Last checked at 13 May 2024 08:00
13 May 2024
ROS AGRO PLC financial results for 1Q 2024
13 May 2024 - Today ROS AGRO PLC (the "Company"), the holding company of Rusagro Group (the "Rusagro"), a leading Russian diversified food producer with vertically integrated operations, has announced the financial results for the three months ended 31 March 2024.
1Q 2024 HIGHLIGHTS:
- Sales amounted to RUB 68,309 million (US$ 753 million1), an increase of RUB 20,913 million (+44%) compared to 1Q 2023;
- Adjusted EBITDA2 amounted to RUB 7,303 million (US$ 80 million), an increase of RUB 163 million (+2%) compared to 1Q 2023;
- Adjusted EBITDA margin decreased to 11% in 1Q 2024 from 15% in 1Q 2023;
- Net profit for the period amounted to RUB 1,740 million (US$ 19 million), a decrease of RUB 3,677 million (-68%);
- Net debt position3 as of 31 March 2024 amounted to RUB 62,765 million (US$ 680 million);
- Net Debt/Adjusted EBITDA (LTM4) as of 31 March 2024 was 1.11x.
Commenting on the results, Timur Lipatov, CEO of Rusagro, said:
"In 1Q 2024 Rusagro's revenue significantly increased mainly following the growth in production of crude oil and meal in Oil and Fat business and due to consolidation of NMGK Group results starting from the second half of 2023. Additionally, the dynamics of pork market prices and the growth of sugar sales volumes following the growth of processed volumes of sugar beet positively impacted the revenue. Decrease in revenue of Agricultural segment is attributable to the difference in carryover stocks because of prolonged harvesting in 2022 due to adverse weather conditions.
Group's adjusted EBITDA demonstrated the increase of 2%. The growth of adjusted EBITDA in Meat business following positive market conditions and the consolidation of NMGK completely compensated the decrease in other segments under the pressure of increased costs.
Net debt decreased by 6% and the ratio of net debt to adjusted EBITDA has also improved.Net profit decrease is mainly due to the dynamics of exchange differences."
Key consolidated financial performance indicators | ||||
in RUB million | Three months ended | Variance | ||
31 March 2024 | 31 March 2023 | Units | % | |
Sales | 68,309 | 47,395 | 20,913 | 44 |
Gross profit | 13,823 | 8,630 | 5,193 | 60 |
Gross margin, % | 20% | 18% | 2 pp |
|
Adjusted EBITDA | 7,303 | 7,139 | 163 | 2 |
Adjusted EBITDA margin, % | 11% | 15% | (4) pp |
|
Net profit for theperiod 1 | 1,740 | 5,417 | (3,677) | (68) |
Net profit margin % | 3% | 11% | (8) pp |
|
1 Net profit for the period is affected by non-cash income/(loss) on revaluation of biological assets and agricultural produce. See details in business sections below.
Note: since some indicators and percentages in the press release were rounded to the nearest whole number, the sum of the rounded values may not fully match the totals.
Key financial performance indicators by segments | ||||
in RUB million | Three months ended | Variance | ||
31 March 2024 | 31 March 2023 | Units | % | |
| ||||
Sales, incl. | 68,309 | 47,395 | 20,913 | 44 |
Sugar | 12,429 | 9,411 | 3,018 | 32 |
Meat | 10,607 | 10,725 | (119) | (1) |
Agriculture | 4,306 | 5,896 | (1,590) | (27) |
Oil and Fat | 29,856 | 23,357 | 6,499 | 28 |
NMGK | 14,520 | - | 14,520 | - |
Other | 505 | 464 | 41 | 9 |
Eliminations | (3,913) | (2,457) | (1,455) | (59) |
Gross profit, incl. | 13,823 | 8,630 | 5,193 | 60 |
Sugar | 1,590 | 2,815 | (1,225) | (44) |
Meat | 2,012 | 1,143 | 869 | 76 |
Agriculture | (82) | (774) | 691 | 89 |
Oil and Fat | 4,567 | 5,641 | (1,074) | (19) |
NMGK | 4,884 | - | 4,884 | - |
Other | 60 | 167 | (107) | (64) |
Eliminations | 792 | (362) | 1,154 | - |
Adjusted EBITDA, incl. | 7,303 | 7,139 | 163 | 2 |
Sugar | 784 | 2,010 | (1,226) | (61) |
Meat | 1,153 | 447 | 706 | 158 |
Agriculture | (1,792) | (116) | (1,675) | (1,441) |
Oil and Fat | 2,209 | 4,161 | (1,952) | (47) |
NMGK | 2,694 | - | 2,694 | - |
Other | (600) | (297) | (303) | (102) |
Eliminations | 2,854 | 934 | 1,920 | 206 |
Adjusted EBITDA margin, % | 11% | 15% | (4) pp |
|
Sugar | 6% | 21% | (15) pp |
|
Meat | 11% | 4% | 7 pp |
|
Agriculture | (42%) | (2%) | (40) pp |
|
Oil and Fat | 7% | 18% | (10) pp |
|
NMGK | 19% | - | - |
|
SUGAR SEGMENT
In 1Q 2024 Sugar segment adjusted EBITDA comprised RUB 784 million (-61% y-o-y) with 6% margin (-15 pp y-o-y).
