REG - Ros Agro PLC - 4TH QUARTER FINANCIAL RESULTS
04/03/2024 07:00
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RNS Number : 4272F Ros Agro PLC 04 March 2024
4 March 2024
ROS AGRO PLC financial results for 12M 2023 and 4Q 2023
4 March 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 third quarter and the nine months ended 31 December 2023.
12M 2023 HIGHLIGHTS:
- Sales amounted to RUB 277,328 million (US$ 3,252 million(1)), an
increase of RUB 37,098 million (+15%) compared to 2022;
- Adjusted EBITDA(2) amounted to RUB 56,560 million (US$ 663 million),
an increase of RUB 11,545 million (+26%) compared to 2022;
- Adjusted EBITDA margin increased to 20% in 2023 from 19% in 2022;
- Net profit for the period amounted to RUB 48,706 million (US$ 571
million), an increase of RUB 41,920 million (+618%);
- Net debt position(3) as of 31 December 2023 amounted to RUB 66,476
million (US$ 741 million);
- Net Debt/Adjusted EBITDA (LTM(4)) as of 31 December 2023 was 1.18x.
Commenting on the results, Timur Lipatov, CEO of Rusagro, said:
"In 2023 Rusagro has demonstrated record financial results in terms of
revenue, adjusted EBITDA and net profit. Revenue increased by 15%, adjusted
EBITDA has grown by 126%, net profit amounted to RUB 48.7 billion and net debt
decreased by 33%.
Revenue of all business segments, except Oil and Fat, increased in 2023 with
the most significant contribution of Agricultural segment, where higher
volumes were sold, and Sugar segment, where both sales volumes and prices
increased. Oil and Fat segment's revenue decreased due to the fall of world
prices for oil and fat products as well as lower production volumes caused by
the suspension of the oil extraction plant in Balakovo for modernization,
which was completed in August 2023 and led to the increase in the production
capacity by 30%.
The acquisition of NMGK business brings Rusagro significant synergies, which
also are reflected in the Group's financial results.
Rusagro Group's adjusted EBITDA in 2023 improved across all business segments,
except Oil and Fat, mostly attributable to increased sales volumes supported
by higher prices following the USD to RUB exchange rate while costs growth was
contained on the Group level.
Net profit of the Group increased due to higher Adjusted EBITDA, positive
exchange rate dynamics and the consolidation of the financial results of
NMGK."
Key consolidated financial performance indicators
in RUB million Year ended Variance Three months ended Variance
31 December 2023 31 December 2022 Units % 31 December 2023 31 December 2022 Units %
Sales 277,328 240,230 37,098 15 99,105 58,204 40,901 70
Gross profit (1) 76,057 47,252 28,805 61 26,397 6,664 19,733 296
Gross margin, % 27% 20% 7 pp 27% 11% 16 pp
Adjusted EBITDA (1) 56,560 45,015 11,545 26 25,927 9,645 16,282 169
Adjusted EBITDA margin, % 20% 19% 1 pp 26% 17% 9 pp
Net profit for the 48,706 6,787 41,920 618 10,181 4,605 5,577 121
period (1,2)
Net profit 18% 3% 15 pp 10% 8% 2 pp
margin %
( )
( )
(1) Several adjustments were made to the published 9M and 3Q 2022 key
financial indicators:
• Gross profit and Net profit for 4Q 2022 was decreased by RUB 1,057
million and RUB 845 million correspondingly to reflect the distribution of
depreciation expenses in Oil and Fat segment between the quarters of 2022;
• Gross profit for 4Q 2022 was increased by RUB 572 million to reflect
the distribution of depreciation expenses in Meat segment between the quarters
of 2022;
(2) 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 Year ended Variance Three months ended Variance
31 December 2023 31 December 2022 Units % 31 December 2023 31 December 2022 Units %
Sales, incl. 277,328 240,230 37,098 15 99,105 58,204 40,901 70
Sugar 64,781 49,584 15,197 31 27,492 11,904 15,587 131
Meat 48,462 43,705 4,757 11 12,899 11,910 989 8
Agriculture 56,919 31,993 24,926 78 33,130 14,870 18,259 123
Oil and Fat 108,746 133,369 (24,623) (18) 32,603 31,003 1,599 5
NMGK 31,202 - 31,202 - 16,230 - 16,230 -
Other 1,960 1,408 552 39 498 495 3 1
Eliminations (34,742) (19,829) (14,912) (75) (23,747) (11,980) (11,768) (98)
Gross profit, incl. 76,057 47,252 28,805 61 26,397 6,664 19,733 296
Sugar 22,629 19,941 2,689 13 9,552 3,800 5,752 151
Meat 8,187 (2,539) 10,726 - 2,220 (1,947) 4,168 -
Agriculture 18,272 7,195 11,077 154 6,220 (2,447) 8,667 -
Oil and Fat 21,261 23,418 (2,158) (9) 5,665 7,664 (1,999) (26)
NMGK 8,479 - 8,479 - 3,408 - 3,408 -
Other 588 447 141 31 105 250 (145) (58)
Eliminations (3,359) (1,211) (2,148) (177) (773) (655) (118) (18)
Adjusted EBITDA, incl. 56,560 45,015 11,545 26 25,927 9,645 16,282 169
Sugar 19,171 15,695 3,476 22 7,790 1,640 6,150 375
Meat 5,010 1,622 3,389 209 1,721 612 1,110 181
Agriculture 16,961 9,755 7,206 74 12,585 3,010 9,575 318
Oil and Fat 13,492 15,950 (2,458) (15) 3,933 5,239 (1,307) (25)
NMGK 5,191 - 5,191 - 2,446 - 2,446 -
Other (1,443) (1,331) (111) (8) (471) (255) (216) (85)
Eliminations (1,822) 3,325 (5,147) - (2,077) (600) (1,476) (246)
Adjusted EBITDA margin, % 20% 19% 1 pp 26% 17% 9 pp
Sugar 30% 32% (2) pp 28% 14% 15 pp
Meat 10% 4% 7 pp 13% 5% 8 pp
Agriculture 30% 30% (1) pp 38% 20% 18 pp
Oil and Fat 12% 12% 0 pp 12% 17% (5) pp
NMGK 17% - - 15% - -
SUGAR SEGMENT
In 12M 2023 Sugar segment earned RUB 19,171 million of adjusted EBITDA (+22%
y-o-y) with 30% margin (-2 pp y-o-y).
