Source - RNS
RNS Number : 1372H
Ros Agro PLC
05 June 2017
 

 

 

05 June 2017

 

ROS AGRO financial results for Q1 2017

 

 

05 June 2017 - Today ROS AGRO PLC (the "Company"), the holding company of Rusagro Group (the "Group"), a leading Russian diversified food producer with vertically integrated operations, has announced the financial results for the three months ended 31 March 2017.

 

 

Q1 2017 Highlights

 

-     Sales amounted to RR 18,780 million (US$ 320 million1), an increase of RR 1,042 million compared to Q1 2016;

-     Adjusted EBITDA2 amounted to RR 2,725 million (US$ 46 million), a decrease of RR 2,139 million compared to Q1 2016;

-     Adjusted EBITDA margin amounted to 15%;

-     Net debt position3 as of 31 March 2017 was negative and amounted to RR -552 million (US$ -10 million);

-     Net Debt/ Adjusted EBITDA (LTM4) as of 31 March 2017 was -0.03x.

 

Commenting on the results, Maxim Basov, a member of the Board of Directors of ROS AGRO PLC and CEO of the Group, said:

 

"In the first quarter of 2017 rouble was stronger than in the first quarter of 2016 by more than 28%. Stronger rouble decreases margins of all business units given large surpluses of sugar, grain and vegetable oil in Russia. Margins of processing businesses (sugar and oil&fat) were further hit as raw material was bought at the end of the year when rouble was weaker and prices were higher. These businesses will operate with weak margins in strong rouble export-driven environment. Meat segment improved year-to-year on higher global meat prices and improved operations. Traditionally the first quarter is the weakest quarter in the year. Construction in Far East is on track. Integration of Razguliay assets is now completed."

 

Key consolidated financial performance indicators

in RR million

Three months ended

Variance

31 March 2017

31 March 2016

Units

%

Sales

18,780

17,738

1,042

6

Gross profit

2,410

3,650

(1,240)

(34)

Gross margin, %

13%

21%

-8%


Adjusted EBITDA

2,725

4,863

(2,139)

(44)

Adjusted EBITDA margin, %

15%

27%

-13%


Net profit / (loss) for the period*

(344)

367

(711)

-

Net profit margin %

-2%

2%

-4%


 

*Net profit for the period is affected by non-cash loss on revaluation of biological assets and agricultural produce. See details in business-sections below. Net profit for the period excl. effect of biological assets and agricultural produce revaluation amounted to RR 1,625 million for Q1 2017 (Q1 2016: RR 3,162 million), a decrease of RR 1,538 million or 49%  compared to Q1 2016.

Key financial performance indicators by segment

in RR million

Three months ended

Variance

31 March 2017

31 March 2016

Units

%






Sales, incl.

18,780

17,738

1,042

6

Sugar

7,410

5,877

1,533

26

Meat

4,732

3,615

1,117

31

Agriculture

3,670

3,362

308

9

Oil and Fat

4,368

5,747

(1,379)

(24)

Other

16

18

(2)

(10)

Eliminations

(1,416)

(881)

(535)

(61)






Gross profit / (loss), incl.

2,410

3,650

(1,240)

(34)

Sugar

1,394

2,783

(1,390)

(50)

Meat

621

(773)

1,395

-

Agriculture

(40)

556

(596)

-

Oil and Fat

669

1,073

(404)

(38)

Other

16

18

(2)

(10)

Eliminations

(250)

(7)

(243)

(3,664)






Adjusted EBITDA, incl.

2,725

4,863

(2,139)

(44)

Sugar

734

2,315

(1,580)

(68)

Meat

1,331

551

780

142

Agriculture

363

1,563

(1,200)

(77)

Oil and Fat

(59)

214

(273)

-

Other

(136)

(598)

462

77

Eliminations

492

820

(327)

(40)






Adjusted EBITDA margin, %

15%

27%

-13%


Sugar

10%

39%

-29%


Meat

28%

15%

13%


Agriculture

10%

46%

-37%


Oil and Fat

-1%

4%

-5%


 

Sugar Segment

The financial results of the sugar segment for Q1 2017 as compared to Q1 2016 are presented in the table below:

in RR million

Three months ended

Variance

31 March 2017

31 March 2016

Units

%

Sales

7,410

5,877

1,533

26

Cost of sales

(6,012)

