Adecoagro recorded Adjusted EBITDA of $34.7 million in 1Q14, marking a 19.7% growth over 1Q13

May 14, 2014

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


Hernan Walker

IR Manager


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.

Source: PR Newswire

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