REG - Ros Agro PLC - Half-year Report
05/08/2024 10:45
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RNS Number : 1842Z Ros Agro PLC 05 August 2024
5 August 2024
ROS AGRO PLC financial results for 6M and 2Q 2024
5 August 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 second quarter and the six months ended 30 June 2024.
6M 2024 HIGHLIGHTS:
- Sales amounted to RUB 139,043 million (US$ 1,533 million(1)), an
increase of RUB 32,494 million (+30%) compared to 6M 2023;
- Adjusted EBITDA(2) amounted to RUB 13,802 million (US$ 152 million),
a decrease of RUB 1,804 million (-12%) compared to 6M 2023;
- Adjusted EBITDA margin decreased to 10% in 6M 2024 from 15% in 6M
2023;
- Net profit for the period amounted to RUB 3,485 million (US$ 38
million), a decrease of RUB 9,70 million (-74%) compared to 6M 2023;
- Net debt position(3) as of 30 June 2024 amounted to RUB 61,23
million (US$ 719 million);
- Net Debt/Adjusted EBITDA (LTM(4)) as of 30 June 2024 was 1.13x.
Commenting on the results, Timur Lipatov, CEO of Rusagro, said:
"In 6M 2024 Rusagro's revenue 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. The
dynamics of pork market prices positively impacted the revenue. The decrease
in Sugar segment revenue was the result of lower sales volumes due to lower
carryover stocks and reserving volumes of sugar for future deliveries under
long-term and high margin contracts. The decrease in Agriculture segment
revenue was due to a prolonged harvest in 2022 caused by adverse weather
conditions, which shifted sales to the first half of 2023.
Oil and Fat and Meat business demonstrated cumulative increase of adjusted
EBITDA by 92% following market conditions and growth in overall business
efficiency. In Sugar business we saw the decrease in adjusted EBITDA in the
period due to the sales of sugar produced in the winter months at a higher
cost of sales (due to high sugar prices in the autumn of 2023 as per
accounting policy). Agricultural business demonstrated the decrease of
adjusted EBITDA following the differences of carryover stocks in 2023 due to
prolonged harvesting.
Rusagro continues to demonstrate positive dynamics in net debt which decreased
by 7%. 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 Six months ended Variance Three months ended Variance
30 June 2024 30 June 2023 Units % 30 June 2024 30 June 2023 Units %
Sales 139,043 106,549 32,494 30 70,734 59,154 11,580 20
Gross profit 28,752 20,948 7,804 37 14,928 12,317 2,611 21
Gross margin, % 21% 20% 1 pp 21% 21% 0 pp
Adjusted EBITDA 13,802 15,606 (1,804) (12) 6,499 8,466 (1,968) (23)
Adjusted EBITDA margin, % 10% 15% (5) pp 9% 14% (5) pp
Net profit for the 3,485 13,191 (9,706) (74) 1,745 7,774 (6,029) (78)
period (1)
Net profit margin % 3% 12% (9) pp 2% 13% (11) 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 Six months ended Variance Three months ended Variance
30 June 2024 30 June 2023 Units % 30 June 2024 30 June 2023 Units %
Sales, incl. 139,043 106,549 32,494 30 70,734 59,154 11,580 20
Sugar 21,378 23,974 (2,595) (11) 8,949 14,563 (5,613) (39)
Meat 22,615 22,649 (33) (0) 12,009 11,923 86 1
Agriculture 8,616 11,559 (2,943) (25) 4,310 5,663 (1,353) (24)
Oil and Fat 90,107 51,399 38,708 75 46,995 28,042 18,953 68
Other 1,205 1,005 201 20 701 541 160 30
Eliminations (4,879) (4,036) (843) (21) (2,230) (1,578) (651) (41)
Gross profit, incl. 28,752 20,948 7,804 37 14,928 12,317 2,611 21
Sugar 3,081 8,114 (5,033) (62) 1,490 5,298 (3,808) (72)
Meat 3,096 2,547 549 22 1,084 1,403 (319) (23)
Agriculture 3,866 218 3,648 1,673 3,948 992 2,957 298
Oil and Fat 19,572 11,043 8,529 77 10,121 5,402 4,719 87
Other 146 435 (289) (66) 86 269 (183) (68)
Eliminations (1,010) (1,409) 399 28 (1,801) (1,047) (755) (72)
Adjusted EBITDA, incl. 13,802 15,606 (1,804) (12) 6,499 8,466 (1,968) (23)
Sugar 1,126 6,714 (5,588) (83) 342 4,704 (4,362) (93)
Meat 2,565 734 1,831 250 1,412 287 1,125 392
Agriculture (2,192) 1,116 (3,308) - (401) 1,233 (1,633) -
Oil and Fat 10,719 6,192 4,528 73 5,817 2,030 3,787 186
Other (1,383) (655) (727) (111) (783) (358) (426) (119)
Eliminations 2,966 1,504 1,462 97 112 570 (458) (80)
Adjusted EBITDA margin, % 10% 15% (5) pp 9% 14% (5) pp
Sugar 5% 28% (23) pp 4% 32% (28) pp
Meat 11% 3% 8 pp 12% 2% 9 pp
Agriculture (25%) 10% (35) pp (9%) 22% (31) pp
Oil and Fat 12% 12% (0) pp 12% 7% 5 pp
SUGAR SEGMENT
In 6M 2024 Sugar segment adjusted EBITDA comprised RUB 1,126 million (-83%
y-o-y) with 5% margin (-23 pp y-o-y).