The financial results of the Sugar Segment of 12M 2023 and 4Q 2023 compared to
12M 2022 and 4Q 2022 are presented in the table below:
Sugar segment 12M and 4Q 2023 Financial Results
in RUB million Year ended Variance Three months ended Variance
31 December 2023 31 December 2022 Units % 31 December 2023 31 December 2022 Units %
Sales 64,781 49,584 15,197 31 27,492 11,904 15,587 131
Cost of sales (42,151) (29,643) (12,508) (42) (17,940) (8,104) (9,835) (121)
Gross profit 22,629 19,941 2,689 13 9,552 3,800 5,752 151
Gross profit margin 35% 40% (5) pp 35% 32% 3 pp
Distribution and selling expenses (4,486) (4,833) 347 7 (1,991) (2,151) 161 7
General and administrative expenses (1,629) (1,757) 129 7 (420) (498) 78 16
Other operating income/ (expenses), net 602 (294) 897 - 132 31 102 331
incl. Reimbursement of operating costs (government grants) 222 158 64 41 130 14 116 836
incl. other adjustments to EBITDA (non-recurring items) 77 (305) 381 - 3 74 (71) (96)
Operating profit 17,117 13,056 4,061 31 7,274 1,182 6,092 515
Adjusted EBITDA 19,171 15,695 3,476 22 7,790 1,640 6,150 375
Adjusted EBITDA margin 30% 32% (2) pp 28% 14% 15 pp
In 4Q 2023 and 12M 2023 compared to the respective periods of 2022 Sales of
Sugar segment increased by 131% and 31%, correspondingly, mainly due to the
growth of sugar sales volumes supported by the growth of market prices. Sales
volume growth is attributable to the increase in production volumes and higher
export.
Production and sales volume of sugar in 12M and 4Q 2023
Nine months ended Variance Three months ended Variance
31 December 2023 31 December 2022 Units % 31 December 2023 31 December 2022 Units %
Sugar production volume, 928 770 157 20 600 492 108 22
thousand tonnes
Sales volume, 1,065 850 215 25 477 214 262 122
thousand tonnes
Cost of sales in 4Q 2023 increased following the growth of production volumes
and sugar beet prices of new season 2023-2024. Cost of sales increased in 2023
compared to 2022 following the growth of volumes as well as higher sugar beet
and its processing costs per unit of sugar because of lower quality and sugar
content of beet in season 2022-2023 compared to the previous season.
Other operating income/ (expenses), net in 4Q and 12M 2023 increased mainly
due to the positive dynamics of the operating forex differences and the gain
from forward contracts for the purchase of foreign currency.
MEAT SEGMENT
In 12M 2023 Meat segment earned RUB 5,010 million of adjusted EBITDA (+209%
y-oy) with 10% margin (+7 pp y-o-y).
The financial results of the Meat segment of 12M 2023 and 4Q 2023 compared to
12M 2022 and 4Q 2022 respectively are presented in the table below.
