Brasilagro Cia Brasileira De Propriedades Agricolas · BMFBOVESPA:AGRO3
Brasilagro Cia Brasileira De Propriedades Agricolas — Brasilagro Brazilian Agric Real Estate Co Sponsored ADR (Brazil) — Q3 2020 Earnings Presentation
37 slides from Brasilagro Cia Brasileira De Propriedades Agricolas's earnings presentation, May 13, 2020
Slide 1: 3Q20 Earnings Release
3Q20 EARNINGS RELEASE brasilagro »
Slide 2: Earnings Release
01 EARNINGS RELEASE Quarter ended March 31, 2020 _____________________________________________________________________________ São Paulo, May 6, 2020 – BrasilAgro (B3: 3Q20 Conference Call AGRO3) (NYSE: LND), the Brazilian leader May 7, 2020 in acquiring, developing and selling rural properties that
Slide 3: Highlights
Highlights R$78.5 million Adjusted EBITDA 2019/2020 Harvest Completion of planting second corn crop and harvesting more than 40,000 hectares of soybean in Brazil and Paraguay R$353.2 million 1. Net Revenue Lorem ipsum dolor sit amet, consectetur ad Guaranteeing supply to the global food chain amid C
Slide 4: Message from Management
02 MESSAGE FROM MANAGEMENT 2020 is being marked by a very challenging scenario with the Covid- 19 pandemic, which is substantially changing routine of the population. As disclosed in the Notice to the Market of March 23, we put into practice a plan with several measures established by a Risk and Pre
Slide 5: Measures adopted to mitigate Covid-19 impacts
83.3. The measures adopted to mitigate the impacts of Covid-19 on the Company’s results include the marginal reduction of the sugarcane area and the maintenance of our production estimate. We continue to monitor the ethanol margins, which were substantially impacted by the effects of the oil crisis
Slide 6: Operating Performance
03 OPERATING PERFORMANCE Definitions: 3Q19 and 3Q20 – quarters ended March 31, 2019 and 2010 respectively| 9M19 and 9M20 – nine-month periods ended March 31, 2019 and 2020 respectively | 2018/2019 Harvest Year – fiscal year started July 1, 2018 and ended June 30, 2019 | 2019/2020 Harvest Year – fisc
Slide 7: Property Portfolio
agricultural inputs delivery and of the agricultural products sale to ensure storage capability for the Company; BrasilAgro’s operations in Brazil and Paraguay are being conducted without significant impacts. We do not present at this time relevant impact due to the Covid-19 pandemic in our Financia
Slide 8: Market Value of the Portfolio
Land Ownership Total area Arable area 2019/2020 production area 20% 28% 46% 54% 72% 80% Ownership Area Leasing Ownership Area Leasing Ownership Area Leasing The current mix between own and leased areas of the total production area allows greater flexibility in portfolio management, reducing the vola
Slide 9: Agricultural Operations
During the 2019/2020 harvest year, we concluded the transformation process of 3,200 hectares started last harvest and estimate to transform another 3,000 hectares. We accumulated a total transformed area of 128,600 hectares in 11 years of operation. This represents an average growth of 29% in portfo
Slide 10: Production
19/20 Harvest Area in Production by product (ha) 18/19 Harvest 19/20 Harvest (1) Change (%) Participation (%) Grains 66,899 81,905 53.5% 22.4% Soybean 51,843 54,342 35.5% 4.8% Corn and Corn 2nd Crop 15,056 24,939 16.3% 65.6% Bean 2nd Crop - 2,624 1.7% n.a. Sugarcane 31,832 29,169 19.0% -8.4% Pasture
Slide 11: Cotton and Sugarcane production
also allocated second harvest areas to Chaparral and Parceria V Farms for such crop. Second bean crop has already been planted. Cotton 18/19 Harvest 19/20 Harvest Change 19/20 Harvest Change Production (tons) Realized Estimated (%) Forecasted (%) Cotton 4,875 8,152 67.2% 6,934 -14.9% We project a lo
Slide 12: Cattle Raising
Cattle Raising 19/20 Harvest 18/19 19/20 Harvest Change Change Realized Cattle Raising Harvest Estimated C/A C/B (Up to Mar/31) (A) (B) (%) (%) (C) Hectares 13,351 13,721 13,721 2.8% 0.0% Number of heads 20,865 17,983 21,351 2.3% 18.7% Meat production (kg) 2,803,685 2,687,005 1,977,627 -29.5% -26.4%
Slide 13: Other
Other In order to improve the Company’s results, mitigate operating risks and as a real estate strategy, in 9M20, we leased 21,872 hectares to third parties in the state of Bahia and in Paraguay. The areas were leased to local farmers, and the contracts have a duration of up to 5 years with a value
Slide 14: Financial Performance
04 FINANCIAL PERFORMANCE The consolidated financial statements were prepared and are being presented in accordance with International Financial Reporting Standards (IFRS), issued by the International Accounting Standards Board. Merger of Agrifirma On January 27, 2020, we concluded the merger of Agri
Slide 15: EBITDA and Adjusted EBITDA