(3,389)

(2,622)

(77)

Net gain from trading derivatives

(5)

296

(300)

-

Gross profit

1,394

2,783

(1,390)

(50)

Gross profit margin

19%

47%

-29%







Distribution and selling expenses

(725)

(416)

(309)

(74)

General and administrative expenses

(381)

(245)

(136)

(56)

Other operating income / (expenses), net

(77)

(29)

(48)

(169)

Operating profit

211

2,094

(1,883)

(90)






Adjusted EBITDA

734

2,315

(1,580)

(68)

Adjusted EBITDA margin

10%

39%

-29%


Sales in the sugar segment increased mainly because of 57% increase in sugar sales volume, following the high sugar beet harvest in 2016 and acquisition of new sugar plants in 2016, that was partly offset by 24% decrease in sugar sale prices. The sales volume of by-products are also increased. Revenue from beet pulp, molasses and betaine amounted to RR 408 million in Q1 2017 compared to RR 216 million in Q1 2016.

Additional factor of sales growth in Q1 2017 is the acquisition of buckwheat production plant from Razguliay Group in June 2016 and the beginning of sales of buckwheat products. Sales of rice and buckwheat amounted to RR 437 million in Q1 2017 compared to RR 124 million in Q1 2016.

Sugar sales and production volumes and the average sales prices per kilogram (excl. VAT) were as follows:


Three months ended

Variance

31 March 2017

31 March 2016

Units

%

Sugar production volume (in thousand tonnes), incl.

122

-

122

-

beet sugar

122

-

122

-

cane sugar

-

-

-

-

Sales volume (in thousand tonnes)

196

125

72

57

Sale price (roubles per kg, excl. VAT)

33.4

44.0

(10.6)

(24)

An increase in Distribution and selling expenses mainly relates to increase in transportation and loading services and correlate with the increase in sales volume.

An increase in General and administrative expenses in Q1 2017 include RR 81 million attributed to newly acquired plants, whose financial results are included in the consolidated segment's results starting 1 June 2016. The remaining increase is attributed to an increase in payroll costs and taxes.

Profitability of the segment deteriorated following the significant decrease in sugar sale prices and lower sugar content in sugar beet from 2016 harvest.

Meat Segment

The financial results of the meat segment for Q1 2017 as compared to Q1 2016 are presented in the table below:

in RR million

Three months ended

Variance

31 March 2017

31 March 2016

Units

%

Sales

4,732

3,615

1,117

31

Net gain / (loss) on revaluation of biological assets and agricultural produce

(336)

(1,013)

677

67

Cost of sales

(3,775)

(3,375)

(400)

(12)

Gross profit / (loss)

621

(773)

1,395

-

Gross profit margin

13%

-21%

35%


Gross profit excl. effect of biological assets revaluation

957

240

717

299

Adjusted gross profit margin

20%

7%

14%







Distribution and selling expenses

(86)

(44)

(42)

(94)

General and administrative expenses

(21)

(138)

117

85

Other operating income, net

70

174

(104)

(60)

incl. reimbursement of operating costs (government grants)

-

98

(98)

-

Operating profit / (loss)

585

(781)

1,366

-






Adjusted EBITDA

1,331

551

780

142

Adjusted EBITDA margin

28%

15%

13%


Sales in the meat segment increased by 31% as a result of both sales volume and pork sale prices increase. Overall sales volume increased due to increase in livestock population and the average weight of pigs.

Pork sales volumes and the average pork sales prices per kilogram (excl. VAT) were as follows:


Three months ended

Variance

31 March 2017

31 March 2016

Units

%

Sales volume (in thousand tonnes), incl.

44

37

7

21

livestock pigs

21

16

5

33

processed pork

23

21

2

11

Sale prices (roubles per kg, excl. VAT):





livestock pigs

93.9

82.4

11.5

14

processed pork

120.1

111.7

8.4

7

Net loss on revaluation of biological assets and agricultural produce in Q1 2017 resulted mainly from a decrease in market prices for live pigs during Q1 2017 and a respective decrease in fair value of livestock in the closing balance compared to the beginning of the year. In Q1 2016 a magnitude of a decrease in live pigs market prices were more significant compared to Q1 2017 and was accompanied by an increase in cost due to higher grain and other feed components prices.

