United States

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 20-F

☐   REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR (g) OF THE SECURITIES EXCHANGE ACT OF 1934

OR

☒   ANNUAL REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended June 30, 2022

OR

☐   TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE ACT OF 1934

OR

☐   SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES AND EXCHANGE ACT OF 1934

Date of event requiring this shell company report ___

Commission file number 001-29190

CRESUD SOCIEDAD ANONIMA COMERCIAL INMOBILIARIA FINANCIERA Y AGROPECUARIA

(Exact name of Registrant as specified in its charter)

Cresud Inc.

(Translation of Registrant’s name into English)

Republic of Argentina

(Jurisdiction of incorporation or organization)

Carlos M. Della Paolera 261, 9th Floor (C1001ADA),

City of Buenos Aires, Argentina

(Address of principal executive offices)

Matías Iván Gaivironsky

Chief Financial and Administrative Officer

Tel +(5411) 4323-7449 – ir@cresud.com.ar

Carlos M. Della Paolera 261, 9th Floor, (C1001ADA),

City of Buenos Aires, Argentina

(Name, Telephone, E-mail and/or Facsimile number and Address of Company Contact Person)

Securities registered or to be registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol	Name of each exchange  on which registered
American Depositary Shares (ADSs), each representing ten shares of Common Stock	CRESY	Nasdaq National Market of the Nasdaq Stock Market
Common Stock, par value ARS 1.00 per share		Nasdaq National Market of the Nasdaq Stock Market*

* Not for trading, but only in connection with the registration of American Depositary Shares, pursuant to the requirements of the Securities and Exchange Commission.

Securities registered or to be registered pursuant to Section 12(g) of the Act: None

Securities for which there is a reporting obligation pursuant to Section 15(d) of the Act: None

Indicate the number of outstanding shares of each of the issuer’s classes of capital or common stock as of the close of the period covered by the Annual Report: 592,088,735.

Indicate by check mark if the registrant is a well known seasoned issuer, as defined in Rule 405 of the Securities Act:  ☐ Yes  ☒ No

If this report is an annual or transition report, indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15 (d) of the Securities Exchange Act of 1934.  ☒ Yes   ☐ No

Note: Checking the box above will not relieve any registrant required to file reports pursuant to Section 13 or 15(a) of the Securities Exchange Act of 1934 from their obligations under those Sections Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.  ☒ Yes   ☐ No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).  ☒ Yes   ☐ No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer or an emerging growth company. See definition of “large accelerated filer,” “accelerated filer” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer   ☐ Accelerated filer ☒ Non-accelerated filer ☐ Emerging growth company ☐

If an emerging growth company that prepares its financial statements in accordance with U.S. GAAP, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards† provided pursuant to Section 13(a) of the Exchange Act.   ☐

†The term “new or revised financial accounting standard” refers to any update issued by the Financial Accounting Standards Board to its Accounting Standards Codification after April 5, 2012.

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report.   ☒

Indicate by check mark which basis of accounting the registrant has used to prepare the financial statements included in this filing:

U.S. GAAP ☐ International Financial Reporting Standards as issued by the International Accounting Standards Board ☒ Other ☐

If “Other” has been checked in response to the previous question, indicate by check mark which financial statement item the registrant has elected to follow.

☐ Item 17   ☐ Item 18

 If this is an annual report, indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

☐ Yes   ☒ No 

(APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE PAST FIVE YEARS)

Indicate by check mark whether the registrant has filed all documents and reports required to be filed by Sections 12, 13 or 15(d) of the Securities Exchange Act of 1934 subsequent to the distribution of securities under a plan confirmed by the court. Yes ☐   No ☐

Please send copies of notices and communications from the

Securities and Exchange Commission to:

Carolina Zang	Jaime Mercado Juan M. Naveira
Zang Bergel & Viñes Abogados	Simpson Thacher & Bartlett LLP
Florida 537, 18th Floor C1005AAK City of Buenos Aires, Argentina.	425 Lexington Avenue New York, NY 10017 United States of America

TABLE OF CONTENTS

		Page No.
	DISCLAIMER REGARDING FORWARD-LOOKING STATEMENTS	iv
	AVAILABLE INFORMATION	v
	PRESENTATION OF FINANCIAL AND CERTAIN OTHER INFORMATION	vi
Part I		1
ITEM 1.	Identity of Directors, Senior Management, Advisers and Auditors	1
ITEM 2.	Offer Statistics and Expected Timetable	1
ITEM 3.	Key Information	1
	A. Reserved	1
	A.1. Local Exchange Market and Exchange Rates	1
	B. Capitalization and Indebtedness	1
	C. Reasons for the Offer and Use of Proceeds	1
	D. Risk Factors	2
ITEM 4.	Information on the Company	60
	A. History and Development of the Company	60
	B. Business Overview	69
	C. Organizational Structure	128
	D. Property, Plant and Equipment	129
ITEM 4A.	Unresolved staff comments	132
ITEM 5.	Operating and Financial Review and Prospects	132
	A. Operating Results	132
	B. Liquidity and Capital Resources	176
	C. Research and Development, Patents and Licenses, Etc	189
	D. Trend Information	190
	E. Critical Accounting Estimates	193
ITEM 6.	Directors, Senior Management and Employees	194
	A. Directors and Senior Management	194
	B. Compensation	199
	C. Board Practices	201
	D. Employees	202
	E. Share Ownership	203
ITEM 7.	Major Shareholders and Related Party Transactions	204
	A. Major Shareholders	204
	B. Related Party Transactions	205
	C. Interests of Experts and Counsel	209
ITEM 8.	Financial Information	210
	A. Consolidated Statements and Other Financial Information	210
	B. Significant Changes	218
ITEM 9.	The Offer and Listing	218
	A. Offer and Listing Details	218
	B. Plan of Distribution	219
	C. Markets	219
	D. Selling Shareholders	222
	E. Dilution	222
	F. Expenses of the Issue	222
ITEM 10.	Additional Information	222
	A. Share Capital	222
	B. Memorandum and Articles of Association	222
	C. Material Contracts	230
	D. Exchange Controls	230
	E. Money Laundering	234
	F. Taxation	237
	G. Dividends and Paying Agents	244

ii

	H. Statement by Experts	245
	I. Documents on Display	245
	J. Subsidiary Information	246
ITEM 11.	Quantitative and Qualitative Disclosures about Market Risk	246
ITEM 12.	Description of Securities Other than Equity Securities	246
	A. Debt Securities	246
	B. Warrants and Rights	246
	C. Other Securities	246
	D. American Depositary Shares	246
Part II		247
ITEM 13.	Defaults, Dividend Arrearages and Delinquencies	247
ITEM 14.	Material Modifications to the Rights of Security Holders and Use of Proceeds	247
ITEM 15.	Controls and Procedures	247
	A. Disclosure Controls and Procedures	247
	B. Management’s Annual Report on Internal Control Over Financial Reporting	247
	C. Attestation Report of the Registered Public Accounting Firm	248
	D. Changes in Internal Control Over Financial Reporting	248
ITEM 16.	Reserved	248
ITEM 16A.	Audit Committee Financial Expert	248
ITEM 16B.	Code of Ethics	248
ITEM 16C.	Principal Accountant Fees and Service	249
ITEM 16D.	Exemption from the Listing Standards for Audit Committees	250
ITEM 16E.	Purchases of Equity Securities by the Issuer and Affiliated Purchasers	250
ITEM 16F.	Change In Registrant’s Certifying Accountant	250
ITEM 16G.	Corporate Governance	250
ITEM 16H.	Mine Safety Disclosures	254
ITEM 16I.	Disclosure Regarding Foreign Jurisdictions that Prevent Inspections	254
Part III		255
ITEM 17.	Financial Statements	255
ITEM 18.	Financial Statements	255
ITEM 19.	Exhibits	255

iii

DISCLAIMER REGARDING FORWARD-LOOKING STATEMENTS

This Annual Report contains and incorporates by reference statements that constitute estimates and forward-looking statements. The words “believe,” “will,” “may,” “may have,” “would,” “estimate,” “continues,” “anticipates,” “intends,” “should,” “plans,” “expects,” “predicts,” “potential,” “seek” and similar words or phrases, or the negative of these terms or other similar expressions, are intended to identify estimates and forward-looking statements. Some of these statements include statements regarding our current intent, belief or expectations. While we consider these expectations and assumptions to be reasonable, forward-looking statements are subject to various risks and uncertainties, most of which are difficult to predict and many of which are beyond our control. Forward-looking statements are not guarantees of future performance. Actual results may be substantially different from the expectations described in the forward-looking statements. Accordingly, investors should not place undue reliance on forward-looking statements as a prediction of actual results.

We have based these forward-looking statements on current expectations and assumptions about future events. While we consider these expectations and assumptions to be reasonable, they are inherently subject to significant risks and uncertainties, most of which are difficult to predict and many of which are beyond our control. The risks and uncertainties that may affect our forward-looking statements include, among others, the following:

· changes in general economic, financial, business, political, legal, social or other conditions in Argentina, Brazil and Latin America or changes in developed markets or emerging markets or both;

· changes in capital markets in general that may affect policies or attitudes toward lending to or investing in Argentina or Argentine companies, including volatility in domestic and international financial markets;

· inflation and deflation;

· ongoing economic impacts of the COVID-19 pandemic on the Argentine economy, and the related impacts on our business and financial condition;

· measures adopted by the Argentine government in response to the COVID-19 pandemic and other infectious diseases;

· impact of the COVID-19 pandemic and the spread of other infectious diseases on our business;

· fluctuations in the exchanges rates of the Peso and in the prevailing interest rates in Argentina;

· increases in financing costs or our inability to obtain additional financing on attractive terms, which may limit our ability to fund existing operations and to finance new activities;

· current and future Argentine government regulation and changes in law or in the interpretation by Argentine courts;

· price fluctuations in the agricultural real estate market;

· political, civil and armed conflicts;

· adverse legal or regulatory disputes or proceedings;

· fluctuations and declines in the aggregate principal amount of Argentine public debt outstanding and default on Argentina’s of sovereign debt;

· the impact of the new agreement with the International Monetary Fund (“IMF”) and the restructuring of Argentina’s sovereign debt with the IMF and the Paris Club;

iv

· governmental intervention in the private sector and in the economy, including through nationalization, expropriation, labor regulation or other actions;

· restrictions on transfer of foreign currencies and other exchange controls;

· increased competition in the shopping mall sector, office or other commercial properties and related industries;

· potential loss of significant tenants at our shopping malls, offices or other commercial properties;

· our ability to take advantage of opportunities in the real estate market on a timely basis;

· restrictions on energy supply or fluctuations in prices of utilities in the Argentine market;

· our ability to meet our debt obligations;

· shifts in consumer purchasing habits and trends;

· technological changes and our potential inability to implement new technologies;

· deterioration of regional, national or global businesses and economic conditions;

· changes to applicable regulations to currency exchange or transfers;

· incidents of government corruption that adversely impact the development of our real estate projects;

· fluctuations and declines in the exchange rate of the Peso and the U.S. dollar against other currencies; and

· the risk factors discussed under “Risk Factors.”

Forward-looking statements refer only to the date of this Annual Report, and neither we undertake any obligation to update or revise any estimate or forward-looking statement due to new information, future events or otherwise. Additional factors or events affecting our business may emerge from time to time, and we cannot predict all of these factors or events, nor can we assess the future.

AVAILABLE INFORMATION

We file annual and current reports and other information with the United States Securities and Exchange Commission (“SEC”). You may obtain any report, information or other document we file electronically with the SEC at the SEC’s website (http://www.sec.gov) or at our website (http://www.cresud.com.ar). The information contained in our website does not form part of this Annual Report.

v

PRESENTATION OF FINANCIAL AND CERTAIN OTHER INFORMATION

In this annual report (the “Annual Report”), references to “Cresud,” the “Company,” “we,” “us” and “our” means Cresud Sociedad Anónima Comercial, Inmobiliaria, Financiera y Agropecuaria, and its consolidated subsidiaries, unless the context otherwise requires, or where we make clear that such term refers only to Cresud and not to its subsidiaries.

The term “Argentine government” refers to the federal government of Argentina, the term “Central Bank” refers to the Banco Central de la República Argentina (the Argentine Central Bank), the terms “CNV” and “CNV Rules” refer to the Comisión Nacional de Valores (the Argentine National Securities Commission) and the rules issued by the CNV, respectively.

References to “ADSs” are to the American Depositary Shares, each representing 10 shares of our common stock, issued pursuant to the deposit agreement, dated as of March 18, 1997 (the “deposit agreement”), between us, The Bank of New York, as depositary (the “ADS Depositary”), and the owners and holders of the ADRs issued from time to time thereunder, and references to “ADRs” are to the American Depositary Receipts, which represent the ADSs.

Financial Statements

We prepare and maintain our financial books and records in Pesos (as defined below in section “—Currency”) and in accordance with International Financial Reporting Standards (“IFRS”), as issued by the International Accounting Standards Board (“IASB”) and the CNV Rules. Our fiscal year begins on July 1 of each year and ends on June 30 of each year thereafter.

Our audited Consolidated Financial Statements as of June 30, 2022 and 2021 and for the years ended June 30, 2022, 2021 and 2020, and the notes thereto (our “Audited Consolidated Financial Statements”) are set forth on pages F-1 through F-102 of this Annual Report.

Our Audited Consolidated Financial Statements have been approved by resolution of the Board of Directors’ meeting held on October 27, 2022 and have been audited by Price Waterhouse & Co S.R.L., Argentina, member of PricewaterhouseCoopers International Limited, an independent registered public accounting firm whose report is included herein.

Deconsolidation of IDBD and DIC

On September 25, 2020 the Court decreed the insolvency and liquidation of IDBD and appointed a trustee for its shares along with a custodian over DIC and Clal shares. After this decision, the Board of Directors of IDBD was removed, therefore, IRSA lost control on that date. For comparability purposes and as required by IFRS 5, the results of the Israel Operations Center have been reclassified to discontinued operations for all the years presented.

As of the date of this Annual Report, IRSA no longer owns any capital stock of IDBD while we have an investment in DIC that amounts to 2,062,000 of shares representing 1.5% of its capital stock.

Functional and Presentation Currency; Adjustment for Inflation

Our functional and presentation currency is the Peso, and our Audited Consolidated Financial Statements included in this Annual Report are presented in Pesos.

IAS 29, Financial Reporting in Hyperinflationary Economies (“IAS 29”) requires that the financial statements of an entity whose functional currency is one of a hyperinflationary economy be measured in terms of the current unit of measurement at the closing date of the financial statements, regardless of whether they are based on the historical cost method or the current cost method. This requirement also includes the comparative information of the financial statements.

vi

In order to conclude that an economy is “hyperinflationary,” IAS 29 outlines a series of factors, including the existence of an accumulated inflation rate in three years that is approximately or exceeds 100%. As of July 1, 2018, Argentina reported a cumulative three-year inflation rate greater than 100% and therefore financial information published as from that date should be adjusted for inflation in accordance with IAS 29. Therefore, our Audited Consolidated Financial Statements and the financial information included in this Annual Report have been stated in terms of the measuring unit current at the end of the reporting year. For more information, see section “Financial Statements” above and Note 2.1 to our Audited Consolidated Financial Statements.

Effective July 1, 2019, we adopted IFRS 16 “Leases” which establishes the criteria for recognition and valuation of leases for lessees and lessors. The changes incorporated mainly impact the tenant’s accounting. IFRS 16 provides that the lessee recognizes an asset for the right of use and a liability at present value with respect to those contracts that meet the definition of lease agreements according to IFRS 16. In accordance with the standard, a lease agreement is one that provides the right to control the use of an identified asset for a specific period. In order for a company to have control over the use of an identified asset: a) it must have the right to obtain substantially all the economic benefits of the identified asset and b) it must have the right to direct the use of the identified asset. The standard allows to exclude the short-term contracts (under 12 months) and those in which the underlying asset has low value. The application of IFRS 16 increased assets and liabilities and generated a decrease in operating costs for leases. On the other hand, the balance of depreciation and financial results generated by the present value of those lease liabilities were increased. This application does not imply changes in comparative information.

Additionally, effective July 1, 2019, in accordance with the amendment to IAS 28, an entity shall implement the provisions of IFRS 9 to Long-term Investments that are essentially part of the entity’s net investment in the associate or in the joint venture according to the definitions of said standard, using the modified retrospective approach. The provisions of IFRS 9 shall apply to such investments with respect to the share of the losses of an associate or a joint venture, as well as with respect to the recognition of the impairment of an investment in an associate or joint venture. In addition, when applying IFRS 9 to such long-term investments, the entity will make it prior to the adjustments made to the carrying amount of the investment in accordance with IAS 28. We opted for an accounting policy where the currency translation adjustments arising from these loans are recorded as part of other comprehensive income.

See Note 2.2 to our Audited Consolidated Financial Statements for more information about the adoption of new standards.

Currency

Unless otherwise specified or the context otherwise requires, references in this Annual Report to “Peso,” “Pesos” or “ARS” are to Argentine pesos, references to “U.S. dollars,” “dollars” or “USD” are to United States dollars and references to “Real,” “Reals,” “Rs.” or “BRL” are to Brazilian Real, the legal currency Brazil.

We have translated some of the Peso amounts contained in this Annual Report into U.S. dollars for convenience purposes only. Unless otherwise specified or the context otherwise required, the rate used to convert Peso amounts to U.S. dollars is the seller exchange rate quoted by Banco de la Nación Argentina of ARS 125.2300 per USD 1.00 as of June 30, 2022. The average seller exchange rate for fiscal year 2022, quoted by Banco de la Nación Argentina was ARS 105.3712. The seller exchange rate quoted by Banco de la Nación Argentina was ARS 155.39 per USD 1.00 as of October 26, 2022. The U.S. dollar-equivalent information presented in this Annual Report is provided solely for the convenience of the reader and should not be construed as implying that the Peso amounts represent, or could have been or could be converted into, U.S. dollars at such rates or at any other rate. See “Local Exchange Market and Exchange Rates” and “Risk Factors—Risks relating to Argentina—Continuing high rates of inflation may have an adverse effect on the economy and our business, financial condition and the results of our operations.”

Certain Measurements

In Argentina, the standard measure of area in the real estate market is the square meters (m2, or “sqm”), while in the United States and certain other jurisdictions the standard measure of area is the square foot (sq. ft.). All units of area shown in this Annual Report (e.g., gross leasable area of buildings (“GLA” or “gross leasable area”), and size of undeveloped land) are expressed in terms of sqm. One sqm is equal to approximately 10.8 square feet. One hectare is equal to approximately 10,000 sqm and to approximately 2.47 acres.

vii

In Argentina the standard measure of weight are the tons (“Tons,” “tons” or “Tns”) and kilograms (“kg” or “kgs”), while in the United States and certain other jurisdictions the standard measure of weight are the pound or the bushel. A metric ton is equal to 1,000 kilograms. A kilogram is equal to approximately 2.2 pounds. A metric ton of wheat is equal to approximately 36.74 bushels. A metric ton of corn is equal to approximately 39.37 bushels. A metric ton of soybean is equal to approximately 36.74 bushels. One kilogram of live weight cattle is equal to approximately 0.5 to 0.6 kilogram of carcass (meat and bones).

As used in this Annual Report, GLA in the case of shopping malls refers to the total leasable area of the properties, regardless of our ownership interest in such properties (excluding common areas and parking areas and space occupied by supermarkets, hypermarkets, gas stations and co-owners, except where specifically stated otherwise).

Rounding Adjustments

Certain figures which appear in this Annual Report (including percentage amounts) and in our financial statements have been subject to rounding adjustments for ease of presentation. Accordingly, figures shown for the same category presented in different tables or different parts of this Annual Report and in our financial statements may vary slightly, and figures shown as totals in certain tables may not be arithmetic aggregation of the figures that precede them.

Economic, Industry and Market Data

Economic, industry and market data and other statistical information included or incorporated by reference into this Annual Report is based on data compiled by us from internal sources and based on publications such as Bloomberg, the International Council of Shopping Centers, the Argentine Chamber of Shopping Centers (Cámara Argentina de Shopping Centers), and the National Institute of Statistics and Censuses (Instituto Nacional de Estadística y Censos, the “INDEC”). Although we believe these sources are reliable, we have not independently verified the information and cannot guarantee its accuracy or completeness.