The financial results of the Sugar segment of 1Q 2024 compared to 1Q 2023 are presented in the table below:
Sugar segment 1Q 2024 Financial Results | ||||
in RUB million | Three months ended | Variance | ||
31 March 2024 | 31 March 2023 | Units | % | |
Sales | 12,429 | 9,411 | 3,018 | 32 |
Cost of sales | (10,838) | (6,595) | (4,243) | (64) |
Gross profit | 1,590 | 2,815 | (1,225) | (44) |
Gross profit margin | 13% | 30% | (17) pp |
|
Distribution and selling expenses | (961) | (945) | (17) | (2) |
General and administrative expenses | (505) | (394) | (111) | (28) |
Other operating income/ (expenses), net | (47) | (3) | (44) | (1,587) |
incl. other adjustments to EBITDA (non-recurring items) | 21 | 22 | (1) | (4) |
Operating profit | 77 | 1,473 | (1,396) | (95) |
| ||||
Adjusted EBITDA | 784 | 2,010 | (1,226) | (61) |
Adjusted EBITDA margin | 6% | 21% | (15) pp |
|
In 1Q 2024 compared to the respective period of 2023 Sales of Sugar segment increased by 32% mainly due to the growth of sugar sales volumes supported by the growth of market prices. The dynamics of sales volume is due to the increase in the volume of sugar beet processing in the 2023/2024 season, which affected the amount of sugar produced.
The Сost of sales for 1Q 2024 increased following an increase in production volumes and prices for sugar beet in the 2023/2024 season.
Production and sales volume of sugar in 1Q 2024
| Three months ended | Variance | ||
31 March 2024 | 31 March 2023 | Units | % | |
Sugar production volume,thousand tonnes | 129 | 69 | 60 | 88 |
Sales volume, thousand tonnes | 187 | 148 | 39 | 26 |
MEAT SEGMENT
In 1Q 2024 Meat segment earned RUB 1,153 million of adjusted EBITDA (+158% y-o-y) with 11% margin (+7 pp y-o-y).
The financial results of the Meat segment of 1Q 2024 compared to 1Q 2023 respectively are presented in the table below.
Meat segment 1Q 2024 Financial Results
in RUB million | Three months ended | Variance | ||
31 March 2024 | 31 March 2023 | Units | % | |
Sales | 10,607 | 10,725 | (119) | (1) |
Net gain/ (loss) on revaluation of biological assets and agricultural produce | 956 | 1,327 | (371) | (28) |
Cost of sales | (9,551) | (10,909) | 1,359 | 12 |
Gross profit | 2,012 | 1,143 | 869 | 76 |
Gross profit margin | 19% | 11% | 8 pp |
|
Gross profit excl. effect of biological assets and agricultural produce revaluation | 1,056 | (184) | 1,240 | - |
Adjusted gross profit margin | 10% | (2%) | 12 pp |
|
Distribution and selling expenses | (432) | (315) | (117) | (37) |
General and administrative expenses | (570) | (601) | 31 | 5 |
Other operating income/ (expenses), net | 118 | 314 | (196) | (62) |
incl. Reimbursement of operating costs (government grants) | - | 19 | (19) | - |
incl. Other adjustments to EBITDA (non-recurring items) | (6) | 98 | (104) | - |
Operating profit | 1,128 | 541 | 587 | 108 |
| ||||
Adjusted EBITDA | 1,153 | 447 | 706 | 158 |
Adjusted EBITDA margin | 11% | 4% | 7 pp |
|
Sales of the Meat segment decreased by 1% in 1Q 2024 compared to the respective period of 2023. Decrease of sales volumes is partially compensated by the increase in sales prices for both meat products and livestock.
Production and sales volume of pork products in 1Q 2024
Three months ended | Variance | |||
31 March 2024 | 31 March 2023 | Units | % | |
Pigs production,thousand tonnes in live weight | 73 | 89 | (15) | (17) |
Sales volume, thousand tonnes | 58 | 72 | (14) | (19) |
Cost of sales decreased by 12% in 1Q 2023 compared to the respective period of 2023 due to lower sales volumes.
Net gain on revaluation of biological assets and agricultural produce in 1Q 2024 resulted from the increase in fair value of consumable livestock pigs while costs for consumable livestock pigs decreased by the reporting date compared to the respective figures at the beginning of 2024.
AGRICULTURAL SEGMENT
As at 31 March 2024 Rusagro's area of controlled land stands at 689 thousand hectares(31 December 2023: 685 thousand hectares).
In 1Q 2024 Agriculture segment amounted to RUB -1,792 million of adjusted EBITDA (in comparison with RUB -116 million in 1Q 2023) with -42% margin (in comparison with -2% in 1Q 2023).
The financial results of the Agricultural segment of 1Q 2024 compared to 1Q 2023 respectively are presented below.