General and administrative expenses in Q1 2017 include RR 114 million of gain from reverse of property tax for 2016 in relation to tax relief legally confirmed in Q1 2017.

Other operating income in Q1 2017 decreased due to the lack of government grants for compensation of operating expenses. On the contrary, in Q1 2016 the meat segment received RR 98 million of subsidies for partial reimbursement of feed costs.

Agricultural Segment

As at 31 March 2017 the segment's area of controlled land stands at 665 thousand hectares, including 86 thousand hectares in the Far Eastern region. The financial results of the agricultural segment for Q1 2017 as compared to Q1 2016 are presented in the table below:

in RR million

Three months ended

Variance

31 March 2017

31 March 2016

Units

%

Sales

3,670

3,362

308

9

(1,146)

(1,049)

(97)

(9)

Cost of sales

(2,564)

(1,758)

(806)

(46)

Net gain/ (loss) from trading derivatives

-

1

(1)

-

Gross profit / (loss)

(40)

556

(596)

-

Gross profit margin

-1%

17%

-18%


1,106

1,605

(499)

(31)

Adjusted gross profit margin

30%

48%

-18%







Distribution and selling expenses

(826)

(289)

(537)

(186)

General and administrative expenses

(252)

(146)

(106)

(72)

Other operating income, net

29

151

(122)

(81)

incl. reimbursement of operating costs (government grants)

-

159

(159)

-

Operating profit / (loss)

(1,090)

271

(1,361)

-






Adjusted EBITDA

363

1,563

(1,200)

(77)

Adjusted EBITDA margin

10%

46%

-37%


In Q1 2017 Sales increased by 9% as compared to Q1 2016 as a result of sales of sugar beet, that was not the case in Q1 2016, and 90% increase in sales volume of wheat, which was offset by a decrease in sales volume of sunflower seeds and soy and a decrease in sale prices.

Sales volumes by product were as follows:

Thousand tonnes

Three months ended

Variance

31 March 2017

31 March 2016

Units

%

sugar beet

452

-

452

-

wheat

164

87

78

90

barley

12

12

1

8

sunflower seeds

18

33

(15)

(46)

corn

38

40

(2)

(5)

soy

31

56

(25)

(45)

 

The average sale prices per kilogram (excl. VAT) were as follows:

RR per kilogram, excl. VAT

Three months ended

Variance

31 March 2017

31 March 2016

Units

%

sugar beet

2.1

n/a

n/a

n/a

wheat

7.4

8.9

(1.5)

(17)

barley

7.1

10.4

(3.4)

(32)

sunflower seeds

16.7

23.6

(6.9)

(29)

corn

9.3

8.5

0.8

9

soy

19.9

22.4

(2.5)

(11)

Net loss on revaluation of biological assets and agricultural produce in Q1 figures represents the realisation of gain from crops revaluation, recognised in the previous year financial statements and remained unrealised as at the year-end. The gain on revaluation of crops and its subsequent realisation do not affect the Adjusted EBITDA figure.

An increase in Distribution and selling expenses relates to an increase in sales volume (see above) and significant opening balance of crops from the previous year harvest.

An increase in General and administrative expenses in Q1 2017 include RR 51 million attributed to the agricultural companies, acquired in Q2 2016 and later, whose financial results were not included in the consolidated segment's results in Q1 2016. The remaining increase is attributed to an increase in payroll costs and consulting services related to implementation and support the SAP ERP.

Other operating income in Q1 2017 significantly decreased due to the lack of government grants for compensation of operating expenses. On the contrary, in Q1 2016 the agricultural segment received RR 159 million of subsidies for compensation of operating expenses.

Oil and Fat segment

The financial results of the oil and fat segment for Q1 2017 as compared to Q1 2016 are presented in the table below:

in RR million

Three months ended

Variance

31 March 2017

31 March 2016

Units

%

Sales

4,368

5,747

(1,379)

(24)

Cost of sales

(3,699)

(4,675)

975

21

Gross profit

669

1,073

(404)

(38)

Gross profit margin

15%

19%

-3%







Distribution and selling expenses

(672)

(789)

117

15

General and administrative expenses

(186)

(158)

(28)

(18)

Other operating income/ (expenses), net

33

61

(28)

(46)

Operating profit / (loss)

(156)

186

(342)

-






Adjusted EBITDA

(59)

214

(273)

-

Adjusted EBITDA margin

-1%

4%

-5%


The breakdown of Sales, Gross profit and Adjusted EBITDA between the Samara oil plant, the Ekaterinburg fat plant and Far East operations is as follows:

in RR million

Three months ended

Variance

31 March 2017

31 March 2016

Units

%






Sales, incl.

