Le Lézard
Classified in: Business
Subjects: ERN, CCA

Adecoagro reported Adjusted EBITDA of $137.0 million in 2Q18 and $198.9 million for 6M18, 103% and 77.7% higher year-over-year, respectively


LUXEMBOURG, August 16, 2018 /PRNewswire/ -- Adecoagro S.A. (NYSE: AGRO, Bloomberg: AGRO US, Reuters: AGRO.K), a leading agricultural company in South America, announced today its results for the second quarter of 2018.

Main highlights for the period:

Financial & Operational Highlights

Year-to-date, Adjusted EBITDA totaled $128.9 million, marking a 40.7% increase compared to the same period of last year. In addition to the previously referred drivers, higher Adjusted EBITDA is explained by a $3.9 million increase derived from the mark-to-market of our commodity hedge positions, partially offset by lower sugar prices.

On a year-to-date basis, Adjusted EBITDA grew by 161.2%, reaching $80.0 million. This increase is primarily explained by: (i) a $3.8 million increase in our Crops business, due to a higher margin recognition as a result of higher commodity prices in the local market coupled with a reduction in production costs, (ii) a $9.2 million increase in our Rice business, as a result of a significant 17% increase in agricultural yields, coupled with lower production costs, measured in U.S dollar. These effects were partially offset by the negative mark-to-market of our commodity hedge position.

Strategy Execution

Cluster Expansion: The expansion of the cluster in Mato Grosso do Sul is moving forward according to plan and budget. Investments in Angelica mill, as previously announced, are already done and the mill reached a nominal crushing capacity of 1,050 tons/hour. As for the Ivinhema mill, most of the investments are completed.

At the same time, based on projected relative sugar and ethanol prices, we commenced minor investments in order to increase our maximum ethanol production capacity by 5%, reaching 73% of total TRS production by 2019. It´s worth highlighting that, during the first half of the year, 77% of TRS went to ethanol and we feel very optimistic with our 70% target for the year. We believe that this investment, will result in higher margins and returns as we will be making a better use of our assets by producing  products with higher margin contribution.

(1) Adjusted EBITDA is defined as consolidated profit from operations before financing and taxation, depreciation, amortization 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, 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.

Non-Gaap Financial Measures: For a full reconciliation of non-gaap financial measures please refer to page 29 of our 4Q17 Earnings Release found on Adecoagro's website (ir.adecoagro.com)

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. 
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 relate 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.

To read the full 2Q18 earnings release, please access ir.adecoagro.com. A conference call to discuss 2Q18 results will be held on August 17, 2018 with a live webcast through the internet:

Conference Call

August 17, 2018
9 a.m. (US EST)
10 a.m. Buenos Aires
10 p.m. Sao Paulo
3 p.m. Luxembourg

Participants calling from the US: Tel: +1 (844) 836-8746
Participants calling from other countries: Tel: +1 (412) 317-2501
Access Code: Adecoagro

Conference Call Replay
Participants calling from the US: Tel: +1 (877) 344-7529
Participants calling from other countries: Tel: +1 (412) 317-0088
Access Code: 10122948

Investor Relations Department
Charlie Boero Hughes
CFO

Juan Ignacio Galleano
IRO
Email: [email protected]
Tel: +54 (11) 4836-8624

About Adecoagro:

Adecoagro is a leading agricultural company in South America. Adecoagro owns over 247 thousand hectares of farmland and several industrial facilities spread across the most productive regions of Argentina, Brazil and Uruguay, where it produces over 1.9 million tons of agricultural products including sugar, ethanol, bio-electricity, milled rice, corn, wheat, soybean and dairy products, among others.

SOURCE Adecoagro S.A.


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