The financial results of the Sugar segment of 6M 2024 and 2Q 2024 compared to
the respective periods of 2023 are presented in the table below:
Sugar segment 6M and 2Q 2024 Financial Results
in RUB million Six months ended Variance Three months ended Variance
30 June 2024 30 June 2023 Units % 30 June 2024 30 June 2023 Units %
Sales 21,378 23,974 (2,595) (11) 8,949 14,563 (5,613) (39)
Cost of sales (18,298) (15,860) (2,438) (15) (7,459) (9,265) 1,805 19
Gross profit 3,081 8,114 (5,033) (62) 1,490 5,298 (3,808) (72)
Gross profit margin 14% 34% (20) pp 17% 36% (19) pp
Distribution and selling expenses (2,232) (1,876) (356) (19) (1,271) (931) (340) (36)
General and administrative expenses (951) (768) (183) (24) (446) (373) (72) (19)
Other operating income/ (expenses), net (8) 221 (230) - 39 224 (185) (83)
incl. other adjustments to EBITDA (non-recurring items) (9) 62 (72) - (30) 41 (71) -
Operating profit (111) 5,691 (5,802) - (188) 4,218 (4,405) -
Adjusted EBITDA 1,126 6,714 (5,588) (83) 342 4,704 (4,362) (93)
Adjusted EBITDA margin 5% 28% (23) pp 4% 32% (28) pp
In 2Q 2024 compared to the respective period of 2023 Sales of Sugar segment
decreased by 39% mainly due to the decrease of sugar sales volume by 50% to
117 thousand tonnes. Sales volumes reduced in 2Q 2024 due to lower carryover
stocks and reserving volumes of sugar for future deliveries under long-term
and high margin contracts.
In 6M 2024 compared to the respective period of 2023 Sales of Sugar segment
decreased by 11% mainly due to the decrease of sugar sales volume by 20%.
Production and sales volume of sugar in 6M and 2Q 2024
Six months ended Variance Three months ended Variance
30 June 2024 30 June 2023 Units % 30 June 2024 30 June 2023 Units %
Sugar production volume, 183 104 79 76 54 35 19 54
thousand tonnes
Sales volume, 304 381 (77) (20) 117 233 (116) (50)
thousand tonnes
The Сost of sales in 6M 2024 increased compared to the respective period in
2023 following an increase in prices for sugar beet and increase in processing
and delivery costs.
The Cost of sales in 2Q 2024 compared to the respective period in 2023
decreased mainly due to the decrease of sugar sales volumes.
MEAT SEGMENT
In 6M 2024 Meat segment earned RUB 2,565 million of adjusted EBITDA (+250%
y-o-y) with 11% margin (+8 pp y-o-y).