4,368

5,747

(1,379)

(24)

Samara oil plant

1,946

3,285

(1,338)

(41)

Ekat. fat plant

2,097

2,064

33

2

Far East

906

997

(91)

(9)

Eliminations

(581)

(598)

17

3






Gross profit, incl.

669

1,073

(404)

(38)

Samara oil plant

158

512

(353)

(69)

Ekat. fat plant

426

450

(23)

(5)

Far East

72

141

(70)

(49)

Eliminations

12

(30)

42

-






Adjusted EBITDA, incl.

(59)

214

(273)

-

Samara oil plant

(60)

205

(264)

-

Ekat. fat plant

(76)

(84)

8

10

Far East

37

96

(59)

(62)

Eliminations

40

(3)

43

-






Adjusted EBITDA  margin, %

-1%

4%

-5%


Samara oil plant

-3%

6%

-9%


Ekat. fat plant

-4%

-4%

0%


Far East

4%

10%

-6%


Intra-segment sales include sales of raw oil from Samara oil plant to Ekaterinburg fat plant.

Sales volumes by product were as follows:

Thousand tonnes

Three months ended

Variance

31 March 2017

31 March 2016

Units

%

Ekaterinburg fat plant





mayonnaise

15.8

14.4

1.4

10

margarine

9.4

9.7

(0.3)

(3)

bottled oil

4.1

3.4

0.7

20

Samara oil plant





bulk oil

24

38

(14)

(37)

meal

48

44

4

9

Far East





bottled oil

0.4

1.7

(1.2)

(75)

bulk oil

0.2

0.5

(0.3)

(58)

meal

21

26

(5)

(18)

 



 

The average sale prices per kilogram (excl. VAT) for sales to third parties were as follows:

RR per kilogram, excl. VAT

Three months ended

Variance

31 March 2017

31 March 2016

Units

%

mayonnaise

77.1

75.7

1.5

2

margarine

78.1

69.4

8.6

12

bottled oil

62.1

75.6

(13.5)

(18)

bulk oil

44.2

57.8

(13.6)

(23)

meal

16.2

18.8

(2.5)

(13)

A decrease in gross profit and Adjusted EBITDA is attributed to Samara oil plant and Far East operations. These plants faced a significant decrease in sale prices that was partly compensated by a decrease of raw materials, sunflower seeds and soybean, prices. The segment decreased export operations with bulk oil that also led to a decrease in gross profit and Adjusted EBITDA.

Key consolidated cash flow indicators (not IFRS presentation*)

The key consolidated cash flow indicators presented according to management accounts methodology were as follows:

in RR million

Three months ended

Variance

31 March 2017

31 March 2016

Units

%

Net cash from operating activities, incl.

7,113

856

6,257

731

Operating cash flow before working capital changes

2,804

4,138

(1,417)

(34)

Working capital changes

4,465

(2,797)

7,346

-

Net cash used in investing activities, incl.

(2,850)

(1,310)

(1,541)

(118)

Purchases of property, plant and equipment and inventories intended for construction

(2,901)

(1,156)

(1,745)

(151)

Net cash from/ (used in) financing activities

6,489

210

6,279

2,989

Net effect of exchange rate changes on cash and cash equivalents

(97)

(412)

315

77

Net increase / (decrease) in cash and cash equivalents

10,656

(655)

11,311

-

 

(*) See Appendix 4

The main investments in property, plant and equipment and inventories intended for construction in Q1 2017 were made in the agricultural segment in the amount of RR 1,669 million (Q1 2016: RR 552 million), related to purchases of machinery and equipment, and in the sugar segment in the amount of RR 461 million (Q1 2016: RR 435 million), related to the modernization of sugar plants. Investments in the oil and fat segment for Q1 2017 amounted to RR 400 million (Q1 2016: RR 94 million) and mainly relates to construction of vegetable oil refining, deodorizing and packaging plant in Samara region. Investments in property, plant and equipment and inventories intended for construction in the meat segment for Q1 2017 amounted to RR 371 million (Q1 2016: RR 62 million), net of purchases from other segments, and mainly relates to construction of new pig-breeding farms.