Agriculture segment 1Q 2024 Financial Results
in RUB million | Three months ended | Variance | ||
31 March 2024 | 31 March 2023 | Units | % | |
Sales | 4,306 | 5,896 | (1,590) | (27) |
Net gain/ (loss) on revaluation of biological assets and agricultural produce | (679) | (1,415) | 736 | 52 |
Cost of sales | (3,709) | (5,254) | 1,546 | 29 |
Gross profit | (82) | (774) | 691 | 89 |
Gross profit margin | (2%) | (13%) | 11 pp |
|
Gross profit excl. effect of biological assets and agricultural produce revaluation | 597 | 641 | (44) | (7) |
Adjusted gross profit margin | 14% | 11% | 3 pp |
|
Distribution and selling expenses | (1,484) | (1,049) | (435) | (41) |
General and administrative expenses | (480) | (352) | (128) | (36) |
Other operating income/ (expenses), net | (471) | 96 | (567) | - |
incl. Reimbursement of operating costs (government grants) | 224 | 31 | 193 | 616 |
incl. Other adjustments to EBITDA (non-recurring items) | 53 | 19 | 33 | 171 |
Operating profit | (2,517) | (2,079) | (438) | (21) |
| ||||
Adjusted EBITDA | (1,792) | (116) | (1,675) | (1,441) |
Adjusted EBITDA margin | (42%) | (2%) | (40) pp |
|
In 1Q 2024 in comparison to 1Q 2023 Sales of the Agriculture segment decreased by 27% to RUB 4,306 million mainly due to a decrease in sales volumes for all crops except wheat caused by the difference in stocks at the beginning of the reporting periods.
The decrease in sales of soybean and sunflower in 1Q 2024 compared to 1Q 2023 is due to the difference in stocks at the beginning of the reporting periods caused by adverse weather conditions in 4Q 2022 and prolonged harvesting in 1Q 2023.
There were no sales of sugar beet during 1Q 2024. Sugar beet sales in 1Q 2023 were the result of the shift of harvesting to January-February 2023 due to adverse weather conditions in 4Q 2022.
The dynamics of wheat sales in 1Q 2024 compared to the same period in 2023 is due to higher sales during the period of price reduction and in order to release the storage for the new year's harvest.
Sales volumes of crops in 1Q 2024
Thousand tonnes | Three months ended | Variance | ||
31 March 2024 | 31 March 2023 | Units | % | |
sugar beet | - | 494 | (494) | (100) |
wheat | 155 | 59 | 96 | 163 |
soybean | 46 | 86 | (40) | (47) |
corn | 19 | 29 | (10) | (34) |
sunflower seeds | 5 | 40 | (35) | (87) |
The main reason for the decrease in Cost of sales is the decrease in sales volumes.
Net gain/(loss) on revaluation of biological assets and agricultural produce depends on revaluation amounts in opening and closing inventory balances. As agricultural produce matures and at the point of harvest, a gain on revaluation of agricultural produce to fair value less costs to sell is recognized. During subsequent sale, a loss from the revaluation of agricultural products sold in the reporting period is recognized in the amount of the previously recognized gain.
Net loss in 1Q 2024 and 1Q 2023 resulted from the realization of gain on revaluation of agricultural produce to fair value less costs to sell recognized in 2023 and 2022 correspondingly. In 1Q 2024 the loss from gain realization is lower compared to 1Q 2023 following the decrease in sales volumes.
Net gain/ (loss) on revaluation of biological assets and agricultural produce and its subsequent realisation do not affect the Adjusted EBITDA figure.
OIL AND FAT SEGMENT
In 1Q 2024 Oil and Fat segment earned RUB 2,209 million of adjusted EBITDA (-47 %y-o-y) with 7% margin (-10% y-o-y).
The financial results of the Oil and Fat segment for 1Q 2024 compared to 1Q 2023 are presented below.
Oil and Fat segment 1Q 2024 Financial Results
in RUB million | Three months ended | Variance | ||
31 March 2024 | 31 March 2023 | Units | % | |
Sales | 29,856 | 23,357 | 6,499 | 28 |
Cost of sales | (25,289) | (17,716) | (7,573) | (43) |
Gross profit | 4,567 | 5,641 | (1,074) | (19) |
Gross profit margin | 15% | 24% | (9) pp |
|
Distribution and selling expenses | (2,548) | (1.907) | (641) | (34) |
General and administrative expenses | (720) | (820) | 101 | 12 |
Other operating income/ (expenses), net | 120 | (578) | 698 | - |
incl. Other adjustments to EBITDA (non-recurring items) | 241 | (702) | 944 | - |
Operating profit | 1,419 | 2,336 | (916) | (39) |
| ||||
Adjusted EBITDA | 2,209 | 4,161 | (1,952) | (47) |
Adjusted EBITDA margin | 7% | 18% | (10) pp |
|
In 1Q 2024 Sales of Oil and Fat segment increased in comparison to 1Q 2023 mainly because of the increase in sales volumes of bulk oil and meal after the completion of modernization of oil extraction plant in Balakovo, which led to growth in production capacity and production volumes. Also Sales increased due to the higher volumes and prices of industrial fats and mayonnaise. The growth was partially compensated by the decrease in sales prices of bulk oil.
Sales volumes of oil and fat and dairy products in 1Q 2024
Thousand tonnes | Three months ended | Variance | ||
31 March 2024 | 31 March 2023 | Units | % | |
meal | 190 | 133 | 56 | 42 |
crude oil | 111 | 54 | 57 | 106 |
industrial fats | 78 | 76 | 2 | 3 |
dry whey mixes | 4 | 3 | 1 | 30 |
consumer oil&fat products | 72 | 65 | 7 | 11 |
consumer dairy products | 4 | 3 | 1 | 34 |
The growth of Cost of sales in 1Q 2024 compared to the same period of the previous year is mainly due to the increase in sales volumes as well as the growth of palm oil prices.