Subsidiaries Corporate Reorganization

On September 30, 2021, IRSA Inversiones y Representaciones S.A. (“IRSA”) and IRSA Propiedades Comerciales S.A. (“IRSA CP”), both subsidiaries of the Company, executed a Preliminary Merger Agreement pursuant to which IRSA CP would merge into IRSA, by way of absorption by IRSA of IRSA CP, and IRSA would assume, by universal succession, all of the assets and liabilities and succeed to all of the rights and obligations of IRSA CP. On December 22, 2021, the shareholders of IRSA and IRSA CP approved the merger, whose effective date was established on July 1, 2021. On January 30, 2022, IRSA and IRSA CP executed a Definitive Merger Agreement. On May 9, 2022, we disclosed that the CNV informed us that the merger by absorption of IRSA with IRSA CP, and the dissolution without liquidation of IRSA CP was registered, with IRSA as the surviving corporation.

viii

PART I

Item 1. Identity of Directors, Senior Management and Advisers

This item is not applicable.

Item 2. Offer Statistics and Expected Timetable

This item is not applicable.

Item 3. Key Information

A.    Reserved

A.1. Local Exchange Market and Exchange Rates

The Argentine government has established a series of exchange control measures that restrict the free flow of currency and the transfer of funds abroad. These measures significantly curtail access to the foreign exchange market Mercado Único y Libre de Cambios (“MULC”) by both individuals and private sector entities. This makes it necessary, among other things, to obtain prior approval from the Central Bank to enter into certain foreign exchange transactions such as payments relating to royalties, services or fees payable outside Argentina. For more information about exchange controls see, “Item 10. Additional Information—D. Exchange Controls”.

The following table shows the maximum, minimum, average and closing exchange rates for each applicable period to purchases of U.S. dollars.

	Maximum(1) (2)		Minimum(1) (3)		Average(1) (4)		At closing(1)
Fiscal year ended:
June 30, 2020		70.3600		41.5000		59.5343		70.3600
June 30, 2021		95.6200		70.4200		83.8081		95.6200
June 30, 2022		125.1300		95.6600		105.2712		125.1300
Month ended:
July 31, 2022		131.1700		125.3500		128.3519		132.3200
August 31, 2022		138.6300		131.7900		135.2041		138.6300
September 30, 2022		147.2200		138.9300		143.5305		147.2200
October 2022 (through October 26, 2022)		155.2900		148.1300		151.8113		155.2900

____________________ 

Source: Banco de la Nación Argentina

(1)	Average between the offer exchange rate and the bid exchange rate according to Banco de la Nación Argentina’s foreign currency exchange rate.
(2)	The maximum exchange rate appearing in the table was the highest end-of-month exchange rate in the year or shorter period, as indicated.
(3)	The minimum exchange rate appearing in the table was the lowest end-of-month exchange rate in the year or shorter period, as indicated.
(4)	Average exchange rates at the end of the month.

B. Capitalization and Indebtedness

This section is not applicable.

C. Reasons for the Offer and use of Proceeds

This section is not applicable.

1

D. Risk Factors

Summary of Risk Factors

The following summarizes some, but not all, of the risks provided below. Please carefully consider all of the information discussed in this Item 3.D. “Risk Factors” in this Annual Report for a more thorough description of these and other risks:

Risks Relating to Argentina, Brazil and other Countries Where We Operate

· We depend on macroeconomic and political conditions in Argentina.

· Governments in the countries where we operate or intend to operate exercise significant influence over their economies.

· Continuing high rates of inflation may have an adverse effect on the economy and our business, financial condition and results of operations.

· Argentina’s ability to obtain financing in the international capital markets is limited, which may impair our ability to access international credit markets to finance our operations in Argentina.

· Significant fluctuation in the exchange rate of the Peso against foreign currencies may adversely affect the Argentine economy as well as our financial condition and results of operations.

· Property values in U.S. dollars in Argentina could decline significantly.

· Restrictions on transfers of foreign currency and the repatriation of capital from Argentina may impair our ability to pay dividends and distributions and investors may face restrictions on their ability to collect capital and interest payments in connection with corporate bonds issued by Argentine companies.

· The imposition of restrictions on acquisitions of agricultural properties by foreign nationals in Brazil may materially restrict the development of our business and significant environmental regulation may significantly increase our expenses.

· The ongoing COVID-19 pandemic and Argentine government measures to contain the virus are adversely affecting our business and results of operations, preventing us from accurately predicting the ultimate impact on our results of operations.

· The appearance of “monkeypox” and its spread in different countries, including Argentina, and possible Argentine government measures to contain the virus may adversely affect our business and results of operations.

Risks Relating to Our Agricultural Business

· Fluctuation in market prices for our agriculture products could adversely affect our financial condition and results of operations.

· Unpredictable weather conditions, pest infestations and diseases may have an adverse impact on our crop yields and cattle production. We may be exposed to material losses due to volatile crop prices since a significant portion of our production is not hedged, and exposed to crop price risk.

· Worldwide competition in the markets for our products could adversely affect our business and results of operations.

2

· Our internal processes and controls might not be sufficient to comply with the extensive environmental regulation and current or future environmental regulations could prevent us from fully developing our land.

· Our level of debt may adversely affect our operations and our ability to pay our debt as it becomes due.

Risks Relating to IRSA’s Business in Argentina

· Disease outbreaks or other public health concerns could reduce traffic in IRSA’s shopping malls.

· IRSA is subject to risks inherent to the operation of shopping malls that may affect its profitability.

· The increasingly competitive real estate sector in Argentina may adversely affect IRSA’s ability to rent or sell office space and other real estate.

· IRSA’s assets are highly concentrated in certain geographic areas and an economic downturn in such areas could have a material adverse effect on its results of operations and financial condition.

· The loss of tenants could adversely affect IRSA’s operating revenue and value of its properties.

· IRSA’s level of debt may adversely affect its operations and ability to pay its debt as it becomes due.

· IRSA may face risks associated with acquisitions of properties, IRSA’s future acquisitions may not be profitable and the properties IRSA acquires may be subject to unknown liabilities.

· Some of the land IRSA has purchased is not zoned for development purposes, and it may be unable to obtain, or may face delays in obtaining, the necessary zoning permits and other authorizations.

· IRSA is dependent on its Board of Directors senior management and other key personnel and may face potential conflicts of interest relating to its principal shareholders.

Risks Relating to IRSA’s Investment in Banco Hipotecario

· COVID-19 may negatively impact the operations and financial situation of Banco Hipotecario.

· Banco Hipotecario’s capacity to successfully access the local and international markets on favorable terms affects its cost of funding.

· The asset quality of financial institutions is exposed to the non-financial public sector’s and Central Bank’s indebtedness.

· The short-term structure of Banco Hipotecario’s deposit base could lead to a reduction in liquidity levels and limit the long-term expansion of financial intermediation.

· Banco Hipotecario operates in a highly regulated environment and its operations are subject to capital controls regulations adopted by several regulatory agencies.

3

Risks Relating to our ADSs and Common Shares

· Shares eligible for sale could adversely affect the price of our common shares and ADSs.

· If we issue additional equity securities in the future, you may suffer dilution, and trading prices for our equity securities may decline.

· We are subject to certain different corporate disclosure requirements and accounting standards than domestic issuers of listed securities in the United States.

· Investors may not be able to effect service of process within the United States, limiting their recovery of any foreign judgment.

· If we are considered to be a passive foreign investment company for United States federal income tax purposes, United States holders of our common shares or ADSs would suffer negative consequences.

· Holders of the ADS may be unable to exercise voting rights with respect to the common shares underlying their ADSs.

· Under Argentine law, shareholder rights may be fewer or less well defined than in other jurisdictions and our ability to pay dividends is limited by law and our by-laws.

· Restrictions on the movement of capital out of Argentina may impair your ability to receive dividends and distributions on, and the proceeds of any sale of, the common shares underlying the ADSs.

· You might be unable to exercise preemptive or accretion rights with respect to the common shares underlying your ADSs.

· Our shareholders may be subject to liability for certain votes of their securities.

· The warrants are exercisable under limited circumstances and will expire.

Risk Factors

You should carefully consider the risks described below, in addition to the other information contained in this Annual Report, before making an investment decision. We also may face additional risks and uncertainties not currently known to us, or which as of the date of this Annual Report we might not consider significant, which may adversely affect our business. In general, you take more risk when you invest in securities of issuers in emerging markets, such as Argentina, than when you invest in securities of issuers in the United States, and certain other markets. You should understand that an investment in our common shares and American Depositary Shares (“ADSs”) involves a high degree of risk, including the possibility of loss of your entire investment.

Risks Relating to Argentina

We depend on macroeconomic and political conditions in Argentina.

The Argentine economy has experienced significant volatility in recent decades, characterized by periods of low or negative growth, high levels of inflation and depreciation of the currency. As a consequence, our business and operations have been, and could in the future be, affected to varying degrees by economic and political developments and other material events affecting the Argentine economy, such as: inflation; price controls; foreign exchange restrictions; fluctuations in foreign currency exchange rates and interest rates; governmental policies regarding spending and investment, national, provincial or municipal tax increases and other initiatives increasing Argentine government involvement with economic activity; civil unrest and local security concerns. Developments in economic, political, regulatory and social conditions in Argentina, and measures taken by the Argentine government, have had and are expected to continue to have a significant impact on our business, results of operations and financial condition. Argentina is an emerging market and investing in such markets generally carries additional risks.

4

Historically, Argentina went through periods of severe political, economic and social crisis. Among other consequences, these crises resulted in Argentina defaulting on its foreign debt obligations, introducing emergency measures and numerous changes in economic policies that affected utilities, financial institutions, and many other sectors of the economy. Argentina also suffered a significant real depreciation of the Peso, which in turn caused numerous Argentine private sector debtors with foreign currency exposure to default on their outstanding debt. In the past three years, GDP contracted 2.2% in 2019 and 6.5% in 2020. During 2021, the GDP increased 11.0% with respect to the previous year. On September 17, 2021, the Argentine Treasury announced that it expected GDP to grow 4% in 2022 and the fiscal deficit to reach 3.3%, both figures higher than previously expected.

Legislative elections took place on November 14, 2021, in the context of which one third of the seats in the senate and half of the seats in the house of representatives, were up for election. “Juntos por el Cambio” (the political party of the former administration) obtained 41.7% of the votes and “Frente de Todos” (the political party of the current administration) obtained 33.6% of the votes. As a result, the “Frente de Todos” coalition lost its majority of votes in the house of representatives, but maintained a majority of the seats in the senate. As a result, the administration of President Fernández may not be able to enact new legislation.

We can offer no assurances as to the policies that may be implemented by the administration of President Fernández, or that political developments in Argentina will not adversely affect the Argentine economy and our business, financial condition and results of operations. In addition, we cannot assure you that future economic, regulatory, social and political developments in Argentina will not impair our business, financial condition or results of operations, or cause the market value of our shares to decline.

During periods of high uncertainty in the international markets, potential investors choose to invest in high quality assets. This situation has caused adverse effects on the Argentine economy which could continue to do so in the near future.

On June 24, 2021, Morgan Stanley Capital International Inc. (“MSCI”) announced that it would reclassify the MSCI Argentina Index from Emerging Markets to Standalone Markets status in one step during its November 2021 Semi‐Annual Index Review. Pursuant to such announcement, on November 11, 2021, MSCI went forward with the reclassification of the MSCI Argentina Index to Standalone Markets.

The success of any measure taken by the Argentine government pursuant to restoring the market’s trust and achieving the stability of the Peso is uncertain. Furthermore, the continuous loss of value of the Peso may have an adverse effect on our financial condition and the results of our operations.

The IMF and the Argentine authorities have reached an understanding on key policies as part of their ongoing discussions of an IMF-supported program in order to renegotiate the principal maturities of the USD 44.1 billion under a stand-by arrangement. On March 25, 2022, the IMF approved the execution of the financing agreement (the “IMF Agreement”) with Argentina for a total amount of USD 44 billion, which includes a disbursement of USD 9.6 billion. We cannot assure that the conditions of the IMF Agreement will not affect Argentina’s ability to implement reforms and public policies and boost economic growth, nor the impact that the IMF Agreement may have in Argentina’s ability to access international capital markets (and indirectly in our ability to access those markets). Moreover, the long-term impact of these measures and any future measures taken by the government on the Argentine economy remains uncertain. It is possible that reforms could be disruptive to the economy and adversely affect the Argentine economy and our business, results of operations and financial condition. We are also unable to predict the measures that the Argentine government may adopt in the future, and how they will impact on the Argentine economy and our results of operations and financial condition.

Sergio Tomas Massa formally took office as Minister of Economy on August 3, 2022, and stated that his program will be based on four pillars: (i) fiscal order; (ii) trade surplus; (iii) strengthening of monetary reserves; and (iv) development with social inclusion. In matters of fiscal order, Mr. Massa has stated that the goal of 2.5% primary deficit established by the budget for the fiscal year 2022 will be met. In turn, he expressed that payment advances from the National Treasury will not be used for the remainder of the year 2022 together with freezing any new hiring in all sectors of the national public administration. Regarding subsidies of public services, Mr. Massa announced that saving for consumption will be promoted together with a request for care of the country’s natural resources.

5

In the matter of trade surplus, he has stipulated for the promotion - by means of decrees of necessity and urgency - of special regimes for the agroindustry, mining and hydrocarbon sectors due to increased production and the knowledge economy. Related to the strengthening of reserves, he proposed an export advance scheme, with the value chains of fishing, mining, agriculture and other sectors. In addition, he announced that there will be disbursement of funds by international organizations under current programs, and a new program with the CAF - Development Bank of Latin America. On the other hand, he announced that, during the month of August of 2022, the retirement mobility index will be announced with a “reinforcement”, whose objective will be to help retired workers overcome the loss of purchasing power as a result of growing inflation. Such “reinforcement” was granted on August 25, 2022, for an amount of ARS 7,000 to be paid to retirees during the months of September, October and November 2022.

The long-term impact of these measures and any future measures taken by the Argentine government on the Argentine economy, as a whole, remains uncertain. It is possible that such reforms could be disruptive to the economy and adversely affect the Argentine economy, and consequently, our business, results of operations and financial condition. We are also unable to predict the measures that the Argentine government may adopt in the future, and how they will impact on the Argentine economy and our results of operations and financial condition.

Presidential elections will be held in Argentina in October 2023. We cannot predict which policies the new President of Argentina, who assumed office in December, 2023, may adopt or change during his mandate or the effect that any such policies might have on our business and on the Argentinian economy. Any such new policies or changes to current policies may have a material adverse effect on us. The political uncertainty resulting from the presidential elections and the transition to a new government may have an adverse effect on our business, results of operations and financial condition and the price of our shares and ADSs.

Continuing high rates of inflation may have an adverse effect on the economy and our business, financial condition and results of operations.

Historically, high rates of inflation have undermined the Argentine economy and the Argentine government’s ability to foster conditions for stable growth. High rates of inflation may also undermine Argentina’s competitiveness in international markets and adversely affect economic activity and employment, as well as our business, financial condition and results of operations.

The INDEC reported cumulative variation of the consumer price index (“CPI”) of 53.8% for 2019, 36.1% for 2020 and 50.9% for 2021. INDEC reported a CPI of 5.3%, 7.4%, 7% and 6.2%, for June, July, August and September 2022, respectively. As of September 30, 2022, the cumulative variation of the CPI was 66.1%.

In recent years, the Argentine government has taken certain measures to curb inflation, such as implementing price controls and limiting wage increases. We cannot assure you that inflation rates will not continue to escalate in the future or that the measures adopted or that may be adopted by the Fernández administration to control inflation will be effective or successful. High rates of inflation remain a challenge for Argentina. Significant increases in the rates of inflation could have a material adverse effect on Argentina’s economy and in turn could increase our costs of operation, in particular labor costs, and may negatively affect our business, financial condition and results of operations.

A high level of uncertainty with regard to these economic variables, and a general lack of stability in terms of inflation, could have a negative impact on economic activity and adversely affect our financial condition.

As of July 1, 2018, the Peso qualified as a currency of a hyperinflationary economy and we were required to restate our historical financial statements in terms of the measuring unit current at the end of the reporting year, which could adversely affect our results of operations and financial condition.

Pursuant to IAS 29 “Financial Reporting in Hyperinflationary Economies”, the financial statements of entities whose functional currency is that of a hyperinflationary economy must be restated for the effects of changes in a suitable general price index. IAS 29 does not prescribe when hyperinflation arises, but includes several characteristics of hyperinflation. The IASB does not identify specific hyperinflationary jurisdictions. However, in June 2018, the International Practices Task Force of the Center for Quality, which monitors “highly inflationary countries”, categorized Argentina as a country with projected three-year cumulative inflation rate greater than 100%. Additionally, some of the other qualitative factors of IAS 29 were present, providing prima facie evidence that the Argentine economy was hyperinflationary for the purposes of IAS 29. Therefore, Argentine companies that prepare financial statements pursuant to IFRS and use the Peso as their functional currency were required to apply IAS 29 to their financial statements for periods ending on and after July 1, 2018.

6

Adjustments to reflect inflation, including tax indexation, such as those required by IAS 29, are in principle prohibited in Argentina. However, on December 4, 2018, the Argentine government enacted Law No. 27,468, which lifted the ban on indexation of financial statements. Certain regulatory authorities, such as the CNV and the Public Registry of Commerce of the City of Buenos Aires (Inspección General de Justicia) (the “IGJ”), have required that financial statements for periods ended on and after December 31, 2018, be restated for inflation in accordance with IAS 29.

During the first three fiscal years beginning after January 1, 2018, inflation adjustment for tax purposes was applicable if the variation in the CPI exceeds 55% in 2019, 30% in 2020 and 15% in 2021.

Therefore, inflation adjustment for tax purposes:

· Year ended June 30, 2019: one third of the adjustment to be allocated to 2019 and the remaining two thirds to be allocated in equal parts in the following two years.

· Years ended June 30, 2020 and 2021: one sixth of the adjustment to be allocated to 2020 and 2021 and the remaining portions in equal parts in the five following years.

As from fiscal year 2022, the inflation adjustment for tax purposes will be applicable if the variation in the accumulated CPI in the 36 months prior to the end of the fiscal year being settled is higher than 100%. In that case, the result of inflation adjustment for tax purposes is fully allocated to the fiscal year in which it originated.

We cannot predict the future impact that the eventual application of inflation adjustment for tax purposes and other related inflation adjustments described above will have on our financial statements or their effects on our business, results of operations and financial condition.

High levels of public spending in Argentina could generate long-lasting adverse consequences for the Argentine economy.

During recent years, the Argentine government has substantially increased public spending. Argentina recorded a primary deficit of 0.4% 6.5% and 3.0% of GDP in 2019, 2020 and 2021, respectively. However, the Fernández administration has indicated that it will seek to foster economic growth, which may require additional public spending. If government spending continues to outpace fiscal revenue, the fiscal deficit is likely to increase.

The Argentine government’s ability to access the long-term financial markets to finance such increased spending is limited given the high levels of public sector indebtedness. The inability to access the capital markets to fund its deficit or the use of other sources of financing may have a negative impact on the economy and, in addition, could limit the access to such capital markets for Argentine companies, which could adversely affect our business, financial condition and results of operations.

Argentina’s ability to obtain financing in the international capital markets is limited, which may impair our ability to access international credit markets to finance our operations in Argentina.

During recent years the Argentine government has faced difficulties in the payment of its sovereign debt. As a result, the Argentine government may not have access to international financing, or its access may be costly, which would limit its ability to make investments and foster economic growth. Additionally, Argentine companies may also have difficulty accessing international financing, at reasonable costs or at all.

7

In 2018, due to Argentina’s limited access to the international capital and lending markets, the Argentine government and the IMF entered into the Stand-By Agreement. As of the date of this Annual Report, Argentina has received disbursements under the agreement totaling USD 57.1 billion. Notwithstanding the foregoing, the Fernández administration has publicly announced that it will refrain from requesting additional disbursements under this agreement, and instead vowed to renegotiate its terms and conditions in good faith.

During March 2020, the Argentine government initiated discussions with various groups of creditors to discuss a path for Argentina’s debt sustainability. With respect to Argentina’s international bonds, the Argentine executive branch approved the restructuring of certain eligible global bonds issued under foreign laws for up to USD 65 billion. In August 2020, the Argentine government announced that it had obtained the consents required to exchange 99% of the aggregate principal amount outstanding of all series of eligible bonds.

On March 13, 2020, the Minister of Economy addressed a letter to the Paris Club members expressing Argentina’s decision to postpone until May 5, 2021 the USD 2.1 billion payment originally due on May 5, 2020, in accordance with the terms of the settlement agreement Argentina had reached with the Paris Club members on May 29, 2014 (the “Paris Club 2014 Settlement Agreement”). In addition, on April 7, 2020, the Minister of Economy sent the Paris Club members a proposal to modify the existing terms of the Paris Club 2014 Settlement Agreement, seeking mainly an extension of the maturity dates and a significant reduction in the interest rate. In June 2021, the parties agreed that Argentina would pay USD 430 million to the group before the end of July and the rest during the following year to avert default in July 2021. On March 22, 2022, the Argentine government reached an agreement with the Paris Club for a new extension of the agreement reached in June 2021.