Meat segment 12M and 4Q 2023 Financial Results
in RUB million Year ended Variance Three months ended Variance
31 December 2023 31 December 2022 Units % 31 December 2023 31 December 2022 Units %
Sales 48,462 43,705 4,757 11 12,899 11,910 989 8
Net gain/ (loss) on revaluation of biological assets and agricultural produce 2,747 (2,094) 4,841 - (590) (1,764) 1,174 67
Cost of sales (43,022) (44,150) 1,129 3 (10,089) (12,093) 2,004 17
Gross profit 8,187 (2,539) 10,726 - 2,220 (1,947) 4,168 -
Gross profit margin 17% (6%) 23 pp 17% (16%) 33 pp
Gross profit excl. effect of biological assets and agricultural produce 5,441 (445) 5,886 - 2,811 (183) 2,994 -
revaluation
Adjusted gross profit margin 11% (1%) 12 pp 22% (2%) 24 pp
Distribution and selling expenses (1,790) (1,716) (74) (4) (583) (442) (141) (32)
General and administrative expenses (2,430) (1,922) (508) (26) (663) (792) 128 16
Other operating income/ (expenses), net (274) 1,389 (1,662) - (597) 693 (1,289) -
incl. Reimbursement of operating costs (government grants) 165 418 (253) (60) 138 403 (264) (66)
incl. Other adjustments to EBITDA (non-recurring items) 445 676 (231) (34) 151 133 18 13
Operating profit 3,694 (4,788) 8,482 - 378 (2,489) 2,866 -
Adjusted EBITDA 5,010 1,622 3,389 209 1,721 612 1,110 181
Adjusted EBITDA margin 10% 4% 7 pp 13% 5% 8 pp
Sales of the Meat segment increased by 8% in 4Q 2023 compared to the
respective period of 2022 mainly due to increase of sales prices for both meat
products and livestock.
In 12M 2023 compared to the same period in 2022 Sales of Meat segment
increased by 11% supported by the higher sales prices for meat products.
Production and sales volume of pork products in 12M and 4Q 2023
Year ended Variance Three months ended Variance
31 December 2023 31 December 2022 Units % 31 December 2023 31 December 2022 Units %
Pigs production, 334 336 (2) (1) 80 91 (11) (12)
thousand tonnes in live weight
Sales volume, 279 281 (2) (1) 66 77 (11) (14)
thousand tonnes
Cost of sales decreased by 17% in 4Q 2023 compared to the respective period of
2022 due to lower sales volumes. In 12M 2023 compared to the respective period
of 2022 Cost of sales decreased by 3% following the lower sales volumes.
Net loss on revaluation of biological assets and agricultural produce in 4Q
2023 resulted from the decrease in fair value of consumable livestock pigs
while costs for consumable livestock pigs remained stable. Net gain on
revaluation of biological assets and agricultural produce in 12M 2023 resulted
from the increase in fair value and at the same time the decrease in costs for
consumable livestock pigs during the reporting period compared to the
respective figures at the beginning of 2023.
Other operating expenses in 4Q 2023 and 12M 2023 showed negative dynamics
mainly due to additional costs caused by the outbreak of African swine fever
and one-off gain for the reversal of provision for legal claims and government
grants for part of the cost of livestock feed in 2022.
AGRICULTURAL SEGMENT
As at 31 December 2023 Rusagro's area of controlled land stands at 685
thousand hectares
(31 December 2022: 660 thousand hectares).
The financial results of the Agricultural Segment of 12M 2023 and 4Q 2023
compared to 12M 2022 and 4Q 2022 respectively are presented below.
Agriculture segment 12M and 4Q 2023 Financial Results
in RUB million Year ended Variance Three months ended Variance
31 December 2023 31 December 2022 Units % 31 December 2023 31 December 2022 Units %
Sales 56,919 31,993 24,926 78 33,130 14,870 18,259 123
Net gain/ (loss) on revaluation of biological assets and agricultural produce (1,957) (4,312) 2,356 55 (7,503) (5,697) (1,805) (32)
Cost of sales (36,690) (20,485) (16,204) (79) (19,407) (11,620) (7,787) (67)
Gross profit 18,272 7,195 11,077 154 6,220 (2,447) 8,667 -
Gross profit margin 32% 22% 10 pp 19% -16% 35 pp
Gross profit excl. effect of biological assets and agricultural produce 20,229 11,508 8,721 76 13,722 3,250 10,472 322
revaluation
Adjusted gross profit margin 36% 36% 0 pp 41% 22% 19 pp
Distribution and selling expenses (6,043) (2,788) (3,254) (117) (2,934) (1,017) (1,917) (188)
General and administrative expenses (1,876) (1,852) (24) (1) (647) (693) 46 7
Share-based remuneration - - - - - - - -
Other operating income/ (expenses), net 1,233 1,246 (13) (1) 578 647 (69) (11)
incl. Reimbursement of operating costs (government grants) 845 446 399 89 290 384 (93) (24)
incl. Other adjustments to EBITDA (non-recurring items) 293 550 (257) (47) 306 219 87 40
Operating profit 11,587 3,801 7,786 205 3,218 (3,510) 6,728 -
Adjusted EBITDA 16,961 9,755 7,206 74 12,585 3,010 9,575 318
Adjusted EBITDA margin 30% 30% (1) pp 38% 20% 18 pp
In 12M 2023 Agriculture segment earned RUB 16,961 million of adjusted EBITDA
(+74%
y-o-y) with 30% margin (-1 pp y-o-y).
In 4Q 2023 in comparison to 4Q 2022 Sales of the Agriculture segment increased
by 123% to RUB 33,130 million mainly due to higher sales volumes of sugar beet
and soybean.
In 2023 compared to 2022 Sales of Agriculture segment increased by 78% to RUB
56,919 million mainly due to higher sales volumes of all crops and the
increase in sugar beet price, compensated by the decrease in soybean, wheat
and sunflower prices.