The growth of Distribution and selling expenses in 1Q 2024 compared to the same period of the previous year is mainly attributable to higher transportation costs.
NMGK
At the end of 2Q 2023 the Company acquired 50% of the shares and control over the NMGK group of companies. The Company's financial results include the financial results of the NMGK Group starting from the acquisition date.
For 1Q 2024 the revenue of the NMGK Group of companies amounted to RUB 14,520 million, adjusted EBITDA amounted to RUB 2,694 million with a margin of 19%.
The financial results of NMGK as a part of Rusagro for 1Q 2024 are presented in the table below.
NMGK 1Q 2024 Financial Results | ||
in RUB million | Three months ended | |
31 March 2024 | 31 March 2023 | |
Sales | 14,520 | - |
Cost of sales | (9,635) | - |
Gross profit | 4,884 | - |
Gross profit margin | 34% | - |
Distribution and selling expenses | (2,189) | - |
General and administrative expenses | (535) | - |
Other operating income/ (expenses), net | (24) | - |
incl. Other adjustments to EBITDA (non-recurring items) | (26) | - |
Operating profit | 2,136 | - |
| ||
Adjusted EBITDA | 2,694 | - |
Adjusted EBITDA margin | 19% | - |
Sales volumes of NMGK oil and fat products in 1Q 2024
Thousand tonnes | Three months ended | |
31 March 2024 | 31 March 2023 | |
Meal | 80 | - |
Crude oil | 60 | - |
Industrial fats | 16 | - |
Oil & fat products | 49 | - |
KEY CONSOLIDATED CASH FLOW INDICATORS (NOT IFRS PRESENTATION*)
The key consolidated cash flow indicators presented according to management accounts methodology
in RUB million | Three months ended | Variance | ||
31 March 2024 | 31 March 2023 | Units | % | |
Net cash from operating activities, incl. | 10,248 | 16,004 | (5,756) | (36) |
Operating cash flow before working capital changes | 8,405 | 6,992 | 1,414 | 20 |
Working capital changes | 3,423 | 9,304 | (5,881) | (63) |
Net cash from investing activities, incl. | (6,321) | (2,289) | (4,032) | (176) |
Purchases of property, plant and equipment and inventories intended for construction | (6,271) | (2,089) | (4,181) | (200) |
Net cash from financing activities | (13,619) | (6,729) | (6,891) | (102) |
Net effect of exchange rate changes on cash and cash equivalents | (100) | 1,933 | (2,033) | - |
Net (decrease) / increase in cash and cash equivalents | (9,792) | 8,919 | (18,711) | - |
(*) See Appendix 4
Debt position and liquidity management | ||||
in RUB million | 31 March 2024 | 31 December 2023 | Variance | |
Units | % | |||
Gross debt | 128,433 | 127,533 | 900 | 1 |
Short-term borrowings | 66,769 | 68,035 | (1,266) | (2) |
Long-term borrowings | 61,664 | 59,498 | 2,166 | 4 |
Cash and cash equivalents, bank deposits and bonds | (65,668) | (61,057) | (4,611) | (8) |
Short-term cash, deposits and bonds | (31,253) | (27,086) | (4,167) | (15) |
Long-term cash, deposits and bonds | (34,415) | (33,971) | (444) | (1) |
Net debt | 62,765 | 66,477 | (3,712) | (6) |
Short-term borrowings, net | 35,516 | 40,949 | (5,433) | (13) |
Long-term borrowings, net | 27,249 | 25,527 | 1,722 | 7 |
Adjusted EBITDA (LTM4) | 56,723 | 56,560 | 163 | 0 |
Net debt/ Adjusted EBITDA (LTM) | 1.11 | 1.18 | (0.1) |
|
Net finance income / (expense): |
| |||
in RUB million | Three months ended | Variance | ||
31 March 2024 | 31 March 2023 | Units | % | |
Net interest expense | (1,420) | (1,925) | 505 | 26 |
Gross interest expense | (3,396) | (4,643) | 1,247 | 27 |
Reimbursement of interest expense | 1,975 | 2,718 | (742) | (27) |
Interest income | 2,270 | 2,441 | (171) | (7) |
Net gains / (losses) from bonds held for trading | - | - | - | - |
Other financial expenses, net | (33) | 2,982 | (3,015) | - |
Net foreign exchange gains / (losses) | (13) | 3,098 | (3,112) | - |
Other financial income/ (expenses), net | (20) | (117) | 97 | 83 |
Total net finance income / (expense) | 816 | 3,498 | (2,682) | (77) |
Net debt decreased at 31 March 2024 compared at 31 December 2023 by 6%.
In 1Q 2024 Rusagro continued to enjoy benefits from the state agriculture subsidies programme. Rusagro continued to receive bank loans with decreased preferential interest rates under the programme of government support. Under this programme, the government provides subsidies to the banks to compensate the loss of income on borrowings with decreased interest rates, given by the banks to agricultural producers. In 1Q 2024 IFRS accounts these borrowings are accounted according to its face value with no adjustments to prevailing market rates. The differences between nominal and market interest rate is recognized as either government grants in a statement of financial position for borrowings received with the purpose to finance investment projects or interest expenses in a statement of comprehensive income for general purpose borrowings.