In June 2018, the Argentine government and the IMF signed a three-year, USD50 billion loan agreement, as further amended to USD57.1 billion through 2021 (the “IMF 2018 Agreement”). Following an IMF report in February 2020 stating that Argentina’s debt may not be sustainable, the Argentine government requested to begin discussions with the IMF in order to renegotiate the principal maturities of the USD44.1 billion disbursed between 2018 and 2019 under a stand-by arrangement. The IMF and the Argentine authorities reached an understanding on key policies as part of their ongoing discussions on an IMF-supported program. On March 25, 2022, the IMF approved the execution of the IMF Agreement with Argentina for a total amount of USD44 billion, which includes a disbursement of USD9.6 billion. The IMF will monitor Argentina’s compliance with such agreement at the end of each quarter. By means of the IMF Agreement, the Argentine government seeks to decrease the high inflation in Argentina improving public finances and strengthening Argentina’s balance of payments. We cannot assure that the conditions of the IMF Agreement will not affect Argentina’s ability to implement reforms and public policies and boost economic growth, nor the impact that the IMF Agreement may have in Argentina’s ability to access international capital markets (and indirectly in our ability to access those markets).

On January 28, 2022, President Alberto Fernandez announced that an understanding with the IMF pursuant to restructuring the debt incurred as set forth in the Stand-by Agreement was reached. On that same day, President Alberto Fernandez authorized the payment of principal pursuant to such agreement for an amount of USD 731 million.

In addition, during the latter part of June 2022, the IMF made a second disbursement of funds for an amount of USD 4,155 million. Furthermore, a third disbursement of funds for an amount of USD 3.8 million was made on October 7, 2022.

Due to past or future defaults on its indebtedness, we cannot assure you that Argentina will have access to international financing in the future, on favorable terms or at all. If Argentina is not able to access financing, it may not be able to foster economic growth and invest in the country. As a result, we cannot assure you that private companies in Argentina will have access to financing on favorable terms or at all, which could adversely affect our business, financial condition and results of operations.

For more information see “Restrictions on transfers of foreign currency and the repatriation of capital from Argentina may impair our ability to pay dividends and distributions and investors may face restrictions on their ability to collect capital and interest payments in connection with corporate bonds issued by Argentine companies”.

8

Significant fluctuation in the exchange rate of the Peso against foreign currencies may adversely affect the Argentine economy as well as our financial condition and results of operations.

Fluctuations in the rates of exchange of the Peso against foreign currencies, particularly the U.S. dollar, may adversely affect the Argentine economy, our financial condition and results of operations. In 2018, 2019, 2020 and 2021, the Peso depreciated by approximately 105%, 59%, 40% and 18%, respectively, against the U.S. dollar. Depreciation of the Peso in real terms can have a negative impact on the ability of Argentine businesses to honor their foreign currency-denominated debt, and also lead to very high inflation and significantly reduced real wages. The depreciation of the Peso can also negatively impact businesses whose success is dependent on domestic market demand, and adversely affect the Argentine government’s ability to honor its foreign debt obligations. A substantial increase in the exchange rate of the Peso against foreign currencies of the Peso against the U.S. dollar also represents risks for the Argentine economy since it may lead to a deterioration of the country’s current account balance and the balance of payments which may have a negative effect on GDP growth and employment, and reduce the revenue of the Argentine public sector by reducing tax revenue in real terms, due to its current heavy dependence on export taxes.

As a result of the greater volatility of the Peso, the former administration announced several measures to restore market confidence and stabilize the value of the Peso. Among them, during 2018, the Argentine government negotiated two agreements with the IMF, increased interest rates and the Central Bank decided to intervene in the exchange market in order to stabilize the value of the Peso. During 2019, based on a new understanding with the IMF, the Argentine government established new guidelines for stricter control of the monetary base, which would remain in place until December 2019, in an attempt to reduce the amount of Pesos available in the market and reduce the demand for foreign currency. Complementing these measures, in September 2019 foreign currency controls were reinstated in Argentina. As a consequence of the re-imposition of exchange controls, the spread between the official exchange rate and other exchange rates resulting implicitly from certain common capital markets operations (“dólar MEP” or “contado con liquidación”) has broadened significantly, reaching a value of approximately 90% above the official exchange rate. As of October 26, 2022, the seller exchange rate quoted by Banco de la Nación Argentina was ARS 155.39 per USD 1.00.

The “Dollar Soja” was a special exchange regime created by Decree 576/2022 that was in force during September 2022 and offers ARS 200 for each USD, unlike the currently approx. ARS 142 offered during same time to the rest of the exporters. Said was established for the settlement of foreign currency from soybeans and products associated with it, for those who adhere to the program and that comply with the requirements established in said decree. As of the date of this Annual Report, the aforementioned exchange regime has not been extended and, consequently, the “Dollar Soja” is not currently in effect. As a result of this special exchange regime, the Argentina Central Bank achieved a total of USD 8,123 million.

Furthermore, in early October 2022, the Argentine government announced a special exchange rate for the high-tech industry. Additionally, through the Federal Administration of Public Revenue (“AFIP”) General Resolution No. 5272/2022, it established two additional exchange rates. In this regard, is a special exchange rate that applies to any expense of more than USD 300 made abroad during a calendar month, pursuant to which an extra 25% advance payment of Income Tax would be applicable. In addition, local concert promoters will be subjected to a special exchange rate pursuant applicable to the payment of foreign entertainers, set in an amount of ARS 204 ARS per USD 1.

The success of any measures taken by the Argentine government to restore market confidence and stabilize the value of the Peso is uncertain and the continued depreciation of the Peso could have a significant adverse effect on our financial condition and results of operations.

Certain measures that may be taken by the Argentine government, or changes in policies, laws and regulations, may adversely affect the Argentine economy and, as a result, our business, financial condition and results of operations.

The Argentine government exercises substantial control over the economy and may increase its level of intervention in certain areas of the economy, including through the regulation of market conditions and prices.

9

On June 2020, President Alberto Fernández announced a project to intervene and expropriate the cereal exporting company Vicentin S.A.I.C (“Vicentin”) under which the national public administration would take control of 51% of Vicentin, which is in creditor competition as a result of the company’s ARS 350 million debt with state-owned Banco de la Nación Argentina, on a total increase of USD 1.35 billion. However, on June 19, 2020, the holder of the Civil and Commercial Court, responsible for carrying out Vicentin’s call for creditors, decided to restore the company’s original Board of Directors to office for 60 days and to give the observer status to the interventors appointed by the administration of Alberto Fernández.

As for taxes, the Argentine government regulated the “Ley de Aporte Solidario y Extraordinario” to mitigate the effects of the pandemic (Law No. 27,605) - also known as “aporte de las grandes fortunas o impuesto a las riquezas”. It established a one-time contribution of a rate starting at 2% of the assets of individuals who have declared more than ARS 200 million in assets. The contribution will rise up to 3% in the case of assets of between ARS 800 million and ARS 1,500 million; will be extended up to 3.25% for those between ARS 1,500 million and ARS 3,000 million; and those who exceed that value will be taxed at 3.5%. The number of taxpayers covered by the regulations is estimated at 12,000.

Decree 42/2021 also empowered the AFIP to be in charge of “implementing the information regimes for the purpose of collecting data” and thus prevent tax evasion operations. In this sense, when the law was sanctioned and promulgated, some businessmen with large assets threatened to start a fiscal rebellion.

Historically, actions of the Argentine government concerning the economy, including decisions regarding interest rates, taxes, price controls, wage increases, increased benefits for workers, exchange controls and potential changes in the market of foreign currency, have had a substantial adverse effect on Argentina’s economic growth.

It is widely reported by private economists that expropriations, price controls, exchange controls and other direct involvement by the Argentine government in the economy have had an adverse impact on the level of investment in Argentina, the access of Argentine companies to international capital markets and Argentina’s commercial and diplomatic relations with other countries. If the level of Government intervention in the economy continues or increases, the Argentine economy and, in turn, our business, results of operations and financial condition could be adversely affected.

On June 6, 2022, the Argentine government sent to the Chamber of Deputies a bill that would establish a one-time “windfall income tax” for companies that obtained extraordinary income from the increase in international prices. Based on the current Argentine political environment, it is uncertain whether the Argentine Congress will approve this bill.

The bill would establish a one-time additional 15% windfall income tax on the excess of the net taxable income resulting from the difference of the (1) net taxable income obtained in the first tax year ended on or after the month immediately following the month in which the bill enters into force, and (2) net taxable income from the previous tax year adjusted by the variation of the CPI, published by the National Institute of Statistics and Census.

The windfall income tax would apply to companies that meet the following requirements:

· The net taxable income or the accounting profits adjusted for inflation for the first financial year ending on or after the month immediately following the month in which the bill enters into force is at least ARS 1 billion; and

· (i) The accounting profits adjusted for inflation for the first financial year ending on or after the month immediately following the month in which the bill enters into force represents at least 10% of the total gross income for that period; or (ii) the ratio between the accounting profits adjusted for inflation for the first financial year ending on or after the month immediately following the month in which the bill enters into force and the total gross income for that period, is at least 20% higher than the same ratio for the previous year.

10

The bill would exclude the income tax and the extraordinary results from the calculations referred to in the previous paragraph, in accordance with the regulations to be issued after the bill’s enactment.

If approved by the Argentine Congress, the bill would be enacted on the date of publication in the Official Gazette and would apply for the first financial year ending from the first day of the month immediately following enactment and the last day of the 12th month immediately following that date.

However, since such bill has not yet been discussed in the Chamber of Deputies, and doesn’t looks like it will in the near future, the AFIP issued General Resolution No. 5,248, establishing that an extraordinary payment on account of income tax payable in 3 monthly installments shall be in effect for companies that meet any of the following parameters:

· The amount of the tax determined from the tax return corresponding to the fiscal year 2021 or 2022, as the case may be, is equal to or higher than ARS 100,000,000.

· The amount of the tax result arising from the tax return, without applying the deduction corresponding to tax losses of previous years, is equal to or higher than ARS 300,000,000.

Any such payment on account of income tax shall be 25% of the calculation basis of the advance payment, or 15% of the tax result, without considering the losses of previous years.

The aforementioned payment on account of income tax may not be cancelled through a compensation mechanism and shall not be considered when requesting a reduction of tax payments.

The Argentine government may mandate salary increases for private sector employees, which would increase our operating costs.

In the past, the Argentine government has passed laws, regulations and decrees requiring companies in the private sector to maintain minimum wage levels and provide specific benefits to employees. Argentine employers, both in the public and private sectors, have experienced significant pressure from their employees and labor organizations to increase wages and to provide additional employee benefits. Due to high levels of inflation, employees and labor organizations regularly demand significant wage increases.

Through Decree No.11/2022, a staggered increase of the minimum salary was approved as follows: (i) September 1, 2022, ARS 51,200.00 for all full-time monthly workers and ARS 256.00 per hour for day laborers; (ii) October 1, 2022, ARS 54,550.00 for all full-time monthly workers and ARS 272.75 per hour for day laborers; and (iii) November 1, 2022, ARS 57,900.00 for all full-time monthly workers and ARS 289.50 per hour for day laborers. In addition, the Argentine government has arranged various measures to mitigate the impact of inflation and exchange rate fluctuation in wages. In December 2019, Decree No. 34/2019 doubled legally-mandated severance pay for termination of employment. This decree was extended until June 30, 2022, under the provisions of Decree 886/2021. This last decree established a gradual reduction of the double compensation, namely: (i) 75% of the amount of the same, from January 1, 2022 and until January 28, February 2022; (ii) 50% from March 1, 2022 and until April 30, 2022; and (iii) 25% from May 1, 2022 and until June 30, 2022. As of the date of this Annual Report, there has been no further extensions to the payment of double compensations; therefore, the aforementioned rule is no longer in force.

It is possible that the Argentine government could adopt measures mandating further salary increases or the provision of additional employee benefits in the future. Any such measures could have a material and adverse effect on our business, results of operations and financial condition.

Property values in U.S. dollars in Argentina could decline significantly.

Property values in U.S. dollars are influenced by multiple factors that are beyond our control, such as a decreased demand for real estate properties due to a deterioration of macroeconomic conditions or an increase in supply of real estate properties that could adversely affect the value in U.S. dollars of real estate properties. We cannot assure you that property values in U.S. dollars will increase or that they will not be reduced. Most of the properties we own are located in Argentina. As a result, a reduction in the value in U.S. dollars of properties in Argentina could materially affect our business and our financial statements due to the valuation of our investment properties at fair market value in U.S. dollars.

11

Restrictions on transfers of foreign currency and the repatriation of capital from Argentina may impair our ability to pay dividends and distributions and investors may face restrictions on their ability to collect capital and interest payments in connection with corporate bonds issued by Argentine companies.

On September 1, 2019, the Central Bank issued Communication “A” 6,770, which established various rules for exports of goods and services, imports of goods and services, foreign assets, non-resident operations, financial debt, debts between residents, profits and dividends, and information systems. The Communication was issued in response to the publication of Decree 609/2019, pursuant to which the Argentine government implemented foreign exchange regulations until December 31, 2019. Decree 609/2019 sets forth the obligation to convert the value of goods and services exported into Pesos in the local financial system, in accordance with terms and conditions established by the Central Bank. Through Decree 91/2019, the National Executive Branch resolved to continue with the provisions of Decree 609/2019, this is the obligation to convert the value of exported goods and services to Pesos in the local financial system, in accordance with the terms and conditions established by the Central Bank. Accordingly, through Communication “A” 6,856, Communication “A” 6,770 was modified, establishing that the rules regarding the obligation to enter the country in foreign currency and/or negotiation in the MULC of receipts for exports of goods and services, disseminated through Communication “A” 6,844 remains in force since December 31, 2019.

On September 15, 2020, Communication “A” 7,106 established that companies must refinance the maturities of the capital of the financial debt in the period between October 15, 2020 and December 31, 2023. Subsequently, such period was extended in various opportunities, with the final extension being issued on October 13, 2022, pursuant to Communication “A” 7,621 by which it was further extended until December 31, 2023. In this regard, the Central Bank will grant companies access to the MULC for up to 40% of the maturities and the companies must refinance the remaining 60% within a period of at least two years. In addition, CNV Resolution No. 862/2020 established a minimum holding term requirement of three days for both transfers of securities from local accounts abroad and vice versa.

As of the date of this Annual Report, we have outstanding obligations pursuant to the Series XXIII Notes issued by the Company, for USD 14,7 million and Series II Notes issued by IRSA for USD 121.0 million. We currently cannot predict whether the Government will impose further exchange controls and transfer restrictions that may impair our ability to access the MULC for the repayment of the total amount or part of such obligations.

On January 11, 2021, through Resolution No. 878/21, the CNV reduced the minimum holding term to one business day, both to carry out sales operations of negotiable securities with settlement in foreign currency in the local market, as well as to use in the settlement of operations in foreign currency in the local market the negotiable securities transferred from depositories abroad to depositories of the country.

On July 12, 2021, through Resolution No. 895/2021 of the CNV, it was established that in order to carry out sales operations of negotiable securities with settlement in foreign currency and in foreign jurisdiction, a minimum period of holding of said securities must be observed negotiable securities in portfolio of 2 business days counted from its accreditation in the depositary agent. This term shall not apply in the case of purchases of negotiable securities with settlement in foreign currency and in foreign jurisdiction. In the case of sales operations of negotiable securities with settlement in foreign currency and in local jurisdiction, the minimum term of permanence in the portfolio to be observed will be 1 business day to be computed in the same way. This minimum holding period shall not apply in the case of purchases of negotiable securities with settlement in foreign currency. To give effect to transfers of negotiable securities acquired with settlement in national currency to depository entities abroad, a minimum term of holding said negotiable securities in the portfolio of 2 business days must be observed, counted from their accreditation in the depositary agent. The exception is contemplated in those cases in which the accreditation is the product of the primary placement of negotiable securities issued by the National Treasury or in the case of Argentine shares and/or Certificates of Deposit (“Cedears”) with trading in markets regulated by the CNV. As a result of all the exchange restrictions mentioned and all those that may be issued in the future by the Central Bank in the context of the exercise of its powers, it is clarified that there may be possible “withholdings” in the context of the restructuring that Argentine companies are undergoing. obliged to carry out with the consequent possible claims.

12

In order to comply with the requirements of this regulation, a financial debt refinancing plan had to be presented to the Central Bank, which must be registered until December 31, 2020 before September 30, 2020. In order for maturities to be registered between January 1, 2021 and March 31, 2021, the plan must be presented at least 30 calendar days before the maturity of the principal to be refinanced, which implies a risk to obtain financing for new productive projects. As a consequence, there could be a rise in corporate bond spreads.

Likewise, on February 22, 2021, the Central Bank resolved to extend the validity of point 7 of Communication “A” 7,106, which expired on March 31, 2021. Thus, it established that the provisions of point 7 will be applicable to those who register capital maturities scheduled between April 1, 2021 and December 31, 2021 for the indebtedness detailed therein. Subsequently, through Communication “A” 7,422, it was extended again until June 30, 2022.

And, finally, on October 13, 2022, the Central Bank issued Communication “A” 7,621 by which it was decided to extend the period until December 31, 2023. The refinancing plan had to be presented to the Central Bank before March 15, 2021, for principal maturities scheduled between April 1, 2021, and April 15, 2021. In all other cases, it must be submitted at least 30 calendar days before the maturity of the principal to be refinanced. Specifically, the requirement to renegotiate is maintained, although the monthly maturities that must be rescheduled are raised from USD 1 million to USD 2 million and frees companies that have restructured their debts under the same procedure throughout 2020, and that this year they face maturities of such rescheduling. By the same requirement, the maturities of new loan disbursements entered as of 2020 have not been reached either. In addition, since June 2020, pursuant to Communication “A” 7,030, companies could no longer access the MULC to cancel the financial debt between companies in advance. It is also noted that such possible restructuring proposals will fully comply with the requirements set forth by the applicable and current regulations, as long as the breach brings the application of the foreign exchange criminal law to the members of our board of directors.

Furthermore, on August 13, 2021, through Communication “A” 7,340, the Central Bank incorporated as point 4.3.3. of the regulations of Foreign Trade and Exchange regulations (Texto Ordenado de Exterior y Cambios), that the purchase and sale of securities that are carried out with settlement in foreign currency must be paid by one of the following mechanisms: a) by transfer of funds from and to sight accounts at name of the client in local financial entities, and b) against wire on bank accounts in the name of the client in a foreign entity that is not incorporated in countries or territories where the Recommendations of the Financial Action Task Force do not apply, or do not apply sufficiently. International. In no case is the settlement of these operations permitted by means of payment in foreign currency bills, or by depositing them in custody accounts or in third-party accounts. On December 9, 2021, through Communication “A” 7,416 of the Central Bank, modified by Communication “A” 7,422 and later Communications, most of the foreign exchange restrictions were extended until December 31, 2022.

On April 12, 2022, through Communication “A” 7,490, the Central Bank released the ordered text of the Foreign Trade and Exchange regulations (Texto Ordenado de Exterior y Cambios) to replace Communications “A” 7,433, 7,466, 7,469, 7,471, 7,472 and 7,488. Among other things, the aforementioned regulations extended until December 31, 2022, the exchange restrictions applicable to import payments, the prior approval to make payments of foreign financial indebtedness with related creditors and the rules on matters of refinancing foreign liabilities. In addition, they established that the Central Bank will have the possibility of assigning a specific category linked to the way of accessing the MULC.

As of the date of this Annual Report, the restrictions outlined above remain in place. Such measures may negatively affect Argentina’s international competitiveness, discouraging foreign investments and lending by foreign investors or increasing foreign capital outflow which could have an adverse effect on economic activity in Argentina, and which in turn could adversely affect our business and results of operations. Any restrictions on transferring funds abroad imposed by the Argentine government could undermine our ability to pay dividends on our ADSs in U.S. dollars. Furthermore, these measures may cause delays or impose restrictions on the ability to collect payments of capital and interest on bonds issued by us. The challenge will be to achieve acceptance by creditors, in accordance with the Central Bank regulations mentioned above, especially when it has highly diversified and retail creditors.

13

The company has several dollar-denominated maturities affected by these measures. For more information see “Operating and Financial Review and Prospects—Liquidity and capital resources—Indebtedness”.

The ongoing COVID-19 pandemic and Argentine government measures to contain the virus are adversely affecting our business and results of operations, preventing us from accurately predicting the ultimate impact on our results of operations.

As of the date of this Annual Report, most of the operations and properties are located in Argentina. As a result, the quality of our assets, our financial condition and the results of our operations are dependent upon the macroeconomic, regulatory, social and political conditions prevailing in Argentina.

