|
136
|
46.9%
|
Sunflower
|
471
|
2,494
|
(81.1)%
|
|
1,616
|
7,905
|
(79.6)%
|
|
291
|
315
|
(7.6)%
|
Cotton Lint
|
—
|
264
|
(100.0)%
|
|
—
|
148
|
(100.0)%
|
|
n.a
|
1,784
|
n.a
|
Others
|
1,847
|
5,891
|
(68.6)%
|
|
|
7,391
|
|
|
|
|
|
Total
|
34,804
|
59,201
|
(41.2)%
|
|
145,997
|
264,539
|
(44.8)%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Crops - Gross Sales Breakdown
|
|
|
|
|
|
|
|
|
|
|
|
Amount ($ '000)
|
|
Volume
|
|
$ per unit
|
Crop
|
9M18
|
9M17
|
Chg %
|
|
9M18
|
9M17
|
Chg %
|
|
9M18
|
9M17
|
Chg %
|
Soybean
|
70,209
|
66,977
|
4.8%
|
|
216,738
|
229,151
|
(5.4)%
|
|
324
|
292
|
11%
|
Corn
(1)
|
31,289
|
55,296
|
(43.4)%
|
|
201,322
|
348,917
|
(42.3)%
|
|
155
|
158
|
(2)%
|
Wheat
(2)
|
7,483
|
11,078
|
(32.5)%
|
|
43,204
|
72,673
|
(40.5)%
|
|
173
|
152
|
14%
|
Sunflower
|
1,454
|
2,932
|
(50.4)%
|
|
4,599
|
9,109
|
(49.5)%
|
|
316
|
322
|
(2)%
|
Cotton Lint
|
—
|
310
|
(100.0)%
|
|
—
|
173
|
(100.0)%
|
|
n.a
|
1,792
|
n.a
|
Others
|
4,881
|
7,504
|
(35.0)%
|
|
|
7,391
|
|
|
|
|
|
Total
|
115,316
|
144,097
|
(20.0)%
|
|
465,864
|
667,414
|
(30.2)%
|
|
|
|
|
(1) Includes sorghum
(2) Includes barley
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Rice - Highlights
|
|
|
|
|
|
|
|
|
metric
|
3Q18
|
|
3Q17
|
|
Chg %
|
|
9M18
|
|
9M17
|
|
Chg %
|
|
Gross Sales
|
$ thousands
|
31,271
|
|
16,218
|
|
92.8
|
%
|
87,482
|
|
59,497
|
|
47.0
|
%
|
Gross Sales of White Rice
|
thousand tons
(1)
|
84
|
|
47
|
|
79.1
|
%
|
219
|
|
163
|
|
34.4
|
%
|
$ per ton
|
277
|
|
281
|
|
(1.2
|
)%
|
286
|
|
288
|
|
(0.8
|
)%
|
$ thousands
|
23,324
|
|
13,183
|
|
76.9
|
%
|
62,621
|
|
46,959
|
|
33.4
|
%
|
Gross Sales By-products
|
$ thousands
|
7,947
|
|
3,035
|
|
161.8
|
%
|
24,861
|
|
12,537
|
|
98.3
|
%
|
Adjusted EBITDA
|
$ thousands
|
6,755
|
|
1,692
|
|
299.2
|
%
|
21,211
|
|
6,907
|
|
207.1
|
%
|
Adjusted EBIT
|
$ thousands
|
6,024
|
|
781
|
|
671.3
|
%
|
18,521
|
|
4,110
|
|
350.6
|
%
|
Area under production
(2)
|
|
40,289
|
|
39,728
|
|
1.4
|
%
|
40,289
|
|
39,728
|
|
1.4
|
%
|
|
|
|
|
|
|
|
|
Rice Mills
|
|
|
|
|
|
|
|
Total Processed Rough Rice
|
thousand tons
(1)
|
80
|
|
65
|
|
22.8
|
%
|
212
|
|
183
|
|
15.8
|
%
|
Ending stock
|
thousand tons
(1)
|
83
|
|
78
|
|
6.7
|
%
|
83
|
|
78
|
|
6.7
|
%
|
(1) Of rough rice equivalent.
(2) Areas under production correspond to the 2017/18 and 2016/17 harvest.
Due to the seasonality and growth cycle of the rice crop, Adjusted EBITDA generation during the second half of the year is usually driven by sales of processed rice and by-products, net of selling expenses and overhead costs.
Rice sales during 3Q18 reached $
31.3 million
,
92.8%
higher than 3Q17. This was attributable to the
79.1%
increase in selling volumes. Rough rice was available and enhanced efficiencies at the industry level, allowed us to increase processing operations. Total sales were partially offset by a slight reduction in average selling prices. This decrease, is explained by the change in selling mix and the reduction in selling prices for the domestic market measured in USD . During 3Q18 78.0% of total selling volumes were diverted to the export market compared to the 68% in 3Q17. That margins in the export market are higher than in the domestic one since selling costs are considerable lower. This coupled with the cost dilution in USD, explain the almost 4.0x increase in 3Q18 EBITDA year-over-year.
On a cumulative basis adjusted EBITDA was $
21.2 million
, $
14.3 million
or
207.1%
higher than 9M17. This is mainly explained by: (i) higher margins in our agricultural operations driven by higher yields and lower production costs as a result of the depreciation of the Argentine Peso; coupled with a better mill out ratio of white rice (less broken) due to high quality of our rough rice.
|
|
|
|
|
|
|
|
|
Dairy - Highlights
|
|
|
|
|
|
|
|
|
metric
|
3Q18
|
3Q17
|
Chg %
|
9M18
|
9M17
|
Chg %
|
Gross Sales
|
$ thousands
(1)
|
8,549
|
8,931
|
(4.3)%
|
24,176
|
28.253
|
(14.4)%
|
|
million liters
(2)
|
25.4
|
24.1
|
5.5%
|
69.8
|
73.1
|
(4.5)%
|
|
$ per liter
(3)
|
0.30
|
0.34
|
(13.0)%
|
0.31
|
0.36
|
(14.0)%
|
Adjusted EBITDA
|
$ thousands
|
1,183
|
2,801
|
(57.8)%
|
6,140
|
7,616
|
(19.4)%
|
Adjusted EBIT
|
$ thousands
|
900
|
2,559
|
(64.8)%
|
5,296
|
6,879
|
(23.0)%
|
Milking Cows
|
Average Heads
|
7,545
|
7,094
|
6.4%
|
7,429
|
6,901
|
7.7%
|
Cow Productivity
|
Liter/Cow/Day
|
37.6
|
37.6
|
—%
|
36.2
|
36.1
|
0.3%
|
Total Milk Produced
|
million liters
|
26.1
|
24.5
|
6.3%
|
73.5
|
68.1
|
7.9%
|
(1) Includes (i) $0.50 million from sales of culled cows in 3Q18 and $0.77 million in 3Q17, (ii) $0.06 million from sales of cream in 3Q18, (iii) $3.0 million from sales of powder milk in 3Q18; and (v) $0.51 million from electricity sales in 3Q18
(2) Selling volumes includes 7.4 million liters of milk destined towards powder milk production in 3Q18.
(3) Sales price includes the sale of fluid milk and whole milk powder and excludes cattle, electricity, cream and whey sales.
Our Dairy operation continues to deliver strong operational results. On a year-to-date basis, milk production reached
73.5 million
,
7.9%
higher compared to the same period of last year. This increase is primarily attributable to an
7.7%
increase in our dairy cow herd, coupled with a slight increase in cow productivity.
Despite higher production volumes, Adjusted EBITDA reached
$6.1 million
,
19.4%
lower year-over-year. This decrease is primarily explained by lower gross sales as a result of the
14.0%
reduction in average selling prices, measured in U.S. dollar after the sharp depreciation of the Argentine peso. This negative effect was partialy offset by: (i) the reduction in unitary production cost as a result of enhanced operational efficiencies; and (iii) the $1.4 million derived from electricity sales.
We expect to keep enhancing efficiencies as we continue populating our third free-stall facility and achieve stable production.
|
|
|
|
|
|
|
|
|
All Other Segments - Highlights
|
|
|
|
|
|
|
|
|
metric
|
3Q18
|
3Q17
|
Chg %
|
9M18
|
9M17
|
Chg %
|
Gross Sales
|
$ thousands
|
344
|
375
|
(8.3)%
|
1,148
|
813
|
41.2%
|
Adjusted EBITDA
|
$ thousands
|
(333)
|
(180)
|
84.8%
|
(146)
|
4
|
n.a
|
Adjusted EBIT
|
$ thousands
|
(348)
|
(209)
|
66.3%
|
(222)
|
(85)
|
160.7%
|
All Other Segments primarily encompasses our cattle business. Our cattle segment consists of pasture land that is not suitable for crop production due to soil quality and is leased to third parties for cattle grazing activities.
Adjusted EBITDA for All Other Segment during 3Q18 was a loss of $0.3 million.
|
|
Land transformation business
|
|
|
|
|
|
|
|
|
|
Land transformation - Highlights
|
|
|
|
|
|
|
|
|
metric
|
3Q18
|
3Q17
|
Chg %
|
9M18
|
9M17
|
Chg %
|
Adjusted EBITDA
|
$ thousands
|
—
|
—
|
n.a
|
36,227
|
—
|
n.a
|
Adjusted EBIT
|
$ thousands
|
—
|
—
|
n.a
|
36,227
|
—
|
n.a
|
Land sold
|
Hectares
|
—
|
—
|
n.a
|
9,300
|
—
|
n.a
|
Adjusted EBITDA for our Land Transformation business during 9M18 totaled $36.2, compared to a null result during 9M17.
During June 2018, we completed the sale of Rio de Janeiro and Conquista farms, located in western Bahia and Tocantins, respectively. The aggregate selling price reached $53.0 million for a total of 9,300 croppable hectares. The selling price represent a 37% premium to the latest Cushman and Wakefield´s independent appraisal, as of September 30, 2017.