Increase in sales volumes of sugar beet in 4Q 2023 and 12M 2023 is
attributable to higher yields and larger area of cultivation as well as the
shift of harvesting in 2022 to 2023. Sugar beet sales prices increased
following the sugar prices dynamics.
Increase in sales volumes of soybean in 4Q 2023 and 12M 2023 is mainly caused
by the shift in harvesting from 2022 to 2023 due to bad weather conditions, as
well as increased yields in 2023. The growth of sunflower sales volumes is
also attributable to the shift of harvesting in 2022.
Increase in sales of wheat in 12M 2023 was caused by sales of carryover stocks
from previous year.
Sales prices for wheat decreased due to the fall in global wheat prices
because of high grain stocks. Prices decrease for oil crops is attributed to
the quality of harvest following adverse weather conditions during the
prolonged harvesting period.
Sales volumes of crops in 12M and 4Q 2023
Thousand tonnes Year ended Variance Three months ended Variance
31 December 2023 31 December 2022 Units % 31 December 2023 31 December 2022 Units %
sugar beet 5,394 3,247 2,147 66 3,797 2,458 1,339 54
wheat 942 817 125 15 366 524 (158) (30)
soybean 511 148 363 245 264 4 260 7,163
corn 177 162 15 9 32 27 5 18
sunflower seeds 137 23 115 505 79 1 77 5,725
The main reason for the increase in Cost of sales and Distribution and selling
expenses is the growth of volumes of goods sold.
Reimbursement of operating costs (government grants) was received in higher
amount in 12M 2023 as the Company received subsidies for grain crops sales,
support of elite seed and ameliorants usage.
Change in Other operating income except government grants in 12M 2023 in
comparison to the same period of 2022 is mainly due to the one-off gain from
sale of fixed assets in 1Q 2022.
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 4Q 2023 and 4Q 2022 resulted from the realization of gain on
revaluation of agricultural produce to fair value less costs to sell
recognized in 3Q 2023 and 3Q 2022, correspondingly. In 4Q 2023 the loss from
gain realization is higher compared to 4Q 2022 following the increase in sales
volumes. Net loss in 12M 2023 is lower than net loss in 12M 2022 because
opening balance of revaluation was higher at the beginning of 2022 than at the
beginning of 2023.
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 12M 2023 Oil and Fat segment earned RUB 13,492 million of adjusted EBITDA
(-15 %
y-o-y) with 12% margin (without changes compared to the previous year).
The financial results of the Oil and Fat Segment for 12M 2023 and 4Q 2023
compared to 12M 2022 and 4Q 2022 respectively are presented below.
Oil and Fat segment 12M and 4Q 2023 Financial Results
in RUB million Year ended Variance Three months ended Variance
31 December 2023 31 December 2022 Units % 31 December 2023 31 December 2022 Units %
Sales 108,746 133,369 (24,623) (18) 32,603 31,003 1,599 5
Cost of sales (87,486) (109,951) 22,465 20 (26,938) (23,339) (3,598) (15)
Gross profit 21,261 23,418 (2,158) (9) 5,665 7,664 (1,999) (26)
Gross profit margin 20% 18% 2 pp 17% 25% (8) pp
Distribution and selling expenses (8,066) (9,038) 972 11 (2,357) (3.033) 677 22
General and administrative expenses (3,710) (3,080) (629) (20) (962) (885) (77) (9)
Other operating income/ (expenses), net (264) (2,158) 1,895 88 951 325 626 193
incl. Reimbursement of operating costs (government grants) 312 322 (10) (3) 72 78 (5) (7)
incl. Other adjustments to EBITDA (non-recurring items) 278 (2,266) 2,544 - 691 147 543 369
Operating profit 9,221 9,141 80 1 3,296 4,070 (774) (19)
Adjusted EBITDA 13,492 15,950 (2,458) (15) 3,933 5,239 (1,307) (25)
Adjusted EBITDA margin 12% 12% 0 pp 12% 17% (5) pp
In 4Q 2023 Sales of Oil and Fat segment increased in comparison to 4Q 2022
mainly because of the increase in sales volumes of bulk oil after the
completion of modernization of oil extraction plant in Balakovo, which led to
growth in production capacity and production volumes. Also Sales increased
following higher oil prices supported by the growth USD to RUB exchange rate.
In 2023 Sales of the Oil and Fat segment decreased compared to 2022 (by 18% to
RUB 108 746 million) mainly because of the decrease of world prices for oil
and fat products and of bulk oil and meal sales volumes, which was partially
compensated by the increase in sales volumes of industrial fats.
Decrease in sales volumes of bulk oil and meal was caused by difficulties with
the vessels shipment caused by ice situation in Astrakhan in January and
February 2023 and the suspension of Balakovo oil extraction plant for
modernization from 23 May 2023 till 28 August 2023.