EBITDA and Adjusted EBITDA EBITDA is presented based on Net Income adjusted for interest, taxes, depreciation and amortization, pursuant to accounting standards. Adjusted EBITDA was calculated by excluding biological assets in progress (sugarcane and grains planted) and adjusted for the harvest’s de
Slide 16: Income Statement
Due to the high volatility of the US Dollar exchange rate late in the 9M20, caused mainly by the Covid-19 pandemic, we had a negative impact in Derivative Results. In the 9M20 we recorded negative R$26.6 million in this account, negative R$29.2 million attributed to FX operations and R$2.5 million a
Slide 17: Farm Sales
Farm Sales Change 9M20 9M19 (R$ thousand) (%) Nominal Value of Sale 28,163 181,636 -84.5% Present Value Adjustment (4,111) (51,431) -92.0% Revenue from Farms Sale 24,052 130,205 -81.5% Sales Taxes (878) (4,753) -81.5% Selling Costs (2,478) (19,191) -87.1% Farm Sale Gain 20,696 106,261 -80.5% The var
Slide 18: Sale of Agricultural Products
The increase in the volume of grains sold reflects the absorption of new production areas. In contrast, the prices practiced in each region impact revenue per ton as they consider factors such as the distance for production outflow. In this sense, there was an impact in 9M20 over 9M19, chiefly due t
Slide 19: Agricultural products results
Corn Corn Soybean Cotton Cattle Gain / Loss Agricultural Products (crop) (2nd crop) Sugarcane Others 19/20 18/19 Raising 03/31/20 18/19 18/19 Area (hectares) 27,932 1,095 7,670 976 18,499 13,721 2,016 71,909 Production (Tons or Meat Kgs) 97,025 - 33,681 3,418 1,568,704 1,977,627 1,429 3,681,884 Yiel
Slide 20: Cattle raising and biological assets
recoverable sugar) of the harvest. This good result was due to the higher prices of TRS (total recoverable sugar) and Consecana. Loss from cattle raising corresponded to R$0.6 million, with a production of 2.0 tons of meat, 7.8% lower compared to the same period last year. Cattle Raising 9M20 9M19 C
Slide 21: Production Cost
PRODUCTION COST Corn Cattle 18/19 Harvest (%) Soybean Corn Cotton Sugarcane 2nd Crop Raising Variable costs 72% 74% 100% 86% 69% 35% Seeds 9% 17% 22% 7% 0% 0% Fertilizers 22% 27% 28% 16% 8% 0% Defensives 20% 12% 16% 31% 7% 0% Agricultural services 17% 14% 34% 32% 45% 0% Fuels and Lubricants 3% 3% 0%
Slide 22: Cost of Goods Sold
COST OF GOODS SOLD (R$ thousand) 3Q20 3Q19 Change 9M20 9M19 Change Cost of Goods Sold (59,665) (11,028) 441.0% (248,159) (142,407) 74.3% Soybean (44,061) (5,866) 651.1% (103,960) (36,340) 186.1% Corn (1,543) (438) 252.3% (21,244) (6,708) 216.7% Bean (1,573) - n.a. (1,573) - n.a. Cotton (4,087) - n.a
Slide 23: Sugarcane and cattle COGS, Selling Expenses
Sugarcane COGS decreased by R$700,000 in 9M20 versus the previous year, from R$85.4 million, from the sale of 1.2 million tons at R$69,38 per ton, to R$84.7 million, from the sale of 1.4 million tons at R$58.67 per ton of sugarcane. The decrease in cost per ton is mainly due to improved productivity
Slide 24: Other Operating Income / Expenses
OTHER OPERATING INCOME / EXPENSES (R$ thousand) 3Q20 3Q19 Change 9M20 9M19 Change Other operating income/expenses (1,707) (40) n.a. (2,047) (557) 267.5% Gain/Loss on sale of fixed assets (102) 34 n.a. (94) 3 n.a. Provisions for lawsuits (456) 198 n.a. (582) 402 n.a. Others (5,273) (272) n.a. (5,495)
Slide 25: Financial Result and Derivative Operations
totaled R$13.2 million, R$6.1 million of which related to currency operations and R$7.1 million to operations with commodities. Due to the high volatility of the US Dollar exchange rate late in the 9M20, caused mainly by the Covid-19 pandemic, we had a negative impact in Derivative Results. However,
Slide 26: Balance Sheet, Hedge Position and NAV
HEDGE POSITION ON APRIL 27, 2020 Soybean FX Harvest Price Volume Volume % of hedge(1) % of hedge(2) BRL/USD (USD/bu) (thousand) 19/20 141,673 ton 97.37% 9.59 USD 45,848 100.00% 4.07 20/21 18,000 ton 12.83% 9.30 USD 5,271 11.82% 4.21 (1) % of the v olume of soybean locked in tons. (2) % of estimated
Slide 27: Cash and Cash Equivalents, Clients
CASH AND CASH EQUIVALENTS Cash and Cash equivalents / Marketable Securities 03/31/2020 06/30/2019 Change (R$ thousand) Cash and Cash equivalents 72,701 106,627 -31.8% Cash and Banks 19,090 25,614 -25.5% Repurchase agreements - 12,632 -100.0% Bank deposit certificates 53,611 46,262 15.9% Finance Leas
Slide 28: Inventories
INVENTORIES (R$ thousand) 03/31/2020 06/30/2019 Change Soybean 54,846 54,581 0.5% Corn 1,164 11,116 -89.5% Bean 233 - n.a. Cotton 617 4,349 -85.8% Livestock 40,273 37,122 8.5% Other crops 960 255 276.5% Agricultural Products 98,093 107,423 -8.7% Supplies 24,309 26,767 -9.2% Total 122,402 134,190 -8.