Over the last 12 years, we have been able to generate gains of over $200 million by strategically selling at least one of our fully mature farms per year. Monetizing a portion our land transformation gains allows us to redeploy the capital into higher yielding activities, enabling us to continue growing and enhancing shareholder value.
|
|
|
|
|
|
|
|
|
Sugar, Ethanol & Energy - Selected Information
|
|
|
|
metric
|
3Q18
|
3Q17
|
Chg %
|
9M18
|
9M17
|
Chg %
|
Milling
|
|
|
|
|
|
|
|
Sugarcane Milled
|
tons
|
3,295,659
|
4,116,044
|
(19.9)%
|
8,611,975
|
8,040,480
|
7.1%
|
Own Cane
|
tons
|
3,005,049
|
3,529,781
|
(14.9)%
|
8,103,449
|
7,100,094
|
14.1%
|
Third Party Cane
|
tons
|
290,610
|
586,263
|
(50.4)%
|
508,526
|
940,386
|
(45.9)%
|
Production
|
|
|
|
|
|
|
|
TRS Equivalent Produced
|
tons
|
487,941
|
584,646
|
(16.5)%
|
1,151,316
|
1,050,732
|
9.6%
|
Sugar
|
tons
|
140,770
|
267,674
|
(47.4)%
|
282,474
|
470,129
|
(39.9)%
|
Ethanol
|
M3
|
200,390
|
178,363
|
12.3%
|
504,116
|
327,778
|
53.8%
|
Hydrous Ethanol
|
M3
|
133,070
|
97,773
|
36.1%
|
352,301
|
192,106
|
83.4%
|
Anhydrous Ethanol
|
M3
|
67,320
|
80,590
|
(16.5)%
|
151,815
|
135,672
|
11.9%
|
Sugar mix in production
|
%
|
33%
|
48%
|
(30.8)%
|
28%
|
47%
|
(40.1)%
|
Ethanol mix in production
|
%
|
67%
|
52%
|
28.3%
|
72%
|
53%
|
35.2%
|
Energy Exported (sold to grid)
|
MWh
|
252,781
|
273,804
|
(7.7)%
|
554,211
|
543,583
|
2.0%
|
Cogen efficiency (KWh sold per ton crushed)
|
KWh/ton
|
76.7
|
66.5
|
15.3%
|
64.4
|
67.6
|
(4.8)%
|
Agricultural Metrics
|
|
|
|
|
|
|
|
Harvested own sugarcane
|
tons
|
3,005,049
|
3,529,781
|
(14.9)%
|
8,103,449
|
7,100,094
|
14.1%
|
Harvested area
|
Hectares
|
37,015
|
44,059
|
(16.0)%
|
90,221
|
84,249
|
7.1%
|
Yield
|
tons/hectare
|
81.2
|
80.1
|
1.3%
|
89.8
|
84.3
|
6.6%
|
TRS content
|
kg/ton
|
143.3
|
137.7
|
4.1%
|
128.7
|
127.2
|
1.2%
|
TRS per hectare
|
kg/hectare
|
11,635
|
11,030
|
5.5%
|
11,563
|
10,722
|
7.8%
|
Mechanized harvest
|
%
|
98.3%
|
98.2%
|
0.1%
|
98.6%
|
98.3%
|
0.3%
|
Area
|
|
|
|
|
|
|
|
Sugarcane Plantation
|
hectares
|
151,597
|
142,133
|
6.7%
|
151,597
|
142,133
|
6.7%
|
Expansion & Renewal Area
|
hectares
|
8,095
|
7,503
|
7.9%
|
23,599
|
17,881
|
32.0%
|
Year-to-date, a total of
8.6 million
tons of sugarcane were crushed,
7.1%
higher compared to the same period of last year. Considering crushing volumes during the third quarter, the increase during the first nine months is entirely explained by what happened during the first half of the year.
On a quarterly basis, sugarcane milling marked a
19.9%
decrease compared to 3Q17, reaching
3.3 million
tons. This was mainly explained by the reduction in effective milling days due to weather related issues. A total of 323 mm of water fell during 3Q18 in the region, 57.9% higher compared to 3Q17.
Production mix continued to favor ethanol to profit from higher relative prices. During the first nine months of the year, hydrous and anhydrous ethanol traded at a 29.0% and 34.5% premium to sugar.
72%
of total TRS produced was slanted towards ethanol, compared to
53%
in 9M17. This explains, the
53.8%
increase in total ethanol production, reaching
504 thousand
cubic meters. Sugar production totaled
282 thousand
tons,
39.9%
lower year-over-year.
In terms of agricultural productivity, sugarcane yields during the nine-month period reached
89.8
tons/ha,
6.6%
higher than the previous year, while TRS content per ton of sugarcane reached
128.7
kg/ton. The combination of these two effects resulted in TRS production per hectare of
11.6 thousand
,
7.8%
higher year-over-year. Higher yields were mainly explained by: (i) above average rainfalls, which favored cane development; and (ii) a longer growth cycle for a greater proportion of the sugarcane harvested in 2018 than the sugarcane harvested in 2017.
Exported energy during the quarter totaled
252,781
MWh, marking a
7.7%
decrease year-over-year. The
19.9%
reduction in crushing volumes was partially offset by (i) the large bagasse availability carried over from the previous quarter; coupled with (ii) enhanced efficiencies at an industry level. This explains, at the same time, the
15.3%
increase in cogeneration efficiency. On a year-to-date basis, total exported energy marked a slight increase, reaching
554,211
MWh.
As of September 30, 2018, our sugarcane plantation consisted of
151,597
hectares,
6.7%
higher year-over-year. Sugarcane planting continues to be a key strategy to supply our mills with quality raw material at low cost. During 3Q18 we planted a total of
8,095
hectares of sugarcane. Of this total area, 2,361 hectares correspond to expansion areas planted to supply our growing milling capacity and 5,734 hectares correspond to areas planted to renew old plantations with newer and high-yielding sugarcane, thus allowing us to maintain the productivity of our plantation.
|
|
|
|
|
|
|
|
Sugar, Ethanol & Energy - Highlights
|
|
|
|
|
|
|
$ thousands
|
3Q18
|
3Q17
|
Chg %
|
9M18
|
9M17
|
Chg %
|
Net Sales
(1)
|
127,228
|
170,451
|
(25.4)%
|
328,496
|
404,150
|
(18.7)%
|
Margin on Manufacturing and Agricultural Act. Before Opex
|
35,141
|
54,041
|
(35.0)%
|
103,907
|
101,848
|
2.0%
|
Adjusted EBITDA
|
63,976
|
74,341
|
(13.9)%
|
192,850
|
165,967
|
16.2%
|
Adjusted EBITDA Margin
|
50.3%
|
43.6%
|
15.3%
|
58.7%
|
41.1%
|
43.0%
|
Adjusted EBITDA Margin (net of third party commercialization)
|
54.8%
|
51.2%
|
7.2%
|
67.9%
|
48.0%
|
41.4%
|
(1) Net Sales are calculated as Gross Sales net of sales taxes.
|
|
|
|
|
|
Net sales in 3Q18 reached $
127.2 million
, $43.2 million or
25.4%
lower than 3Q17. This decrease was primarily driven by the combination of lower sugar and energy selling volumes, coupled with lower sugar and ethanol prices, measured in USD. Ethanol prices in BRL increased by 4.2% during the quarter .
Adjusted EBITDA during 3Q18 was $
64.0 million
,
13.9%
lower compared to 3Q17. Adjusted EBITDA was positively affected by: (i) a
14%
reduction in total production costs, on a per unit basis, a a result of enhanced agricultural and industrial efficiencies, coupled with the depreciation of the Brazilian Real; (ii) $14.2 million higher gain derived from the mark-to-market of our commodity hedge position. These positive effects were offset by lower sales coupled with a $16.2 million loss from the fair value of the unharvested cane
On a cumulative basis, Adjusted EBITDA in 9M18 grew by
16.2%
reaching $
192.9 million
. Main drivers for the increase are explained by a reduction in cost of production coupled with and increase of other operating income and partially offset by a decrease in sales.
The table below reflects the breakdown of net sales for the Sugar, Ethanol & Energy business.
|
|
|
|
|
|
|
|
|
|
|
|
|
Sugar, Ethanol & Energy - Net Sales Breakdown
(1)
|
|
|
|
|
|
|
|
|
|
$ thousands
|
|
|
Units
|
|
|
|
($/unit)
|
|
|
3Q18
|
3Q17
|
Chg %
|
|
3Q18
|
3Q17
|
Chg %
|
|
3Q18
|
3Q17
|
Chg %
|
Sugar (tons)
(2)
|
42,991
|
110,552
|
(61.1)%
|
|
158,121
|
320,612
|
(50.7)%
|
|
272
|
345
|
(21.2)%
|
Ethanol (cubic meters)
|
64,469
|
36,889
|
74.8%
|
|
169,588
|
81,123
|
109.1%
|
|
380
|
455
|
(16.4)%
|
Energy (Mwh)
(3)
|
19,769
|
23,011
|
(14.1)%
|
|
277,658
|
328,887
|
(15.6)%
|
|
71
|
70
|
1.8%
|
TOTAL
|
127,228
|
170,451
|
(25.4)%
|
|
|
|
|
|
|
|
|
|
$ thousands
|
|
|
Units
|
|
|
|
($/unit)
|
|
|
9M18
|
9M17
|
Chg %
|
|
9M18
|
9M17
|
Chg %
|
|
9M18
|
9M17
|
Chg %
|
Sugar (tons)
(2)
|
95,076
|
232,149
|
(59.0)%
|
|
318,330
|
606,654
|
(47.5)%
|
|
299
|
383
|
(22.0)%
|
Ethanol (cubic meters)
|
194,067
|
131,623
|
47.4%
|
|
424,140
|
268,199
|
58.1%
|
|
458
|
491
|
(6.8)%
|
Energy (Mwh)
(3)
|
39,352
|
40,377
|
(2.5)%
|
|
581,787
|
647,009
|
(10.1)%
|
|
68
|
62
|
8.4%
|
TOTAL
|
328,496
|
404,150
|
(18.7)%
|
|
|
|
|
|
|
|
|
(1) Net Sales are calculated as Gross Sales net of ICMS, PIS, COFINS, INSS and IPI taxes.
|
|
|
|
|
(2) Includes commercialization of third party sugar: 22.3k tons ($8.5m) in 3Q18 and 72.7k tons ($26.0.8m) in 3Q17; 82.1k tons ($32.4m) in 9M18 and 149.6k tons ($60.6m) in 9M17
|
(3) Includes commercialization of energy from third parties.
|
|
|
|
|
On a quarterly basis, ethanol selling volumes increased
109.1%
. This increase reflects our strategic decision to maximize ethanol production to profit from higher relative prices. Hydrous and anhydrous ethanol traded, during the nine-month period, at a 29.0% and a 34.5% premium to VHP sugar. Measured in U.S. dollars, ethanol prices decreased
16.4%
year-over-year, less than the 25% depreciation of the Brazilian Real. Compared to the same period of last year, we are executing a more aggressive carry strategy aiming to profit from higher prices during the inter-harvest season.
In the case of energy, selling volumes reached
277,658
MWh, a
15.6%
decrease. This is mainly explained by lower crushing activities; partially offset by (i) bagasse inventories carried from the first semester, (ii) enhanced efficiencies, coupled with (iii) a commercial effort to maximize energy sales in order to capture higher selling prices. We expect prices to remain at attractive levels, despite the recent drop in spot prices, in the wake of increasing demand and lower levels of water reservoirs in the south-east region of Brazil.