Sales volumes of oil and fat and dairy products in 12M and 4Q 2023
Thousand tonnes Year ended Variance Three months ended Variance
31 December 2023 31 December 2022 Units % 31 December 2023 31 December 2022 Units %
meal 509 601 (92) (15) 162 131 32 24
crude oil 314 369 (54) (15) 108 84 23 28
industrial fats 316 298 19 6 80 84 (4) (5)
dry whey mixes 14 16 (3) (17) 4 4 0 5
consumer oil&fat products 296 304 (8) (3) 88 94 (6) (7)
consumer dairy 17 15 2 12 4 4 1 23
products
The growth of Cost of sales in 4Q 2023 compared to the same period of the
previous year is due to the increase in sales volumes as well as the growth of
palm oil prices following the dynamics of USD to RUB exchange rate.
The decrease of Cost of sales in 2023 is caused by the decline in sales
volumes of oil and fat products. Cost of sales decreased more than Sales
mainly due to reduction of prices for sunflower seeds.
The growth of General and administrative expenses in 2023 compared to the same
period of the previous year is mainly attributable to higher costs of
information and consulting services.
The decrease of Other operating expenses is due to lower charity expenses and
positive exchange dynamics in 12M 2023 compared to the same period in 2022,
which was partially compensated by accrual of provision for bad debts.
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 for 12M 2023
include the financial results of the NMGK Group starting from the acquisition
for 3Q 2023 and 4Q 2023.
For 12M 2023* the revenue of the NMGK Group of companies amounted to RUB
31,202 million, adjusted EBITDA amounted to RUB 5,191 million with a margin of
17%.
The financial results of NMGK as a part of Rusagro for 4Q 2023 and 12M 2023*
are presented in the table below.
NMGK 12M and 4Q 2023 Financial Results
in RUB million Year ended Three months ended
31 December 2023 31 December 2022 31 December 2023 31 December 2022
Sales 31,202 - 16,230 -
Cost of sales (22,723) - (12,822) -
Gross profit 8,479 - 3,408 -
Gross profit margin 27% - 21% -
Distribution and selling expenses (3,482) - (1,435) -
General and administrative expenses (1,299) - (741) -
Other operating income/ (expenses), net (123) - (157) -
incl. Other adjustments to EBITDA (non-recurring items) (189) - (203) -
Operating profit 3,575 - 1,075 -
Adjusted EBITDA 5,191 - 2,446 -
Adjusted EBITDA margin 17% - 15% -
Sales volumes of NMGK oil and fat products in 12M and 4Q 2023
Thousand tonnes Year ended Three months ended
31 December 2023 31 December 2022 31 December 2023 31 December 2022
Meal 145 - 80 -
Crude oil 107 - 47 -
Industrial fats 32 - 15 -
Oil & fat products 112 - 57 -
(*) NMGK results have been presented since the acquisition of control - for Q3
2023 and Q4 2023
KEY CONSOLIDATED CASH FLOW INDICATORS (NOT IFRS PRESENTATION*)
The key consolidated cash flow indicators presented according to management
accounts methodology
in RUB million Year ended Variance Three months ended Variance
31 December 2023 31 December 2022 Units % 31 December 2023 31 December 2022 Units %
Net cash from operating activities, incl. 53,330 4,423 48,907 1,106 5,951 (3,495) 9,446 -
Operating cash flow before working capital changes 57,203 41,074 16,129 39 25,921 8,647 17,274 200
Working capital changes 2,201 (34,205) 36,406 - (16,605) (11,209) (5,396) (48)
Net cash from investing activities, incl. (22,815) (11,967) (10,848) (91) (7,195) (5,214) (1,980) (38)
Purchases of property, plant and equipment and inventories intended for (18,351) (11,973) (6,377) (53) (14,418) (4,331) (10,087) (233)
construction
Acquisition of SolPro assets - - - - - - - -
Net cash from financing activities (31,742) (6,572) (25,170) (383) 3,625 (35,320) 38,945 -
Net effect of exchange rate changes on cash and cash equivalents 5,691 (10,873) 16,564 - (940) 6,303 (7,244) -
Net (decrease) / increase in cash and cash equivalents 4,464 (24,989) 29,453 - 1,440 (37,727) 39,167 -
(*) See Appendix 4
Debt position and liquidity management
in RUB million 31 December 2023 31 December 2022 Variance
Units %
Gross debt 127,533 233,390 (105,857) (45)
Short-term borrowings 68,035 172,352 (104,317) (61)
Long-term borrowings 59,498 61,038 (1,540) (3)
Cash and cash equivalents, bank deposits and bonds (61,057) (133,668) 72,611 54
Short-term cash, deposits and bonds (27,086) (99,697) 72,611 73
Long-term cash, deposits and bonds (33,971) (33,971) 0 0
Net debt 66,476 99,723 (33,247) (33)
Short-term borrowings, net 40,949 72,655 (31,706) (44)
Long-term borrowings, net 25,527 27,067 (1,540) (6)
Adjusted EBITDA (LTM(4)) 56,560 45,015 11,545 26
Net debt/ Adjusted EBITDA (LTM) 1.18 2.22 (-1) pp
Net finance income / (expense):
in RUB million Year ended Variance Three months ended Variance
31 December 2023 31 December 2022 Units % 31 December 2023 31 December 2022 Units %
Net interest expense (7,173) (7,865) 693 9 (1,607) (2,090) 483 23
Gross interest expense (18,911) (20,784) 1,873 9 (6,055) (5,851) (204) (3)
Reimbursement of interest expense 11,739 12,919 (1,180) (9) 4,448 3,762 686 18
Interest income 10,322 9,398 924 10 2,481 2,848 (368) (13)
Other financial expenses, net 5,790 (12,188) 17,978 - (3,421) 5,964 (9,385) -
Net foreign exchange gains / (losses) 6,906 (11,510) 18,416 - (3,053) 6,213 (9,266) -
Other financial income/ (expenses), net (1,116) (678) (438) (65) (368) (249) (119) (48)
Total net finance income / (expense) 8,940 (10,654) 19,594 - (2,547) 6,724 (9,271) -
Net debt decreased at 31 December 2023 compared at 31 December 2022 by 33%.
