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ASTARTA published Report for the first quarter of 2020

Key highlights:

In 1Q20 ASTARTA’s consolidated revenues amounted to EUR101m, 39% of which were generated by the Agriculture segment (versus 52% a year ago) at totalled EUR39m as the Company accelerated its harvest sales in 2019. The Sugar segment, being the second biggest contributor to consolidated revenues (28%), increased sales by 46% y-o-y to EUR29m on higher volumes of sugar sold and an 11% y-o-y increase in realized price. The Group’s EBITDA grew from EUR16m to EUR 28m on higher contribution from the Agriculture and the Sugar segments. The Gross profit increased by 47% y-o-y to EUR30m corresponding to the Gross profit margin of 29% (versus 18% in 1Q19) as cost of sales was positively affected by the local currency depreciation and higher contribution from the remeasurement of agricultural produce. Exports contributed EUR60m, or 60% of the Company’s consolidated revenues.

Agriculture

Segment revenues totalled EUR39m as majority of the grain and oilseeds’ 2019 harvest were sold by the end of 1Q20. Exports accounted for 96% of revenues in 1Q20 versus 91% in 1Q19. Ahead of the 2020 planting season the Company was focused on agricultural machinery upgrade within its maintenance capex. Obsolete 47 tractors were replaced with 31 new John Deere units allowing for precision planting. In addition, other agricultural equipment such as sowers and sprayers were purchased. Higher gain in fair value of biological assets and agricultural produce and lower cost of revenues due to local currency depreciation lead to EBITDA doubling from EUR9m in 1Q19 to EUR20m in 1Q20.

Sugar

Sugar revenues grew to EUR 29m (up by 46% y-o-y) on higher sugar sales volumes and improvement of realized prices to EUR352 per t compared to EUR 316 per t a year ago. Segment EBITDA improved to EUR3.4m in 1Q20 versus EUR2.0m in 1Q19.

Soybean processing

The Soybean Processing segment generated revenues of EUR22m. Exports contributed 89% of revenues. Gross margin improved from 18% in 1Q19 to 20% in 1Q20 on lower cost of sales. EBITDA margin remained flat at 13%.

Сattle Farming

The Cattle Farming segment generated revenues of EUR10m in 1Q20 versus EUR9m in 1019.  Gross margin improved from 20% in 1Q19 to 23% in 1Q20, the EBITDA margin remained flat at 19%. EBITDA stood at EUR2m.

Comments of Valery Sokolenko, Executive Director of ASTARTA:

In the first quarter of 2020, we continued to focus on operational efficiency increase and product cost optimization. COVID-19 pandemic and quarantine measures did not affect the efficiency of our business: all of the planned business processes and tasks were accomplished, the remote work was successfully organized. I am convinced that our team coped well with the challenges and once again proved its professionalism and adaptability.

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