Sugar sales volumes reached
158,121
tons,
50.7%
lower year-over-year. Average realized selling prices reached $254/ton,
21.2%
lower compared to 3Q17. Lower prices are primarily explained by global supply and demand. In the case of India, for instance the government has officially announced its subsidies policies for exports and cane production, and on top of that it has increased its export quota from 3 to 5 million tons. As a result, net sales reached $
43.0 million
,
61.1%
lower compared to the same period of last year.
|
|
|
|
|
|
|
|
|
Sugar, Ethanol & Energy - Total Production Costs
|
|
|
|
|
|
Total Cost (´000)
|
|
Total Cost per Pound (cts/lbs)
|
|
3Q18
|
3Q17
|
Chg %
|
|
3Q18
|
3Q17
|
Chg %
|
Industrial costs
|
27,428
|
42,228
|
(35)%
|
|
2.8
|
3.5
|
(22.1)%
|
Industrial costs
|
21,132
|
25,021
|
(15.5)%
|
|
2.1
|
2.1
|
1.3%
|
Cane from 3rd parties
|
6,296
|
17,207
|
(63.4)%
|
|
0.6
|
1.4
|
(56.1)%
|
Agricultural costs
|
70,155
|
93,914
|
(25.3)%
|
|
7
|
7.9
|
(10.4)%
|
Harvest costs
|
30,068
|
40,065
|
(25)%
|
|
3
|
3.4
|
(10)%
|
Cane depreciation
|
17,027
|
22,158
|
(23.2%)
|
|
1.7
|
1.9
|
(7.8)%
|
Agricultural Partnership Costs
|
9,419
|
17,078
|
(44.8)%
|
|
0.9
|
1.4
|
(33.8)%
|
Maintenance costs
|
13,640
|
14,612
|
(6.7)%
|
|
1.4
|
1.2
|
12%
|
Total Production Costs
|
97,583
|
136,142
|
(28.3)%
|
|
9.8
|
11.4
|
(14)%
|
Depreciation & Amortization
|
(39,736)
|
(51,689)
|
(23.1%)
|
|
(4)
|
(4.3)
|
(7.8%)
|
Total Production Costs (excl. D&A)
|
57,847
|
84,452
|
(31.5)%
|
|
5.8
|
7.1
|
(17.8)%
|
|
|
|
|
|
|
|
|
Sugar, Ethanol & Energy - Total Production Costs
|
|
|
|
|
|
Total Cost (´000)
|
|
Total Cost per Pound (cts/lbs)
|
|
9M18
|
9M17
|
Chg %
|
|
9M18
|
9M17
|
Chg %
|
Industrial costs
|
64,720
|
78,255
|
(17.3)%
|
|
2.8
|
3.3
|
(16.6)%
|
Industrial costs
|
53,677
|
51,961
|
3.3%
|
|
2.3
|
2.4
|
(4.7)%
|
Cane from 3rd parties
|
11,043
|
26,295
|
(58.0)%
|
|
0.5
|
1.2
|
(61.3)%
|
Agricultural costs
|
191,182
|
199,734
|
(4.3)%
|
|
8.2
|
9.3
|
(11.7)%
|
Harvest costs
|
77,351
|
83,520
|
(7.4)%
|
|
3.3
|
3.9
|
(14.5)%
|
Cane depreciation
|
45,091
|
42,112
|
7.1%
|
|
1.9
|
2.0
|
(1.2)%
|
Agricultural Partnership Costs
|
25,646
|
32,273
|
(20.5)%
|
|
1.1
|
1.5
|
(26.7%)
|
Maintenance costs
|
43,093
|
41,828
|
3.0%
|
|
1.8
|
1.9
|
(4.9)%
|
Total Production Costs
|
255,902
|
277,989
|
(7.9)%
|
|
10.9
|
12.6
|
(13.0)%
|
Depreciation & Amortization
|
(106,355)
|
(104,723)
|
1.6%
|
|
(4.5)
|
(4.9)
|
(6.3%)
|
Total Production Costs (excl. D&A)
|
149,547
|
173,266
|
(13.7)%
|
|
6.4
|
7.7
|
(17.2)%
|
As shown in the table above, total production costs excluding depreciation and amortization fell a 17.2%, on a per unit basis. This decrease was explained by: (i) enhanced agricultural efficiencies that contributed to reduce harvest costs, (ii) lower sugar prices which resulted in a reduction in Consecana price and thus, in our agricultural partnership costs; and (iii) a reduction in the share of third party cane. Unit costs, measured in U.S. dollars, were further reduced by the year-over-year depreciation of the Brazilian Real.
|
|
|
|
|
|
|
|
|
Sugar, Ethanol & Energy - Changes in Fair Value
|
|
|
|
|
$ thousands
|
3Q18
|
3Q17
|
Chg %
|
|
9M18
|
9M17
|
Chg %
|
Sugarcane Valuation Model current period
|
54,575
|
68,865
|
(20.8)%
|
|
54,575
|
68,865
|
(20.8%)
|
Sugarcane Valuation Model previous period
|
70,785
|
71,017
|
(0.3)%
|
|
93,177
|
82,380
|
13.1%
|
Total Changes in Fair Value
|
(16,210)
|
(2,152)
|
653.1%
|
|
(38,603)
|
(13,515)
|
185.6%
|
Total Changes in Fair Value of Unharvested Biological Assets (what is currently growing on the fields and will be harvested during the next 12 months) represented an $2.3 million loss. This loss is mainly attributable to a decrease in Consecana price as a result of sugar price dynamics. On a year to date basis, there was a $
38.6 million
loss in line with the explanation for the quarter.
|
|
|
|
|
|
|
|
Corporate Expenses
|
|
|
|
|
|
|
$ thousands
|
3Q18
|
3Q17
|
Chg %
|
9M18
|
9M17
|
Chg %
|
Corporate Expenses
|
(4,726)
|
(5,999)
|
(21.2)%
|
(14,686)
|
(16,329)
|
(10.1)%
|
Adecoagro’s corporate expenses include items that have not been allocated to a specific business segment, such as executive officers and headquarter staff, certain professional fees, travel expenses, and office lease expenses, among others. As shown in the table above, corporate expenses for 3Q18 were $
4.7 million
,
21.2%
lower compared to 3Q17, mainly as a result of the depreciation of the Brazilian Real and the Argentine peso.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Other Operating Income
|
|
|
|
|
|
|
$ thousands
|
3Q18
|
|
3Q17
|
|
Chg %
|
|
9M18
|
|
9M17
|
|
Chg %
|
|
Gain from the sale of subsidiaries
|
123
|
|
—
|
|
n.a.
|
|
36,350
|
|
—
|
|
n.a.
|
|
Gain / (Loss) from commodity derivative financial instruments
|
19,840
|
|
2,080
|
|
853.8
|
%
|
51,982
|
|
40,833
|
|
27.3
|
%
|
Gain from disposal of other property items
|
(160
|
)
|
89
|
|
(279.8
|
)%
|
(217
|
)
|
(529
|
)
|
(59.0
|
)%
|
Net Gain from FV Adjustement in Investment Property
|
2,465
|
|
1,753
|
|
40.6
|
%
|
18,457
|
|
3,634
|
|
407.9
|
%
|
Other
|
(111.313
|
)
|
976
|
|
n.a.
|
|
1,206
|
|
(904
|
)
|
n.a.
|
|
Total
|
37,891
|
|
5,015
|
|
656
|
%
|
107,520
|
|
43,034
|
|
149.8
|
%
|
Other Operating Income on a year-to-date basis reported a gain of $
107.5 million
,
149.8%
or $64.5 million higher than the same period of last year. This increase is mainly attributable to the proceeds from the sale of Rio de Janeiro and Conquista farms coupled with a higher gain derived from the mark-to-market of our sugar hedge position.
Adecoagro’s financial performance is affected by the volatile price environment inherent to agricultural commodities. The company uses forward and derivative markets to mitigate swings in commodity prices by locking-in margins and stabilizing cash flows.
The table below shows the average selling price of our hedged production volumes, including volumes that have already been invoiced and delivered, forward contracts with fixed-price and volumes hedged through derivative instruments.
|
|
|
|
|
Commodity Hedge Position - as of September 30, 2018
|
|
|
Consolidated Hedge Position
|
Farming
|
|
Avg. FAS Price
|
CBOT FOB
|
|
Volume
(1)
|
USD/Ton
|
USD/Bu
|
2017/2018 Harvest season
|
|
|
|
Soybeans
|
146,372
|
278.5
|
994.5
|
Corn
|
106,765
|
162.8
|
476.1
|
2018/2019 Harvest season
|
|
|
|
Soybeans
|
17,965
|
288.0
|
994.5
|
Corn
|
106,765
|
162.8
|
476.1
|
|
|
|
|
|
Consolidated Hedge Position
|
Sugar, Ethanol & Energy
|
|
Avg. FOB Price
|
ICE FOB
|
|
Volume
(1)
|
USD/Unit
|
Cents/Lb
|
2018/2019 Harvest season (2017/18 for ethanol)
|
|
|
|
Sugar (tons)
|
363,626
|
380.6
|
17.3
|
Ethanol (m3)
|
369,452
|
434.5
|
n.a
|
Energy (MW/h)
|
751,015
|
71.1
|
n.a
|
2019/2020 Harvest season (2018/19 for ethanol)
|
|
|
|
Sugar (tons)
|
147,320
|
328.0
|
14.9
|
Ethanol (m3)
|
-
|
-
|
-
|
Energy (MW/h)
|
477,478
|
64.2
|
n.a
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Financial Results
|
|
|
|
|
|
|
$ thousands
|
3Q18
|
|
3Q17
|
|
Chg %
|
|
9M18
|
|
9M17
|
|
Chg %
|
|
Interest Expenses, net
|
(7,381
|
)
|
(10,730
|
)
|
(31.2
|
)%
|
(30,543
|
)
|
(31,507
|
)
|
(3.1
|
)%
|
Cash Flow Hedge - Transfer from Equity
|
(519
|
)
|
(7,369
|
)
|
(93.0
|
)%
|
(7,846
|
)
|
(10,689
|
)
|
(26.6
|
)%
|
FX (Losses), net
|
(62,932
|
)
|
(6,627
|
)
|
n.m
|
|
(188,204
|
)
|
(18,510
|
)
|
n.m
|
|
Gain/loss from derivative financial Instruments
|
923
|
|
143
|
|
545.5
|
%
|
(5,836
|
)
|
(2,052
|
)
|
184.4
|
%
|
Taxes
|
(13
|
)
|
(972
|
)
|
(98.7
|
)%
|
(2,081
|
)
|
(2,276
|
)
|
(8.6
|
)%
|
Inflation accounting effects
|
50,370
|
|
—
|
|
n.a.
|
|
50,370
|
|
—
|
|
n.a.
|
|
Other Expenses, net
|
(1,080
|
)
|
(2,194
|
)
|
(50.8
|
)%
|
(1,338
|
)
|
(2,903
|
)
|
(53.9
|
)%
|
Total Financial Results
|
(20,632
|
)
|
(27,749
|
)
|
(25.6
|
)%
|
(185,478
|
)
|
(67,937
|
)
|
173
|
%
|
Our net financial results in 3Q18 presented a loss of
$20.6 million
, compared to a loss of
$27.7 million
in the same period of last year. The financial results loss is primarily composed of (i) foreign exchange losses, (ii) net interest expenses; and (iii) inflation accounting effects as described below:
|
|
(i)
|
Foreign exchange losses (composed of “Cash Flow Hedge - Transfer from Equity
(1)
and “Fx Gain/Loss line” items) reflect the impact of foreign exchange variations on our dollar denominated monetary assets and liabilities. As a result of the sharp depreciations experienced by the Argentina Peso and Brazilian Real (43.0% and 3.8%, respectively) during 3Q18, foreign exchange losses stood at $63.5 , marking a $49.5 higher loss compared to 3Q17. It´s worth highlighting that these results are non-cash in nature and represent no equity loss, in US dollar.