In order to mitigate the economic impact of the COVID-19 pandemic and mandatory lockdown and shutdown of non-essential businesses, the Argentine government adopted social aid, monetary and fiscal measures, including price controls and the prohibition of dismissals without cause.

As of the date of this Annual Report, the COVID-19 outbreak has caused significant social and market disruption. The long-term effects of the coronavirus pandemic on the global economy, Argentine economy and the Company, are difficult to assess or predict, and may include a decline in market prices (including the market prices of our common shares), risks to employee health and safety and reduced sales in the impacted geographic locations. Any prolonged restrictive measures put in place in order to control an outbreak of a contagious disease or other adverse public health development such as the ongoing COVID-19 outbreak, may have a material and adverse effect on our business operations, financial condition or operational results. In this regard, and due to the restrictions that were in place, we were forced to keep the DirecTV Arena stadium closed throughout the entire 2021 fiscal year.

The Company is currently considering alternatives pursuant to mitigating the effects this outbreak may have had on its operations and ongoing projects, as well as to any measures adopted by the Argentine government, which so far have resulted in a slowdown in economic activity that has further adversely affected economic growth in Argentina during the 2020 and 2021 fiscal years.

We are continuing to monitor the impact of the ongoing COVID-19 pandemic across our businesses. The ultimate impact of the pandemic on our business, results of operations and financial condition remains uncertain and will depend on future developments outside of our control, including whether new variants of the COVID-19 arise and the Argentine government measures in response of the COVID-19 pandemic, including the vaccination program launched in December 2020. To the extent the COVID-19 pandemic adversely affects our business, it may also have the effect of heightening many of the other risks described in this “Risk Factors” section. To the extent the COVID-19 pandemic adversely affects our business, it may also have the effect of heightening many of the other risks described in this “Risk Factors” section.

For more information in connection with the COVID-19 pandemic and their impact on our Company, see “Item 5.A. Operating Results – The Ongoing COVID-19 Pandemic.”

The appearance of “monkeypox” and its spread in different countries, including Argentina, and possible Argentine government measures to contain the virus may adversely affect our business and results of operations.

Monkeypox was first detected in humans in 1970 in the Democratic Republic of the Congo, being transmitted from person to person by close contact with infected respiratory secretions or skin lesions of an infected person.

Since then, the majority of reported cases have come from rural rainforest regions of the Congo Basin and West Africa, particularly the Democratic Republic of the Congo, where it is considered endemic. However, in mid-May 2022, cases of monkeypox were identified in countries such as Portugal, Spain and the United Kingdom, in addition to investigations in several countries finding cases without a known source of infection, which suggested the existence of a undetected community spread. In the United States, the cities of New York and San Francisco have declared a state of emergency due to the spike in cases of this disease. As of October 25, 2022, the World Health Organization reported that 75,790 have been detected globally.

In order to mitigate the impact of the spread of monkeypox, the Argentine government may adopt measures, such as mandatory lockdown and shutdown of non-essential businesses. If adopted, we cannot assure you whether these measures will be sufficient to prevent a severe economic downturn in Argentina, particularly if Argentina’s main trading partners are concurrently facing an economic recession, which may adversely affect our business and results of operations.

14

The Argentine economy could be adversely affected by economic developments in other global markets.

Argentina’s economy is vulnerable to external shocks that could be caused by adverse developments affecting its principal trading partners. A significant decline in the economic growth of any of Argentina’s major trading partners (including Brazil, the European Union, China and the United States), including as a result of the ongoing COVID-19 pandemic, could have a material adverse impact on Argentina’s balance of trade and adversely affect Argentina’s economic growth. In addition, Argentina may be affected by economic and market conditions in other markets worldwide.

General elections in Brazil, including the election of the president, were held on October 2, 2022. Historically, election years in Brazil, and especially presidential elections, are marked by political uncertainty which generates greater instability and volatility. Moreover, the Brazilian Supreme Court recently overturned criminal convictions and restored former President Luis Inácio Lula da Silva’s political rights, allowing him to run in the presidential election. According to the official results, Lula obtained 48.4% of the votes while Bolsonaro obtained 43.2% of the votes. As no presidential candidate received a majority of the votes on 2 October, Lula and Bolsonaro advanced to a runoff election, scheduled for October 30, 2022. As a consequence, we cannot provide certainties of the effects that the results of the election may have on the Brazilian economy and its impact in Argentina, taking not account that both countries are close commercial partners and members of the MERCOSUR.

In addition, financial and securities markets in Argentina have been influenced by economic and market conditions in other markets worldwide. Although economic conditions vary from country to country, investors’ perceptions of events occurring in other countries have in the past substantially affected, and may continue to substantially affect, capital flows into, and investments in securities from issuers in, other countries, including Argentina. International investors’ reactions to events occurring in one market sometimes demonstrate a “contagion” effect in which an entire region or class of investment is disfavored by international investors.

On November 3, 2020, presidential elections took place in the United States. Former Vice President Joseph R. Biden Jr. was the Democratic nominee to challenge President Trump. Finally, on November 7, 2020, Democrat Joe Biden was declared president. Mr. Biden became the 46th president on January 20, 2021. We cannot predict how any measures adopted by the Biden administration may affect Argentina, nor the effect that any other measure taken by the Biden administration could cause on global economic conditions and the stability of global financial markets.

In July 2019, the Common Market of the South (“MERCOSUR”) signed a strategic partnership agreement with the European Union (the “EU”), which was expected to enter into force in 2021, once approved by the relevant legislatures of each member country. The objective of this agreement is to promote investments, regional integration, increase the competitiveness of the economy and achieve an increase in GDP. However, the effect that this agreement could have on the Argentine economy and the policies implemented by the Argentine government is uncertain. In October 2020, The European Parliament passed a non-binding resolution opposing the ratification of the trade agreement between the EU and MERCOSUR due to concerns over the environmental policy of the Jair Bolsonaro government. At the same time, the EU was to send MERCOSUR member countries a document with additional requirements on the environmental commitment, a matter that has not been fulfilled and that, in part, has slowed down the implementation of the agreement between both entities. In this regard, it is reported that the definition and implementation of the free trade agreement will be completed next year and not in the second part of 2022, as expected.

Changes in social, political, regulatory and economic conditions in other countries or regions, or in the laws and policies governing foreign trade, could create uncertainty in the international markets and could have a negative impact on emerging market economies, including the Argentine economy. Also, if these countries fall into a recession, the Argentine economy would be impacted by a decline in its exports, particularly of its main agricultural commodities. All of these factors could have a negative impact on Argentina’s economy and, in turn, our business, financial condition and results of operations.

15

High commodity prices contributed to the increase in Argentine exports and to high Argentine government tax revenue from export withholdings. Consequently, the Argentine economy has remained relatively dependent on the price of its main agricultural products, primarily soy. This dependence has rendered the Argentine economy more vulnerable to commodity prices fluctuations.

A continuous decline in international prices of Argentina’s main commodity exports could have a negative impact on the levels of government revenue and the Argentine government’s ability to service its sovereign debt, and could either generate recessionary or inflationary pressures, depending on the Argentine government’s reaction. Either of these results would adversely impact Argentina’s economy and, therefore, our business, results of operations and financial condition.

The absence of a solid institutional framework and corruption have been pointed out as an important problem for Argentina and continue to be. Recognizing that the failure to address these issues could increase the risk of political instability, distort decision-making processes and adversely affect Argentina’s international reputation and ability to attract foreign investment, the former Macri administration adopted several measures aimed at strengthening Argentina’s institutions and curbing corruption. These measures included the reduction of criminal sentences in exchange for cooperation with the Argentine government in corruption investigations, increased access to public information, the seizing of assets from corrupt officials, increasing the powers of the Anticorruption Office (Oficina Anticorrupción) and the passing of a new public ethics law, among others.

The Russian invasion of Ukraine could have an unpredictable effect on the global economy and on international and local securities markets, and adversely affect our business and results of operations.

The recent outbreak of war in Ukraine has affected global economic markets, including a dramatic increase in the price of oil and gas, and the uncertain resolution of this conflict could result in protracted and/or severe damage to the global economy. Also see “D.   Risk Factors - Risks Relating to Brazil - Increases in the price of raw materials and oil may adversely affect us”.

Russia’s recent military interventions in Ukraine have led to, and may lead to, additional sanctions being levied by the United States, the European Union and other countries against Russia and possibly countries that support, directly or indirectly, Russia’s incursion. Russia’s military incursion and the resulting sanctions could adversely affect global energy and financial markets, including Argentina’s, and thus could affect our businesses and the businesses of our customers, even though we do not have any direct exposure to Russia or the adjoining geographic regions.

The extent and duration of the military action, sanctions and resulting market disruptions are impossible to predict, but could be substantial. Any such disruptions caused by Russian military action or resulting sanctions may magnify the impact of other risks described herein. We cannot predict the progress or outcome of the situation in Ukraine, as the conflict and governmental reactions are rapidly developing and beyond their control. Prolonged unrest, intensified military activities or more extensive sanctions impacting the region, could have a material adverse effect on the global economy, and such effect could in turn have a material adverse effect on our business, financial condition, results of operations and prospects.

Our internal policies and procedures might not be sufficient to guarantee compliance with anti-corruption and anti-bribery laws and regulations.

Our operations are subject to various anti-corruption and anti-bribery laws and regulations, including the Corporate Criminal Liability Law and the U.S. Foreign Corrupt Practices Act of 1977 (the “FCPA”). Both the Corporate Criminal Liability Law and the FCPA impose liability against companies who engage in bribery of Argentine government officials, either directly or through intermediaries. The anti-corruption laws generally prohibit providing anything of value to Argentine government officials for the purposes of obtaining or retaining business or securing any improper business advantage. As part of our business, we may deal with entities in which the employees are considered government officials. We have a compliance program that is designed to manage the risks of doing business in light of these new and existing legal and regulatory requirements.

16

Although we have internal policies and procedures designed to ensure compliance with applicable anti-corruption and anti-bribery laws and regulations, there can be no assurance that such policies and procedures will be sufficient. Violations of anti-corruption laws and sanctions regulations could lead to financial penalties being imposed on us, limits being placed on our activities, our authorizations and licenses being revoked, damage to our reputation and other consequences that could have a material adverse effect on our business, results of operations and financial condition. Further, litigations or investigations relating to alleged or suspected violations of anti-corruption laws and sanctions regulations could be costly.

Risks Relating to Brazil

The measures taken or to be implemented by the Brazilian government in response to the COVID-19 pandemic may have an adverse effect on our business and operations.

In March 2020, the World Health Organization declared the COVID-19 outbreak a pandemic. Brazilian federal, state and municipal governments and other authorities have adopted a number of measures to address the potential impacts of the COVID-19 pandemic, including:

· to contain or delay the spread of COVID-19, the Brazilian Ministry of Health (Ministério da Saúde), as well as several state and municipal authorities have adopted or recommended social distancing measures;

· in March 2020, the Brazilian federal government created a Crisis Committee to Monitor the Impacts of COVID-19 in Brazil. Since then, it has announced several measures to adress the effects of the COVID-19 pandemic in Brazil;

· the Brazilian National Congress has held discussions regarding several measures to increase the Brazilian government’s revenues, such as imposing new taxes, revoking tax benefits and increasing the rates of current taxes; and

· a revision of tax benefits and increase of the rates of current taxes.

It is also possible that our commercial agreements, including rural partnership agreements, could be affected by the adverse impacts derived from the COVID-19 pandemic, since the parties thereto may be unable to comply with their contractual obligations. The COVID-19 pandemic would most likely be considered as an act of God or force majeure event by Brazilian courts. If our agreements are litigated, parties thereto could try to justify nonperformance and request: (i) termination without penalties; (ii) adjustment or release from contractual obligations; (iii) adjustment or release from the effects of arrears; and (iv) adjustment or release from penalties for breach of contract, which, could have a material adverse effect on our business and operations.

In addition, there is considerable uncertainty regarding the possible outcomes of the COVID-19 pandemic. We cannot predict what other measures will be implemented to mitigate the impacts of COVID-19 and whether they will lead to restrictions or limitations that could affect our business operations. The deterioration of global economic conditions as a result of the COVID-19 pandemic may decrease demand for our products and have a material adverse effect on our business, financial condition and results of operations. The COVID-19 pandemic may also heighten several of the other risk factors described in this annual report.

The Brazilian government has exercised, and continues to exercise, significant influence over the Brazilian economy, which, together with Brazilian political and economic conditions, may adversely affect us.

We may be adversely affected by the following factors, as well as the Brazilian federal government’s response to these factors:

· economic and social instability;

· increase in interest rates;

· exchange controls and restrictions on remittances abroad;

· restrictions and taxes on agricultural exports;

· exchange rate fluctuations;

· inflation;

17

·

· volatility and liquidity in domestic capital and credit markets;

· expansion or contraction of the Brazilian economy, as measured by GDP growth rates;

· allegations of corruption against political parties, elected officials or other public officials, including allegations made in relation to the Lava Jato investigation;

· government measures aimed at controlling the COVID-19 pandemic;

· government policies related to our sector; and

· fiscal or monetary policy and amendments to tax legislation; and other political, diplomatic, social or economic developments in or affecting Brazil.

Historically, the Brazilian government has frequently intervened in the Brazilian economy and has occasionally made significant changes in economic policies and regulations, including, among others, the enactment of new tax laws, changes in monetary, fiscal and tax policies, currency devaluations, capital controls and limits on imports.

The Brazilian economy has been experiencing a slowdown. The Brazilian GDP decreased 3.6% in 2016, increased 1.0% in 2017, increased 1.1% in 2018, increased 1.1% in 2019, decreased 4.1% in 2020, increased 4.6% in 2021 and 2.3% in the first six months of 2022.

Inflation and interest rates have increased more recently, and the Brazilian real has weakened significantly in relation to the U.S. dollar. Adverse economic conditions in Brazil may materially and adversely affect our business, financial condition and results of operations.

As a result of investigations carried out in connection with the Lava Jato (Car Wash) operation into corruption in Brazil, a number of senior politicians, including congressmen, and executive officers of certain of the major state-owned companies in Brazil have resigned or been arrested, while others are being investigated for allegations of unethical and illegal conduct. The matters that have come, and may continue to come, to light as a result of, or in connection with, the Lava Jato operation and other similar operations have adversely affected, and we expect that they will continue to adversely affect, the Brazilian economy, markets and trading prices of securities issued by Brazilian issuers in the near future.

The ultimate outcome of these investigations is uncertain, but they have already had an adverse effect on the image and reputation of the implicated companies, and on the general market perception of the Brazilian economy, the political environment and the Brazilian capital markets. The development of these investigations has affected and may continue to adversely affect us. We cannot predict if these investigations will bring further political or economic instability to Brazil, or if new allegations will be raised against high-level members of the Brazilian federal government. In addition, we cannot predict the results of these investigations, nor their effects on the Brazilian economy.

The ongoing economic uncertainty and political instability in Brazil may adversely affect the Brazilian economy, our business, and the market price of our shares and ADSs.

Brazil’s political environment has historically influenced, and continues to influence, the performance of the country’s economy. Political crises have affected and continue to affect the confidence of investors and the general public, which have historically resulted in economic deceleration and heightened volatility in the securities issued by Brazilian companies.

In recent years, there has been significant political turmoil in connection with the impeachment of the former president (who was removed from office in August 2016) and ongoing investigations of her successor (who left office in January 2019) as part of the ongoing “Lava Jato” investigations. Presidential elections were held in Brazil in October 2022. We cannot predict which policies the new President of Brazil, who assumed office on January 1, 2023, may adopt or change during his mandate or the effect that any such policies might have on our business and on the Brazilian economy. Any such new policies or changes to current policies may have a material adverse effect on us. The political uncertainty resulting from the presidential elections and the transition to a new government may have an adverse effect on our business, results of operations and financial condition and the price of our shares and ADSs.

18

Furthermore, Brazil’s federal budget has been in deficit since 2014. Similarly, the governments of Brazil’s constituent states are also facing fiscal concerns due to their high debt burdens, declining revenues and inflexible expenditures. While the Brazilian Congress has approved a ceiling on government spending that will limit primary public expenditure growth to the prior year’s inflation for a period of at least 10 years, local and foreign investors believe that fiscal reforms, and in particular a reform of Brazil’s pension system, will be critical for Brazil to comply with the spending limit. As of the date of this annual report, discussions in the Brazilian Congress relating to such reforms remain ongoing. Diminished confidence in the Brazilian government’s budgetary condition and fiscal stance could result in downgrades of Brazil’s sovereign debt by credit rating agencies, negatively impact Brazil’s economy, lead to further depreciation of the real and an increase in inflation and interest rates, thus adversely affecting our business, results of operations and financial condition.

Uncertainty about the Brazilian government’s implementation of changes in policies or regulations that affect such implementation may contribute to economic instability in Brazil and increase the volatility of securities issued abroad by Brazilian companies, including our securities. Any of the above factors may create additional political uncertainty, adversely affect the Brazilian economy, our business, financial condition, results of operations and the market price of our shares and ADSs. 

Inflation, coupled with the Brazilian government’s measures to fight inflation, may hinder Brazilian economic growth and increase interest rates, which could have a material adverse effect on us.

Brazil has in the past experienced significantly high rates of inflation. As a result, the Brazilian government adopted monetary policies that resulted in Brazilian interest rates being among the highest in the world. The Central Bank’s Monetary Policy Committee (Comitê de Política Monetária do Banco Central, or COPOM), establishes an official interest rate target for the Brazilian financial system based on the level of economic growth, inflation rate and other economic indicators in Brazil. Between 2004 and 2010, the official Brazilian interest rate varied from 19.75% to 8.75% per year. In response to an increase in inflation in 2010, the Brazilian government increased the official Brazilian interest rate, the SELIC rate, which was 10.75% per year as or December 31, 2010. The SELIC rate has increased and decreased since then and, as of June 30, 2019, it was 6.50% per year. The inflation rates, as measured by the General Market Price Index (Índice Geral de Preços–Mercado), or IGP-M, and calculated by Fundação Getúlio Vargas, or FGV, were 0.52% in 2017, 7.54% in 2018, 7.30% in 2019, 23.14% in 2020 and 17.78% in 2021. Cumulative inflation in the first six months of 2022, calculated by the same index, was 8.39%%. The inflation rates, as measured by the Extended National Consumer Price Index (Índice Nacional de Preços ao Consumidor Amplo), or IPCA, and calculated by Instituto Brasileiro de Geografia e Estatistica, or IBGE, were 1.26% in 2018, 0.01% in 2019, 0.26% in 2020 and 10.06% in 2021. Cumulative inflation in the first six months of 2022, calculated by the same index, was 5.49%.

Inflation and the government measures to fight inflation have had and may continue to have significant effects on the Brazilian economy and our business. In addition, the Brazilian government’s measures to control inflation have often included maintaining a tight monetary policy with high interest rates, thereby restricting the availability of credit and slowing economic growth. On the other hand, an easing of monetary policies of the Brazilian government may trigger increases in inflation. In the event of an increase in inflation, we may not be able to adjust our daily rates to offset the effects of inflation on our cost structure, which may materially and adversely affect us.

An increase in interest rates may have a significant adverse effect on us. In addition, as of June 30, 2022, certain of our loans were subject to interest rate fluctuations, such as the Brazilian long-term interest rate (Taxa de Juros de Longo Prazo, or TJLP), and the interbank deposit rate (Certificados de Depósitos Interbancários), or CDI. In the event of an abrupt increase in interest rates, our ability to comply with our financial obligations may be materially and adversely affected.

19

A deterioration in general economic and market conditions or the perception of risk in other countries, principally in emerging countries or the United States, may have a negative impact on the Brazilian economy and us.

Economic and market conditions in other countries, including United States and Latin American and other emerging market countries, may affect the Brazilian economy and the market for securities issued by Brazilian companies. Although economic conditions in these countries may differ significantly from those in Brazil, investors’ reactions to developments in these other countries may have an adverse effect on the market value of securities of Brazilian issuers. Crises in other emerging market countries could dampen investor enthusiasm for securities of Brazilian issuers, including ours, which could adversely affect the market price of our common shares. In the past, the adverse development of economic conditions in emerging markets resulted in a significant flow of funds out of the country and a decrease in the quantity of foreign capital invested in Brazil. Changes in the prices of securities of public companies, lack of available credit, reductions in spending, general slowdown of the global economy, exchange rate instability and inflationary pressure may adversely affect, directly or indirectly, the Brazilian economy and securities market. Global economic downturns and related instability in the international financial system have had, and may continue to have, a negative effect on economic growth in Brazil. Global economic downturns reduce the availability of liquidity and credit to fund the continuation and expansion of business operations worldwide.