In 12M 2023 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 12M 2023 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 expense of 12M 2022 in the sum of RUB 10,654 million changed to
net finance income in the amount of RUB 8,940 million as the result of
positive dynamics in forex differences.
________________________________
(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 685 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 12M and 4Q
2023 financial results for investors and analysts.
Details of the call:
Date: 4 March 2024
Time: 4:00 PM (Moscow) / 2:00 PM (London)
Subject: ROS AGRO PLC 12M and 4Q 2023 Financial results
Registration: available up to 3:00 PM Moscow time / 1:00 PM London time on 4 March
https://us06web.zoom.us/webinar/register/WN_SpicMuM2Tbyu91a3lyKFjg
(https://us06web.zoom.us/webinar/register/WN_SpicMuM2Tbyu91a3lyKFjg)
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 relate
to 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 out
in 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 events
or 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 Year and
Three months ended 31 December 2023 (in RUB thousand)
Twelve months ended Three months ended
31 December
31 December
2023 2022 2023 2022
Sales 277,328,308 240,230,251 99,104,775 58,203,644
Net gain / (loss) on revaluation of biological assets and agricultural produce 3,698,693 (8,542,435) (4,934,583) (6,455,205)
Cost of sales (204,970,260) (184,436,046) (67,773,190) (45,084,170)
Gross profit 76,056,536 47,251,770 26,397,002 6,664,269
Distribution and selling expenses (20,379,110) (16,851,961) (7,855,928) (5,883,086)
General and administrative expenses (11,143,940) (9,071,112) (3,524,637) (2,907,786)
Other operating income/(expenses), net 3,386,834 (2,194,559) 235,420 1,903,742
Operating profit 47,928,303 19,059,782 15,259,840 (297,217)
Interest expense (7,172,633) (7,865,190) (1,606,694) (2,089,513)
Interest income 10,322,249 9,397,651 2,480,637 2,848,254
Net gain / (loss) from bonds held for trading - 1,063 - 1,021
Other financial income/ (expenses), net 5,790,190 (12,187,973) (3,420,780) 5,963,935
Profit / (loss) before taxation 56,868,109 8,405,333 12,713,003 6,426,480
Income tax expense (8,161,660) (1,618,793) (2,495,802) (1,821,877)
Profit for the period 48,706,449 6,786,540 10,217,201 4,604,603
Other comprehensive income:
Total comprehensive income/ (loss) for the period 48,706,449 6,786,540 10,217,201 4,604,603
Profit / (loss) is attributable to:
Owners of ROS AGRO PLC 46,501,167 6,763,338 9,810,830 4,621,602
Non-controlling interest 2,205,282 23,202 406,371 (16,999)
Profit / (loss) for the period 48,706,449 6,786,540 10,217,201 4,604,603
Total comprehensive income/ (loss) is attributable to:
Owners of ROS AGRO PLC 46,501,167 6,763,338 9,810,830 4,621,602
Non-controlling interest 2,205,282 23,202 406,371 (16,999)
Total comprehensive income/ (loss) for the period 48,706,449 6,786,540 10,217,201 4,604,603
Earnings per ordinary share for profit attributable to the equity holders of 1,728.27 251.37 364.63 171.77
ROS AGRO PLC, basic and diluted (in RR per share)
Appendix 2. Segment information for the Year ended 31 December 2023 (in RUB
thousand)
12М 2023 Sugar Meat Agriculture Oil and Fat NMGK Other Eliminations Total
Sales 64,780,529 48,462,322 56,918,979 108,746,467 31,201,619 1,959,929 (34,741,537) 277,328,308
Net gain/ (loss) on revaluation of biological assets and agricultural produce - 2,746,737 (1,956,844) - - - 2,908,800 3,698,693
Cost of sales (42,151,266) (43,021,660) (36,689,851) (87,485,863) (22,722,813) (1,372,408) 28,473,601 (204,970,260)
incl. Depreciation (2,068,084) (4,374,682) (3,245,776) (3,795,050) (1,289,812) (20,210) (102,652) (14,896,266)
Net loss from trading derivatives - - (205) - - - - (205)
Gross profit / (loss) 22,629,263 8,187,399 18,272,079 21,260,604 8,478,806 587,521 (3,359,136) 76,056,536
Distribution and Selling, General and administrative expenses (6,114,655) (4,219,713) (7,918,620) (11,775,958) (4,780,794) (2,036,423) 5,323,113 (31,523,050)
incl. Depreciation (63,043) (132,991) (464,538) (753,773) (137,947) (105,845) 102,652 (1,555,485)
Other operating income/(expenses), net 602,220 (273,738) 1,233,342 (263,619) (123,150) 11,397,245 (9,185,466) 3,386,834
incl. Reimbursement of operating costs (government grants) 221,704 165,233 844,744 311,801 - - - 1,543,482