|
|
|
(ii)
|
Interest expenses: our net interest expenses in 3Q18 were
$7.4 million
,
25.6%
lower year-over-year. This difference is mainly explained by the depreciation of the Brazilian Real, coupled with a lower average debt compared to 3Q17.
|
|
|
(iii)
|
Inflation accounting effects reflect the results derived from the exposure of our net monetary position to inflation. In this line, monetary assets generate a loss when exposed to inflation while monetary liabilities generate a gain, every time inflation reduces the owed balance, in real terms. During 3Q18, since we had a negative net monetary position (monetary liabilities were higher than monetary assets), we registered a
$50.4 million
gain.
|
(1) Effective July 1, 2014, Adecoagro formally documented and designated cash flow hedging relationships to hedge the foreign exchange rate risk of a portion of its highly probable future sales in US dollars using a portion of its borrowings denominated in US dollars and foreign currency forward contracts. Cash flow hedge accounting permits that gains and losses arising from the effect of changes in foreign currency exchange rates on derivative and non-derivative hedging instruments not be immediately recognized in profit or loss, but be reclassified from equity to profit or loss in the same periods during which the future sales occur, thus allowing for a more appropriate presentation of the results for the period reflecting Adecoagro's Risk Management Policy.
|
|
|
|
|
|
|
Net Debt Breakdown
|
|
|
|
|
|
$ thousands
|
3Q18
|
2Q18
|
Chg %
|
3Q17
|
Chg %
|
Farming
|
179,813
|
177,307
|
1.4%
|
165,989
|
8.3%
|
Short term Debt
|
94,446
|
86,210
|
9.6%
|
115,946
|
(18.5)%
|
Long term Debt
|
85,367
|
91,097
|
(6.3)%
|
50,043
|
70.6%
|
Sugar, Ethanol & Energy
|
635,319
|
633,614
|
0.3%
|
641,301
|
(0.9)%
|
Short term Debt
|
71,633
|
59,212
|
21.0%
|
67,226
|
6.6%
|
Long term Debt
|
563,686
|
574,402
|
(1.9)%
|
574,075
|
(1.8)%
|
Bond Proceeds at Holding
|
—
|
—
|
n.a
|
301,587
|
(100.0)%
|
Total Short term Debt
|
166,079
|
145,422
|
14.2%
|
183,172
|
(9.3)%
|
Total Long term Debt
|
649,053
|
665,498
|
(2.5)%
|
925,705
|
(29.9)%
|
Gross Debt
|
815,132
|
810,920
|
0.5%
|
1,108,877
|
(26.5)%
|
Cash & Equivalents
|
180,829
|
144,708
|
25.0%
|
523,175
|
(65.4)%
|
Net Debt
|
634,303
|
666,212
|
(4.8)%
|
585,702
|
8.3%
|
EOP Net Debt / Adj. EBITDA LTM
|
1.73x
|
1.83x
|
(5.9)%
|
1.95x
|
(11.3)%
|
Adecoagro’s consolidated gross debt as of 3Q18 stood at $
815.1 million
,
26.5%
lower year-over-year. As of September 30
th
,2017, $
301.6
million out of the $500 million bond proceeds remained in our cash balance.
$251.6
million were subsequently used to keep refinancing our existing debt and extending debt maturity.
Net debt as of 3Q18 was $
634.3 million
,
4.8%
lower and
8.3%
higher than 2Q18 and 3Q17, respectively. Adjusted by the excess cash balance from the bond proceeds as of September 30
th
2017; the $48.6 million increase in net debt from a yearly perspective is primarily driven by a $7.8 million higher gross debt, mainly explained by our investment program, coupled with a $40.8 million reduction in cash & equivalents mainly as a result of lower sales proceeds from crops sales as a consequence of lower selling volumes because of the drought,
Due to the growth in Adjusted EBITDA, however, Net debt ratio (Net debt / LTM Adj. EBITDA) reached
1.73x
,
11.3%
lower year-over-year.
|
|
Capital Expenditures & Investments
|
|
|
|
|
|
|
|
|
Capital Expenditu
res & Investments
|
|
|
|
|
|
|
$ thousands
|
3Q18
|
3Q17
|
Chg %
|
9M18
|
9M17
|
Chg %
|
Farming & L
and Transformation
|
22,664
|
4,575
|
395.4%
|
33,700
|
11,935
|
182.4%
|
Expansion
|
21,100
|
3,165
|
566.8%
|
30,856
|
7,853
|
292.9%
|
Maintenance
|
1,564
|
1,410
|
10.9%
|
2,844
|
4,082
|
(30.3)%
|
Sugar, Ethanol & Energy
|
91,380
|
32,168
|
184.1%
|
131,484
|
131,229
|
0.2%
|
Maintenance
|
70,637
|
18,741
|
276.9%
|
98,717
|
99,224
|
(0.5)%
|
Planting
|
31,239
|
16,833
|
85.6%
|
45,658
|
40,001
|
14.1%
|
Industrial & Agricultural Machinery
|
39,398
|
1,908
|
1,964.9%
|
53,058
|
59,223
|
(10.4)%
|
Expansion
|
20,744
|
13,427
|
54.5%
|
32,768
|
32,005
|
2.4%
|
Planting
|
13,303
|
7,946
|
67.4%
|
24,965
|
21,606
|
15.5%
|
Industrial & Agricultural Machinery
|
7,441
|
5,481
|
35.7%
|
7,802
|
10,399
|
(25.0)%
|
Total
|
114,045
|
36,743
|
210.4%
|
165,184
|
143,164
|
15.4%
|
Adecoagro’s capital expenditures during during 9M18 totaled $
165.2 million
,
15.4%
higher compared to the same period of last year.
The Sugar, Ethanol and Energy business accounted for 79.6% or $
131.5 million
of total capex. Expansion capex reached $
32.8 million
, mainly as a result of the investments related to the increase in nominal crushing capacity and to new sugarcane hectares planted to supply the growing industrial capacity. Maintenance capex, in turn, reached $
98.7 million
million, in line with the previous year.
Farming & Land Transformation businesses accounted for 20.5% or $
33.7 million
of total capex in 9M18. The increase is mainly driven by the expansion capex in the Dairy and Rice businesses. We completed the construction of our third free stall last quarter and during this quarter we started operating and populating it. In our Rice business, the main projects that account for the increase are the construction of the parboil plant and a packaging machine. With these investments, we expect to enhance industrial efficiencies and capture higher margins.
|
|
|
|
|
|
|
|
|
|
End of Period Inventories
|
|
|
|
|
Volume
|
|
thousand $
|
Product
|
Metric
|
3Q18
|
3Q17
|
% Chg
|
|
3Q18
|
3Q17
|
% Chg
|
Soybean
|
tons
|
67,138
|
96,735
|
(30.6)%
|
|
17,139
|
24,162
|
(29.1)%
|
Corn
(1)
|
tons
|
96,454
|
56,965
|
69.3%
|
|
11,847
|
7,207
|
64.4%
|
Wheat
(2)
|
tons
|
7,770
|
15,127
|
(48.6)%
|
|
1,775
|
2,143
|
(17.2)%
|
Sunflower
|
tons
|
2,180
|
16
|
n.m.
|
|
735
|
6
|
n.m.
|
Rough Rice
(3)
|
tons
|
25,333
|
54,287
|
(53.3)%
|
|
3,060
|
11,633
|
(73.7)%
|
Sugar
|
tons
|
52,892
|
66,080
|
(20.0)%
|
|
11,433
|
17,139
|
(33.3)%
|
Ethanol
|
m3
|
144,817
|
135,771
|
6.7%
|
|
47,817
|
70,469
|
(32.1)%
|
Total
|
|
397,056
|
424,982
|
(6.6)%
|
|
94,255
|
132,757
|
(29.0)%
|
(1) Includes sorghum.
(2) Includes barley.
(3) Expressed in rough rice equivalent
Variations in inventory levels between 3Q18 and 3Q17 are attributable to changes in (i) production volumes resulting from changes in planted area, (ii) production mix between different crops and in yields obtained, (ii) different percentage of area harvested during the period, and (iii) commercial strategy or selling pace for each product.
|
|
Forward-looking Statements
|
This press release contains forward-looking statements that are based on our current expectations, assumptions, estimates and projections about us and our industry. These forward-looking statements can be identified by words or phrases such as “anticipate,” “forecast”, “believe,” “continue,” “estimate,” “expect,” “intend,” “is/are likely to,” “may,” “plan,” “should,” “would,” or other similar expressions.
The forward-looking statements included in this press release relate to, among others: (i) our business prospects and future results of operations; (ii) weather and other natural phenomena; (iii) developments in, or changes to, the laws, regulations and governmental policies governing our business, including limitations on ownership of farmland by foreign entities in certain jurisdictions in which we operate, environmental laws and regulations; (iv) the implementation of our business strategy, including the expansion of our sugarcane cluster in Mato Grosso do Sul and other current projects; (v) our plans relating to acquisitions, joint ventures, strategic alliances or divestitures; (vi) the implementation of our financing strategy and capital expenditure plan; (vii) the maintenance of our relationships with customers; (viii) the competitive nature of the industries in which we operate; (ix) the cost and availability of financing; (x) future demand for the commodities we produce; (xi) international prices for commodities; (xii) the condition of our land holdings; (xiii) the development of the logistics and infrastructure for transportation of our products in the countries where we operate; (xiv) the performance of the South American and world economies; and (xv) the relative value of the Brazilian Reais, the Argentine Peso, and the Uruguayan Peso compared to other currencies; as well as other risks included in the registrant’s other filings and submissions with the United States Securities and Exchange Commission.
These forward-looking statements involve various risks and uncertainties. Although we believe that our expectations expressed in these forward-looking statements are reasonable, our expectations may turn out to be incorrect. Our actual results could be materially different from our expectations. In light of the risks and uncertainties described above, the estimates and forward-looking statements discussed in this press release might not occur, and our future results and our performance may differ materially from those expressed in these forward-looking statements due to, inclusive, but not limited to, the factors mentioned above. Because of these uncertainties, you should not make any investment decision based on these estimates and forward-looking statements.
The forward-looking statements made in this press release related only to events or information as of the date on which the statements are made in this press release. We undertake no obligation to update any forward-looking statements to reflect events or circumstances after the date on which the statements are made or to reflect the occurrence of unanticipated events.
|
|
Reconciliation of Non-IFRS measures
|
To supplement our consolidated financial statements, which are prepared and presented in accordance with IFRS, we use the following non-IFRS financial measures in this press release:
|
|
•
|
Net Debt to Adjusted EBITDA
|
In this section, we provide an explanation and a reconciliation of each of our non-IFRS financial measures to their most directly comparable IFRS measures. The presentation of these financial measures is not intended to be considered in isolation or as a substitute for, or superior to, financial information prepared and presented in accordance with IFRS.