In addition, the Brazilian economy is affected by international economic and market conditions generally, especially economic conditions in the United States. Share prices on B3 S.A. – Brasil, Bolsa, Balcão, or B3, for example, have historically been sensitive to fluctuations in U.S. interest rates and the behavior of the major U.S. stock indexes. An increase in interest rates in other countries, especially the United States, may reduce global liquidity and investors’ interest in the Brazilian capital markets, adversely affecting the price of our common shares.

The imposition of restrictions on acquisitions of agricultural properties by foreign nationals in Brazil may materially restrict the development of our business in Brazil.

In August 2010, the then-president of Brazil approved the opinion of the Federal Attorney General affirming the constitutionality of Brazilian Law No. 5,709/71, which imposes important limitations on the acquisition and lease of land in Brazil by foreigners and by Brazilian companies controlled by foreigners. Pursuant to this legislation, companies that are majority-owned by foreigners are not allowed to acquire agricultural properties in excess of 100 indefinite exploration modules, or MEI (which are measurement units adopted by the National Institute of Agrarian Development (Instituto Nacional de Colonização e Reforma Agrária, or INCRA), within different Brazilian regions, and which range from five to 100 hectares) absent the prior approval of the Brazilian Congress, while the acquisition of areas measuring less than 100 MEIs by such companies requires the prior approval of INCRA. In addition, agricultural areas that are owned by foreigners or companies controlled by foreigners shall not exceed 25% of the surface area of the municipality, of which area up to 40% shall not belong to foreigners or companies controlled by foreigners of the same nationality, meaning that the sum of agricultural areas that belong to foreigners or companies controlled by foreigners of the same nationality shall not exceed 10% of the surface area of the relevant municipality. In addition, INCRA is also required to verify if the agricultural, cattle-raising, industrial or colonization projects to be developed in such areas were previously approved by the relevant authorities. After that analysis, INCRA will issue a certificate allowing the acquisition or rural lease of the property. The purchase and rural lease of agricultural properties that do not comply with the aforementioned requirements need to be authorized by the Brazilian Congress. In both cases, it is not possible to determine an estimated time frame for the approval procedure, since at the date of this annual report, there are no known cases on the grating of such certificates.

Recently, Brazilian Law No. 13,986, of April 7, 2020, amended Law No. 5,709/91 and provided that the limitations mentioned above do not apply (i) to the pledge of real estate as collateral (including the fiduciary transfer of real estate property); and (ii) to debt settlements arising from the execution of real estate collateral. Both exceptions favor Brazilian companies controlled by foreigners or foreign entities, which creates new business opportunities.

As of September 30, 2022, approximately 57.3% of BrasilAgro’s common shares were held by foreigners. Bearing that in mind, the implementation of Law No. 5,709/71 may impose on us additional procedures and approvals in connection with future acquisitions of land, which may result in material delays and our inability to obtain required approvals. There is also a case pending on the Supreme Court (Supremo Tribunal Federal, or STF) on the Opinion No. 461/2012-E, issued by São Paulo’s General Controller of Justice (Corregedoria Geral de Justiça do Estado de São Paulo), which has established that entities providing notary and registrar services located in the State of São Paulo are exempt from observing certain restrictions and requirements imposed by Law No. 5,709/71 and Decree No. 74,965/74. Moreover, on April 16, 2015, the Brazilian Rural Society filed a claim for the acknowledgment of non-compliance with basic principles (ADPF) under certain provisions of the Brazilian Constitution with the Supreme Court in order to (i) rule that paragraph 1, article 1, of Law No. 5,709/71 was repealed by the 1988 Federal Constitution and (ii) reverse the opinion issued by the Federal Attorney General (AGU) of 2010.

In June 2021, Supreme Court Justice Alexandre de Moraes issued an opinion to repeal certain restrictions on the ownership of property by foreigners and reverse the opinion issued by the Federal Attorney General (AGU) in 2010. The proceeding, however, is pending judgment by the Supreme Court. As of the date hereof, we are not able to provide an estimate of the timeframe for a final judgment to be issued by the Supreme Court.

20

Depending on the final decisions of these pending lawsuits, we may need to modify our business strategy and intended practices in order to be able to acquire agricultural properties.

As in the case of Brazil, in the rest of the countries where we operate, there are also laws in place that impose limitations on the purchase and lease of rural land by foreigners and/or companies controlled by foreigners. Such regulations have been incorporated into the local legislation of those countries, by means of: (i) Law No. 26,737 of Argentina; (ii) Law No. 1,715 of Bolivia; (iii) and Law No. 2,532 of Paraguay, in addition to the fact that there is currently a bill for the " Proteccion Nacional de las Tierras Rurales", which we do not know the impact it could have on our operations if it becomes law.

This might have the effect of increasing the number of transactions we must complete, which would increase our transaction costs. It might also require the execution of joint ventures or shareholder agreements, which increases the complexity and risks associated with such transactions.

Any regulatory limitations and restrictions could materially limit our ability to acquire agricultural properties, increase the investments, transaction costs or complexity of such transactions, or complicate the regulatory procedures required, any of which could materially and adversely affect us and our ability to successfully implement our business strategy.

We are subject to extensive Brazilian environmental regulation that may significantly increase the company’s expenses.

Our business activities in Brazil are subject to extensive federal, state and municipal laws and regulations concerning environmental protection, which impose on us various environmental obligations, such as environmental licensing requirements, minimum standards for the release of effluents, use of agrochemicals, management of solid waste, protection of certain areas (legal reserve and permanent preservation areas), and the need for a special authorization to use water, among others. The failure to comply with such laws and regulations may subject the violator to administrative fines, mandatory interruption of activities and criminal sanctions, in addition to the obligation to rectify damages and pay environmental and third-party damage compensation, without any caps. In addition, Brazilian environmental law adopts a joint and several and strict liability system for environmental damages, which makes the polluter liable even in cases where it is not negligent and would render us jointly and severally liable for the obligations of our contractors or off-takers. If we become subject to environmental liabilities, any costs we may incur to rectify possible environmental damage would lead to a reduction in our financial resources, which would otherwise remain at our disposal for current or future strategic investment, thus causing an adverse impact on our business, financial condition and results of operations.

As environmental laws and their enforcement become increasingly stricter, our expenses for complying with environmental requirements are likely to increase in the future. Furthermore, the possible implementation of new regulations, changes in existing regulations or the adoption of other measures could cause the amount and frequency of our expenditures on environmental preservation to vary significantly compared to present estimates or historical costs. Any unplanned future expenses could force us to reduce or forego strategic investments and as a result could materially and adversely affect our business, financial condition and results of operations.

Local currencies used in the conduct of our business are subject to exchange rate volatility and exchange controls.

The currencies of many Latin American countries have experienced substantial volatility in recent years. Currency movements, as well as higher interest rates, have materially and adversely affected the economies of many Latin American countries, including countries in which account for or are expected to account for a significant portion of our revenues. The depreciation of local currencies creates inflationary pressures that may have an adverse effect on us generally, and may restrict access to international capital markets. On the other hand, the appreciation of local currencies against the U.S. dollar may lead to deterioration in the balance of payments of the countries where we operate, as well as to a lower economic growth.

In 2020, the U.S. dollar to the peso exchange rate increased 40.5% compared to 2019. In 2021, the U.S. dollar to the peso exchange rate increased 22,7% compared to 2020 and so far in 2022 it increased by 51% as of October 26, 2022. We cannot predict future fluctuations in the exchange rate of the Argentine Peso or whether the Argentine government will change its currency policy.

21

Historically, the Brazilian currency has suffered frequent fluctuations. As a consequence of inflationary pressures, in the past, the Brazilian government has implemented several economic plans and adopted a series of exchange rate policies, including sudden devaluations, periodic mini-devaluations during which the frequency of adjustments has ranged from daily to monthly, floating exchange rate systems, exchange controls and dual exchange rate markets. Formally the value of the Real against foreign currencies is determined under a free-floating exchange rate regime, but in fact the Brazilian government is currently intervening in the market, through currency swaps and trading in the spot market, among other measures, every time the currency exchange rate is above or below the levels that the Brazilian government considers appropriate, taking into account, inflation, growth, the performance of the Real against the U.S dollar in comparison with other currencies and other economic factors. Periodically, there are significant fluctuations in the value of the Real against the U.S. dollar. During 2021, the Real depreciated 7.4% against the U.S. dollar and so far in 2022 (until September 30, 2022), the Real appreciated by 13.1% against the U.S. dollar.

Future fluctuations in the value of the local currencies relative to the U.S. dollar in the countries in which we operate may occur, and if such fluctuations were to occur in one or a combination of the countries in which we operate, our results of operations or financial condition could be adversely affected.

Inflation and certain government measures to curb inflation may have adverse effects on the economies of the countries where we operate or intend to operate our business and our operations.

In the past, high levels of inflation have adversely affected the economies and financial markets of some of the countries in which we operate, particularly Argentina and Brazil, and the ability of their governments to create conditions that stimulate or maintain economic growth. Moreover, governmental measures to curb inflation and speculation about possible future governmental measures have contributed to the negative economic impact of inflation and have created general economic uncertainty. As part of these measures, governments have at times maintained a restrictive monetary policy and high interest rates that has limited the availability of credit and economic growth.

A portion of our operating costs in Argentina are denominated in Argentine Pesos and most of our operating costs in Brazil are denominated in Brazilian Reais. Inflation in Argentina or Brazil without a corresponding Peso or Real devaluation, could result in an increase in our operating costs without a commensurate increase in our revenues, which could adversely affect our financial condition and our ability to pay our foreign currency denominated obligations.

In February 2014 the INDEC modified the methodology for the calculation of the consumer price index (“CPI”) and the gross domestic product. Under the new calculation methodology, the CPI increased by 23.9% in 2014 and 11.9% as of October 2015 (for the first nine months of 2015). However, opposition lawmakers reported an inflation rate of 38.5% and 27.5%, respectively. In December 2015, the Macri administration appointed a former director of a private consulting firm to manage the INDEC. The new director initially suspended the publication of any official data prepared by INDEC and implemented certain methodological reforms and adjusted certain indices based on those reforms. In January 25, 2016, INDEC published two alternative measures of the CPI for the year 2015, 29.6% and 31.6%, which were based on data from the City of Buenos Aires and the Province of San Luis. After implementing these methodological reforms in June 2016, the INDEC resumed its publication of the consumer price index.

Brazil has historically experienced high rates of inflation. Inflation, as well as Brazilian government efforts to curb inflation, has had significant negative effects on the Brazilian economy, particularly prior to 1995. Inflation rates were 7.8% in 2007 and 9.8% in 2008, compared to deflation of 1.7% in 2009, inflation of 11.3% in 2010, inflation of 5.1% in 2011, inflation of 7.8% in 2012, inflation of 5.5% in 2013, inflation of 3.7% in 2014, inflation of 10.5% in 2015, 7.2% in 2016, 2.1% in 2017, 3.4% in 2018, 4.5% in 2019, 4.5% in 2020 and 10% in 2021, as measured by the General Market Price Index (Indice Geral de Preços — Mercado), compiled by the Getúlio Vargas Foundation (Fundação Getúlio Vargas). A significant proportion of our cash costs and our operating expenses are denominated in Brazilian Reais and tend to increase with Brazilian inflation. The Brazilian overnment’s measures to control inflation have in the past included maintaining a tight monetary policy with high interest rates, thereby restricting the availability of credit and reducing economic growth. As of August 2022, the Brazilian government has raised the interest rate to 13.75%. Subsequently, the high inflation, arising from the lower interest rate, and the intention to maintain this rate at low levels, led the Brazilian government to adopt other measures to control inflation, such as tax relief for several sectors of the economy and tax cuts for the products included in the basic food basket. These measures were not sufficient to control the inflation, which led the Brazilian government to reinstate a tighter monetary policy. As a result, interest rates have fluctuated significantly. The Special System for Settlement and Custody (Sistema Especial de Liquidação e Custódia, or “SELIC”) interest rate in Brazil at year-end was 11.75% in 2014, 14.25% in 2015, 13.75% in 2016, 7% in 2017, 6.75% in 2018, 6.00% in 2019, 2.00% in 2020 and 6,53% in 2021, as determined by the Comitê de Política Monetária, or COPOM.

22

Supply problems at our farms and processing facilities and impair our ability to deliver our products to our customers in a timely manner Argentina and/or Brazil may experience high levels of inflation in the future, which may impact domestic demand for our products. Inflationary pressures may also weaken investor confidence in Argentina and/or Brazil, curtail our ability to access foreign financial markets and lead to further government intervention in the economy, including interest rate increases, restrictions on tariff adjustments to offset inflation, intervention in foreign exchange markets and actions to adjust or fix currency values, which may trigger or exacerbate increases in inflation, and consequently have an adverse impact on us. In an inflationary environment, the value of uncollected accounts receivable, as well as of unpaid accounts payable, declines rapidly. If the countries in which we operate experience high levels of inflation in the future and price controls are imposed, we may not be able to adjust the rates we charge our customers to fully offset the impact of inflation on our cost structures, which could adversely affect our results of operations or financial condition.

Depreciation of the Peso or the Real relative to the U.S. dollar or the Euro may also create additional inflationary pressures in Argentina or Brazil that may negatively affect us. Depreciation generally curtails access to foreign financial markets and may prompt government intervention, including recessionary governmental policies. Depreciation also reduces the U.S. dollar or Euro value of dividends and other distributions on our common shares and the U.S. dollar or Euro equivalent of the market price of our common shares. Any of the foregoing might adversely affect our business, operating results, and cash flow, as well as the market price of our common shares.

Conversely, in the short term, a significant increase in the value of the Peso or the Real against the U.S. dollar would adversely affect the respective Argentine and/or Brazilian government’s income from exports. This could have a negative effect on GDP growth and employment and could also reduce the public sector’s revenues in those countries by reducing tax collection in real terms, as a portion of public sector revenues are derived from the collection of export taxes.

Increases in the price of raw materials and oil may adversely affect us.

The agricultural properties are located in Brazil’s cerrado biome (also known as the Brazilian savannah region), a location where the soil is mostly acidic and not very fertile, requiring the use of lime and fertilizers. Our operations require other raw materials such as pesticides and seeds which we acquire from local and international suppliers. We do not have long-term supply contracts for these raw materials and therefore are exposed to the risk of cost increases. A significant increase in the price of lime, fertilizers or other raw materials we use would likely reduce our profitability or otherwise adversely affect our business operations as these are not costs that can readily be passed on to our customers. In addition, certain of our production costs, including fertilizers and the cost of leasing agricultural machinery, are linked to the international price of oil and its derivatives. Therefore, if the price of oil increases significantly, our results of operations could be adversely affected.

We also rely on fertilizers and agrochemicals, many of which are petrochemical based. In our segments related to agricultural activity (grains, cotton, sugarcane and cattle raising), fertilizers and agrochemicals represented approximately 74% of our total cost of production (including manufacturing and administrative expenses) for the 2021-2022 harvest year. Worldwide production of agricultural products has increased significantly in recent years in response to increased demand for agrochemicals and fertilizers. However, supply shortages have continued to exist and have been aggravated by the ongoing conflict between Russia and Ukraine.

Delays or failures in the delivery of raw materials used by us and our suppliers could have an adverse effect on us.

We depend on suppliers to provide us with fertilizers, seeds, other raw materials and machinery services.

Possible delays in the delivery of such items may delay our planting efforts until we are able to establish agreements with other suppliers, or may delay our harvest in case of delay in delivery of machinery. Accordingly, any delays, failures or defects in the delivery of raw materials or inputs or with regard to the provision of services to us by our suppliers could adversely affect our business and results of operations. See “—Our business, financial condition and results of operations may be adversely affected by lack of transportation, storage and processing infrastructure in Brazil, which represents an important challenge for the Brazilian agricultural and agricultural real estate sectors.”

23

We may be adversely affected by the ongoing conflict between Russia and Ukraine and the ensuing global geopolitical and economic instability.

The effects of the ongoing conflict between Russia and Ukraine on the Russian and global economy remains uncertain. However, they have resulted in significant volatility in financial markets, as well as an increase in energy and commodity prices globally. As a result, in particular, the availability and price of fertilizers for the 2022-2023 harvest year is subject to significant uncertainty in Brazil and the other countries in which we operate. From a supply point of view, Brazil and the other countries in which we operate are highly dependent on imports of fertilizers from Russia and other neighboring countries. In addition, fertilizer prices, which had already risen before the conflict, have continued to rise and have led producers to delay purchase negotiations. As a result of such supply risks, we believe that there may be shortages of some types of fertilizers (mainly of potash-based products). We may also be unsuccessful in finding alternative direct imports from non-sanctioned regions or in increasing our prices to reflect increased supply costs in the future. Failure to obtain fertilizer on favorable terms, or at all, could have a material adverse effect on our business, financial condition and results of operations. Geopolitical tensions in petroleum-producing countries may also affect the global supply of oil and lead to increased prices. The conflict between Russia and Ukraine led to a spike in oil and energy prices. Although this positively impacted ethanol demand and prices, we cannot assure you that such geopolitical tensions will not adversely affect our business, financial condition and results of operations.

Risks Relating to other Countries Where We Operate

Our business is dependent on economic conditions in the countries where we operate or intend to operate.

We have made investments in farmland in Argentina, Brazil, Paraguay and Bolivia and we may possibly make investments in other countries in and outside Latin America and United States, among others. Owing that demand for livestock and agricultural products is usually correlated to economic conditions prevailing in the local market, which in turn is dependent on the macroeconomic condition of the country in which the market is located, our financial condition and results of operations are, to a considerable extent, dependent upon political and economic conditions prevailing from time to time in the countries where we operate. Latin American countries have historically experienced uneven periods of economic growth, as well as recession, periods of high inflation and economic instability. Certain countries have experienced severe economic crises, which may still have future effects. As a result, governments may not have the necessary financial resources to implement reforms and foster growth. Any of these adverse economic conditions could have a material adverse effect on our business.

We face the risk of political and economic crises, instability, terrorism, civil strife, expropriation and other risks of doing business in emerging markets.

In addition to Argentina and Brazil, we conduct or intend to conduct our operations in other Latin American countries such as Paraguay and Bolivia, among others. Economic and political developments in the countries in which we operate, including future economic changes or crisis (such as inflation or recession), government deadlock, political instability, terrorism, civil strife, changes in laws and regulations, expropriation or nationalization of property, and exchange controls could adversely affect our business, financial condition and results of operations.

In particular, fluctuations in the economies of Argentina and Brazil and actions adopted by the governments of those countries have had and may continue to have a significant impact on companies operating in those countries, including us. Specifically, we have been affected and may continue to be affected by inflation, increased interest rates, fluctuations in the value of the Argentine Peso and Brazilian Real against foreign currencies, price and foreign exchange controls, regulatory policies, business and tax regulations and in general by the political, social and economic scenarios in Argentina and Brazil and in other countries that may affect Argentina and Brazil.

Although economic conditions in one country may differ significantly from another country, we cannot assure that events in one only country will not adversely affect our business or the market value of, or market for, our common shares and/or ADSs.

24

Governments in the countries where we operate or intend to operate exercise significant influence over their economies.

Emerging market governments, including governments in the countries where we operate, frequently intervene in the economies of their respective countries and occasionally make significant changes in monetary, credit, industry and other policies and regulations. Governmental actions to control inflation and other policies and regulations have often involved, among other measures, price controls, currency devaluations, capital controls and limits on imports. Our business, financial condition, results of operations and prospects may be adversely affected by changes in government policies or regulations, including factors, such as:

· exchange rates and exchange control policies;

· inflation rates;

· labor laws;

· economic growth;

· currency fluctuations;

· monetary policy;

· liquidity and solvency of the financial system;

· limitations on ownership of rural land by foreigners;

· developments in trade negotiations through the World Trade Organization or other international organizations;

· environmental regulations;

· restrictions on repatriation of investments and on the transfer of funds abroad;

· expropriation or nationalization;

· import/export restrictions or other laws and policies affecting foreign trade and investment;

· price controls or price fixing regulations;

· restrictions on land acquisition or use or agricultural commodity production

· interest rates;

· tariff and inflation control policies;

· import duties on information technology equipment;

· liquidity of domestic capital and lending markets;

· electricity rationing;

· tax policies;

· armed conflict or war declaration; and

· other political, social and economic developments, including political, social or economic instability, in or affecting the country where each business is based.

25

Uncertainty on whether governments will implement changes in policy or regulation affecting these or other factors in the future may contribute to economic uncertainty and heightened volatility in the securities markets, which may have a material and adverse effect on our business, results of operations and financial condition. In addition, an eventual reduction of foreign investment in any of the countries where we operate may have a negative impact on such country’s economy, affecting interest rates and the ability of companies to access financial markets.

Developments in other markets may affect the Latin American countries where we operate or intend to operate, and as a result our financial condition and results of operations may be adversely affected.