The financial results of the Meat segment of 6M 2024 and 2Q 2024 compared to
6M 2023 and 2Q 2023 are presented in the table below:
Meat segment 6M and 2Q 2024 Financial Results
in RUB million Six months ended Variance Three months ended Variance
30 June 2024 30 June 2023 Units % 30 June 2024 30 June 2023 Units %
Sales 22,615 22,649 (33) (0) 12,009 11,923 86 1
Net gain/ (loss) on revaluation of biological assets and agricultural produce 17 2,272 (2,255) (99) (939) 945 (1,884) -
Cost of sales (19,536) (22,375) 2,839 13 (9,986) (11,465) 1,479 13
Gross profit 3,096 2,547 549 22 1,084 1,403 (319) (23)
Gross profit margin 14% 11% 3 pp 9% 12% (3) pp
Gross profit excl. effect of biological assets and agricultural produce 3,079 273 2,806 1,027 2,023 458 1,565 342
revaluation
Adjusted gross profit margin 14% 1% 13 pp 17% 4% 13 pp
Distribution and selling expenses (1,019) (766) (253) (33) (587) (451) (136) (30)
General and administrative expenses (1,146) (1,216) 70 6 (576) (616) 40 7
Other operating income/ (expenses), net 124 182 (57) (32) 6 (133) 138 -
incl. Reimbursement of operating costs (government grants) 3 23 (20) (86) 3 4 (1) (16)
incl. Other adjustments to EBITDA (non-recurring items) 83 215 (132) (61) 89 117 (28) (24)
Operating profit 1,055 746 309 41 (73) 204 (277) -
Adjusted EBITDA 2,565 734 1,831 250 1,412 287 1,125 392
Adjusted EBITDA margin 11% 3% 8 pp 12% 2% 9 pp
Sales of the Meat segment in 6M 2024 and 2Q 2024 stay at the same level as in
6M 2023 and 2Q 2023. The increase in prices for both meat products and
livestock pigs was offset by a decrease in sales volumes following lower
production volumes.
Production and sales volume of pork products in 6M and 2Q 2024
Six months ended Variance Three months ended Variance
30 June 2024 30 June 2023 Units % 30 June 2024 30 June 2023 Units %
Pigs production, 153 175 (22) (13) 79 86 (7) (8)
thousand tonnes in live weight
Sales volume, 121 146 (25) (17) 63 74 (11) (15)
thousand tonnes
Cost of sales in 2Q 2024 and 6M 2024 decreased by 13% compared to the
respective periods of 2023 following lower sales volumes.
Net loss on revaluation of biological assets and agricultural produce in 2Q
2024 resulted from the decrease in fair value of consumable livestock pigs and
at the same time the increase of costs for consumable livestock pigs increased
by the reporting date compared to the respective figures at the beginning of
2Q 2024. The increase of the fair value in 1Q 2024 was partly compensated by
its decrease in 2Q 2024 which affected Net gain on revaluation of biological
assets and agricultural produce in 6M 2024.
AGRICULTURAL SEGMENT
As at 30 June 2024 Rusagro's area of controlled land stands at 696 thousand
hectares
(31 December 2023: 685 thousand hectares).
In 6M 2024 Agriculture segment amounted to RUB -2,192 million of adjusted
EBITDA (in comparison with RUB 1,116 million in 6M 2023) with -25% margin (in
comparison with 10% in 6M 2023).
The financial results of the Agricultural segment of 6M and 2Q 2024 compared
to 6M and 2Q 2023 respectively are presented below.
Agriculture segment 6M and 2Q 2024 Financial Results
in RUB million Six months ended Variance Three months ended Variance
30 June 2024 30 June 2023 Units % 30 June 2024 30 June 2023 Units %
Sales 8,616 11,559 (2,943) (25) 4,310 5,663 (1,353) (24)
Net gain/ (loss) on revaluation of biological assets and agricultural produce 2,964 (2,092) 5,056 - 3,643 (677) 4,320 -
Cost of sales (7,714) (9,249) 1,535 17 (4,005) (3,994) (11) (0)
Gross profit 3,866 218 3,648 1,673 3,948 992 2,957 298
Gross profit margin 45% 2% 43 pp 92% 18% 74 pp
Gross profit excl. effect of biological assets and agricultural produce 902 2,310 (1,408) (61) 305 1,669 (1,364) (82)
revaluation
Adjusted gross profit margin 10% 20% (10) pp 7% 29% (22) pp
Distribution and selling expenses (2,373) (2,068) (305) (15) (890) (1,019) 130 13
General and administrative expenses (889) (780) (109) (14) (409) (428) 19 4
Other operating income/ (expenses), net (203) 457 (659) - 268 361 (92) (26)
incl. Reimbursement of operating costs (government grants) 434 457 (23) (5) 210 425 (216) (51)
incl. Other adjustments to EBITDA (non-recurring items) (102) (125) 23 18 (155) (145) (10) (7)
Operating profit 401 (2,174) 2,575 - 2,918 (95) 3,013 -
Adjusted EBITDA (2,192) 1,116 (3,308) - (401) 1,233 (1,633) -
Adjusted EBITDA margin -25% 10% (35) pp (9%) 22% (31) pp
In 6M and 2Q 2024 compared to 6M and 2Q 2023 Sales of the Agriculture segment
decreased by 25% and 24% correspondingly mainly due to a decrease in sales
volumes for all crops except for wheat (for 2Q 2024) and barley (for 2Q and 6M
2024).