We believe these non-GAAP financial measures provide investors with useful supplemental information about the financial performance of our business, enable comparison of financial results between periods where certain items may vary independent of business performance, and allow for greater transparency with respect to key metrics used by management for financial and operational decision making and as a means to evaluate period-to-period.
There are limitations associated with the use of non-IFRS financial measures as an analytical tool. In particular, many of the adjustments to our IFRS financial measures reflect the exclusion of items, such as depreciation and amortization, changes in fair value and the related income tax effects of the aforementioned exclusions and exchange differences generated by the net liability monetary position in USD in the countries where the functional currency is the local currency, that are recurring and will be reflected in our financial results for the foreseeable future. In addition, these measures may be different from non-IFRS financial measures used by other companies, limiting their usefulness for comparison purposes.
Adjusted EBITDA, Adjusted EBIT & Adjusted EBITDA margin
We define Adjusted EBITDA for each of our operating segments as the segment’s share of consolidated profit from operations before financing and taxation for the year or period, as applicable, before depreciation and amortization, excluding the revaluation result of the hectares hold as investment property, and adjusted by profit or loss from discontinued operations and by gains or losses from disposals of non-controlling interests in subsidiaries whose main underlying asset is farmland which are reflected in our Shareholders Equity under the
line item “Reserve from the sale of minority interests in subsidiaries.” Revaluation results from the farmland held as Property, Plant & Equipment
We define “Adjusted Consolidated EBITDA” as (i) consolidated net profit (loss) for the year, as applicable, before interest expense, income taxes, depreciation and amortization, net gain from fair value adjustments of investment property land, foreign exchange gains or losses, other net financial expenses; and (ii) adjusted by profit or loss from discontinued operations if any; and (iii) adjusted by those items, that do not impact profit and loss, but are recorded directly in shareholders’ equity, i.e., (x) the gains or losses from disposals of non-controlling interests in subsidiaries whose main underlying asset is farmland , reflected under the line item: "Reserve from the sale of non-controlling interests in subsidiaries; and (y) the net increase in value of sold farmland, which has been recognized in either Revaluation surplus or retained earnings.
We believe that Adjusted EBITDA and Adjusted EBIT are for the Company and each operating segment, respectively important measures of operating performance because they allow investors and others to evaluate and compare our consolidated operating results and to evaluate and compare the operating performance of our segments, respectively, including our return on capital and operating efficiencies, from period to period by removing the impact of our capital structure (interest expense from our outstanding debt), asset base (depreciation and amortization), tax consequences (income taxes), foreign exchange gains or losses and other financial expenses. In addition, by including the gains or losses from disposals of non-controlling interests in subsidiaries whose main underlying asset is farmland, investors can evaluate the full value and returns generated by our land transformation activities. Other companies may calculate Adjusted EBITDA and Adjusted EBIT differently, and therefore Adjusted EBITDA and Adjusted EBIT may not be comparable to similarly titled measures used by other companies. Adjusted EBITDA and Adjusted EBIT are not measure of financial performance under IFRS, and should not be considered in isolation or as an alternative to consolidated net profit (loss), cash flows from operating activities, profit from operations before financing and taxation and other measures determined in accordance with IFRS.
We define Adjusted EBITDA margin as Adjusted EBITDA to net sales. We consider that the presentation of adjusted EBITDA margin provides useful information on how successfully we operate our Company and enhances the ability of investors to compare profitability between segments, periods and with other public companies.
Reconciliation of both Adjusted EBITDA and Adjusted EBIT starts on page 39.
Net Debt & Net Debt to Adjusted EBITDA
Net debt is defined as the sum of long- and short-term debt less cash and cash equivalents. This measure is widely used by management and investment analysts and we believe it shows the financial strength of the Company
Management is consistently tracking our leverage position and our ability to repay and service our debt obligations over time. We have therefore set a leverage ratio target that is measured by net debt divided by Adjusted EBITDA.
We believe that this metric provides useful information to investors because management uses it to manage our debt-equity ratio in order to promote access to debt financing instruments in the capital markets and our ability to meet scheduled debt service obligations.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Reconciliation - Net Debt
|
|
|
|
|
|
|
|
|
|
|
$ thousands
|
|
3Q18
|
|
|
2Q 18
|
|
|
% Chg
|
|
|
3Q17
|
|
|
% Chg
|
|
Total Borrowings
|
|
815,132
|
|
|
810,920
|
|
|
0.5
|
%
|
|
1,108,877
|
|
|
(26.5
|
)%
|
Cash and Cash equivalents
|
|
180,829
|
|
|
144,708
|
|
|
25.0
|
%
|
|
523,175
|
|
|
(65.4
|
)%
|
Net Debt
|
|
634,303
|
|
|
666,212
|
|
|
(4.8
|
)%
|
|
585,702
|
|
|
8.3
|
%
|
Adjusted Net Income
We define Adjusted Net Income as (i) Profit/ (Loss) of the period/year before net gain from fair value adjustments of investment property land; plus (ii) any non-cash finance costs resulting from foreign exchange gain/losses for such period, which are composed by both Exchange Differences and Cash Flow Hedge Transfer from Equity, included in Financial Results, net, in our statement of income; net of the related income tax effects, plus (iii) gains or losses from disposals of non-controlling interests in subsidiaries whose main underlying asset is farmland, which are reflected in our Shareholders Equity under the line item. “Reserve from the sale of non-controlling interests in subsidiaries”, plus (iv) the reversal of the aforementioned income tax effect, plus (v) any inflation accounting effect; plus (vi) the net increase in value of sold farmland, which has been recognized in either Revaluation surplus or Retained earnings, net of the related income tax effect.
We believe that Adjusted Net Income is an important measure of performance for our company allowing investors to properly assess the impact of the results of our operations in our Equity. In effect, results arising from the revaluation effect of our net monetary position held in foreign currency in the countries where our functional currency is the local currency do not affect the Equity of the Company, when measured in foreign / reporting currency. Conversely, the tax effect resulting from the aforementioned revaluation effect does impact the Equity of the Company, since it reduces/increases the income tax to be paid in each country; which is why we decided to add back the income tax effect to the Adjusted Net Income considering this tax effect.
In addition, by including the gains or losses from disposals of non-controlling interests in subsidiaries whose main underlying asset is farmland, investors can also include the full value and returns generated by our land transformation activities.
Other companies may calculate Adjusted Net Income differently, and therefore our Adjusted Net Income may not be comparable to similarly titled measures used by other companies. Adjusted Net Income is not a measures of financial performance under IFRS, and should not be considered in isolation or as an alternative to consolidated net profit (loss). This non-IFRS measure should be considered in addition to, but not as a substitute for or superior to, the information contained in our financial statements.
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted Net Income