Net finance income of 1Q 2024 in the sum of RUB 816 million decreased in the amount of RUB 2,682 million compared to 1Q 2023 mainly as the result of decrease in forex differences income.
________________________________
(1) The exchange rates used for translation of RUB amounts into USD represent average Central Bank official exchange rate for the respective reporting period for income, expenses and profits and the Central Bank official exchange rate as at the reporting date for balance figures.
(2) Adjusted EBITDA is defined as operating profit before taking into account (i) depreciation included in operating profit, (ii) net gain/ (loss) on revaluation of biological assets and agricultural produce, (iii) non-recurring components of other operating income/ (expenses), net, (iv) share-based remuneration, (v) provision for impairment of loans issued (see Appendix 2 for the detailed calculation of Adjusted EBITDA). Adjusted EBITDA is not a measure of financial performance under IFRS. It should not be considered as an alternative to profit for the period as a measure of operating performance or to cash flows from operating activities as a measure of liquidity. Our calculation of Adjusted EBITDA may be different from the calculation used by other companies and therefore comparability may be limited. We believe that Adjusted EBITDA provides useful information to investors because it is an indicator of the strength and performance of our ongoing business operations, including our ability to fund discretionary spending such as capital expenditures, acquisitions of subsidiaries and other investments and our ability to incur and service debt.
(3) Rusagro determines the net debt as short-term borrowings and long-term borrowings less cash and cash equivalents, bank deposits, bank promissory notes and bonds held for trading.
(4) LTM - The abbreviation for the "Last twelve months".
NOTE
ROS AGRO PLC (LSE, MOEX: AGRO) - a holding company of Rusagro Group, a leading Russian diversified food producer with vertically integrated operations in the following branches:
Agricultural:
Rusagro currently controls one of the largest land banks among Russian agriculture producers, with 689 thousand hectares of land under control located in the highly fertile Black Earth regions of Russia (in the Belgorod, Tambov, Voronezh, Kursk, Saratov, Tula and Orel regions) and in the Far East Primorye Region. Land and production sites are strategically located within the same regions to optimize efficiency and minimize logistical costs. Rusagro is one of the major sugar beet producers in Russia, but it also produces wheat, barley and corn, sunflower seeds and soybeans. These products are partially consumed by the Sugar, Meat and Oil and Fat segments, supporting a synergistic effect and lowering price change risk.
Oil and Fat:
Rusagro together with NMGK is the leading crude sunflower oil and consumer margarine and mayonnaise producer, second largest industrial fats and mayonnaise producer in Russia with products sold under eleven key brands, such as EZhK, Schedroye Leto, Mechta Khozyaiki, umbrella brand Ya Lublu Gotovit (includes Moskovskiy Provansal, Novosibirskiy Provansal and Saratovskiy Provansal), Rossiyanka and Saratovskiy Slivochniy, Benefitto, Maslava and Leto Krasno (红色夏日), which is sold on the Chinese market. Rusagro also produces dry industrial mixes, cheeses, butter and cream sold under three brands: Milie, Syrnaya Kultura and Ya Lublu Gotovit. Rusagro owns four crushing and two oil & fats plants and leases two milk processing plants. Owning its sunflower and soy oil production allows Rusagro to control the source of the sunflower and soybean oil required to produce oil and fats products.
Rusagro finalized the acquisition of 50% of NMGK Group in 2023. NMGK Group owns an oil and fat plant in Nizhny Novgorod, a fat plant in Samara, oil extraction factories in Uryupinsk and Sorochinsk, as well as elevators in the Volgograd, Orenburg, Samara, Saratov regions and the Republic of Bashkortostan. The company produces mayonnaise and sauces "Ryaba", "Sdobri", sauces and ketchups "Astoria", margarine "Khozyayushka", Slivochnik, spread "Kremlevskoe", coconut oil "Delicato", soap "Moy malysh" and "Retsepty chistoty".
Sugar:
Rusagro is one of the leading Russian sugar producers (№2 in Russia and №1 on cube white sugar market), producing sugar from sugar beet at nine production sites in four regions. Group produces white and brown sugar sold under the brands Russkii Sakhar, Chaikofsky, Mon Café and Brauni. The Sugar segment is vertically integrated and sugar beets are supplied by Rusagro's Agriculture segment, which ensures a consistent supply. The sugar segment also operates a cereal plant and sells buckwheat and rice under the brand Tyoplye Traditsii.
Meat:
Rusagro is №2 largest pork producer in Russia. It operates large commercial pig breeding complexes adhering to best practices regarding biosecurity standards, nucleus farms, compound feed plants, slaughterhouses and meat processing plants in Tambov and Belgorod Regions and in the Russian Far East. Since 2016, Rusagro sells retail products under its own brand Slovo Myasnika (Butcher's word).
CONFERENCE CALL
Rusagro management is organizing a conference call on Company's 1Q 2024 financial results for investors and analysts.