The decrease in sales of soybean and sunflower in 6M 2024 compared to 6M 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 6M 2024. Sugar beet sales in 6M 2023
were the result of the shift of harvesting to 1Q 2023 due to adverse weather
conditions in 4Q 2022.
The dynamics of wheat sales in 6M 2024 compared to the same period in 2023 is
due to higher sales in 1Q 2024 in order to release the storage for the new
year's harvest.
Sales volumes of crops in 6M and 2Q 2024
Thousand tonnes Six months ended Variance Three months ended Variance
30 June 2024 30 June 2023 Units % 30 June 2024 30 June 2023 Units %
wheat 278 194 84 43 123 135 (12) (9)
soybean 85 180 (96) (53) 39 94 (55) (59)
corn 72 92 (20) (22) 53 63 (10) (16)
barley 28 - 28 100 15 - 15 100
sunflower seeds 19 56 (37) (66) 14 16 (2) (11)
sugar beet - 494 (494) (100) - - - -
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 gain in 6M 2024 and 2Q 2024 was caused by the revaluation of growing crops
during the positive dynamics of market prices. Net loss in 6M 2023 and 2Q 2023
resulted from the realization of gain on revaluation of agricultural produce
to fair value less costs to sell recognized in 2022.
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 1H 2024 Oil and Fat segment earned RUB 10,719 million of adjusted EBITDA
(+73 %
y-o-y) with 12% margin (+0% y-o-y).
The financial results of the Oil and Fat segment of 6M 2024 and 2Q 2024
compared to 6M 2023 and 2Q 2023 are presented below.
Oil and Fat segment 6M and 2Q 2024 Financial Results
in RUB million Six months ended Variance Three months ended Variance
30 June 2024 30 June 2023 Units % 30 June 2024 30 June 2023 Units %
Sales 90,107 51,399 38,708 75 46,995 28,042 18,953 68
Cost of sales (70,535) (40,356) (30,179) (75) (36,874) (22,640) (14,234) (63)
Gross profit 19,572 11,043 8,529 77 10,121 5,402 4,719 87
Gross profit margin 22% 21% 1 pp 22% 19% 3 pp
Distribution and selling expenses (9,622) (4,078) (5,544) (136) (4,885) (2.172) (2,713) (125)
General and administrative expenses (2,309) (1,917) (393) (20) (1,055) (1,096) 42 4
Other operating income/ (expenses), net (1,051) (1,950) 899 46 (1,147) (1,372) 225 16
incl. Reimbursement of operating costs (government grants) 97 126 (29) (23) 97 125 (27) (22)
incl. Other adjustments to EBITDA (non-recurring items) (935) (805) (130) (16) (1,150) (103) (1,048) (1,020)
Operating profit 6,589 3,098 3,491 113 3,034 762 2,272 298
Adjusted EBITDA 10,719 6,192 4,528 73 5,817 2,030 3,787 186
Adjusted EBITDA margin 12% 12% (0) pp 12% 7% 5 pp
In 6M 2024 and 2Q 2024 Sales of Oil and Fat segment increased in comparison to
6M 2023 and 2Q 2023 mainly due to the consolidation of NMGK and also 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 volumes, and increase in accident free operation time
at other production sites.