|
|
|
|
|
|
|
$ thousands
|
3Q18
|
|
3Q17
|
|
Chg %
|
|
9M18
|
|
9M17
|
|
Chg %
|
|
Net Income
|
3,496
|
|
(1,644
|
)
|
n.a
|
|
(18,978
|
)
|
9,535
|
|
n.a
|
|
Foreign exchange losses, net
|
62,932
|
|
6,627
|
|
850
|
%
|
188,204
|
|
18,510
|
|
917
|
%
|
Cash flow hedge - transfer from equity
|
519
|
|
7,369
|
|
(93
|
)%
|
7,846
|
|
10,689
|
|
(27
|
)%
|
Income tax effect on Exchange Differences and Cash Flow Hedge
|
(19,992
|
)
|
(4,616
|
)
|
333
|
%
|
(62,588
|
)
|
(9,392
|
)
|
566
|
%
|
Inflation Accounting Effects
|
(50,370
|
)
|
—
|
|
n.a
|
|
(50,370
|
)
|
—
|
|
n.a
|
|
Revaluation Result - Investment Property
|
(2,465
|
)
|
(1,753
|
)
|
|
(18,457
|
)
|
(3,634
|
)
|
|
Reverse of Income tax effect on Exchange Differences and Cash Flow Hedge
|
19,992
|
|
4,616
|
|
333
|
%
|
62,588
|
|
9,392
|
|
|
Adjusted Net Income
|
14,112
|
|
10,599
|
|
33
|
%
|
108,245
|
|
35,100
|
|
208
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBIT & Adjusted EBITDA Reconciliation to Profit/Loss - 3Q18
|
$ thousands
|
|
Crops
|
Rice
|
Dairy
|
Others
|
Farming
|
|
Sugar, Ethanol & Energy
|
|
Land Transformation
|
|
Corporate
|
|
Total
|
Sales of manufactured products and services rendered
|
|
34,804
|
|
31,271
|
|
8,577
|
|
344
|
|
74,996
|
|
|
137,957
|
|
|
—
|
|
|
—
|
|
|
212,953
|
|
Cost of manufactured products sold and services rendered
|
|
(34,860
|
)
|
(19,764
|
)
|
(7,998
|
)
|
(221
|
)
|
(62,844
|
)
|
|
(94,437
|
)
|
|
—
|
|
|
—
|
|
|
(157,281
|
)
|
Initial recog. and changes in FV of BA and agricultural produce
|
|
3,757
|
|
489
|
|
763
|
|
(460
|
)
|
4,549
|
|
|
(8,379
|
)
|
|
—
|
|
|
—
|
|
|
(3,830
|
)
|
Gain from changes in NRV of agricultural produce after harvest
|
|
7,236
|
|
—
|
|
—
|
|
—
|
|
7,236
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
7,236
|
|
Gross Profit from Agricultural Activities
|
|
10,937
|
|
11,996
|
|
1,342
|
|
(337
|
)
|
23,937
|
|
|
35,141
|
|
|
—
|
|
|
—
|
|
|
59,078
|
|
General and administrative expenses
|
|
(1,071
|
)
|
(985
|
)
|
882
|
|
(9
|
)
|
(1,183
|
)
|
|
(6,146
|
)
|
|
—
|
|
|
(4,652
|
)
|
|
(11,981
|
)
|
Selling expenses
|
|
(1,504
|
)
|
(4,952
|
)
|
(216
|
)
|
(1
|
)
|
(6,673
|
)
|
|
(19,126
|
)
|
|
—
|
|
|
(67
|
)
|
|
(25,866
|
)
|
Other operating income, net
|
|
4,120
|
|
(35
|
)
|
(1,109
|
)
|
—
|
|
2,976
|
|
|
14,371
|
|
|
—
|
|
|
(7
|
)
|
|
17,340
|
|
Share of gain/(loss) of joint ventures
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Profit from Operations Before Financing and Taxation
|
|
12,482
|
|
6,024
|
|
899
|
|
(347
|
)
|
19,057
|
|
|
24,240
|
|
|
—
|
|
|
(4,726
|
)
|
|
38,571
|
|
Reserve from the sale of minority interests in subsidiaries
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Adjusted EBIT
|
|
12,482
|
|
6,024
|
|
899
|
|
(347
|
)
|
19,057
|
|
|
24,240
|
|
|
—
|
|
|
(4,726
|
)
|
|
38,571
|
|
(-) Depreciation PPE
|
|
305
|
|
731
|
|
283
|
|
15
|
|
1,334
|
|
|
39,736
|
|
|
—
|
|
|
—
|
|
|
41,070
|
|
Adjusted EBITDA
|
|
12,787
|
|
6,755
|
|
1,182
|
|
(332
|
)
|
20,391
|
|
|
63,976
|
|
|
—
|
|
|
(4,726
|
)
|
|
79,641
|
|
Reconciliation to Profit/(Loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA
|
|
|
|
|
|
|
|
|
|
|
|
|
|
79,641
|
|
Reserve from the sale of minority interests in subsidiaries
|
|
|
|
|
|
|
|
|
|
—
|
|
(+) Depreciation PPE
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(41,070
|
)
|
(+) Financial result, net
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(20,632
|
)
|
(+) Revaluation Result - Investment Property
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2,465
|
|
(+) Income Tax (Charge)/Benefit
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(10,889
|
)
|
(+) Translation Effect (IAS 21)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(6,019
|
)
|
Profit/(Loss) for the Period
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3,496
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBIT & Adjusted EBITDA Reconciliation to Profit/Loss - 3Q17
|
$ thousands
|
|
Crops
|
Rice
|
Dairy
|
Others
|
Farming
|
|
Sugar, Ethanol & Energy
|
|
Land Transformation
|
|
Corporate
|
|
Total
|
Sales of manufactured products and services rendered
|
|
59,201
|
|
16,219
|
|
8,931
|
|
375
|
|
84,726
|
|
|
178,262
|
|
|
—
|
|
|
—
|
|
|
262,988
|
|
Cost of manufactured products sold and services rendered
|
|
(58,663
|
)
|
(12,431
|
)
|
(8,933
|
)
|
(149
|
)
|
(80,176
|
)
|
|
(126,714
|
)
|
|
—
|
|
|
—
|
|
|
(206,890
|
)
|
Initial recog. and changes in FV of BA and agricultural produce
|
|
(3,892
|
)
|
432
|
|
2,898
|
|
(407
|
)
|
(969
|
)
|
|
2,493
|
|
|
—
|
|
|
—
|
|
|
1,524
|
|
Gain from changes in NRV of agricultural produce after harvest
|
|
4,843
|
|
—
|
|
—
|
|
—
|
|
4,843
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4,843
|
|
Gross Profit from Agricultural Activities
|
|
1,489
|
|
4,220
|
|
2,896
|
|
(181
|
)
|
8,424
|
|
|
54,041
|
|
|
—
|
|
|
—
|
|
|
62,465
|
|
General and administrative expenses
|
|
(767
|
)
|
(1,105
|
)
|
(246
|
)
|
(42
|
)
|
(2,160
|
)
|
|
(7,866
|
)
|
|
—
|
|
|
(5,956
|
)
|
|
(15,982
|
)
|
Selling expenses
|
|
(2,304
|
)
|
(2,320
|
)
|
(199
|
)
|
14
|
|
(4,809
|
)
|
|
(22,840
|
)
|
|
—
|
|
|
(32
|
)
|
|
(27,681
|
)
|
Other operating income, net
|
|
3,862
|
|
(14
|
)
|
108
|
|
—
|
|
3,956
|
|
|
(683
|
)
|
|
—
|
|
|
(11
|
)
|
|
3,262
|
|
Share of gain/(loss) of joint ventures
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Profit from Operations Before Financing and Taxation
|
|
2,280
|
|
781
|
|
2,559
|
|
(209
|
)
|
5,411
|
|
|
22,652
|
|
|
—
|
|
|
(5,999
|
)
|
|
22,064
|
|
Reserve from the sale of minority interests in subsidiaries
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Adjusted EBIT
|
|
2,280
|
|
781
|
|
2,559
|
|
(209
|
)
|
5,411
|
|
|
22,652
|
|
|
—
|
|
|
(5,999
|
)
|
|
22,064
|
|
(-) Depreciation PPE
|
|
348
|
|
911
|
|
243
|
|
29
|
|
1,531
|
|
|
51,689
|
|
|
—
|
|
|
—
|
|
|
53,220
|
|
Adjusted EBITDA
|
|
2,628
|
|
1,692
|
|
2,802
|
|
(180
|
)
|
6,942
|
|
|
74,341
|
|
|
—
|
|
|
(5,999
|
)
|
|
75,284
|
|
Reconciliation to Profit/(Loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA
|
|
|
|
|
|
|
|
|
|
|
|
|
|
75,284
|
|
Reserve from the sale of minority interests in subsidiaries
|
|
|
|
|
|
|
|
|
|
—
|
|
(+) Depreciation PPE
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(53,220
|
)
|
(+) Financial result, net
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(27,749
|
)
|
(+) Revaluation Result - Investment Property
|
|
|
|
|
|
|
|
|
|
|
|
|
|
1,753
|
|
(+) Income Tax (Charge)/Benefit
|
|
|
|
|
|
|
|
|
|
|
|
|
|
2,288
|
|
(+) Translation Effect (IAS 21)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
—
|
|
Profit/(Loss) for the Period
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1,644
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBIT & Adjusted EBITDA Reconciliation to Profit/Loss - 9M18
|
$ thousands
|
|
Crops
|
Rice
|
Dairy
|
Others
|
Farming
|
|
Sugar, Ethanol & Energy
|
|
Land Transformation
|
|
Corporate
|
|
Total
|
Sales of manufactured products and services rendered
|
|
115,316
|
|
87,482
|
|
24,184
|
|
1,148
|
|
228,130
|
|
|
356,309
|
|
|
—
|
|
|
—
|
|
|
584,439
|
|
Cost of manufactured products sold and services rendered
|
|
(115,449
|
)
|
(66,037
|
)
|
(22,977
|
)
|
(761
|
)
|
(205,225
|
)
|
|
(237,551
|
)
|
|
—
|
|
|
—
|
|
|
(442,776
|
)
|
Initial recog. and changes in FV of BA and agricultural produce
|
|
27,530
|
|
13,192
|
|
6,263
|
|
(456
|
)
|
46,529
|
|
|
(14,851
|
)
|
|
—
|
|
|
—
|
|
|
31,678
|
|
Gain from changes in NRV of agricultural produce after harvest
|
|
14,584
|
|
—
|
|
—
|
|
—
|
|
14,584
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
14,584
|
|
Gross Profit from Agricultural Activities
|
|
41,980
|
|
34,637
|
|
7,471
|
|
(70
|
)
|
84,018
|
|
|
103,907
|
|
|
—
|
|
|
—
|
|
|
187,925
|
|
General and administrative expenses
|
|
(3,111
|
)
|
(3,443
|
)
|
(611
|
)
|
(59
|
)
|
(7,224
|
)
|
|
(20,181
|
)
|
|
—
|
|
|
(14,460
|
)
|
|
(41,865
|
)
|
Selling expenses
|
|
(4,499
|
)
|
(12,920
|
)
|
(417
|
)
|
(91
|
)
|
(17,927
|
)
|
|
(47,456
|
)
|
|
—
|
|
|
(127
|
)
|
|
(65,510
|
)
|
Other operating income, net
|
|
1,518
|
|
247
|
|
(1,147
|
)
|
(2
|
)
|
616
|
|
|
50,225
|
|
|
36,227
|
|
|
(99
|
)
|
|
86,969
|
|
Share of gain/(loss) of joint ventures
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Profit from Operations Before Financing and Taxation
|
|
35,888
|
|
18,521
|
|
5,296