incl. Other adjustments to EBITDA (non-recurring items) 76,912 444,824 293,085 277,860 (188,796) 11,517,751 (8,308,285) 4,113,351
(Provision)/reversal of provision for impairment of loans issued - - - - - 7,983 - 7,983
Operating profit / (loss) 17,116,828 3,693,948 11,586,801 9,221,027 3,574,862 9,956,326 (7,221,489) 47,928,303
Adjustments:
Depreciation included in Operating profit 2,131,127 4,507,673 3,710,314 4,548,823 1,427,759 126,055 - 16,451,751
Other adjustments to EBITDA (non-recurring items) (76,912) (444,824) (293,085) (277,860) 188,796 (11,517,751) 8,308,285 (4,113,351)
Net gain/ (loss) on revaluation of biological assets and agricultural produce - (2,746,737) 1,956,844 - - - (2,908,800) (3,698,693)
Provision/(reversal of provision) for impairment of loans issued - - - - - (7,983) - (7,983)
Adjusted EBITDA* 19,171,043 5,010,060 16,960,874 13,491,990 5,191,417 (1,443,353) (1,822,004) 56,560,027
Appendix 2 (continued). Segment information for the Year ended 31 December
2023 (in RUB thousand)
12M 2022 Sugar Meat Agriculture Oil and Fat Other Eliminations Total
Sales 49,583,897 43,705,021 31,993,259 133,369,020 1,408,265 (19,829,211) 240,230,251
Net gain/ (loss) on revaluation of biological assets and agricultural produce - (2,094,398) (4,312,350) - - (2,135,687) (8,542,435)
Cost of sales (29,643,242) (44,149,262) (20,485,426) (109,950,614) (961,422) 20,753,920 (184,436,046)
incl. Depreciation (2,270,594) (4,951,716) (1,695,446) (3,761,053) (18,175) (175,610) (12,872,594)
Gross profit / (loss) 19,940,655 (2,538,639) 7,195,483 23,418,406 446,843 (1,210,978) 47,251,770
Distribution and Selling, General and administrative expenses (6,590,185) (3,638,654) (4,640,663) (12,118,669) (2,001,255) 3,066,353 (25,923,073)
incl. Depreciation (63,607) (39,905) (496,419) (781,207) (83,424) 175,610 (1,288,952)
Other operating income/(expenses), net (294,339) 1,388,504 1,246,170 (2,158,484) 15,093,839 (17,470,249) (2,194,559)
incl. Reimbursement of operating costs (government grants) 157,532 417,824 445,978 322,154 - - 1,343,488
incl. Other adjustments to EBITDA (non-recurring items) (304,560) 675,718 549,976 (2,266,102) 14,972,443 (16,804,668) (3,177,193)
Operating profit / (loss) 13,056,131 (4,788,789) 3,800,990 9,141,253 13,465,071 (15,614,874) 19,059,782
Adjustments:
Depreciation included in Operating Profit 2,334,201 4,991,621 2,191,865 4,542,260 101,599 - 14,161,546
Other adjustments to EBITDA (non-recurring items) 304,560 (675,718) (549,976) 2,266,102 (14,972,443) 16,804,668 3,177,193
Net gain/ (loss) on revaluation of biological assets and agricultural produce - 2,094,398 4,312,350 - - 2,135,687 8,542,435
Adjusted EBITDA* 15,694,892 1,621,512 9,755,229 15,949,615 (1,331,417) 3,325,481 45,015,312
* Non-IFRS measure
Appendix 3. Consolidated statement of financial position as at 31 December
2023
(in RUB thousand)
31 December 2023 31 December 2022
ASSETS
Current assets
Cash and cash equivalents 25,936,781 21,473,030
Short-term investments 2,288,852 91,382,536
Trade and other receivables 47,861,374 24,176,680
Prepayments 10,814,811 13,435,149
Current income tax receivable 132,186 832,423
Other taxes receivable 9,006,784 8,360,935
Inventories and short-term biological assets 100,617,833 78,580,317
Other current assets 2,718,720 4,126,715
Total current assets 199,377,341 242,367,785
Non-current assets
Property, plant and equipment 141,897,092 121,165,803
Inventories intended for construction 465,830 864,550
Right-of-use assets 6,392,885 6,916,539
Goodwill 3,840,150 2,364,942
Advances paid for non-current assets 2,867,735 5,482,770
Long-term biological assets 2,736,644 3,240,959
Long-term investments and receivables 42,527,657 42,527,657
Investments in associates 562,323 455,916
Deferred income tax assets 2,532,975 5,964,527
Other intangible assets 7,765,853 1,284,263
Other non-current assets 0 190,978
Total non-current assets 211,589,144 190,458,904
Total assets 410,966,485 432,826,689
Appendix 3 (continued). Consolidated statement of financial position as at 31
December 2023 (in RUB thousand)
31 December 2023 31 December 2022
LIABILITIES and EQUITY
Current liabilities
Short-term borrowings 68,034,977 172,351,514
Lease liabilities 1,098,135 863,452
Trade and other payables 39,452,813 17,024,472
Provisions 123,212 137,542
Current income tax payable 555,913 76,061
Other taxes payable 5,458,529 8,149,780
Total current liabilities 114,723,579 198,602,821
Non-current liabilities
Long-term borrowings 59,498,119 61,038,393