 

Debt position and liquidity management

in RR million

31 March 2017

31 December 2016

Variance

Units

%

Gross debt

37,850

44,503

(6,653)

(15)

Short term borrowings

6,646

11,704

(5,059)

(43)

Long term borrowings

31,204

32,798

(1,594)

(5)

Cash and cash equivalents, bank deposits and bonds

(38,402)

(40,160)

1,759

4

Short-term cash, deposits and bonds

(21,295)

(23,044)

1,749

8

Long-term cash, deposits and bonds

(17,107)

(17,116)

9

0

Net debt

(552)

4,342

(4,894)

-

Short term borrowings, net

(14,649)

(11,340)

(3,309)

(29)

Long term borrowings, net

14,097

15,682

(1,585)

(10)

Adjusted EBITDA (LTM4)

16,067

18,205

(2,139)

(12)

Net debt/Adjusted EBITDA (LTM)

(0.03)

0.24

(0.3)


Net finance income/ (expense)

in RR million

Three months ended

Variance

31 March 2017

31 March 2016

Units

%

Net interest expense

(840)

(1,311)

471

36

Gross interest expense

(859)

(1,420)

561

39

Reimbursement of interest expense

19

109

(90)

(83)

Interest income

1,134

957

177

19

Net gain/ (loss) from bonds held for trading

(8)

-

(8)

-

Other financial income/ (expenses), net

(36)

(856)

820

96

Net foreign exchange gain/ (loss)

(32)

(839)

807

96

Other financial expenses, net

(4)

(17)

13

78

Total net finance income/ (expense)

250

(1,210)

1,460

-

In Q1 2017 the Group earned RR 250 million of net finance income compared to RR 1,210 million of net finance expenses in Q1 2016. So positive changes in Net finance income/ (expense) provided RR 1,460 million of gain into quarter-to-quarter dynamics of the Group's net profit.

The group received RR 471 million of savings in Net interest expense as a result of a decrease in gross debt and more favourable average interest rates.

Net foreign exchange loss significantly decreased from RR 839 million in Q1 2016 to RR 32 million in Q1 2016. Forex losses in Q1 2016 mainly related to cash on bank deposits and cash on current bank accounts.

__________________________

(1) The exchange rates used for translation of RR 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, (ii) other operating income, net (other than reimbursement of operating costs (government grants)), (iii) net gain/ (loss) on revaluation of biological assets and agricultural produce, (iv) provision/ (reversal of provision) for net realizable value of agricultural produce (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) The Group 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: AGRO) - a holding company of Rusagro Group, a leading Russian diversified food producer with vertically integrated operations in the following branches:

Sugar:

We are a leading Russian sugar producer, producing sugar on nine production sites from both sugar beet and raw cane sugar. We produce white and brown cube sugar and packaged sugar sold under the brands Chaikofsky, Russkii Sakhar, Mon Cafe and Brauni. Our sugar segment is vertically integrated with sugar beet cultivation in our agriculture segment, through which we strive to ensure a consistent supply of sugar beets. We also operate a cereal plant and sell buckwheat and rice under the brand Tyoplye Traditsii.

Meat:

According to the National Union of Pig Breeders, we are the second largest pork producer in Russia on the ground of relative production volumes for 2016. We have implemented best practices in biosecurity at our pig farms.

Agricultural:

The Group currently controls what it believes to be one of the largest land banks among Russian agriculture producers, with 665 thousand hectares of land under our control located in the highly fertile Black Earth region of Russia (in the Belgorod, Tambov and Voronezh regions)
and in the Far East Primorie region. Land and production sites are strategically located within
the same regions to optimize efficiency and minimize logistical costs. We believe we are one
of the major sugar beet producers in Russia, and our agricultural segment also produces winter wheat and barley, sunflower products and soybeans. These products are partially consumed
by the meat segment, supporting a synergistic effect and lowering price change risk.

Oil and Fat:

We are a leading producer of mayonnaise and consumer margarine in Russia, such as "Provansal EZhK" and "Schedroe Leto". In January 2013 the Company has begun production of mayonnaise under brand "Mechta Khozyayki". Our oil extraction plant located in Samara (Samara oil plant) enables us to control the source of 100% of the vegetable oil required by our oil and fats production plant in Ekaterinburg (Ekaterinburg fat plant).