|
|
(222
|
)
|
59,483
|
|
|
86,495
|
|
|
36,227
|
|
|
(14,686
|
)
|
|
167,519
|
|
Reserve from the sale of minority interests in subsidiaries
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Adjusted EBIT
|
|
35,888
|
|
18,521
|
|
5,296
|
|
(222
|
)
|
59,483
|
|
|
86,495
|
|
|
36,227
|
|
|
(14,686
|
)
|
|
167,519
|
|
(-) Depreciation PPE
|
|
1,102
|
|
2,690
|
|
844
|
|
76
|
|
4,712
|
|
|
106,355
|
|
|
—
|
|
|
—
|
|
|
111,067
|
|
Adjusted EBITDA
|
|
36,990
|
|
21,211
|
|
6,140
|
|
(146
|
)
|
64,195
|
|
|
192,850
|
|
|
36,227
|
|
|
(14,686
|
)
|
|
278,586
|
|
Reconciliation to Profit/(Loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBITDA
|
|
|
|
|
|
|
|
|
|
|
|
|
|
278,586
|
|
Reserve from the sale of minority interests in subsidiaries
|
|
|
|
|
|
|
|
|
|
—
|
|
(+) Depreciation PPE
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(111,067
|
)
|
(+) Financial result, net
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(185,478
|
)
|
(+) Revaluation Result - Investment Property
|
|
|
|
|
|
|
|
|
|
|
|
|
|
18,457
|
|
(+) Income Tax (Charge)/Benefit
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3,151
|
|
(+) Translation Effect (IAS 21)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(22,627
|
)
|
Profit/(Loss) for the Period
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(18,978
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Adjusted EBIT & Adjusted EBITDA Reconciliation to Profit/Loss - 9M17
|
$ thousands
|
|
Crops
|
Rice
|
Dairy
|
Others
|
Farming
|
|
Sugar, Ethanol & Energy
|
|
Land Transformation
|
|
Corporate
|
|
Total
|
Sales of manufactured products and services rendered
|
|
144,097
|
|
59,497
|
|
28,253
|
|
813
|
|
232,660
|
|
|
424,949
|
|
|
—
|
|
|
—
|
|
|
657,609
|
|
Cost of manufactured products sold and services rendered
|
|
(143,355
|
)
|
(50,133
|
)
|
(27,921
|
)
|
(324
|
)
|
(221,733
|
)
|
|
(320,466
|
)
|
|
—
|
|
|
—
|
|
|
(542,199
|
)
|
Initial recog. and changes in FV of BA and agricultural produce
|
|
13,451
|
|
6,228
|
|
7,426
|
|
(244
|
)
|
26,861
|
|
|
(2,635
|
)
|
|
—
|
|
|
—
|
|
|
24,226
|
|
Gain from changes in NRV of agricultural produce after harvest
|
|
8,036
|
|
—
|
|
—
|
|
—
|
|
8,036
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
8,036
|
|
Gross Profit from Agricultural Activities
|
|
22,229
|
|
15,592
|
|
7,758
|
|
245
|
|
45,824
|
|
|
101,848
|
|
|
—
|
|
|
—
|
|
|
147,672
|
|
General and administrative expenses
|
|
(2,168
|
)
|
(3,384
|
)
|
(742
|
)
|
(130
|
)
|
(6,424
|
)
|
|
(21,850
|
)
|
|
—
|
|
|
(16,209
|
)
|
|
(44,483
|
)
|
Selling expenses
|
|
(5,250
|
)
|
(8,721
|
)
|
(667
|
)
|
(39
|
)
|
(14,677
|
)
|
|
(49,990
|
)
|
|
—
|
|
|
(91
|
)
|
|
(64,758
|
)
|
Other operating income, net
|
|
7,201
|
|
623
|
|
530
|
|
(161
|
)
|
8,193
|
|
|
31,236
|
|
|
—
|
|
|
(29
|
)
|
|
39,400
|
|
Share of gain/(loss) of joint ventures
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Profit from Operations Before Financing and Taxation
|
|
22,012
|
|
4,110
|
|
6,879
|
|
(85
|
)
|
32,916
|
|
|
61,244
|
|
|
—
|
|
|
(16,329
|
)
|
|
77,831
|
|
Reserve from the sale of minority interests in subsidiaries
|
|
—
|
|
—
|
|
—
|
|
—
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
Adjusted EBIT
|
|
22,012
|
|
4,110
|
|
6,879
|
|
(85
|
)
|
32,916
|
|
|
61,244
|
|
|
—
|
|
|
(16,329
|
)
|
|
77,831
|
|
(-) Depreciation PPE
|
|
1,040
|
|
2,797
|
|
737
|
|
89
|
|
4,663
|
|
|
104,723
|
|
|
—
|
|
|
—
|
|
|
109,386
|
|
Adjusted EBITDA
|
|
23052
|
6,907
|
|
7616
|
4
|
|
37579
|
|
165967
|
|
—
|
|
|
(16,329
|
)
|
|
187,217
|
|
Reconciliation to Profit/(Loss)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
0
|
Adjusted EBITDA
|
|
|
|
|
|
|
|
|
|
|
|
|
|
187,217
|
|
Reserve from the sale of minority interests in subsidiaries
|
|
|
|
|
|
|
|
|
|
—
|
|
(+) Depreciation PPE
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(109,386
|
)
|
(+) Financial result, net
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(67,937
|
)
|
(+) Revaluation Result - Investment Property
|
|
|
|
|
|
|
|
|
|
|
|
|
|
3,634
|
|
(+) Income Tax (Charge)/Benefit
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(3,993
|
)
|
(+) Translation Effect (IAS 21)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
—
|
|
Profit/(Loss) for the Period
|
|
|
|
|
|
|
|
|
|
|
|
|
|
9,535
|
|
|
|
Condensed Consolidated Statement of Income
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Statement of Income
|
|
|
|
|
|
|
|
|
|
|
|
$ thousands
|
3Q18
|
|
|
3Q17
|
|
|
Chg %
|
|
|
9M18
|
|
|
9M17
|
|
|
Chg %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Sales of goods and services rendered
|
178,744
|
|
|
262,988
|
|
|
(32.0
|
)%
|
|
550,230
|
|
|
657,609
|
|
|
(16.3
|
)%
|
Cost of goods sold and services rendered
|
(129,954
|
)
|
|
(206,890
|
)
|
|
(37.2
|
)%
|
|
(415,449
|
)
|
|
(542,199
|
)
|
|
(23.4
|
)%
|
Initial recognition and changes in fair value of biological assets and agricultural produce
|
(23,369
|
)
|
|
1,524
|
|
|
(1,633.4
|
)%
|
|
12,139
|
|
|
24,226
|
|
|
(49.9
|
)%
|
Changes in net realizable value of agricultural produce after harvest
|
2,204
|
|
|
4,843
|
|
|
(54.5
|
)%
|
|
9,552
|
|
|
8,036
|
|
|
18.9
|
%
|
Margin on manufacturing and agricultural activities before operating expenses
|
27,625
|
|
|
62,465
|
|
|
(55.8
|
)%
|
|
156,472
|
|
|
147,672
|
|
|
6.0
|
%
|
General and administrative expenses
|
(9,428
|
)
|
|
(15,982
|
)
|
|
(41.0
|
)%
|
|
(39,312
|
)
|
|
(44,483
|
)
|
|
(11.6
|
)%
|
Selling expenses
|
(21,688
|
)
|
|
(27,681
|
)
|
|
(21.7
|
)%
|
|
(61,332
|
)
|
|
(64,758
|
)
|
|
(5.3
|
)%
|
Other operating income, net
|
37,892
|
|
|
5,015
|
|
|
655.6
|
%
|
|
107,521
|
|
|
43,034
|
|
|
149.9
|
%
|
Profit from operations before financing and taxation
|
34,401
|
|
|
23,817
|
|
|
44.4
|
%
|
|
163,349
|
|
|
81,465
|
|
|
100.5
|
%
|
Finance income
|
1,651
|
|
|
3,520
|
|
|
(53.1
|
)%
|
|
6,494
|
|
|
8,742
|
|
|
(25.7
|
)%
|
Finance costs
|
(72,653
|
)
|
|
(31,269
|
)
|
|
132.3
|
%
|
|
(242,342
|
)
|
|
(76,679
|
)
|
|
216.0
|
%
|
Other financial, results
|
50,370
|
|
|
—
|
|
|
|
|
50,370
|
|
|
—
|
|
|
|
Financial results, net
|
(20,632
|
)
|
|
(27,749
|
)
|
|
(25.6
|
)%
|
|
(185,478
|
)
|
|
(67,937
|
)
|
|
173.0
|
%
|
(Loss)/Profit before income tax
|
13,769
|
|
|
(3,932
|
)
|
|
(450.2
|
)%
|
|
(22,129
|
)
|
|
13,528
|
|
|
(263.6
|
)%
|
Income tax benefit/(expense)
|
(10,273
|
)
|
|
2,288
|
|
|
(549.0
|
)%
|
|
3,151
|
|
|
(3,993
|
)
|
|
(178.9
|
)%
|
(Loss)/Profit for the period
|
3,496
|
|
|
(1,644
|
)
|
|
(312.7
|
)%
|
|
(18,978
|
)
|
|
9,535
|
|
|
(299.0
|
)%
|
|
|
Condensed Consolidated Interim Statement of Cash Flow
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Statement of Cashflows
|
|
|
|
|
|
|
|
|
|
|
|
$ thousands
|
3Q18
|
|
|
3Q17
|
|
|
Chg %
|
|
|
9M18
|
|
|
9M17
|
|
|
Chg %
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash flows from operating activities:
|
|
|
|
|
|
|
|
|
|
|
|
(Loss)/Profit for the period
|
3,496
|
|
|
(1,644
|
)
|
|
(312.7
|
)%
|
|
(18,978
|
)
|
|
9,535
|
|
|
(299.0
|
)%
|
Adjustments for
:
|
|
|
|
|
|
|
|
|
|
|
|
Income tax (benefit) /expense
|
10,273
|
|
|
(2,288
|
)
|
|
(549.0
|
)%
|
|
(3,151
|
)
|
|
3,993
|
|
|
(178.9
|
)%
|
Depreciation
|
42,582
|
|
|
52,971
|
|
|
(19.6
|
)%
|
|
112,056
|
|
|
108,721
|
|
|
3.1
|
%
|
Amortization
|
278
|
|
|
249
|
|
|
11.6
|
%
|
|
801
|
|
|
665
|
|
|
20.5
|
%
|
Loss from disposal of other property items
|
160
|
|
|
(89
|
)
|
|
—
|
%
|
|
217
|
|
|
529
|
|
|
—
|
%
|
Gain from the sale of subsidiaries
|
—
|
|
|
—
|
|
|
—
|
%
|
|
(36,227
|
)
|
|
—
|
|
|
—
|
%
|
Net gain from the Fair value adjustment of Investment properties
|
(18,457
|
)
|
|
(1,753
|
)
|
|
(100.0
|
)%
|
|
(18,457
|
)
|
|
(3,634
|
)
|
|
(100.0
|
)%
|
Equity settled share-based compensation granted
|
1,208
|
|
|
1,417
|
|
|
(14.7
|
)%
|
|
3,752
|
|
|
4,224
|
|
|
(11.2
|
)%
|
Gain from derivative financial instruments
|
(21,009
|
)
|
|
(2,223
|
)
|
|
845.1
|
%
|
|
(46,146
|
)
|
|
(38,781
|
)
|
|
19.0
|
%
|
Interest and other expense, net
|
7,792
|
|
|
12,549
|
|
|
(37.9
|
)%
|
|
30,936
|
|
|
33,737
|
|
|
(8.3
|
)%
|
Initial recognition and changes in fair value of non harvested biological assets (unrealized)
|
15,100
|
|
|
5,949
|
|
|
153.8
|
%
|
|
7,604
|
|
|
8,390
|
|
|
(9.4
|
)%
|
Changes in net realizable value of agricultural produce after harvest (unrealized)
|
(3,492
|
)
|
|
(2,595
|
)
|
|
34.6
|
%
|
|
(11,355
|
)
|
|