Sales volumes of oil and fat and dairy products in 6M and 2Q 2024
Thousand tonnes Six months ended Variance Three months ended Variance
30 June 2024 30 June 2023 Units % 30 June 2024 30 June 2023 Units %
meal 483 257 225 88 219 124 95 76
crude oil 368 156 211 135 208 102 106 103
industrial fats 172 151 21 14 78 75 3 4
dry whey mixes 7 6 2 27 4 3 1 24
consumer oil&fat products 235 138 97 70 118 73 45 62
consumer dairy products 7 8 (0) (6) 5 4 0 3
The growth of Cost of sales and Distribution and selling expenses in 6M 2024
and 2Q 2024 compared to the same periods of the previous year is mainly due
to the consolidation of NMGK and the increase in sales volumes.
KEY CONSOLIDATED CASH FLOW INDICATORS (NOT IFRS PRESENTATION*)
The key consolidated cash flow indicators presented according to management
accounts methodology
in RUB million Six months ended Variance Three months ended Variance
30 June 2024 30 June 2023 Units % 30 June 2024 30 June 2023 Units %
Net cash from operating activities, incl. 16,890 32,576 (15,686) (48) 6,642 16,572 (9,930) (60)
Operating cash flow before working capital changes 14,721 15,678 (957) (6) 6,315 8,686 (2,371) (27)
Working capital changes 4,823 17,509 (12,686) (72) 1,400 8,206 (6,805) (83)
Net cash from investing activities, incl. (11,038) (11,974) 935 8 (4,717) (9,684) 4,967 51
Purchases of property, plant and equipment and inventories intended for (10,892) (5,193) (5,699) (110) (4,621) (3,103) (1,518) (49)
construction
Net cash from financing activities (24,067) 5,341 (29,408) - (10,448) 12,070 (22,517) -
Net effect of exchange rate changes on cash and cash equivalents (245) 4,228 (4,473) - (146) 2,295 (2,441) -
Net (decrease) / increase in cash and cash equivalents (18,460) 30,172 (48,632) - (8,668) 21,253 (29,921) -
(*) See Appendix 4
Debt position and liquidity management
in RUB million 30 June 2024 31 December 2023 Variance
Units %
Gross debt 111,043 127,533 (16,490) (13)
Short-term borrowings 45,510 68,035 (22,525) (33)
Long-term borrowings 65,533 59,498 6,035 10
Cash and cash equivalents, bank deposits and bonds (49,420) (61,057) 11,637 19
Short-term cash, deposits and bonds (15,449) (27,086) 11,637 43
Long-term cash, deposits and bonds (33,971) (33,971) (0) (0)
Net debt 61,623 66,477 (4,854) (7)
Short-term borrowings, net 30,061 40,949 (10,888) (27)
Long-term borrowings, net 31,562 25,527 6,035 24
Adjusted EBITDA (LTM(4)) 54,756 56,560 (1,804) (3)
Net debt/ Adjusted EBITDA (LTM) 1.13 1.18 (0.05) -
Net finance income / (expense):
in RUB million Six months ended Variance Three months ended Variance
30 June 2024 30 June 2023 Units % 30 June 2024 30 June 2023 Units %
Net interest expense (3,310) (3,693) 383 10 (1,890) (1,768) (122) (7)
Gross interest expense (9,119) (9,263) 145 2 (5,723) (4,620) (1,102) (24)
Reimbursement of interest expense 5,808 5,570 238 4 3,833 2,852 981 34
Interest income 4,337 4,954 (617) (12) 2,067 2,512 (445) (18)
Other financial expenses, net (1,450) 6,179 (7,629) - (1,417) 3,197 (4,614) -
Net foreign exchange gains / (losses) (995) 6,484 (7,479) - (984) 3,385 (4,370) -
Other financial income/ (expenses), net (455) (305) (150) (49) (433) (188) (244) (130)
Total net finance income / (expense) (423) 7,439 (7,862) - (1,239) 3,941 (5,181) -
Net debt decreased at 30 June 2024 compared at 31 December 2023 by 7%.
In 6M 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 6M 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 6M 2023 in the sum of RUB 7,439 million changed to net
finance expense in the amount of RUB 423 million mainly as the result of
negative 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 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 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% and control over 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).
LIVE BROADCAST
Rusagro management is organizing a live broadcast on Company's 6M and 2Q 2024
financial results for investors and analysts.