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.

 

Rusagro management is organizing a conference call about its Q1 2017 financial results for investors and analysts.

Details of call:

Date

31 May 2017

Time

4:00 PM (Moscow) /2:00 PM (London) at the same day

Subject

ROS AGRO PLC Q1 2017 Financial Results

UK Toll Free

UK Local Line

0800 368 0935

+44 330 336 9105

USA Toll Free

USA Local Line

888 389 5986

+1 719 457 1036

Russia Toll Free

+7 495 213 1767

Conference ID

3961228

 

Contacts:

Svetlana Kuznetsova

Chief Investment Officer

Phone:  +7 495 363 1661

[email protected]

 


 



 

Appendix 1. Unaudited consolidated statement of comprehensive income for the three months ended 31 March 2017 (in RR thousand)

 

 


Three months ended


31 March 2017

31 March 2016

Sales

18,779,507

17,737,764

Net gain / (loss) on revaluation of biological assets and agricultural produce

(1,968,309)

(2,795,100)

Cost of sales

(14,396,722)

(11,589,490)

Net gain / (loss) from trading derivatives

(4,540)

296,457

Gross profit

2,409,936

3,649,631




Distribution and selling expenses

(2,092,806)

(1,524,238)

General and administrative expenses

(965,350)

(1,262,939)

Other operating income/ (expenses), net

74,500

402,195

Operating profit

(573,720)

1,264,649




Interest expense

(840,340)

(1,311,120)

Interest income

1,134,058

956,599

Net gain/ (loss) from bonds held for trading

(7,842)

-

Other financial income/ (expenses), net

(35,925)

(856,386)

Share of results of associates

3,407

2,399

Profit / (loss) before income tax

(320,362)

56,140




Income tax expense

(23,321)

311,038

Profit / (loss) for the year

(343,683)

367,178




Other comprehensive income / (loss):



Items that may be subsequently reclassified to profit and loss:



Change in value of available-for-sale financial assets

(154,082)

(16,319)

Income tax relating to other comprehensive income

30,816

3,264

Total comprehensive income / (loss) for the period

(466,949)

354,123




Profit / (loss) is attributable to:



Owners of ROS AGRO PLC

(277,585)

364,372

Non-controlling interest

(66,098)

2,806

Profit for the period

(343,683)

367,178




Total comprehensive income / (loss) is attributable to:



Owners of ROS AGRO PLC

(400,851)

351,317

Non-controlling interest

(66,098)

2,806

Total comprehensive income / (loss) for the period

(466,949)

354,123




Earnings per ordinary share for profit attributable to the owners of ROS AGRO PLC, basic and diluted (in RR per share)

(10.31)

15.47

 



Appendix 2. Unaudited segment information for the three months ended 31 March 2017 (in RR thousand)

 

Three months ended 31 March 2017

Sugar

Meat

Agriculture

Oil and Fat

Other

Eliminations

Total

Sales

7,409,816

4,731,769

3,669,637

4,367,900

15,959

(1,415,574)

18,779,507

Net gain/ (loss) on revaluation of biological assets and agricultural produce

-

(335,776)

(1,145,935)

-

-

(486,598)

(1,968,309)

Cost of sales

(6,011,546)

(3,774,823)

(2,563,555)

(3,699,326)

-

1,652,528

(14,396,722)

incl. depreciation

(418,452)

(469,239)

(324,907)

(97,679)

-

(1,334)

(1,311,611)

Net gain/ (loss) from trading derivatives

(4,540)

-

-

-

-

-

(4,540)

Gross profit / (loss)

1,393,730

621,170

(39,853)

668,574

15,959

(249,644)

2,409,936

Distribution and Selling, General and administrative expenses

(1,105,941)

(106,906)

(1,078,490)

(857,723)

(164,465)

255,369

(3,058,156)

incl. depreciation

(28,039)

(11,734)

(10,089)

(32,376)

(12,256)

1,334

(93,160)

Other operating income/(expenses), net

(76,737)

70,416

28,567

32,840

5,651,448

(5,632,034)

74,500

incl. reimbursement of operating costs (government grants)

-

-

-

-

-

-

-

Operating profit / (loss)

211,052

584,680

(1,089,776)

(156,309)

5,502,942

(5,626,309)