The market value of securities of companies such as us may be, to varying degrees, affected by economic and market conditions in other global markets. Although economic conditions vary from country to country, investors’ perception of the events occurring in one country may substantially affect capital flows into and securities from issuers in other countries, including Latin American countries. Various Latin American economies have been adversely impacted by the political and economic events that occurred in several emerging economies in recent times. Furthermore, Latin American economies may be affected by events in developed economies which are trading partners or that impact the global economy and adversely affect our activities and the results of our operations.

Land in Latin American countries may be subject to expropriation or occupation.

Our land may be subject to expropriation by the governments of the countries where we operate and intend to operate. An expropriation could materially impair the normal use of our lands or have a material adverse effect on our results of operations. In addition, social movements, such as Movimento dos Trabalhadores Rurais Sem Terra and Comissão Pastoral da Terra in Brazil, are active in certain countries where we operate or intend to operate. Such movements advocate land reform and mandatory property redistribution by governments. Invasions and occupations of rural areas by a large number of individuals is common practice for these movements, and, in certain areas, including some of those in which we are likely to invest, police protection and effective eviction proceedings are not available to land owners. As a result, we cannot assure you that our properties will not be subject to invasion or occupation. A land invasion or occupation could materially affect the normal use of our properties or have a material adverse effect on us or the value of our common shares and our ADSs.

We may invest in countries other than Argentina and Brazil and cannot give you any assurance as to the countries in which we will ultimately invest, and we could fail to list all risk factors for each possible country.

We have a broad and opportunistic business strategy therefore we may invest in countries other than Argentina and Brazil including countries in other emerging markets outside Latin America (e.g., Africa). As a result, it is not possible at this time to identify all risk factors that may affect our future operations and the value of our common shares and ADSs.

Disruption of transportation and logistics services or insufficient investment in public infrastructure could adversely affect our operating results.

One of the principal disadvantages of the agricultural sector in the countries in which we operate is that key growing regions lie far from major ports. As a result, efficient access to transportation infrastructure and ports is critical to the growth of agriculture as a whole in the countries in which we operate and of our operations in particular. Improvements in transportation infrastructure are likely to be required to make more agricultural production accessible to export terminals at competitive prices. A substantial portion of agricultural production in the countries in which we operate is currently transported by truck, a means of transportation significantly more expensive than the rail transportation available to U.S. and other international producers. Our dependence on truck transportation may affect our position as a low-cost producer so that our ability to compete in the world markets may be impaired.

26

Even though road and rail improvement projects have been considered for some areas of Brazil, and in some cases implemented, substantial investments are required for road and rail improvement projects, which may not be completed on a timely basis, if at all. Any delay or failure in developing infrastructure systems could reduce the demand for our products, impede our products’ delivery or impose additional costs on us. We currently outsource the transportation and logistics services necessary to operate our business. Any disruption in these services could result in supply problems at our farms and processing facilities and impair our ability to deliver our products to our customers in a timely manner.

The result of BrasilAgro’s operations are dependent upon economic conditions in Paraguay, in which BrasilAgro operates, and any decline in economic conditions could harm our results of operations or financial condition.

As of June 30, 2022, 28% of BrasilAgro’s assets were located in Paraguay. Paraguay has a history of economic and political instability, exchange controls, frequent changes in regulatory policies, corruption, and weak judicial security. However, in 2013, Paraguay had the highest GDP growth rate in Latin America and the third highest in the world with 14%. Since then, GDP has grown by 4% in 2014, 3% in 2015, 3.8% in 2016, 4.3% in 2017, 3.6% in 2018, 0.2% in 2019, decreased 6.0% in 2020 and an increase of 4.1% in 2021. The Paraguay’s GDP is closely related to the performance of the Paraguayan agricultural sector, which can be volatile and could adversely affect our business, financial condition and results of operations.

The exchange rate of Paraguay is free and floating and the Central Bank of Paraguay participates actively in the exchange market in order to reduce volatility. In 2018, the Paraguayan currency appreciated against the dollar by 6.7%, in 2019 the appreciation was 8.26%, in 2020 the appreciation was 6.7% while in 2021 the it had a decrease by 0.55%. A significant depreciation of the local currency could adversely affect our business, financial condition and results of operations. However, since most of our costs of raw materials and supplies are denominated in U.S. dollars, a significant depreciation of the local currency could adversely affect our business, financial condition and results of operations, as well as impact other expenses, such as professional fees and maintenance costs.

In addition, a significant deterioration in the economic growth of Paraguay or any of its main trading partners, such as Brazil or Argentina, could have a material impact on the trade balance of Paraguay and could adversely affect their economic growth, which could adversely affect our business, financial condition and results of operations.

The result of BrasilAgro’s operations are dependent upon economic conditions in Bolivia, in which BrasilAgro operates, and any decline in economic conditions could harm our results of operations or financial condition.

As of June 30, 2022, 5% of BrasilAgro’s assets were located in Bolivia. Bolivia is exposed to frequent has a history of economic, social and political instability, exchange controls, frequent changes in regulatory frameworks policies, civic and labour strikes, high tax rates and corruption among state officials, the judiciary and also the private sector.

Bolivia is exposed to high risk of social unrest, causing marches and roadblocks deployed by protesters to pressure the government, increasing disruption risks. Furthermore, protests over environmental issues often overlap significantly with labour disputes, which can escalate into disruptive forms of protest, including site occupations.

In turn, the Bolivian economy is the 14th largest in Latin America and is heavily dependent on export commodities such as natural gas and minerals. Bolivia’s GDP growth over the last decade has been among the highest in Latin America, growing by 4.9% in 2015, 4.3% in 2016, 4.2% in 2017, 4.2% in 2018 and 2.2% in 2019, while in 2020 it had a decrease by 7.3% and an increase of 6.1% in 2021. Within this context, inflation has been relatively low and under control for the last 30 years. The inflation rate for 2021 was around 0.49%. In addition, Bolivia it is in the process of becoming an active partner of MERCOSUR, a common market aiming to gradually integrate economic activity among Brazil, Argentina, Uruguay, Paraguay and Bolivia.

27

A significant deterioration in the global and internal macroeconomics, political stability or social unrest of Bolivia, could have a material impact on their economic growth, which could adversely affect our business, financial condition and results of operations. On October 18, 2020, Bolivia’s general elections were held, with the aim of electing e President, Vice-President and deputies of the country. Luis Arce, belonging to the Movement to Socialism (MAS) was elected in the first round, with 54.41% of the votes. The elections were announced by Bolivia’s former president, Evo Morales, on November 10, 2019, hours before his resignation. They were scheduled to be held on May 3, 2020, but due to the outbreak of the COVID-19 pandemic elections had to be postponed to the aforementioned date. In November 2020, Acre was democratically elected, in the first round, president of Bolivia with 55.1% of the vote.

Risks Relating to Our Agricultural Business

Fluctuation in market prices for our agriculture products could adversely affect our financial condition and results of operations.

Prices for crops, oilseeds and by-products, like those of other commodities, have historically been cyclical and sensitive to domestic and international changes in supply and demand and can be expected to fluctuate significantly. In addition, the agricultural products and by-products we produce are traded on commodities and futures exchanges and thus are subject to speculative trading, which may adversely affect us. The prices that we are able to obtain for our agriculture products depend on many factors beyond our control, including:

· prevailing world prices, which historically have been subject to significant fluctuations over relatively short periods of time, depending on worldwide demand and supply;

· changes in the agricultural subsidy levels in certain important countries (mainly the United States and countries in the EU) and the adoption of other government policies affecting industry market conditions and prices;

· changes to trade barriers of certain important consumer markets (including China, India, the U.S. and the E.U.) and the adoption of other governmental policies affecting industry market conditions and prices;

· changes in government policies for biofuels;

· world inventory levels, i.e., the supply of commodities carried over from year to year;

· climatic conditions and natural disasters in areas where agricultural products are cultivated;

· the production capacity of our competitors; and

· demand for and supply of competing commodities and substitutes.

Unpredictable weather conditions, pest infestations and diseases may have an adverse impact on our crop yields and cattle production.

The occurrence of severe adverse weather conditions, especially droughts, hail, or floods, is unpredictable and may have a potentially devastating impact upon our crop production and, to a lesser extent, our cattle and wool production, and may otherwise adversely affect the supply and price of the agricultural commodities that we sell and use in our business. The occurrence of severe adverse weather conditions may reduce yields on our farmlands or require us to increase our level of investment to maintain yields. Additionally, higher than average temperatures and rainfall can contribute to an increased presence of pest and insects that may adversely impact our agricultural production.

According to the United States Department of Agriculture (“USDA”) estimates, Argentina’s crops output (wheat, corn and soybean) for the 2022/2023 season will be reaching a production of 101.6 million tons. The estimated production of soybean is supposed to reach 51 million tons, the wheat production 12.6 million tons and the corn production 38 million tons.

28

The occurrence and effects of disease and plagues can be unpredictable and devastating to agricultural products, potentially rendering all or a substantial portion of the affected harvests unsuitable for sale. Our agricultural products are also susceptible to fungus and bacteria that are associated with excessively moist conditions. Even when only a portion of the production is damaged, our results of operations could be adversely affected because all or a substantial portion of the production costs have been incurred. Although some diseases are treatable, the cost of treatment is high, and we cannot assure you that such events in the future will not adversely affect our operating results and financial condition. Furthermore, if we fail to control a given plague or disease and our production is threatened, we may be unable to supply our main customers, which could affect our results of operations and financial condition.

As a result, we cannot assure you that the current and future severe adverse weather conditions or pest infestations will not adversely affect our operating results and financial condition.

Our cattle are subject to diseases.

Diseases among our cattle herds, such as mastitis, tuberculosis, brucellosis and foot-and-mouth disease, can have an adverse effect on fattening production, rendering cows unable to produce meat for human consumption. Outbreaks of cattle diseases may also result in the closure of certain important markets, such as the United States, to our cattle products. Although we abide by national veterinary health guidelines, which include laboratory analyses and vaccination, to control diseases among the herds, especially foot-and-mouth disease, we cannot assure that future outbreaks of cattle diseases will not occur. A future outbreak of diseases among our cattle herds may adversely affect our cattle sales which could adversely affect our operating results and financial condition.

In addition, outbreaks, or fears of outbreaks, of any of these or other animal diseases can lead to the cancellation of our customers’ orders and, particularly if the disease can affect humans, or create adverse publicity that can have adverse material effect in the consumer demand of our products. In addition, animal disease outbreaks may result in foreign government actions to close the export markets of some or all of our products, which may result in the destruction of some or all of these animals.

We may be exposed to material losses due to volatile crop prices since a significant portion of our production is not hedged, and exposed to crop price risk.

Due to the fact that we do not have all of our crops hedged, we are unable to have minimum price guarantees for all of our production and are therefore exposed to significant risks associated with the level and volatility of crop prices. We are subject to fluctuations in crop prices which could result in receiving a lower price for our crops than our production cost. We are also subject to exchange rate risks related to our crops that are hedged, because our futures and options positions are valued in U.S. dollars, and thus are subject to exchange rate risk.

In addition, if severe weather or any other disaster generates a lower crop production than the position already sold in the market, we may suffer material losses in the repurchase of the sold contracts.

The creation of new export taxes may have an adverse impact on our sales and results of operations.

In order to prevent inflation and variations in the exchange rate from adversely affecting prices of primary and manufactured products (including agricultural products), and to increase tax collections and reduce Argentina’s fiscal deficit, the Argentine government has imposed new taxes on exports.

On December 2015, the Mauricio Macri’s administration, announced the reduction of 35 to 30% of export duties on soybean and the removing of all of the export duties for the rest of the products. To the date, the Argentine government is analyzing the possibility of reducing again the tax for soybean exports. In addition, Decree 1343/17 implemented a monthly reduction of 0.5% of the export duty in force on soybean, wheat and soybean oil from January 2018 to December 2019 inclusive.

29

On September 4, 2018, pursuant to Decree 793/2018, the Argentine government restablished, until December 31, 2020, a 12% export tax on goods and services included in the MERCOSUR Common Nomenclature with a cap of ARS 3 for each dollar of taxable value or the official FOB price, as appropriate, for the goods and services set forth in Annex I of the aforementioned decree and of ARS 4 for all other manufactured products.

On the other hand, the Argentine government has approached in different ways the withholding scheme on grain exports to be applied. For such purposes, Decree No. 789/2020 entered into force on October 6, 2020, which provided for the reduction for three months of the withholding on the export of soybeans and their main derivatives. Then this regulation that sets 0% of the rate of the export duty was extended until December 31, 2022 through Decree No. 831 extends until December 31, 2022 the set of 0% of the rate of the Export Right. In turn, Decree No. 150/2021 establishes that the goods must not pay any other rate of export duty. On September 4, 2018, the Argentine government issued Decree No. 793/2018 that re-implements, until December 31, 2020, a 12% tariff for the export of goods and services included in the common MERCOSUR nomenclature, with a cap of ARS 3 for each US dollar of its tax value or free value (FOB), as appropriate for the goods and services established in Annex I of the aforementioned decree and ARS 4 for other manufactured products. On December 28, 2018, the Argentine government issued decree No. 1201/2018 that established until December 31, 2021, a 5% export tax for services provided in the country, whose effective use or exploitation is carried out abroad. This measure became effective on January 1, 2019 and will be effective for operations that are provided and billed from that day.

Through Decree No. 911/2021 and Resolution No. 301/2021, the guidelines for the export of meat were established. Thus, until December 31, 2023, the export of whole carcasses, half carcasses, forequarters and hindquarters with bone, incomplete half carcasses with bones and incomplete forequarters with bone is prohibited.

Export taxes may have a material adverse effect on our sales and results of operations. We produce exportable goods and, therefore, an increase in export taxes is likely to result in a decrease in our products’ price, and, therefore, may result in a decrease of our sales. We cannot guarantee the impact of those or any other future measures that might be adopted by the Argentine government on our financial condition and result of operations.

We may face risks associated with land-takings in Argentina.

Land-taking is a long-standing problem in Argentina that has escalated throughout the years with every economic crisis, especially now in the context of the economic crisis caused by the COVID-19 pandemic.

The spread of land takes has revived an old debate in Argentina. There is a conflict between two groups that claim, on the one hand, a right to decent housing, and on the other hand a group that claims that the right to private property should be respected Argentina’s constant and cyclical economic crises over the past 50 years have also caused poverty to rise sharply, so less people can access a roof, resulting in a housing deficit.

As a consequence, we cannot provide assurance that Government responses to such disruptions will restore investor confidence in Argentine lands, which could have an adverse impact on our financial condition and results of operations.

The imposition of restrictions on acquisitions of agricultural properties by foreign nationals in the countries where we operate may materially restrict the development of our business in such countries.

Depending on the assets and/or activities that the company undertakes in Argentina, limitations could be imposed on holding percentages by foreigners in accordance with Law No. 26,737 "Régimen de Protección al Dominio Nacional sobre la Propiedad, Posesión o Tenencia de las Tierras Rurales" which regulates, with respect to foreigners or companies controlled by foreigners, the limits to the ownership and possession of rural lands, regardless of their intended use or production destination.

Besides Argentina, in the rest of the countries where we operate, there are laws in place that impose limitations on the purchase and lease of rural land by foreigners and/or companies controlled by foreigners. Such regulations have been incorporated into the local legislation of those countries, by means of: (i) Law No. 1,715 of Bolivia; and (ii) and Law No. 2,532 of Paraguay, in addition to the fact that there is currently a bill for the "Proteccion Nacional de las Tierras Rurales", which we do not know the impact it could have on our operations if it becomes law. In regards to Brazil, for further information concerning applicable on this subject, please see “Risks relating to Brazil - The imposition of restrictions on acquisitions of agricultural properties by foreign nationals in Brazil may materially restrict the development of our business in Brazil.”

A global economic recession could decrease the demand for our products or lower prices.

The demand for the products we sell may be affected by international, national and local economic conditions that are beyond our control. Adverse changes in the real or perceived economic climate, such as rising fuel prices, higher interest rates, falls and / or volatility of real estate and real estate markets, more restrictive credit markets, higher taxes and changes in government policies could reduce the level of demand or prices of the products we produce. We cannot predict the time or duration, magnitude or strength of this slowdown or economic recovery. If a recession continues for a prolonged period of time or worsens, we may experience a prolonged period of declining demand and prices. In addition, economic recessions have and can negatively affect our suppliers, which can lead to interruptions in goods and services and financial losses.

30

An international credit crisis could have a negative impact on our major customers which in turn could materially adversely affect our results of operations and liquidity.

The most recent international credit crisis that started in 2008 had a significant negative impact on businesses around the world. Although we believe that available borrowing capacity under the current conditions and proceeds resulting from potential farmland sales will provide us with sufficient liquidity through the current economic environment, the impact of the crisis on our major customers cannot be predicted and may be quite severe. A disruption in the ability of our significant customers to access liquidity could cause serious disruptions or an overall deterioration of their businesses which could lead to a reduction in their future orders of our products and the inability or failure on their part to meet their payment obligations to us, any of which could have a material adverse effect on our results of operations and liquidity.

Government intervention in the markets may have a direct impact on our prices.

The Argentine government has set certain industry market conditions and prices in the past. In order to prevent a substantial increase in the price of basic products as a result of inflation, the Argentine government is adopting an interventionist policy. In March 2002, the Argentine government fixed the price for milk after a conflict among producers and the Argentine government. Since 2005, the Argentine government, in order to increase the domestic availability of beef and reduce domestic prices, adopted several measures: it increased turnover tax and established a minimum average number of animals to be slaughtered. In March 2006, the registries for beef exports were temporarily suspended. This last measure was softened once prices decreased. There can be no assurance that the Argentine government will not interfere in other areas by setting prices or regulating other market conditions. Accordingly, we cannot assure you that we will be able to freely negotiate all our products’ prices in the future or that the prices or other market conditions that the Argentine government could impose will allow us to freely negotiate the price of our products.

We do not maintain insurance over all our crop storage facilities; therefore, if a fire or other disaster damages some or all of our harvest, we will not be completely covered.

Our production is, in general, subject to different risks and hazards, including adverse weather conditions, fires, diseases, pest infestations and other natural phenomena. We store a significant portion of our grain production during harvest due to the seasonal drop in prices that normally occurs at that time. Currently, we store a significant portion of our grain production in plastic silos. We do not maintain insurance on our plastic silos. Although our plastic silos are placed in several different locations, and it is unlikely that a natural disaster affects all of them simultaneously, a fire or other natural disaster which damages the stored grain, particularly if such event occurs shortly after harvesting, could have an adverse effect on our operating results and financial condition.

Worldwide competition in the markets for our products could adversely affect our business and results of operations.

We experience substantial worldwide competition in each of our markets in which we operate, and in many of our product lines. The market for cereals, oil seeds and by-products is highly competitive and also sensitive to changes in industry capacity, producer inventories and cyclical changes in the world’s economies, any of which may significantly affect the selling prices of our products and thereby our profitability. Argentina is more competitive in the oilseed market than in the market for cereals. Due to the fact that many of our products are agricultural commodities, they compete in the international markets almost exclusively on the basis of price. The market for commodities is highly fragmented. Small producers can also be important competitors, some of which operate in the informal economy and are able to offer lower prices by meeting lower quality standards. Competition from other producers is a barrier to expanding our sales in the domestic/foreign market. Many other producers of these products are larger than us, and have greater financial and other resources. Moreover, many other producers receive subsidies from their respective countries while we do not receive any such subsidies from the Argentine government. These subsidies may allow producers from other countries to produce at lower costs than us and/or endure periods of low prices and operating losses for longer periods than we can. Any increased competitive pressure with respect to our products could materially and adversely affect our financial condition and results of operations.

31

Social movements may affect the use of our agricultural properties or cause damage to them.

Social movements, such as the Landless Rural Workers’ Movement (Movimento dos Trabalhadores Rurais Sem Terra) and the Pastoral Land Commission (Comissão Pastoral da Terra) are active in Brazil and advocate land reform and property redistribution by the Brazilian Government. Invasion and occupation of agricultural land by large numbers of people is a common practice among the members of such movements and, in certain regions, including those where we currently invest, remedies such as police protection or eviction procedures are inadequate or non-existent. As a result, we cannot assure you that our agricultural properties will not be subject to invasion or occupation by any social movement. Any invasion or occupation may materially impair the use of our lands and adversely affect our business, financial condition, and results of operations.

If we are unable to maintain our relationships with our customers, our business may be adversely affected.

Our cattle sales are diversified but we are and will continue to be significantly dependent on a number of third-party relationships, mainly with our customers for crop sales. For the fiscal year 2022, our sales from the agribusiness segment (excluding sales of farms) were made to approximately 30 customers. Sales to our ten largest customers represented approximately 55% to 60%, of our net agriculture sales. Some of these customers included Cargill, FASA, Bunge Alimentos S.A., ACA, GLENCORE and QUILMES. We have signed non-binding letters of intent with some of our largest customers that allow us to estimate the volume of the demand for certain products and to plan production accordingly. We generally enter into short-term agreements with a term of less than a year.