Details:
Date: 5 August 2024
Time: 4:00 PM (Moscow) / 2:00 PM (London)
Subject: ROS AGRO PLC 6M and 2Q 2024 IFRS Financial results
https://www.youtube.com/live/hrhZnbhVFzU
(https://www.youtube.com/live/hrhZnbhVFzU)
Simultaneous translation for English-speaking participants will be available
at the link below:
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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 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 Six and
Three months ended 30 June 2024 (in RUB thousand)
Six months ended Three months ended
30 June 30 June
2024 2023 2024 2023
Sales 139,042,969 106,549,362 70,734,043 59,153,906
Net gain / (loss) on revaluation of biological assets and agricultural produce (335,965) (965,675) 1,633,517 (419,128)
Cost of sales (109,955,503) (84,635,964) (57,439,265) (46,417,378)
Gross profit 28,751,501 20,947,723 14,928,295 12,317,400
Distribution and selling expenses (14,123,413) (7,354,540) (6,716,674) (3,774,048)
General and administrative expenses (5,822,658) (4,862,514) (2,923,363) (2,682,800)
Other operating income/(expenses), net (3,169,761) 278,489 (1,947,430) (512,774)
Operating profit 5,635,669 9,009,158 3,340,828 5,347,778
Interest expense (3,310,064) (3,693,364) (1,889,884) (1,768,118)
Interest income 4,337,267 4,953,569 2,067,458 2,512,334
Other financial income/ (expenses), net (1,450,405) 6,178,811 (1,417,018) 3,196,917
Profit / (loss) before taxation 5,212,467 16,448,174 2,101,384 9,288,911
Income tax expense (1,726,970) (3,256,873) (355,915) (1,514,559)
Profit for the period 3,485,497 13,191,301 1,745,469 7,774,352
Other comprehensive income:
Total comprehensive income/ (loss) for the period 3,485,497 13,191,301 1,745,469 7,774,352
Profit / (loss) is attributable to:
Owners of ROS AGRO PLC 1,222,407 13,194,400 696,416 7,770,659
Non-controlling interest 2,263,090 (3,099) 1,049,053 3,693
Profit / (loss) for the period 3,485,497 13,191,301 1,745,469 7,774,352
Total comprehensive income/ (loss) is attributable to:
Owners of ROS AGRO PLC 1,222,407 13,194,400 696,416 7,770,659
Non-controlling interest 2,263,090 (3,099) 1,049,053 3,693
Total comprehensive income/ (loss) for the period 3,485,497 13,191,301 1,745,469 7,774,352
Earnings per ordinary share for profit attributable to the equity holders of 45.43 490.38 25.88 288.80
ROS AGRO PLC, basic and diluted (in RR per share)
Appendix 2. Segment information for the Six months ended 30 June 2024 (in RUB
thousand)
6М 2024 Sugar Meat Agriculture Oil and Fat Other Eliminations Total
Sales 21,378,288 22,615,448 8,615,958 90,107,175 1,205,311 (4,879,211) 139,042,969
Net gain/ (loss) on revaluation of biological assets and agricultural produce - 16,992 2,964,029 - - (3,316,986) (335,965)
Cost of sales (18,297,653) (19,536,327) (7,713,792) (70,535,188) (1,059,125) 7,186,582 (109,955,503)
incl. Depreciation (1,196,354) (1,574,565) (189,421) (2,557,605) (12,141) (20,439) (5,550,525)
Gross profit / (loss) 3,080,635 3,096,113 3,866,195 19,571,987 146,186 (1,009,615) 28,751,501
Distribution and Selling, General and administrative expenses (3,183,154) (2,164,851) (3,262,725) (11,931,411) (1,344,427) 1,940,497 (19,946,071)
incl. Depreciation (31,558) (35,066) (79,238) (637,249) (31,279) 20,439 (793,951)
Other operating income/(expenses), net (8,393) 124,136 (202,556) (1,051,455) 26,404,115 (28,435,608) (3,169,761)
incl. Reimbursement of operating costs (government grants) 792 3,340 434,032 97,412 - - 535,576
incl. Other adjustments to EBITDA (non-recurring items) (9,187) 82,814 (102,288) (935,434) 26,632,416 (27,153,868) (1,485,547)
Operating profit / (loss) (110,912) 1,055,398 400,914 6,589,121 25,205,874 (27,504,726) 5,635,669
Adjustments: 0 0 0
Depreciation included in Operating profit 1,227,912 1,609,631 268,659 3,194,854 43,420 - 6,344,476
Other adjustments to EBITDA (non-recurring items) 9,187 (82,814) 102,288 935,434 (26,632,416) 27,153,868 1,485,547