(573,720)

Adjustments:








Depreciation included in Operating Profit

446,490

480,972

334,996

130,055

12,256

-

1,404,769

Other operating (income) /expenses, net

76,737

(70,416)

(28,567)

(32,840)

(5,651,448)

5,632,034

(74,500)

Reimbursement of operating costs (government grants)

-

-

-

-

-

-

-

Net gain/ (loss) on revaluation of biological assets and agricultural produce

-

335,776

1,145,935

-

-

486,598

1,968,309

Adjusted EBITDA*

734,279

1,331,012

362,588

(59,094)

(136,250)

492,323

2,724,858

 

* Non-IFRS measure



 

Appendix 2 (continued). Unaudited segment information for the three months ended 31 March 2016 (in RR thousand)

 

Three months ended 31 March 2016

Sugar

Meat

Agriculture

Oil and Fat

Other

Eliminations

Total

Sales

5,876,842

3,614,607

3,361,952

5,747,303

17,796

(880,737)

17,737,764

Net gain/ (loss) on revaluation of biological assets and agricultural produce

-

(1,012,988)

(1,049,194)

-

-

(732,917)

(2,795,100)

Cost of sales

(3,389,085)

(3,375,019)

(1,757,756)

(4,674,653)

-

1,607,022

(11,589,490)

incl. depreciation

(160,744)

(386,584)

(201,386)

(54,345)

-

(33,345)

(836,404)

Net gain/ (loss) from trading derivatives

295,737

-

720

-

-

-

296,457

Gross profit / (loss)

2,783,495

(773,400)

555,721

1,072,651

17,796

(6,632)

3,649,631

Distribution and Selling, General and administrative expenses

(660,759)

(182,246)

(435,421)

(947,404)

(625,630)

64,282

(2,787,177)

incl. depreciation

(31,249)

(8,982)

(32,876)

(33,994)

(9,739)

4,382

(112,458)

Other operating income/(expenses), net

(28,528)

174,366

150,544

60,722

3,712,655

(3,667,564)

402,195

incl. reimbursement of operating costs (government grants)

-

98,000

158,980

-

-

-

256,980

Operating profit / (loss)

2,094,208

(781,279)

270,844

185,969

3,104,821

(3,609,914)

1,264,649

Adjustments:








Depreciation included in Operating Profit

191,992

395,566

234,262

88,339

9,739

28,963

948,861

Other operating (income) /expenses, net

28,528

(174,366)

(150,544)

(60,722)

(3,712,655)

3,667,564

(402,195)

Reimbursement of operating costs (government grants)

-

98,000

158,980

-

-

-

256,980

Net gain/ (loss) on revaluation of biological assets and agricultural produce

-

1,012,988

1,049,194

-

-

732,917

2,795,100

Adjusted EBITDA*

2,314,728

550,909

1,562,736

213,586

(598,095)

819,531

4,863,395

 

* Non-IFRS measure



 


Appendix 3. Unaudited consolidated statement of financial position as at 31 March 2017 (in RR thousand)

 


31 March 2017

31 December 2016

ASSETS



Current assets



Cash and cash equivalents

16,396,825

6,751,712

Restricted cash

37

39

Short-term investments

5,772,795

17,230,012

Trade and other receivables

3,344,506

4,607,634

Prepayments

793,237

746,886

Current income tax receivable

91,332

97,461

Other taxes receivable

2,251,453

3,663,194

Inventories

25,864,973

29,538,204

Short-term biological assets

4,390,677

4,696,957

Total current assets

58,905,835

67,332,099




Non-current assets



Property, plant and equipment

46,597,459

45,662,146

Inventories intended for construction

49,450

38,963

Goodwill

2,333,696

2,225,304

Advances paid for property, plant and equipment

13,347,182

14,172,240

Long-term biological assets

1,666,001

1,745,467

Long-term investments

17,641,133

17,751,740

Investments in associates

113,911

110,504

Deferred income tax assets

2,090,964

1,935,298

Other intangible assets

1,978,913

1,999,209

Restricted cash

3,584

-

Total non-current assets

85,822,293

85,640,871

Total assets

144,728,128

152,972,970




Liabilities and EQUITY



Current liabilities



Short-term borrowings

6,645,725

11,704,276

Trade and other payables

6,327,623

6,988,905

Current income tax payable

89,507

99,450

Other taxes payable

3,194,944

3,814,278

Total current liabilities

16,257,799

22,606,909




Non-current liabilities



Long-term borrowings

31,203,869

32,798,240

Government grants

3,947,326

3,712,593

Deferred income tax liability

539,534

535,514

Total non-current liabilities

35,690,729

37,046,347

Total liabilities

51,948,528

59,653,256




Equity



Share capital

12,269

12,269

Treasury shares

(492,926)