We sell our crop production mainly to exporters and manufacturers that process the raw materials to produce meal and oil, products that are sent to the export markets. The Argentine crop market is characterized by a few purchasers and a great number of sellers. Although most of the purchasers are international companies with strong financial conditions, we cannot assure you that this situation will remain the same in the future or this market will not get more concentrated in the future.

We may not be able to maintain or form new relationships with customers or others who provide products and services that are important to our business. Accordingly, we cannot assure you that our existing or prospective relationships will result in sustained business or the generation of significant revenues.

Our business is seasonal, and our revenues may fluctuate significantly depending on the growing cycle.

Our agricultural business is highly seasonal due to its nature and cycle. The harvest and sale of crops (corn, soybean and sunflower) generally occurs from February to June. Wheat is harvested from December to January. Our operations and sales are affected by the growing cycle of the crops we process and by decreases during the summer in the price of the cattle we fatten. As a result, our results of operations have varied significantly from period to period, and are likely to continue to vary, due to seasonal factors.

A substantial portion of our assets is farmland that is highly illiquid.

We have been successful in partially rotating and monetizing a portion of our investments in farmland. Ownership of a significant portion of the land we operate is a key part of our business model. However, agricultural real estate is generally an illiquid asset. Moreover, the adoption of laws and regulations that impose limitations on ownership of rural land by foreigners in the jurisdictions in which we operate may also limit the liquidity of our farmland holdings. As a result, it is unlikely that we will be able to adjust our owned agricultural real estate portfolio promptly in response to changes in economic, business or regulatory conditions. Illiquidity in local market conditions may adversely affect our ability to complete dispositions, to receive proceeds generated from any such sales or to repatriate any such proceeds.

The restrictions imposed on our subsidiaries’ dividend payments may adversely affect us.

We have subsidiaries, and therefore, dividends in cash and other permitted payments of our subsidiaries constitute a major source of our income. The debt agreements of our subsidiaries contain covenants that may restrict their ability to pay dividends or proceed with other types of distributions. If our subsidiaries are prevented from making payments to us or if they are only allowed to pay limited amounts, we may be unable to pay dividends or to repay our indebtedness.

32

We could be materially and adversely affected by our investment in BrasilAgro.

We consolidated our financial statements with our subsidiary BrasilAgro. BrasilAgro was formed on September 23, 2005 to exploit opportunities in the Brazilian agricultural sector. BrasilAgro seeks to acquire and develop future properties to produce a diversified range of agricultural products (which may include sugarcane, grains, cotton, forestry products and livestock). BrasilAgro is a company that has been operating since 2006. As a result, it has a developing business strategy and an establishd track record. BrasilAgro’s business strategy may not be successful, and if not successful, BrasilAgro may be unable to successfully modify its strategy. BrasilAgro’s ability to implement its proposed business strategy may be materially and adversely affected by many known and unknown factors. If we were to write-off our investments in BrasilAgro, this would likely materially and adversely affect our business. As of June 30, 2022, we owned 39.4% of the outstanding common shares of BrasilAgro.

Changes in facts and circumstances may adversely affect our ability to exercise control over BrasilAgro

Although we own shares representing 39.56% of total voting rights at BrasilAgro, we concluded that we exercise “de facto control” based on the following facts: (i) the percentage and concentration of our voting rights, (ii) the record of attendance to Shareholders’ Meetings and the record of votes cast by the other shareholders; and (iii) the effective control exercised by us to direct BrasilAgro’s relevant activities through the Board of Directors, where we appointed five out of nine board members. As some of these facts are out of our control, a change in the fact pattern that we assessed might derive in a loss of control over BrasilAgro, leading to deconsolidation from an accounting perspective. 

Labor relations could negatively impact us.

As of June 30, 2022, approximately 30% of our employees in our Agricultural Business in Argentina were represented by unions under collective agreements. While we currently enjoy good relations with our employees and unions, we cannot assure that such good labor relations will continue in the future positively or that their eventual deterioration does not affect us materially or negatively.

Our internal processes and controls might not be sufficient to comply with the extensive environmental regulation and current or future environmental regulations could prevent us from fully developing our land reserves.

Our activities are subject to a wide set of federal, state and local laws and regulations relating to the protection of the environment, which impose various environmental obligations. Obligations include compulsory maintenance of certain preserved areas in our properties, management of pesticides and associated hazardous waste and the acquisition of permits for water use. Our proposed business is likely to involve the handling and use of hazardous materials that may cause the emission of certain regulated substances. In addition, the storage and processing of our products may create hazardous conditions. We could be exposed to criminal and administrative penalties, in addition to the obligation to remedy the adverse effects of our operations on the environment and to indemnify third parties for damages, including the payment of penalties for non-compliance with these laws and regulations. Since environmental laws and their enforcement are becoming more stringent in Argentina, our capital expenditures and expenses for environmental compliance may substantially increase in the future. In addition, due to the possibility of future regulatory or other developments, the amount and timing of environmental-related capital expenditures and expenses may vary substantially from those currently anticipated. The cost of compliance with environmental regulation may result in reductions of other strategic investments which may consequently decrease our profits. Any material unforeseen environmental costs may have a material adverse effect on our business, results of operations, financial condition or prospects. We cannot ensure that our internal processes and controls may be sufficient to comply with the extensive environmental regulation.

As of June 30, 2022, we owned land reserves extending over more than 457,711 hectares that were purchased at very attractive prices. In addition, we have a concession over 132,000 hectares reserved for future development. We believe that there are technological tools available to improve productivity in these farmlands and, therefore, achieve appreciation in the long term. However, current or future environmental regulations could prevent us from fully developing our land reserves by requiring that we maintain part of this land as natural woodlands not to be used for production purposes. 

33

New restrictions on agricultural and food products we produce that contain genetically modified organisms could be established which could have an adverse effect on our business.

Our agricultural products contain genetically modified organisms in varying proportions according to the year and the country of production. The use of genetically modified organisms in food has been achieved with varying degrees of acceptance in the markets in which we operate. Argentina and Brazil, for example, have approved the use of genetically modified organisms in food products, and genetically modified organisms and non-genetically modified organisms grains in those countries are produced and mixed frequently during the process of grain origination. Elsewhere, adverse publicity about genetically modified foods has led to Government regulation that limits sales of genetically modified organisms products. It is possible that new restrictions may be imposed on genetically modified organisms products in the main markets for some of our products, which could have an adverse effect on our business, equity and the result of our operations.

If our products become contaminated, we may be subject to product liability claims, product withdrawals and export restrictions that could adversely affect our business.

While we are subject to strict production protocols, the sale of products implies the risk of injury to consumers. These injuries may result from manipulation by third parties, bioterrorism, product contamination or deterioration, including the presence of bacteria, pathogens, foreign objects, substances, chemicals, other agents or waste introduced during the growth phases, storage, handling or transport.

We cannot be sure that the consumption of our products will not cause a health-related illness in the future or that we will not be subject to claims or judgments related to such matters. Even if a product liability claim is unsuccessful or not fully realized, the negative publicity surrounding any claim that our products caused a disease or injury could negatively affect our reputation with current and potential customers and our image as a Company, and we could also incur significant incidents. In addition, claims or liabilities of this nature may not be covered by any compensation or contribution rights we may have against others, which could have a material adverse effect on our business, equity status and the result of our operations.

Increased energy prices and fuel shortages could adversely affect our operations.

We require substantial amounts of fuel oil and other resources for our harvest activities and transport of our agricultural products. We rely upon third parties for our supply of the energy resources consumed in our operations. The prices for and availability of energy resources may be subject to change or curtailment, respectively, due to, among other things, new laws or regulations, imposition of new taxes or tariffs, interruptions in production by suppliers, worldwide price levels and market conditions. The prices of various sources of energy may increase significantly from current levels. An increase in energy prices could materially adversely affect our results of operations and financial condition.

Over the last few years, the Argentine government has taken certain measures in order to reduce the use of energy during peak months of the year by frequently cutting energy supply to industrial facilities and large consumers to ensure adequate supply for residential buildings. If energy supply is cut for an extended period of time or energy tariffs continue increasing and we are unable to find replacement sources at comparable prices, or at all, our business and results of operations could be adversely affected.

Our level of debt may adversely affect our operations and our ability to pay our debt as it becomes due.

As of June 30, 2022, CRESUD’s consolidated financial gross debt amounted to ARS 141,431 million. We cannot assure you that we will have sufficient cash flows and adequate financial capacity to finance our business in the future. Although CRESUD is generating sufficient funds from its operating cash flows to meet our debt service obligations and its ability to obtain new financing is adequate, considering the current availability of loan financing in Argentina, we cannot assure you that we will have sufficient cash flows and adequate financial structure in the future.

34

Our leverage may affect our ability to refinance existing debt or borrow additional funds to finance working capital requirements, acquisitions and capital expenditures. In addition, the recent disruptions in the local capital and the macroeconomic conditions of Argentine markets, may adversely impact our ability to refinance existing debt and the availability and cost of credit in the future. In such conditions, access to equity and debt financing options may be restricted and it may be uncertain how long these economic circumstances may last. This would require us to allocate a substantial portion of cash flow to repay principal and interest, thereby reducing the amount of money available to invest in operations, including acquisitions and capital expenditures. Furthermore, our leverage could also affect our competitiveness and limit our ability to pay our debt due to changes in market conditions, changes in the real estate industry and/or future economic downturns.

The success of our businesses and the feasibility of our transactions depend on the continuity of investments in the real estate markets and our ability to access capital and debt financing. In the long term, lack of confidence in real estate investment and lack of access to credit for acquisitions could restrict growth. As part of our business strategy, we will strive to increase our real estate portfolio through strategic acquisitions of properties at favorable prices and properties with added value which we believe meet the requirements to increase the value of our properties.

We may not be able to generate sufficient cash flows from operations to satisfy our debt service requirements or to obtain future financing. If we cannot satisfy our debt service requirements or if we default on any financial or other covenants in our debt arrangements, the lenders and/or holders of our securities will be able to accelerate the maturity of such debt or default under other debt arrangements. Our ability to service debt obligations or to refinance them will depend upon our future financial and operating performance, which will, in part, be subject to factors beyond our control such as macroeconomic conditions and regulatory changes in Argentina. If we cannot obtain future financing, we may have to delay or abandon some or all of our planned capital expenditures, which could adversely affect our ability to generate cash flows and repay our obligations as they become due.

For more information see “Operating and Financial Review and Prospects—Liquidity and capital resources—Indebtedness”.

We depend on our chairman and senior management.

Our success depends, to a significant extent, on the continued employment of Mr. Eduardo S. Elsztain, our chairman, and Alejandro G. Elsztain, our chief executive officer, and second vice-chairman. The loss of their services for any reason could have a material adverse effect on our business. If our current principal shareholders were to lose their influence on the management of our business, our principal executive officers could resign or be removed from office.

Our future success also depends in part upon our ability to attract and retain other highly qualified personnel. We cannot assure you that we will be successful in hiring or retaining qualified personnel, or that any of our personnel will remain employed by us.

The Investment Company Act may limit our future activities.

Under Section 3(a)(3) of the Investment Company Act of 1940, as amended (“Investment Company Act”), an investment company is defined in relevant part to include any company that owns or proposes to acquire investment securities that have a value exceeding 40% of such company’s unconsolidated total assets (exclusive of U.S. Government securities and cash items). Investments in minority interests of related entities as well as majority interests in consolidated subsidiaries which themselves are investment companies are included within the definition of “investment securities” for purposes of the 40% limit under the Investment Company Act.

Companies that are investment companies within the meaning of the Investment Company Act, and that do not qualify for an exemption from the provisions, are required to register with the SEC and are subject to substantial regulations with respect to capital structure, operations, transactions with affiliates and other matters. In the event such companies do not register under the Investment Company Act, they may not, among other things, conduct public offerings of their securities in the United States or engage in interstate commerce in the United States. Moreover, even if we desired to register with the SEC as an investment company, we could not do so without an order of the SEC because we are a non-U.S. corporation, and it is unlikely that the SEC would issue such an order.

35

As of June 30, 2022, we owned approximately 53.6% of IRSA’s outstanding shares. Although we believe we are not an “investment company” for purposes of the Investment Company Act, our belief is subject to substantial uncertainty, and we cannot give you any assurance that we would not be determined to be an “investment company” under the Investment Company Act. As a result, the uncertainty regarding our status under the Investment Company Act may adversely affect our ability to offer and sell securities in the United States or to U.S. persons. The U.S. capital markets have historically been an important source of funding for us, and our ability to obtain financing in the future may be adversely affected by a lack of access to the U.S. markets. If an exemption under the Investment Company Act is unavailable to us in the future and we desire to access the U.S. capital markets, our only recourse would be to file an application to the SEC for an exemption from the provisions of the Investment Company Act which is a lengthy and highly uncertain process.

Moreover, if we offer and sell securities in the United States or to U.S. persons and we were deemed to be an investment company under the investment company act and not exempted from the application of the Investment Company Act, contracts we enter into in violation of, or whose performance entails a violation of, the Investment Company Act, including any such securities, may not be enforceable against us.

We hold Argentine securities which might be more volatile than U.S. securities and carry a greater risk of default.

We currently have and in the past have had certain investments in Argentine government debt securities, corporate debt securities, and equity securities. In particular, we hold a significant interest in IRSA, an Argentine company that has suffered material losses, particularly during the fiscal years 2001 and 2002. Although our holding of these investments, excluding IRSA, tends to be short term, investments in such securities involve certain risks, including:

· market volatility, higher than those typically associated with U.S. Government and corporate securities; and

· loss of principal.

Some of the issuers in which we have invested and may invest, including the Argentine government, have in the past experienced substantial difficulties in servicing their debt obligations, which have led to the restructuring of certain indebtedness. We cannot assure that the issuers in which we have invested or may invest will not be subject to similar or other difficulties in the future which may adversely affect the value of our investments in such issuers. In addition, such issuers and, therefore, such investments, are generally subject to many of the risks that are described in this section with respect to us, and, thus, could have little or no value.

Risks Relating to IRSA’s business in Argentina

Disease outbreaks or other public health concerns could reduce traffic in IRSA’s shopping malls.

Recently, as a result of the COVID-19 pandemic, the Argentine government enacted several regulations limiting the operation of schools, cinemas and shopping malls, which has significantly reduced traffic at our shopping malls. See “Risks Relating to Argentina – The ongoing COVID-19 pandemic and government measures to contain the virus are adversely affecting our business and results of operations, and, as conditions are evolving rapidly, we cannot accurately predict the ultimate impact on our results of operation.” IRSA cannot assure you that new disease outbreaks or health hazards will not occur in the future, or that such an outbreak or health hazard would not significantly affect consumer and/or tourists’ activity. The recurrence of such a scenario could adversely affect IRSA’s business and IRSA’s results of operations.

IRSA is subject to risks inherent to the operation of shopping malls that may affect our profitability.

IRSA’s shopping malls are subject to various factors that affect their development, administration and profitability, including:

· declines in lease prices or increases in levels of default by our tenants due to economic conditions;

· increases in interest rates and other factors outside our control;

36

· the accessibility and attractiveness of the areas where our shopping malls are located;

· the intrinsic attractiveness of the shopping mall;

· the flow of people and the level of sales of rental units in our shopping malls;

· the increasing competition from internet sales;

· the amount of rent collected from tenants at our shopping malls;

· changes in consumer demand and availability of consumer credit, both of which are highly sensitive to general macroeconomic conditions; and

· fluctuations in occupancy levels in our shopping malls.

An increase in our operating costs could also have a material adverse effect on us if our tenants were to become unable to pay higher rent we may be required to impose as a result of increased expenses. Moreover, the shopping mall business is closely related to consumer spending and affected by prevailing economic conditions. All of our shopping malls and commercial properties are located in Argentina, and consequently, these operations may be adversely affected by recession or economic uncertainty in Argentina. Persistently poor economic conditions could result in a decline in consumer spending which could have a material adverse effect on shopping mall revenue.

IRSA could be adversely affected by decreases in the value of our investments.

IRSA’s investments are exposed to the risks generally inherent to the real estate industry, many of which are out of our control. Any of these risks could adversely and materially affect IRSA’s business, financial condition and results of operations. Any returns on capital expenditures associated with real estate are dependent upon sales volumes and/or revenue from leases and the expenses incurred. In addition, there are other factors that may adversely affect the performance and value of a property, including local economic conditions prevailing in the area where the property is located, macroeconomic conditions in Argentina and globally, competition, IRSA’s ability to find lessees and their ability to perform on their leases, changes in legislation and in governmental regulations (such as the use of properties, urban planning and real estate taxes) as well as exchange controls (given that the real estate market in Argentina relies on the U.S. dollar to determine valuations), variations in interest rates (including the risk of an increase in interest rates that reduces sales of lots for residential development) and the availability of third party financing. In addition, and given the relative illiquidity of the Argentine real estate market, we could be unable to effectively respond to adverse market conditions and/or be compelled to undersell one or more properties. Some significant expenses, such as debt service, real estate taxes and operating and maintenance costs do not fall when there are circumstances that reduce the revenue from an investment, increasing our relative expenditures. These factors and events could impair IRSA’s ability to respond to adverse changes in the returns on IRSA’s investments, which in turn could have an adverse effect on our financial position and the results of IRSA’s operations.

IRSA’s level of debt may adversely affect our operations and its ability to pay its debt as it becomes due and its capacity to successfully access the local and international markets on favorable terms affects its cost of funding.

As of June 30, 2022, IRSA’s consolidated financial gross debt amounted to ARS 74,734 million. We cannot assure you that we will have sufficient cash flows and adequate financial capacity to finance our business in the future. Although we are generating sufficient funds from our operating cash flows to meet our debt service obligations and our ability to obtain new financing is adequate, considering the current availability of loan financing in Argentina, we cannot assure you that we will have sufficient cash flows and adequate financial structure in the future. For more information see “Item 10. Additional Information—D. Exchange Controls.”

37

Our leverage may affect our ability to refinance existing debt or borrow additional funds to finance working capital requirements, acquisitions and capital expenditures. In addition, the recent disruptions in the local capital and the macroeconomic conditions of Argentine markets, may adversely impact our ability to refinance existing debt and the availability and cost of credit in the future. In such conditions, access to equity and debt financing options may be restricted and it may be uncertain how long these economic circumstances may last. This would require us to allocate a substantial portion of cash flow to repay principal and interest, thereby reducing the amount of money available to invest in operations, including acquisitions and capital expenditures. Our leverage could also affect our competitiveness and limit our ability to pay its debt due to changes in market conditions, changes in the real estate industry and/or future economic downturns.

The success of our businesses and the feasibility of our transactions depend on the continuity of investments in the real estate markets and our ability to access capital and debt financing. In the long term, lack of confidence in real estate investment and lack of access to credit for acquisitions could restrict growth. As part of our business strategy, we will strive to increase our real estate portfolio through strategic acquisitions of properties at favorable prices and properties with added value which we believe meet the requirements to increase the value of our properties.

We may not be able to generate sufficient cash flows from operations to satisfy our debt service requirements or to obtain future financing. If we cannot satisfy our debt service requirements or if we default on any financial or other covenants in our debt arrangements, the lenders and/or holders of our securities will be able to accelerate the maturity of such debt or default under other debt arrangements. Our ability to service debt obligations or to refinance them will depend upon our future financial and operating performance, which will, in part, be subject to factors beyond our control such as macroeconomic conditions and regulatory changes in Argentina. If we cannot obtain future financing, we may have to delay or abandon some or all of our planned capital expenditures, which could adversely affect our ability to generate cash flows and repay our obligations as they become due.

For more information see “Operating and Financial Review and Prospects—Liquidity and capital resources—Indebtedness”.

IRSA’s assets are highly concentrated in certain geographic areas and an economic downturn in such areas could have a material adverse effect on our results of operations and financial condition.

As of June 30, 2022, most of IRSA’s revenue from leases and services provided by the Shopping Malls segment derived from properties located in the City of Buenos Aires and the Greater Buenos Aires metropolitan area. In addition, all of IRSA’s office buildings are located in Buenos Aires and a substantial portion of IRSA’s revenue is derived from such properties. Although IRSA owns properties and may acquire or develop additional properties outside Buenos Aires and the Greater Buenos Aires metro area, IRSA expects to continue to be largely affected by economic conditions or by pandemic effects which could affect these high populated areas. Consequently, an economic downturn in those areas could cause a reduction in our rental income and adversely affect its ability to comply with IRSA’s debt service and fund operations.