Net gain/ (loss) on revaluation of biological assets and agricultural produce - (16,992) (2,964,029) - - 3,316,986 335,965
Adjusted EBITDA* 1,126,187 2,565,223 (2,192,168) 10,719,409 (1,383,122) 2,966,128 13,801,657
Appendix 2 (continued). Segment information for the Six months ended 30 June
2023 (in RUB thousand)
6М 2023 Sugar Meat Agriculture Oil and Fat Other Eliminations Total
Sales 23,973,640 22,648,603 11,559,185 51,399,022 1,004,700 (4,035,788) 106,549,362
Net gain/ (loss) on revaluation of biological assets and agricultural produce - 2,272,491 (2,092,419) - - (1,145,747) (965,675)
Cost of sales (15,860,003) (22,374,393) (9,248,748) (40,356,197) (569,399) 3,772,776 (84,635,964)
incl. Depreciation (1,052,138) (2,413,367) (959,561) (1,851,417) (8,811) (19,050) (6,304,344)
Gross profit / (loss) 8,113,637 2,546,701 218,018 11,042,825 435,301 (1,408,759) 20,947,723
Distribution and Selling, General and administrative expenses (2,643,930) (1,982,738) (2,848,308) (5,995,076) (1,050,411) 2,303,409 (12,217,054)
incl. Depreciation (33,778) (62,539) (112,643) (437,660) (71,487) 19,050 (699,057)
Other operating income/(expenses), net 221,266 181,526 456,648 (1,950,089) 1,841,712 (472,574) 278,489
incl. Reimbursement of operating costs (government grants) 87,768 23,413 456,578 126,345 - - 694,104
incl. Other adjustments to EBITDA (non-recurring items) 62,433 214,983 (125,300) (804,995) 1,961,579 63,722 1,372,422
Operating profit / (loss) 5,690,973 745,489 (2,173,642) 3,097,660 1,226,602 422,076 9,009,158
Adjustments:
Depreciation included in Operating Profit 1,085,916 2,475,906 1,072,204 2,289,077 80,298 - 7,003,401
Other adjustments to EBITDA (non-recurring items) (62,433) (214,983) 125,300 804,995 (1,961,579) (63,722) (1,372,422)
Net gain/ (loss) on revaluation of biological assets and agricultural produce - (2,272,491) 2,092,419 - - 1,145,747 965,675
Adjusted EBITDA* 6,714,456 733,921 1,116,281 6,191,732 (654,679) 1,504,101 15,605,812
* Non-IFRS measure
Appendix 3. Consolidated statement of financial position as at 30 June 2024
(in RUB thousand)
30 June 2024 31 December 2023
ASSETS
Current assets
Cash and cash equivalents 7,476,436 25,936,781
Short-term investments 9,460,016 2,288,852
Trade and other receivables 49,671,467 47,861,374
Prepayments 10,116,502 10,814,811
Current income tax receivable 124,322 132,186
Other taxes receivable 7,712,845 9,006,784
Inventories and short-term biological assets 95,882,065 100,617,833
Other current assets 876,076 2,718,720
Total current assets 181,319,729 199,377,341
Non-current assets
Property, plant and equipment 145,486,196 141,897,092
Inventories intended for construction 501,337 465,830
Right-of-use assets 6,663,396 6,392,885
Goodwill 3,840,150 3,840,150
Advances paid for non-current assets 3,872,657 2,867,735
Long-term biological assets 3,083,232 2,736,644
Long-term investments and receivables 42,527,215 42,527,657
Investments in associates 562,323 562,323
Deferred income tax assets 3,871,162 2,532,975
Other intangible assets 7,547,262 7,765,853
Total non-current assets 217,954,930 211,589,144
Total assets 399,274,659 410,966,485
Appendix 3 (continued). Consolidated statement of financial position as at 30
June 2024
(in RUB thousand)
30 June 2024 31 December 2023
LIABILITIES and EQUITY
Current liabilities
Short-term borrowings 45,509,578 68,034,977
Lease liabilities 1,089,553 1,098,135
Trade and other payables 34,705,537 39,452,813
Provisions 153,354 123,212
Current income tax payable 235,210 555,913
Other taxes payable 3,021,856 5,458,529
Total current liabilities 84,715,088 114,723,579
Non-current liabilities
Long-term borrowings 65,532,545 59,498,119
Government grants 14,033,969 12,860,211
Lease liabilities 5,102,632 4,325,136
Deferred income tax liability 3,547,799 2,502,074
Total non-current liabilities 88,216,945 79,185,540
Total liabilities 172,932,033 193,909,119
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 174,598,911 173,344,692