Government grants 12,860,211 11,153,211
Lease liabilities 4,325,136 5,086,897
Deferred income tax liability 2,502,074 2,283,752
Total non-current liabilities 79,185,540 79,562,253
Total liabilities 193,909,119 278,165,074
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 173,344,692 126,843,525
Equity attributable to owners of ROS AGRO PLC 201,194,010 154,692,843
Non-controlling interest 15,863,356 (31,228)
Total equity 217,057,366 154,661,615
Total liabilities and equity 410,966,485 432,826,689
Appendix 4. Consolidated statement of cash flows for the Yaer ended 31
December 2023 (in RUB thousand) - NOT IFRS PRESENTATION (*)
Twelve months ended
31 December 2023 31 December 2022
Cash flows from operating activities
Profit/(loss) before income tax 56,868,110 8,405,333
Adjustments for:
Depreciation and amortization 16,451,751 14,161,544
Interest expense 18,911,361 20,783,744
Government grants (13,831,969) (14,935,568)
Interest income (10,322,249) (9,397,652)
Loss/ (gain) on disposal of property, plant and equipment (170,144) (340,308)
Net (gain) / loss on revaluation of biological assets and agricultural produce (3,698,693) 8,542,435
Change in provision for impairment of loans issued (7,983) 74,356
Interest expense on leases 638,821 690,914
Change in provision for net realisable value of inventory 1,203,415 657,857
Change in provision for impairment of receivables and prepayments 2,007,296 23,385
Foreign exchange (gain) / loss, net (9,775,893) 13,066,836
Lost / (reversal of) harvest write-off 1,090,868 598,041
Net (gain) / loss from bonds held for trading - (1,063)
Settlement of loans and accounts receivable previously written-off (31,906) -
Change in provision for impairment of advances paid for property, plant and 33,454 32,076
equipment
Change in other provisions (14,330) (357,167)
Dividend income (2,009,374) (397,362)
Loss on disposal of other assets - (21,698)
Loss on disposal of other assets 18,768 -
Gain on SolPro loans redemption (325,851) (563,487)
Other non-cash and non-operating expenses, net 167,233 51,704
Operating cash flow before working capital changes 57,202,685 41,073,920
Change in trade and other receivables and prepayments (14,929,809) (21,003,370)
Change in other taxes receivable 155,779 (39,742)
Change in inventories and short-term biological assets (7,423,487) (9,841,732)
Change in trade and other payables 23,606,148 1,414,887
Change in other taxes payable (2,253,880) 993,307
Change on other current assets 3,046,663 (5,727,866)
Cash generated from operations 59,404,099 6,869,404
Income tax paid (6,074,116) (2,446,340)
Net cash from operating activities 53,329,983 4,423,064
Appendix 4. Consolidated statement of cash flows for the Year ended 31
December 2023 (in RUB thousand) - NOT IFRS PRESENTATION (*)
Twelve months ended
31 December 2023 31 December 2022
Cash flows from investing activities
Purchases of property, plant and equipment (24,666,153) (11,718,704)
Purchases of other intangible assets (807,252) (925,855)
Purchases of land lease rights (23,229) (358,879)
Proceeds from sales of property, plant and equipment 712,005 486,542
Purchases of inventories intended for construction (310,135) (254,665)
Purchases of associates (106,407) (96,134)
Dividends received 2,009,374 722,768
Other investing activities 376,894 178,281
Net cash from investing activities (22,814,903) (11,966,646)
Cash flows from financing activities
Proceeds from borrowings 105,049,123 151,465,684
Repayment of borrowings (244,195,528) (93,010,994)
Interest paid (6,095,409) (7,028,058)
Change in cash on bank deposits 99,700,182 (58,841,928)
Proceeds from sales of bonds with maturity over three months* - 141,804
Loans given* (10,854) (24,866,023)
Loans repaid* 740,000 15,504,119
Interest received* 11,495,107 8,692,280
Proceeds from government grants 2,147,322 1,837,714
Repayment of lease libilities - principal (572,322) (466,795)
Other financial activities - (119)
Net cash from financing activities (31,742,379) (6,572,316)
Net effect of exchange rate changes on cash and cash equivalents 5,691,050 (10,873,251)
Net increase/ (decrease) in cash and cash equivalents 4,463,751 (24,989,149)
Cash and cash equivalents at the beginning of the period 21,473,030 46,462,179
Cash and cash equivalents at the end of the period 25,936,781 21,473,030
(*) 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.
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