LUXEMBOURG, May 14, 2014 /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 first quarter of 2014.
Main highlights for the period:
Financial & Operational Highlights
- Adecoagro recorded Adjusted EBITDA of $
34.7 million in 1Q14, representing a $5.7 million or 19.7% increase compared to
1Q13.
- Adjusted EBITDA margin during 1Q14 reached 36.7% in 1Q14,
compared to 28.2% in 1Q13.
- The Farming and Land Transformation businesses' Adjusted EBITDA
in 1Q14 was $35.9 million,
$17.1 million higher than 1Q13. This
improvement is explained by increased operational and financial
performance in each of our segments: (i) in the Rice segment, an
increase in planted area coupled with lower costs driven by the
devaluation of the Argentine peso and the implementation of
efficient production technologies increased Adjusted EBITDA by
183.2%; (ii) in the Crops segment, higher productivity per hectare
and lower production costs increased our margins resulting in 45.8%
growth in Adjusted EBITDA; and (iii) in the Dairy segment a
combination of a larger cow herd and higher productivity per cow
resulted in a 680.9% increase in Adjusted EBITDA. Operational
performance was partially offset by a $12.5
million non-cash loss resulting from the mark-to-market of
our commodity hedge position, compared to a $2.6 million gain in 1Q13.
- The Sugar, Ethanol and Energy business underwent the annual
inter-harvest maintenance of the mills and equipment during the
first quarter of 2014. Accordingly, 1Q14 Adjusted EBITDA primarily
reflects the sale of sugar and ethanol inventories, the expenses
incurred in sugarcane maintenance and treatment, overhead expenses
and derivative hedge results. Net sales and gross profit increased
by 22.1% and 11.3%, respectively, driven by (i) our ethanol carry
strategy implemented in 2013 to capture higher off-season prices,
and (ii) our ability to capture peak energy prices currently in
Brazil by using bagasse leftover
from the previous season to cogenerate electricity at the Angelica
mill. Despite the growth in net sales and gross profit, Adjusted
EBITDA decreased to $3.8 million in
1Q14, from $14.9 million in 1Q13.
Adjusted EBITDA was negatively affected by: (i) a $1.4 million non-cash loss resulting from the
mark-to-market of our sugar derivative hedge position, contrasted
by a $9.6 million gain in 1Q13; (ii)
an 11.2% increase in sugarcane crop treatment expenses —incurred
primarily for fertilizers and agrochemicals to maintain crop
productivity—as a result of the expansion in the size of our
sugarcane plantation; and (iii) lower sugar and ethanol prices in
US dollar terms year-over-year.
- Net Income in 1Q14 was $2.6
million, $0.1 million higher
than in 1Q13. Net income was enhanced by operational and financial
improvements in the Farming business in Argentina and offset by losses in our
Brazilian and Uruguayan subsidiaries, higher interest expenses and
higher accrued income taxes.
Strategy Execution
- During late March and April our Sugar, Ethanol and Energy mills
have begun crushing operations for the 2014/15 sugarcane harvest.
Maintenance of industrial equipment and sugarcane plantations was
successfully performed between January and March 2014. Our cluster has a sufficient supply
of cane and is expected to crush at full nominal capacity. The
Angelica mill began crushing on March
26 to benefit from attractive off-season ethanol prices and
peak energy prices; the Ivinhema mill started operating on
April 25 as planned; and the UMA mill
began crushing on April 11 as
scheduled. Our agricultural and industrial teams have undergone a
thorough training process and are set to enhance operational and
productive efficiencies throughout the year.
To read the full 1Q14 earnings release, please access
ir.adecoagro.com. A conference call to discuss 1Q14 results will be
held tomorrow with live webcast through the internet:
English Conference Call
May
15, 2014
9 a.m. (US EST)
10 a.m. Buenos Aires
10 a.m. Sao Paulo
3 p.m. Luxembourg
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 269
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.
SOURCE Adecoagro S.A.