Slide 29: Indebtedness
INDEBTEDNESS (R$ thousand) Expiration Annual Interest Tax - % 03/31/2020 06/30/2019 Change Short term Financing for Agricultural Funding Jul-20 Pre 1.80 + CDI rate 7.00 11,412 38,588 -70.4% Financing for Agricultural Funding (Guarani) Jan-21 Pre 7.22 to 8.25 29,333 18,364 59.7% Financing of Projeto
Slide 30: Leasing liabilities
Liabilities will be recognized whenever there is an effective lease payment, in addition to periodic updating by the variation of the soybean or sugarcane bag and adjustment to present value. The impacts of the adjustment to present value will be recognized in the Financial Result. For more informat
Slide 31: Investment Properties
Acquisition Buildings and Area Construction Investment (R$ thousand) value improvements Opening in progress Properties Initial Balance 410,561 39,658 78,832 19,666 548,717 In June 30, 2019 Acquisitions 30 115 424 11,425 11,994 Acquisitions - Merger of Agrifirma 197,710 7,906 - - 205,616 Reductions (
Slide 32: Capital Markets
05 CAPITAL MARKETS The Company was the first agricultural production company to list its shares on the Novo Mercado segment of B3 (São Paulo Stock Exchange) and was also the first Brazilian agribusiness company to list its ADRs (American Depositary Receipts) on the NYSE (New York Stock Exchange). Sh
Slide 33: Weights and Measures used in Agriculture
Disclaimer The statements contained in this document related to the prospects for BrasilAgro’s businesses, projected operating and financial results and growth are merely projections, and as such, are based exclusively on management’s expectations. These expectations depend materially on market cond
Slide 34: Income Statement
07 INCOME STATEMENT (R$ thousand) 3Q20 3Q19 Change 9M20 9M19 Change Revenues from Farm Sales - - n.a. 24,052 130,205 -82% Revenues from grains 58,164 14,406 304% 141,307 75,885 86% Revenues from cotton 4,332 - n.a. 12,927 - n.a. Revenues from sugarcane 9,893 1,028 n.a. 150,101 118,764 26% Revenues f
Slide 35: Balance Sheet - Assets
08 BALANCE SHEET - ASSETS Assets (R$ thousand) 03/31/2020 06/30/2019 Change Current assets Cash and Cash equivalents 72,701 106,627 -32% Marketable securities 7,027 4,038 74% Derivative financial instruments 13,291 5,906 125% Trade accounts receivable 151,892 125,320 21% Inventories 82,128 97,068 -1
Slide 36: Balance Sheet - Liabilities
09 BALANCE SHEET - LIABILITIES Liabilities (R$ thousand) 03/31/2020 06/30/2019 Change Current liabilities Trade accounts payable and other obligations 94,295 98,070 -4% Loans and financing 130,258 76,608 70% Labor obligations 9,145 17,093 -46% Derivative financial instruments 13,402 11,055 21% Trans
Slide 37: Cash Flow
10 CASH FLOW (R$ thousand) 9M20 9M19 Change CASH FLOW OF OPERATING ACTIVITIES Profit (loss) for the period 85,603 140,076 -39% Adjustments to reconcile net income Depreciation and amortization 21,083 20,846 1% Farm Sales Gain (20,696) (106,261) -81% Residual value of fixed assets 443 313 42% Written