(499,590)

Share premium

26,964,480

26,964,479

Share-based payment reserve

1,058,172

1,181,437

Retained earnings

65,100,303

65,420,978

Equity attributable to owners of ROS AGRO PLC

92,642,298

93,079,573

Non-controlling interest

137,302

240,141

Total equity

92,779,600

93,319,714

Total liabilities and equity

144,728,128

152,972,970

 



 

Appendix 4. Unaudited consolidated statement of cash flows for the three months ended 31 March 2017 according to the Group's management accounts (in RR thousand) - NOT IFRS PRESENTATION


Three months ended


31 March 2017

31 March 2016

Cash flows from operating activities



Profit before income tax

(320,362)

56,141

Adjustments for:



Depreciation and amortization

 1,726,929

948,861

Interest expense

859,204

 1,419,856

Government grants

(123,421)

(435,327)

Interest income

 (1,134,058)

(956,599)

Loss/ (gain) on disposal of property, plant and equipment

78,428

 (4,606)

Net loss on revaluation of biological assets and agricultural produce

 1,734,844

 2,795,100

Change in provision for net realisable value of inventory

 (9,364)

25,909

Share of results of associates

 (3,407)

 (2,399)

Change in provision for impairment of receivables and prepayments

20,350

22,597

Foreign exchange (gain) / loss, net

 2,013

871,987

Net loss from bonds held for trading

 7,842

-

Settlement of loans and accounts receivable previously written-off

 (39,902)

(124,405)

Change in provision for impairment of other taxes receivables

-

(259,953)

Change in provision for impairment of advances paid for property, plant and equipment

 3,525

 5,078

Loss on other investments

-

 (3,463)

Other non-cash and non-operating (income) / expenses, net

 1,272

(220,515)

Operating cash flow before working capital changes

 2,803,893

 4,138,262

Change in trade and other receivables and prepayments

 1,153,533

(615,659)

Change in other taxes receivable

 2,134,381

(217,037)

Change in inventories

 2,395,165

 (2,015,293)

Change in biological assets

43,648

(412,534)

Change in trade and other payables

(649,227)

840,180

Change in other taxes payable

(611,793)

(376,880)

Cash generated from operations

 7,269,599

 1,341,039

Income tax paid

(156,476)

(484,981)

Net cash from operating activities

 7,113,123

856,058

Cash flows from investing activities



Purchases of property, plant and equipment

 (2,875,175)

 (1,151,493)

Purchases of other intangible assets

 (40,446)

 (34,073)

Proceeds from sales of property, plant and equipment

15,576

12,595

Purchases of inventories intended for construction

 (25,601)

 (4,481)

Investments in subsidiaries, net of cash acquired

79,426

(113,542)

Movement in restricted cash

 (4,187)

 (18,520)

Net cash from investing activities

 (2,850,407)

 (1,309,514)

Cash flows from financing activities



Proceeds from borrowings

 2,031,124

11,291,339

Repayment of borrowings

 (8,731,966)

 (14,765,861)

Interest paid

(745,627)

 (1,116,910)

Change in cash on bank deposits*

12,404,999

 1,494,429

Loans given*

 (7)

 (61,647)

Loans repaid*

343,302

 2,521,860

Interest received*

877,661

371,048

Proceeds from government grants

358,154

476,633

Purchases of non-controlling interest

 (50,206)

-

Proceeds from sales of treasury shares

 6,664

-

Other financial activities

 (4,625)

(785)

Net cash from financing activities

 6,489,474

210,106

Net effect of exchange rate changes on cash and cash equivalents

 (96,560)

(411,808)

Net increase/ (decrease) in cash and cash equivalents

10,655,630

(655,158)

Cash and cash equivalents at the beginning of the period

 6,751,712

 4,401,703

Cash and cash equivalents at the end of the period

17,407,342

 3,746,546

 

(*) 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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