(3,211
|
)
|
|
253.6
|
%
|
Provision and allowances
|
669
|
|
|
375
|
|
|
78.4
|
%
|
|
945
|
|
|
673
|
|
|
40.4
|
%
|
Net gain of inflation effects on the monetary items
|
(50,370
|
)
|
|
—
|
|
|
—
|
%
|
|
(50,370
|
)
|
|
—
|
|
|
—
|
%
|
Foreign exchange losses, net
|
62,932
|
|
|
6,627
|
|
|
849.6
|
%
|
|
188,204
|
|
|
18,510
|
|
|
916.8
|
%
|
Cash flow hedge – transfer from equity
|
519
|
|
|
7,369
|
|
|
(93.0
|
)%
|
|
7,846
|
|
|
10,689
|
|
|
(26.6
|
)%
|
Subtotal
|
51,681
|
|
|
76,914
|
|
|
(32.8
|
)%
|
|
167,677
|
|
|
154,040
|
|
|
8.9
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
Changes in operating assets and liabilities:
|
|
|
|
|
|
|
|
|
|
|
|
Increase in trade and other receivables
|
(58,520
|
)
|
|
(19,475
|
)
|
|
200.5
|
%
|
|
(112,738
|
)
|
|
(48,530
|
)
|
|
132.3
|
%
|
Increase in inventories
|
12,769
|
|
|
(27,168
|
)
|
|
(147.0
|
)%
|
|
(69,716
|
)
|
|
(56,892
|
)
|
|
22.5
|
%
|
Decrease in biological assets
|
5,333
|
|
|
(1,111
|
)
|
|
(580.0
|
)%
|
|
37,894
|
|
|
24,560
|
|
|
54.3
|
%
|
Increase in other assets
|
(207
|
)
|
|
(231
|
)
|
|
(10.4
|
)%
|
|
(274
|
)
|
|
(207
|
)
|
|
32.4
|
%
|
Decrease in derivative financial instruments
|
23,366
|
|
|
126
|
|
|
18,444.4
|
%
|
|
51,023
|
|
|
40,136
|
|
|
27.1
|
%
|
Decrease / (increase) in trade and other payables
|
32,358
|
|
|
13,048
|
|
|
148.0
|
%
|
|
23,208
|
|
|
(19,942
|
)
|
|
(216.4
|
)%
|
Increase in payroll and social security liabilities
|
3,503
|
|
|
5,690
|
|
|
(38.4
|
)%
|
|
6,156
|
|
|
7,268
|
|
|
(15.3
|
)%
|
(Increase) / decrease in provisions for other liabilities
|
(17
|
)
|
|
517
|
|
|
(103.3
|
)%
|
|
(333
|
)
|
|
429
|
|
|
(177.6
|
)%
|
Net cash generated in operating activities before taxes paid
|
70,266
|
|
|
48,310
|
|
|
45.4
|
%
|
|
102,897
|
|
|
100,862
|
|
|
2.0
|
%
|
Income tax paid
|
(576
|
)
|
|
(595
|
)
|
|
(3.2
|
)%
|
|
(1,473
|
)
|
|
(2,248
|
)
|
|
(34.5
|
)%
|
Net cash generated from operating activities
|
69,690
|
|
|
47,715
|
|
|
46.1
|
%
|
|
101,424
|
|
|
98,614
|
|
|
2.8
|
%
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash flows from investing activities:
|
|
|
|
|
|
|
|
|
|
|
|
Purchases of property, plant and equipment
|
(39,549,000
|
)
|
|
(36,170
|
)
|
|
9.3
|
%
|
|
(152,496
|
)
|
|
(142,223
|
)
|
|
7.2
|
%
|
Purchases of cattle and non current biological assets
|
(432
|
)
|
|
(426
|
)
|
|
1.4
|
%
|
|
(3,547
|
)
|
|
(1,007
|
)
|
|
252.2
|
%
|
Purchases of intangible assets
|
(210
|
)
|
|
(814
|
)
|
|
(74.2
|
)%
|
|
(2,359
|
)
|
|
(1,390
|
)
|
|
69.7
|
%
|
Interest received
|
1,538
|
|
|
3,425
|
|
|
(55.1
|
)%
|
|
5,780
|
|
|
8,446
|
|
|
(31.6
|
)%
|
Proceeds from sale of property, plant and equipment
|
487
|
|
|
1,061
|
|
|
100.0
|
%
|
|
1,233
|
|
|
1,859
|
|
|
100.0
|
%
|
Proceeds from sale of subsidiaries
|
26,304,000
|
|
|
—
|
|
|
—
|
%
|
|
31,511
|
|
|
—
|
|
|
—
|
%
|
Net cash used in investing activities
|
(11,862
|
)
|
|
(32,924
|
)
|
|
(64.0
|
)%
|
|
(119,878
|
)
|
|
(134,315
|
)
|
|
(10.7
|
)%
|
|
|
|
|
|
|
|
|
|
|
|
|
Cash flows from financing activities:
|
|
|
|
|
|
|
|
|
|
|
|
Proceeds from equity settled share-based compensation exercise
|
—
|
|
|
39
|
|
|
—
|
%
|
|
—
|
|
|
39
|
|
|
—
|
%
|
Issuance of senior notes
|
—
|
|
|
496,151
|
|
|
—
|
%
|
|
—
|
|
|
496,151
|
|
|
(100.0
|
)%
|
Proceeds from long-term borrowings
|
(13,512
|
)
|
|
40,622
|
|
|
(133.3
|
)%
|
|
37,217
|
|
|
230,391
|
|
|
(83.8
|
)%
|
Payments of long-term borrowings
|
13,033
|
|
|
(226,148
|
)
|
|
(105.8
|
)%
|
|
(49,834
|
)
|
|
(329,872
|
)
|
|
(84.9
|
)%
|
Proceeds from short-term borrowings
|
36,915
|
|
|
8,133
|
|
|
353.9
|
%
|
|
179,127
|
|
|
92,728
|
|
|
93.2
|
%
|
Payment of short-term borrowings
|
(29,121
|
)
|
|
(18,961
|
)
|
|
53.6
|
%
|
|
(151,667
|
)
|
|
(28,492
|
)
|
|
432.3
|
%
|
Payments of derivatives financial instruments
|
(1,588
|
)
|
|
55
|
|
|
—
|
%
|
|
(1,230
|
)
|
|
(9,364
|
)
|
|
'
|
|
Interest paid
|
(17,123
|
)
|
|
(10,898
|
)
|
|
57.1
|
%
|
|
(43,483
|
)
|
|
(33,438
|
)
|
|
30.0
|
%
|
Purchase of own shares
|
—
|
|
|
(2,661
|
)
|
|
(100.0
|
)%
|
|
(15,725
|
)
|
|
(11,342
|
)
|
|
38.6
|
%
|
Dividends paid to non-controlling interest
|
—
|
|
|
—
|
|
|
—
|
%
|
|
(1,195
|
)
|
|
(1,506
|
)
|
|
(20.7
|
)%
|
Net cash (used)/generated from financing activities
|
(11,396
|
)
|
|
286,332
|
|
|
(104.0
|
)%
|
|
(46,790
|
)
|
|
405,295
|
|
|
(111.5
|
)%
|
Net decrease in cash and cash equivalents
|
46,432
|
|
|
301,123
|
|
|
(84.6
|
)%
|
|
(65,244
|
)
|
|
369,594
|
|
|
(117.7
|
)%
|
Cash and cash equivalents at beginning of period
|
144,708
|
|
|
219,934
|
|
|
(34.2
|
)%
|
|
269,195
|
|
|
158,568
|
|
|
69.8
|
%
|
Effect of exchange rate changes and inflation on cash and cash equivalents
|
(10,312
|
)
|
|
2,118
|
|
|
(586.9
|
)%
|
|
(23,123
|
)
|
|
(4,987
|
)
|
|
363.7
|
%
|
Cash and cash equivalents at end of period
|
180,828
|
|
|
523,175
|
|
|
(65.4
|
)%
|
|
180,828
|
|
|
523,175
|
|
|
(65.4
|
)%
|
|
|
Condensed Consolidated Interim Balance Sheet
|
|
|
|
|
|
|
|
|
|
|
|
Statement of Financial Position
|
|
|
|
|
|
|
$ thousands
|
|
September 30, 2018
|
|
December 31, 2017
|
|
Chg %
|
|
ASSETS
|
|
|
|
|
|
|
Non-Current Assets
|
|
|
|
|
|
|
Property, plant and equipment
|
|
1,416,269
|
|
|
831,377
|
|
|
70.4
|
%
|
Investment property
|
|
40,725
|
|
|
42,342
|
|
|
(3.8
|
)%
|
Intangible assets
|
|
24,191
|
|
|
17,192
|
|
|
40.7
|
%
|
Biological assets
|
|
8,890
|
|
|
11,276
|
|
|
(21.2
|
)%
|
Deferred income tax assets
|
|
22,541
|
|
|
30,808
|
|
|
—
|
%
|
Trade and other receivables
|
|
22,747
|
|
|
22,107
|
|
|
2.9
|
%
|
Other assets
|
|
646
|
|
|
535
|
|
|
20.7
|
%
|
|
|
|
|
|
|
|
Total Non-Current Assets
|
|
1,536,009
|
|
|
955,637
|
|
|
60.7
|
%
|
Current Assets
|
|
|
|
|
|
|
Biological assets
|
|
73,749
|
|
|
156,718
|
|
|
(52.9
|
)%
|
Inventories
|
|
159,712
|
|
|
108,919
|
|
|
46.6
|
%
|
Trade and other receivables
|
|
198,950
|
|
|
150,107
|
|
|
32.5
|
%
|
Derivative financial instruments
|
|
5,285
|
|
|
4,483
|
|
|
17.9
|
%
|
Other assets
|
|
60
|
|
|
30
|
|
|
100.0
|
%
|
Cash and cash equivalents
|
|
180,828
|
|
|
269,195
|
|
|
(32.8
|
)%
|
Total Current Assets
|
|
618,584
|
|
|
689,452
|
|
|
(10.3
|
)%
|
TOTAL ASSETS
|
|
2,154,593
|
|
|
1,645,089
|
|
|
31.0
|
%
|
SHAREHOLDERS EQUITY
|
|
|
|
|
|
|
Capital and reserves attributable to equity holders of the parent
|
|
|
|
|
|
|
Share capital
|
|
183,573
|
|
|
183,573
|
|
|
—
|
%
|
Share premium
|
|
900,503
|
|
|
908,934
|
|
|
(0.9
|
)%
|
Cumulative translation adjustment
|
|
(679,854
|
)
|
|
(552,604
|
)
|
|
23.0
|
%
|
Equity-settled compensation
|
|
15,391
|
|
|
17,852
|
|
|
(13.8
|
)%
|
Cash flow hedge
|
|
(76,934
|
)
|
|
(24,691
|
)
|
|
211.6
|
%
|
Treasury shares
|
|
(8,741
|
)
|
|
(6,967
|
)
|
|
25.5
|
%
|
Revaluation surplus
|
|
398,096
|
|
|
—
|
|
|
|
Reserve from the sale of non-controlling interests in subsidiaries
|
|
41,574
|
|
|
41,574
|
|
|
—
|
%
|
Retained earnings
|
|
244,998
|
|
|
106,209
|
|
|
130.7
|
%
|
Equity attributable to equity holders of the parent
|
|
1,018,606
|
|
|
673,880
|
|
|
51.2
|
%
|
Non-controlling interest
|
|
43,831
|
|
|
9,139
|
|
|
379.6
|
%
|
TOTAL SHAREHOLDERS EQUITY
|
|
1,062,437
|
|
|
683,019
|
|
|
55.6
|
%
|
LIABILITIES
|
|
|
|
|
|
|
Non-Current Liabilities
|
|
|
|
|
|
|
Trade and other payables
|
|
1,991
|
|
|
827
|
|
|
140.7
|
%
|
Borrowings
|
|
649,761
|
|
|
663,060
|
|
|
(2.0
|
)%
|
Deferred income tax liabilities
|
|
158,391
|
|
|
10,457
|
|
|
1,414.7
|
%
|
Payroll and social security liabilities
|
|
1,109
|
|
|
1,240
|
|
|
(10.6
|
)%
|
Derivatives financial instruments
|
|
—
|
|
|
—
|
|
|
—
|
%
|
Provisions for other liabilities
|
|
2,971
|
|
|
4,078
|
|
|
(27.1
|
)%
|
Total Non-Current Liabilities
|
|
814,223
|
|
|
679,662
|
|
|
19.8
|
%
|
Current Liabilities
|
|
|
|
|
|
|
Trade and other payables
|
|
77,143
|
|
|
98,423
|
|
|
(21.6
|
)%
|
Current income tax liabilities
|
|
1,111
|
|
|
503
|
|
|
120.9
|
%
|
Payroll and social security liabilities
|
|
26,797
|
|
|
27,267
|
|
|
(1.7
|
)%
|
Borrowings
|
|
165,372
|
|
|
154,898
|
|
|
6.8
|
%
|
Derivative financial instruments
|
|
6,820
|
|
|
552
|
|
|
1,135.5
|
%
|
Provisions for other liabilities
|
|
690
|
|
|
765
|
|
|
(9.8
|
)%
|
Total Current Liabilities
|
|
277,933
|
|
|
282,408
|
|
|
(1.6
|
)%
|
TOTAL LIABILITIES
|
|
1,092,156
|
|
|
962,070
|
|
|
13.5
|
%
|
TOTAL SHAREHOLDERS EQUITY AND LIABILITIES
|
|
2,154,593
|
|
|
1,645,089
|
|
|
31.0
|
%
|