Details of the call:
Date: | 13 May 2024 |
Time: | 4:00 PM (Moscow) / 2:00 PM (London)
|
Subject: | ROS AGRO PLC 1Q 2024 IFRS Financial results
|
Registration: | available up to 3:00 PM Moscow time / 1:00 PM London time on 13 May https://us06web.zoom.us/webinar/register/WN_OYvYIBqIScehso38FyaF9w |
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FORWARD-LOOKING STATEMENTS
This announcement includes statements that are, or may be deemed to be, forward-looking statements. These forward-looking statements do not relate to historical or current events,or to any future financial or operational activity of the Group.
By their nature, forward-looking statements involve risk and uncertainty because they relateto future events and circumstances, a number of which are beyond the Rusagro Group's control. As a result, actual future results may differ materially from the plans and expectations set outin these forward-looking statements.
The Group undertakes no obligation to release the results of any revisions to any forward-looking statements that may occur due to any change in its expectations or to reflect eventsor circumstances after the date of this document.
CONTACTS
Alexey Kulchitskiy Director M&A, IR, ESG Phone: +7 495 363 1661 E-mail: ir@rusagrogroup.ru |
Appendix 1. Consolidated statement of comprehensive income for the Three months ended 31 March 2024 (in RUB thousand)
Three months ended31 December | ||
| 2024 | 2023 |
| ||
Sales | 68,308,926 | 47,395,456 |
Net gain / (loss) on revaluation of biological assets and agricultural produce | (1,969,483) | (546,548) |
Cost of sales | (52,516,237) | (38,218,586) |
Gross profit | 13,823,206 | 8,630,322 |
| ||
Distribution and selling expenses | (7,406,739) | (3,580,492) |
General and administrative expenses | (2,899,295) | (2,179,714) |
Other operating income/(expenses), net | (1,222,331) | 791,263 |
Operating profit | 2,294,841 | 3,661,379 |
| ||
Interest expense | (1,420,180) | (1,925,246) |
Interest income | 2,269,809 | 2,441,235 |
Other financial income/ (expenses), net | (33,386) | 2,981,894 |
Profit / (loss) before taxation | 3,111,084 | 7,159,262 |
| ||
Income tax expense | (1,371,055) | (1,742,313) |
Profit for the period | 1,740,029 | 5,416,949 |
| ||
Other comprehensive income: |
| |
Total comprehensive income/ (loss) for the period | 1,740,029 | 5,416,949 |
| ||
Profit / (loss) is attributable to: |
| |
Owners of ROS AGRO PLC | 525,992 | 5,423,741 |
Non-controlling interest | 1,214,037 | (6,792) |
Profit / (loss) for the period | 1,740,029 | 5,416,949 |
| ||
Total comprehensive income/ (loss) is attributable to: |
| |
Owners of ROS AGRO PLC | 525,992 | 5,423,741 |
Non-controlling interest | 1,214,037 | (6,792) |
Total comprehensive income/ (loss) for the period | 1,740,029 | 5,416,949 |
| ||
Earnings per ordinary share for profit attributable to the equity holders of ROS AGRO PLC, basic and diluted (in RR per share) | 19.55 | 201.58 |
Appendix 2. Segment information for the Three months ended 31 March 2024 (in RUB thousand)
3М 2024 | Sugar | Meat | Agriculture | Oil and Fat | NMGK | Other | Eliminations | Total |
Sales | 12,428,869 | 10,606,608 | 4,305,857 | 29,856,098 | 14,519,735 | 504,575 | (3,912,816) | 68,308,926 |
Net gain/ (loss) on revaluation of biological assets and agricultural produce | - | 955,847 | (679,101) | - | - | - | (2,246,229) | (1,969,483) |
Cost of sales | (10,838,383) | (9,550,706) | (3,708,905) | (25,289,083) | (9,635,435) | (444,605) | 6,950,880 | (52,516,237) |
incl. Depreciation | (708,763) | (956,912) | (53,092) | (891,791) | (447,028) | (6,033) | (6,615) | (3,070,234) |
Gross profit / (loss) | 1,590,486 | 2,011,749 | (82,149) | 4,567,015 | 4,884,300 | 59,970 | 791,835 | 13,823,206 |
Distribution and Selling, General and administrative expenses | (1,466,363) | (1,002,026) | (1,963,988) | (3,267,369) | (2,724,694) | (589,530) | 707,936 | (10,306,034) |
incl. Depreciation | (19,605) | (17,797) | (45,826) | (139,264) | (84,622) | (6,054) | 6,615 | (306,553) |
Other operating income/(expenses), net | (47,128) | 118,475 | (470,909) | 119,583 | (24,065) | 19,858 | (938,145) | (1,222,331) |
incl. Reimbursement of operating costs (government grants) | - | - | 224,437 | - | - | - | - | 224,437 |
incl. Other adjustments to EBITDA (non-recurring items) | 21,049 | (6,085) | 52,543 | 241,284 | (26,380) | 102,087 | (46,162) | 338,336 |
Operating profit / (loss) | 76,995 | 1,128,198 | (2,517,046) | 1,419,229 | 2,135,541 | (509,702) | 561,626 | 2,294,841 |
Adjustments: |
| |||||||