Equity attributable to owners of ROS AGRO PLC 202,448,229 201,194,010
Non-controlling interest 23,894,397 15,863,356
Total equity 226,342,626 217,057,366
Total liabilities and equity 399,274,659 410,966,485
Appendix 4. Consolidated statement of cash flows for the Six months ended 30
June 2024 (in RUB thousand) - NOT IFRS PRESENTATION (*)
Six months ended
30 June 2024 30 June 2023
Cash flows from operating activities
Profit/(loss) before income tax 5,212,467 16,448,174
Adjustments for:
Depreciation and amortization 6,344,476 7,003,399
Interest expense 9,118,509 9,264,000
Government grants (5,999,828) (6,536,472)
Interest income (4,337,267) (4,954,001)
Loss/ (gain) on disposal of property, plant and equipment 23,000 (116,880)
Net (gain) / loss on revaluation of biological assets and agricultural produce 335,965 965,675
Change in provision for impairment of loans issued (69) (123)
Interest expense on leases 355,458 133,630
Change in provision for net realisable value of inventory 955,630 591,994
Change in provision for impairment of receivables and prepayments (70,294) 1,605,292
Foreign exchange (gain) / loss, net 2,123,761 (8,171,930)
Lost / (reversal of) harvest write-off 454,543 -
Settlement of loans and accounts receivable previously written-off (1) (31,379)
Change in provision for impairment of advances paid for property, plant and 8,630 29,613
equipment
Change in other provisions 30,142 59,549
Dividend income - (345,499)
Loss on disposal of other assets - 456
Loss on disposal of other assets 27,007 -
Gain on SolPro loans redemption - (260,587)
Other non-cash and non-operating expenses, net 138,421 (7,275)
Operating cash flow before working capital changes 14,720,550 15,677,636
Change in trade and other receivables and prepayments (2,590,982) 2,727,560
Change in other taxes receivable 732,233 739,260
Change in inventories and short-term biological assets 4,414,931 (364,691)
Change in trade and other payables 2,016,660 15,358,946
Change in other taxes payable (1,676,353) (951,606)
Change on other current assets 1,926,698 -
Cash generated from operations 19,543,737 33,187,105
Income tax paid (2,653,290) (610,788)
Net cash from operating activities 16,890,447 32,576,317
Appendix 4. Consolidated statement of cash flows for the Six months ended 30
June 2024 (in RUB thousand) - NOT IFRS PRESENTATION (*)
Six months ended
30 June 2024 30 June 2023
Cash flows from investing activities
Purchases of property, plant and equipment (10,794,669) (5,058,367)
Purchases of other intangible assets (282,795) (451,098)
Purchases of land lease rights (7,560) (15,486)
Proceeds from sales of property, plant and equipment 71,822 12,165
Purchases of inventories intended for construction (97,110) (134,198)
Purchases of associates - (33,000)
Investments in subsidiaries, net of cash acquired - (6,625,625)
Dividends received - 345,499
Proceeds from sales of other investments - 13,205
Other investing activities 72,024 (26,672)
Net cash from investing activities (11,038,288) (11,973,577)
Cash flows from financing activities
Proceeds from borrowings 44,737,549 79,094,106
Repayment of borrowings (62,343,855) (111,419,218)
Interest paid (3,053,452) (3,238,680)
Change in cash on bank deposits (7,750,908) 33,286,758
Loans given* (9) (3,500)
Loans repaid* 166 527,164
Interest received* 4,240,819 6,454,099
Proceeds from government grants 783,933 690,780
Purchases of non-controlling interest (5) -
Repayment of lease libilities - principal (681,353) (50,492)
Net cash from financing activities (24,067,115) 5,341,017
Net effect of exchange rate changes on cash and cash equivalents (245,389) 4,227,780
Net increase/ (decrease) in cash and cash equivalents (18,460,345) 30,171,537
Cash and cash equivalents at the beginning of the period 25,936,781 21,473,029
Cash and cash equivalents at the end of the period 7,476,436 51,644,566
(*) 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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