Depreciation included in Operating profit | 728,368 | 974,709 | 98,918 | 1,031,055 | 531,650 | 12,087 | - | 3,376,787 |
Other adjustments to EBITDA (non-recurring items) | (21,049) | 6,085 | (52,543) | (241,284) | 26,380 | (102,087) | 46,162 | (338,336) |
Net gain/ (loss) on revaluation of biological assets and agricultural produce | - | (955,847) | 679,101 | - | - | - | 2,246,229 | 1,969,483 |
Adjusted EBITDA* | 784,314 | 1,153,145 | (1,791,570) | 2,209,000 | 2,693,571 | (599,702) | 2,854,017 | 7,302,775 |
Appendix 2 (continued). Segment information for the Three months ended 31 March 2023 (in RUB thousand)
3М 2023 | Sugar | Meat | Agriculture | Oil and Fat | Other | Eliminations | Total |
Sales | 9,410,732 | 10,725,385 | 5,895,911 | 23,356,939 | 463,877 | (2,457,388) | 47,395,456 |
Net gain/ (loss) on revaluation of biological assets and agricultural produce | - | 1,327,245 | (1,415,057) | - | - | (458,736) | (546,548) |
Cost of sales | (6,595,274) | (10,909,413) | (5,254,481) | (17,716,136) | (297,337) | 2,554,055 | (38,218,586) |
incl. Depreciation | (547,479) | (1,294,785) | (524,103) | (954,996) | (4,405) | (7,412) | (3,333,180) |
Gross profit / (loss) | 2,815,458 | 1,143,217 | (773,627) | 5,640,803 | 166,540 | (362,069) | 8,630,322 |
Distribution and Selling, General and administrative expenses | (1,339,210) | (916,154) | (1,400,871) | (2,727,121) | (466,388) | 1,089,538 | (5,760,206) |
incl. Depreciation | (11,259) | (36,387) | (42,554) | (168,472) | (39,995) | 7,412 | (291,255) |
Other operating income/(expenses), net | (2,794) | 314,170 | 95,860 | (578,016) | 951,082 | 10,961 | 791,263 |
incl. Reimbursement of operating costs (government grants) | - | 19,453 | 31,333 | 1,441 | - | - | 52,227 |
incl. Other adjustments to EBITDA (non-recurring items) | 21,873 | 98,353 | 19,356 | (702,271) | 992,587 | 263,130 | 693,028 |
Operating profit / (loss) | 1,473,454 | 541,233 | (2,078,638) | 2,335,666 | 651,234 | 738,430 | 3,661,379 |
Adjustments: |
| ||||||
Depreciation included in Operating Profit | 558,738 | 1,331,172 | 566,657 | 1,123,468 | 44,400 | - | 3,624,435 |
Other adjustments to EBITDA (non-recurring items) | (21,873) | (98,353) | (19,356) | 702,271 | (992,587) | (263,130) | (693,028) |
Net gain/ (loss) on revaluation of biological assets and agricultural produce | - | (1,327,245) | 1,415,057 | - | - | 458,736 | 546,548 |
Adjusted EBITDA* | 2,010,319 | 446,807 | (116,280) | 4,161,405 | (296,953) | 934,036 | 7,139,334 |
* Non-IFRS measure
Appendix 3. Consolidated statement of financial position as at 31 March 2024(in RUB thousand)
31 March 2024 | 31 December 2023 | |
ASSETS |
| |
Current assets |
| |
Cash and cash equivalents | 16,144,849 | 25,936,781 |
Short-term investments | 16,601,995 | 2,288,852 |
Trade and other receivables | 47,392,831 | 47,861,374 |
Prepayments | 7,747,331 | 10,814,811 |
Current income tax receivable | 264,233 | 132,186 |
Other taxes receivable | 7,282,734 | 9,006,784 |
Inventories and short-term biological assets | 95,999,624 | 100,617,833 |
Other current assets | 943,617 | 2,718,720 |
Total current assets | 192,377,214 | 199,377,341 |
Non-current assets |
| |
Property, plant and equipment | 143,546,670 | 141,897,092 |
Inventories intended for construction | 493,123 | 465,830 |
Right-of-use assets | 6,756,917 | 6,392,885 |
Goodwill | 3,840,150 | 3,840,150 |
Advances paid for non-current assets | 3,802,523 | 2,867,735 |
Long-term biological assets | 2,737,818 | 2,736,644 |
Long-term investments and receivables | 42,971,384 | 42,527,657 |
Investments in associates | 562,323 | 562,323 |
Deferred income tax assets | 4,347,441 | 2,532,975 |
Other intangible assets | 7,618,702 | 7,765,853 |
Total non-current assets | 216,677,051 | 211,589,144 |
Total assets | 409,054,265 | 410,966,485 |
Appendix 3 (continued). Consolidated statement of financial position as at 31 March 2024 (in RUB thousand)
31 March 2024 | 31 December 2023 | |
LIABILITIES and EQUITY |
| |
Current liabilities |
| |
Short-term borrowings | 66,769,316 | 68,034,977 |
Lease liabilities | 1,096,904 | 1,098,135 |
Trade and other payables | 29,354,516 | 39,452,813 |
Provisions | 294,770 | 123,212 |
Current income tax payable | 336,397 | 555,913 |
Other taxes payable | 2,131,652 | 5,458,529 |
Total current liabilities | 99,983,555 | 114,723,579 |
Non-current liabilities |
| |
Long-term borrowings | 61,663,671 | 59,498,119 |
Government grants | 13,325,638 | 12,860,211 |
Lease liabilities | 4,895,837 | 4,325,136 |
Deferred income tax liability | 4,588,407 | 2,502,074 |
Total non-current liabilities | 84,473,553 | 79,185,540 |
Total liabilities | 184,457,108 | 193,909,119 |
Equity |
| |
Share capital | 12,269 | 12,269 |
Treasury shares | (490,607) | (490,607) |
Additional paid-in capital | 26,964,479 | 26,964,479 |
Other reserves | 1,363,177 | 1,363,177 |
Retained earnings | 173,838,399 | 173,344,692 |
Equity attributable to owners of ROS AGRO PLC | 201,687,717 | 201,194,010 |
Non-controlling interest | 22,909,440 | 15,863,356 |
Total equity | 224,597,157 | 217,057,366 |
Total liabilities and equity | 409,054,265 | 410,966,485 |
Appendix 4. Consolidated statement of cash flows for the Three months ended 31 March 2024 (in RUB thousand) - NOT IFRS PRESENTATION (*)
Three months ended | ||
| 31 March 2024 | 31 March 2023 |
Cash flows from operating activities |
| |
Profit/(loss) before income tax | 3,111,084 | 7,159,263 |
Adjustments for: |
| |
Depreciation and amortization | 3,376,787 | 3,624,433 |
Interest expense | 3,396,000 | 4,643,175 |
Government grants | (2,002,257) | (2,922,447) |
Interest income | (2,269,809) | (2,441,236) |
Loss/ (gain) on disposal of property, plant and equipment | (13,219) | (26,635) |
Net (gain) / loss on revaluation of biological assets and agricultural produce | 1,969,483 | 546,548 |
Change in provision for impairment of loans issued | (15) | (50) |
Interest expense on leases | 120,467 | 66,329 |
Change in provision for net realisable value of inventory | 555,695 | 409,161 |
Change in provision for impairment of receivables and prepayments | 110,335 | 64,192 |
Foreign exchange (gain) / loss, net | (492,843) | (3,958,876) |
Lost / (reversal of) harvest write-off | 425,839 | - |
Settlement of loans and accounts receivable previously written-off | - | (31,379) |
Change in provision for impairment of advances paid for property, plant and equipment | 6,706 | 37,597 |
Change in other provisions | 171,557 | 24,212 |
Loss on disposal of other assets | 27,007 | - |
Gain on SolPro loans redemption | - | (237,768) |
Other non-cash and non-operating expenses, net | (87,596) | 35,163 |
Operating cash flow before working capital changes | 8,405,221 | 6,991,682 |
Change in trade and other receivables and prepayments | 4,212,448 | (3,504,180) |
Change in other taxes receivable | 1,612,082 | 2,679,345 |
Change in inventories and short-term biological assets | 3,013,161 | (7,695,258) |
Change in trade and other payables | (4,788,175) | 20,241,772 |
Change in other taxes payable | (2,553,227) | (2,417,819) |
Change on other current assets | 1,926,698 | - |
Cash generated from operations | 11,828,208 | 16,295,542 |
Income tax paid | (1,580,066) | (291,696) |
Net cash from operating activities | 10,248,142 | 16,003,846 |
Appendix 4. Consolidated statement of cash flows for the Three months ended 31 March 2024 (in RUB thousand) - NOT IFRS PRESENTATION (*)
Three months ended | ||
| 31 March 2024 | 31 March 2023 |
Cash flows from investing activities |
| |
Purchases of property, plant and equipment | (6,224,351) | (1,999,800) |
Purchases of other intangible assets | (122,708) | (289,137) |
Purchases of land lease rights | (7,560) | (7,743) |
Proceeds from sales of property, plant and equipment | 41,779 | 3,407 |
Purchases of inventories intended for construction | (46,271) | (89,445) |
Purchases of associates | - | (33,000) |
Other investing activities | 37,975 | 126,307 |
Net cash from investing activities | (6,321,136) | (2,289,411) |
Cash flows from financing activities |
| |
Proceeds from borrowings | 5,327,310 | 4,283,066 |
Repayment of borrowings | (5,389,418) | (27,907,485) |
Interest paid | (983,694) | (1,273,985) |
Change in cash on bank deposits | (13,433,635) | 16,450,000 |
Loans given* | (896) | (190,666) |
Loans repaid* | 65 | 3,500 |
Interest received* | 1,267,470 | 1,883,193 |
Proceeds from government grants | 358 | 47,624 |
Purchases of non-controlling interest | (5) | - |
Repayment of lease libilities - principal | (406,745) | (23,783) |
Net cash from financing activities | (13,619,190) | (6,728,536) |
Net effect of exchange rate changes on cash and cash equivalents | (99,748) | 1,932,769 |
Net increase/ (decrease) in cash and cash equivalents | (9,791,932) | 8,918,668 |
Cash and cash equivalents at the beginning of the period | 25,936,781 | 21,473,030 |
Cash and cash equivalents at the end of the period | 16,144,849 | 30,391,698 |
(*) For the purpose of conformity with the methodology of the Group's net debt calculation investments in financial assets related to financial activities are presented in Cash flows from financing activities in the Group's management accounts.