IRSA’s performance is subject to the risks associated with our properties and with the real estate industry.

IRSA’s operating performance and the value of our real estate assets, and as a result, the value of its securities, are subject to the risk that its properties may not be able to generate sufficient revenue to meet its operating expenses, including debt service and capital expenditures, its cash flow needs and its ability to service our debt service obligations. Events or conditions beyond its control that may adversely affect its operations or the value of its properties include:

· downturns in national, regional and local economies;

· decrease in consumer spending and consumption;

· competition from other shopping malls and sales outlets;

· local real estate market conditions, such as oversupply or lower demand for retail space;

· changes in interest rates and availability of financing;

38

· the exercise by our tenants of their right to early termination of their leases;

· vacancies, changes in market rental rates and the need to periodically repair, renovate and re-lease space;

· increased operating costs, including insurance expenses, salary increases, utilities, real estate taxes, federal and local taxes and higher security costs;

· the impact of losses resulting from civil disturbances, strikes, natural disasters, terrorist acts or acts of war;

· significant fixed expenditures associated with each investment property, such as debt service payments, real estate taxes, insurance and maintenance costs;

· declines in the financial condition of our tenants and our ability to collect rents when due;

· changes in our or our tenants’ ability to provide for adequate maintenance and insurance that result in a reduction in the useful life of a property; and

· changes in law or governmental regulations (such as those governing usage, zoning and real property taxes) or changes in the exchange controls or government action (such as expropriation).

If any one or more of the foregoing conditions were to affect IRSA’s activities, this could have a material adverse effect on our financial condition and results of operations, and as a result, on the Company’s results.

An adverse economic environment for real estate companies and the credit crisis may adversely affect IRSA’s results of operations.

The success of IRSA’s business and profitability of its operations depend on continued investment in real estate and access to long-term financing. A prolonged crisis of confidence in real estate investments and lack of credit for acquisitions may constrain our growth and the maintenance of our current business and operations. As part of IRSA’s strategy, IRSA intends to increase our properties portfolio through strategic acquisitions at favorable prices, where IRSA believes IRSA can bring the necessary expertise to enhance property values. In order to pursue acquisitions, IRSA may require capital or debt financing. Recent disruptions in the financial markets may adversely impact IRSA’s ability to refinance existing debt and the availability and cost of credit in the future. Any consideration of sales of existing properties or portfolio interests may be offset by lower property values. IRSA’s ability to make scheduled payments or to refinance IRSA’s existing debt obligations depends on our operating and financial performance, which in turn is subject to prevailing economic conditions. If disruptions in financial markets prevail or arise in the future, we cannot provide assurances that Argentine government responses to such disruptions will restore investor confidence, stabilize the markets or increase liquidity and the availability of credit.

IRSA’s revenue and profit may be materially and adversely affected by continuing inflation and economic activity in Argentina.

IRSA’s business is mainly driven by consumer spending since a portion of the revenue from its Shopping Mall segment derives directly from the sales of our tenants, whose revenue relies on the sales to consumers. As a result, IRSA’s revenues and net income are impacted to a significant extent by economic conditions in Argentina, including the development in the textile industry and domestic consumption, which has experienced significant decline during 2019, 2020 and 2021. Consumer spending is influenced by many factors beyond IRSA’s control, including consumer perception of current and future economic conditions, inflation, political uncertainty, rates of employment, interest rates, taxation and currency exchange rates. Any continuing economic slowdown, whether actual or perceived, could significantly reduce domestic consumer spending in Argentina and therefore adversely affect our business, financial condition and results of operations.

39

The loss of tenants could adversely affect our operating revenue and value of our properties.

Although no single tenant represents more than 4.3% of IRSA’s revenues in any fiscal year, if a significant number of tenants at its retail or office properties were to experience financial difficulties, including bankruptcy, insolvency or a general downturn of business, or if IRSA failed to retain them, IRSA’s business could be adversely affected. Further, IRSA’s shopping malls typically have a significant “anchor” tenant, such as well-known department stores, that generate consumer traffic at each mall. A decision by such tenants to cease operating at any of our shopping mall properties could have a material adverse effect on our financial condition and the results of our operations. In addition, the closing of one or more stores that attract consumer traffic may motivate other tenants to terminate or to not renew their leases, to seek rent concessions and/or close their stores. Moreover, tenants at one or more properties might terminate their leases as a result of mergers, acquisitions, consolidations, dispositions or bankruptcies. The bankruptcy and/or closure of multiple stores, if IRSA is not able to successfully release the affected space, could have a material adverse effect on both the operating revenue and underlying value of the properties involved. See “Item 5.A. Operating Results – The Ongoing COVID-19 Pandemic.”

IRSA may face risks associated with acquisitions of properties, our future acquisitions may not be profitable and the properties we acquire may be subject to unknown liabilities.

As part of IRSA’s growth strategy, IRSA has acquired, and intend to do so in the future, properties, including large properties (such as Edificio República, Abasto de Buenos Aires and Alto Palermo Shopping), that tend to increase the size of our operations and potentially alter our capital structure. Although IRSA believes that the acquisitions IRSA has completed in the past and that IRSA expects to undertake enhance IRSA’s financial performance, the success of such transactions is subject to a number of uncertainties, including the risk that:

· IRSA may not be able to obtain financing for acquisitions on favorable terms;

· acquired properties may fail to perform as expected;

· the actual costs of repositioning or redeveloping acquired properties may be higher than IRSA’s estimates;

· acquired properties may be located in new markets where IRSA may have limited knowledge and understanding of the local economy, absence of business relationships in the area or are unfamiliar with local governmental and permitting procedures; and

· IRSA may not be able to efficiently integrate acquired properties, particularly portfolios of properties, into IRSA’s organization and to manage new properties in a way that allows it to realize cost savings and synergies.

IRSA’s future acquisitions may not be profitable.

IRSA seeks to acquire additional shopping malls to the extent IRSA manages to acquire them on favorable terms and conditions and they meet our investment criteria. Acquisitions of commercial properties entail general investment risks associated with any real estate investment, including:

· IRSA’s estimates of the cost of improvements needed to bring the property up to established standards for the market may prove to be inaccurate;

· properties IRSA acquires may fail to achieve, within the time frames we project, the occupancy or rental rates we expect to achieve at the time we make the decision to acquire, which may result in the properties’ failure to achieve the returns we projected;

· IRSA’s pre-acquisitions evaluation and the physical condition of each new investment may not detect certain defects or identify necessary repairs, which could significantly increase our total acquisition costs; and

· IRSA’s investigation of a property or building prior to its acquisition, and any representations IRSA may receive from the seller of such building or property, may fail to reveal various liabilities, which could reduce the cash flow from the property or increase our acquisition cost.

40

If IRSA acquires a business, IRSA will be required to merge and integrate the operations, personnel, accounting and information systems of such acquired business. In addition, acquisitions of or investments in companies may cause disruptions in our operations and divert management’s attention away from day-to-day operations, which could impair our relationships with our current tenants and employees.

The properties IRSA acquires may be subject to unknown liabilities.

The properties that IRSA acquires may be subject to unknown liabilities, in respect to which IRSA may have limited or no recourse to the former owners. If a liability were asserted against us based on IRSA’s ownership of an acquired property, IRSA may be required to incur significant expenditures to settle, which could adversely affect IRSA’s financial results and cash flow. Unknown liabilities relating to acquired properties could include:

· liabilities for clean-up of undisclosed environmental contamination;

· the costs of changes in laws or in governmental regulations (such as those governing usage, zoning and real property taxes); and

· liabilities incurred in the ordinary course of business.

IRSA’s dependence on rental income may adversely affect IRSA’s ability to meet IRSA’s debt obligations.

A substantial part of IRSA’s revenue is derived from rental income. As a result, our performance depends on our ability to collect rent from IRSA’s tenants. Our revenue and profits would be negatively affected if a significant number of our tenants or any significant tenant were to:

· delay lease commencements;

· decline to extend or renew leases upon expiration;

· fail to make rental payments when due; or

· close stores or declare bankruptcy.

Any of these actions could result in the termination of leases and the loss of related rental income. In addition, IRSA cannot assure you that any tenant whose lease expires will renew that lease or that we will be able to re-let the space on economically reasonable terms. The loss of rental revenue from a number of our tenants and IRSA’s inability to replace such tenants may adversely affect our profitability and its ability to comply with our debt service obligations. These factors are particularly disruptive in the context of emergency situations, such as the COVID-19 pandemic, which has caused significant adverse impacts on our business as tenants have been required to shut down or significantly reduce their operating activities.

It may be difficult to buy and sell real estate quickly and transfer restrictions may apply to part of IRSA’s portfolio of properties.

Real estate investments are relatively illiquid and this tends to limit our ability to change the mix of IRSA’s portfolio in response to economic circumstances or other conditions. In addition, significant expenditures associated with each investment, such as mortgage payments, real estate taxes and maintenance costs, are generally not reduced when an investment generates lower revenue. If revenue from a property declines while expenses remain the same, our results of operations would be adversely affected. Certain properties are mortgaged and if we were unable to meet our underlying payment obligations, we could suffer losses as a result of foreclosures on those mortgaged properties. Furthermore, if we are required to dispose of one or more of our mortgaged properties, we would not be able to obtain release of the mortgage interest without payment of the associated debt. The foreclosure of a mortgage on a property or inability to sell a property could adversely affect our business. In this kind of transactions, we may agree not to sell the acquired properties for a considerable time which could affect our results of operations.

41

Some of the land IRSA has purchased is not zoned for development and IRSA may be unable to obtain, or may face delays in obtaining, the necessary zoning permits and other authorizations.

IRSA owns several plots of land which are not zoned for our intended development plans. In addition, IRSA has not yet applied for the required land-use, building, occupancy and other required governmental permits and authorizations for these properties. IRSA cannot assure you that IRSA will continue to be successful in our attempts to rezone land and to obtain all necessary permits and authorizations, or that rezoning efforts and permit requests will not be delayed or rejected. Moreover, IRSA may be affected by building moratorium and anti-growth legislation. If IRSA is unable to obtain the governmental permits and authorizations we need to develop our present and future projects as planned, IRSA may be forced to make unwanted modifications to such projects or abandon them altogether.

IRSA may face risks associated with land-takings in Argentina.

Land-taking is a long-standing problem in Argentina that has escalated throughout the years with every economic crisis, especially now in the context of the COVID-19 economic crisis.

The spread of land takes has revived in Argentina an old debate in Argentina. There is a conflict between two groups that claim, on the one hand, a right to decent housing, and on the other hand a group that claims that the right to private property should be respected Argentina’s constant and cyclical economic crises over the past 50 years have also caused poverty to rise sharply, so less people can access a roof, resulting in a housing deficit.

As a consequence, we cannot provide assurance that Argentine government responses to such disruptions will restore investor confidence in Argentine lands, which could have an adverse impact on our financial condition and results of operations.

IRSA’s ability to grow will be limited if IRSA cannot obtain additional financing.

Although IRSA is liquid as of the date of this Annual Report, we must maintain liquidity to fund our working capital, service our outstanding indebtedness and finance investment opportunities. Without sufficient liquidity, we could be forced to curtail our operations or we may not be able to pursue new business opportunities.

IRSA’s growth strategy is focused on the development and redevelopment of properties IRSA already owns and the acquisition of additional properties for development. As a result, IRSA is likely to have to depend to an important degree on the availability of capital financing, which may or may not be available on favorable terms if at all. IRSA cannot assure you that additional financing, refinancing or other capital will be available in the amounts we require or on favorable terms. IRSA’s access to debt or equity capital markets depends on a number of factors, including the market’s perception of IRSA’s r growth potential, IRSA’s ability to pay dividends, IRSA’s financial condition, IRSA’s credit rating and our current and potential future earnings. Depending on these factors, we could experience delays or difficulties in implementing IRSA’s growth strategy on satisfactory terms or at all.

The capital and credit markets for Argentina have been experiencing extreme volatility and disruption since the last years. If IRSA’s current resources do not satisfy our liquidity requirements, IRSA may have to seek additional financing. The availability of financing will depend on a variety of factors, such as economic and market conditions, the availability of credit and our credit ratings, as well as the possibility that lenders could develop a negative perception of the prospects of risk in Argentina, of IRSA’s company or the industry generally. IRSA may not be able to successfully obtain any necessary additional financing on favorable terms, or at all.

42

Adverse incidents that occur in IRSA’s shopping malls may result in damage to IRSA’s reputation and a decrease in the number of customers.

Given that IRSA’s shopping malls are open to the public, with ample circulation of people, accidents, theft, robbery, public protest, pandemic effects and other incidents may occur in our facilities, regardless of the preventative measures we adopt. If such an incident or series of incidents occurs, shopping mall customers and visitors may choose to visit other shopping venues that they believe are safer, which may cause a reduction in the sales volume and operating income of our shopping malls.

Argentine laws governing leases impose restrictions that limit IRSA’s flexibility.

Argentine laws governing leases impose certain restrictions, including the following:

· a prohibition on including automatic price adjustment clauses based on inflation increases in leases; and

· the imposition of a two-year minimum lease term for all purposes, except in particular cases such as embassy, consulate or international organization venues, room with furniture for touristic purposes for less than three months, custody and bailment of goods, exhibition or offering of goods in fairs or in cases where due to the circumstances, the subject matter of the lease requires a shorter term.

As a result, IRSA is exposed to the risk of higher rates of inflation under IRSA’s leases, and any exercise of rescission rights by our tenants could materially and adversely affect IRSA’s business and results of operations. IRSA cannot assure you that IRSA’s tenants will not exercise such right, especially if rental rates stabilize or decline in the future or if economic conditions continue to deteriorate.

IRSA may be liable for certain defects in IRSA’s buildings.

The Argentine Civil and Commercial Code imposes liability for real estate developers, builders, technical project managers and architects in case of hidden defects in a property for a period of three years from the date title on the property is tendered to the purchaser, even when those defects did not cause significant property damage. If any defect affects the structural soundness or make the property unfit for use, the liability term is ten years.

In IRSA’s real estate developments, IRSA usually act as developers and sellers while construction generally is carried out by third party contractors. Absent a specific claim, IRSA cannot quantify the potential cost of any obligation that may arise as a result of a future claim, and IRSA has not recorded provisions associated with them in IRSA’s financial statements. If IRSA was required to remedy any defects on completed works, our financial condition and results of operations could be adversely affected.

IRSA could have losses if we have to resort to eviction proceedings in Argentina to collect unpaid rent because such proceedings are complex and time-consuming.

Although Argentine law permits filing of an executive proceeding to collect unpaid rent and a special proceeding to evict tenants, eviction proceedings in Argentina are complex and time-consuming. Historically, the heavy workloads of the courts and the numerous procedural steps required have generally delayed landlords’ efforts to evict tenants. Eviction proceedings generally take between six months and two years from the date of filing of the suit to the time of actual eviction.

Historically, IRSA has sought to negotiate the termination of leases with defaulting tenants after the first few months of non-payment in an effort to avoid legal proceedings. Delinquency may increase significantly in the future, and such negotiations with tenants may not be as successful as they have been in the past. Moreover, new Argentine laws and regulations may forbid or restrict eviction, and in each such case they would likely have a material and adverse effect on our financial condition and results of operations.

43

Climate change may have adverse effects on our business

We, our customers, and communities in which we operate, may be adversely affected by the physical risks of climate change, including increases in temperatures, sea levels, and the frequency and severity of adverse climatic events including fires, storms, floods and droughts. These effects, whether acute or chronic in nature, may directly impact us and our customers through disruptions to business and economic activity or impacts on income and asset values.

Initiatives to mitigate or respond to climate change may impact market and asset prices, economic activity, and customer behavior, particularly in emissions intensive industry sectors and geographies affected by these changes.

Failure to effectively manage and disclose these risks could adversely affect our business, prospects, reputation, financial performance or financial condition.

The recurrence of a credit crisis could have a negative impact on IRSA’s major customers, which in turn could materially adversely affect IRSA’s results of operations and liquidity.

The global credit crisis has a significant negative impact on businesses around the world. Similarly, Argentina is undergoing a credit crisis that could negatively impact IRSA’s tenants’ ability to comply with their lease obligations. The impact of a future credit crisis on IRSA’s major tenants cannot be predicted and may be quite severe. A disruption in the ability of IRSA’s significant tenants to access liquidity could pose serious disruptions or an overall deterioration of their businesses, which could lead to a significant reduction in future orders of their products and their inability or failure to comply with their obligations, any of which could have a material adverse effect on our results of operations and liquidity.

IRSA is subject to risks inherent to the operation of office buildings that may affect IRSA’s profitability.

Office buildings are exposed to various factors that may affect their development, administration and profitability, including the following factors:

· lower demand for office space;

· a deterioration in the financial condition of our tenants that causes defaults under leases due to lack of liquidity, access to capital or for other reasons;

· difficulties or delays renewing leases or re-leasing space;

· decreases in rents as a result of oversupply, particularly offerings at newer or re-developed properties;

· competition from developers, owners and operators of office properties and other commercial real estate, including sublease space available from our tenants;

· maintenance, repair and renovation costs incurred to maintain the competitiveness of our office buildings;

· exchange controls that may interfere with their ability to pay rents that generally are pegged to the U.S. dollar;

· the consequences of a pandemic, epidemic or disease outbreak that would produce lower demand for offices spaces; and

· an increase in our operating costs, caused by inflation or by other factors could have a material adverse effect on us if our tenants are unable to pay higher rent as a result of increased expenses.

44

IRSA’s investment in property development and management activities may be less profitable than IRSA anticipate.

IRSA is engaged in the development and construction of properties to be used for office, residential or commercial purposes, shopping malls and residential complexes, in general through third-party contractors. Risks associated with our development, reconversion and construction activities include the following, among others:

· abandonment of development opportunities and renovation proposals;

· construction costs may exceed our estimates for reasons including higher interest rates or increases in the cost of materials and labor, making a project unprofitable;

· occupancy rates and rents at newly completed properties may fluctuate depending on a number of factors, including market and economic conditions, resulting in lower than projected rental revenue and a corresponding lower return on our investment;

· pre-construction buyers may default on their purchase contracts or units in new buildings may remain unsold upon completion of construction;

· lack of affordable financing alternatives in the private and public debt markets;

· sale prices of residential units may be insufficient to cover development costs;

· construction and lease commencements may not be completed on schedule, resulting in increased debt service expense and construction costs;

· failure or delays in obtaining necessary zoning, land-use, building, occupancy and other required governmental permits and authorizations, or building moratoria and anti-growth legislation;

· significant time lags between the commencement and completion of projects subjects us to greater risks due to fluctuation in the general economy;

· construction may be delayed because of a number of factors, including weather, strikes or delays in receipt of zoning or other regulatory approvals, or man-made or natural disasters, resulting in increased debt service expense and construction costs;

· changes in our tenants’ demand for rental properties outside of Buenos Aires; and

· IRSA may incur capital expenditures that require considerable time and effort and which may never be completed due to government restrictions or overall market conditions.

In addition, IRSA may face claims for the enforcement of labor laws in Argentina. Many companies hire personnel from third parties that provide outsourced services, and sign indemnity agreements if labor claims from employees of such third company arise. However, in recent years several courts have rejected the existence of independence in those labor relations and ruled that joint and several responsibilities by both companies.

While IRSA’s policies with respect to expansion, renovation and development activities are intended to limit some of the risks otherwise associated with such activities, IRSA is nevertheless subject to risks associated with property development, such as cost overruns, design changes and timing delays arising from a lack of availability of materials and labor, weather conditions and other factors outside of our control, as well as financing costs that, may exceed original estimates, possibly making the associated investment unprofitable. Any delays or unanticipated expenses could adversely affect the investment returns from these development projects and harm our operating results.

45

Greater than expected increases in construction costs could adversely affect the profitability of IRSA’s new developments.

IRSA’s business activities include real estate developments. One of the main risks related to this activity corresponds to potential increases in construction costs, which may be driven by higher demand and new development projects in the shopping malls and buildings sectors. Increases higher than those included in the original budget may result in lower profitability than expected.

The increasingly competitive real estate sector in Argentina may adversely affect IRSA’s ability to rent or sell office space and other real estate and may affect the sale and lease price of our premises.

IRSA’s real estate activities are highly concentrated in the Buenos Aires metropolitan area where the market is highly competitive due to a scarcity of properties in sought-after locations and an increasing number of local and international competitors. The Argentine real estate industry is highly competitive and fragmented and does not have high barriers to entry for new competitors. The main competitive factors in the real estate development business include availability and location of land, price, funding, design, quality, reputation and partnerships with developers. A number of residential and commercial developers and real estate service companies compete in identifying land acquisition opportunities, attracting financial resources, and appealing to prospective purchasers and tenants. Other companies, including joint ventures of foreign and local companies, have become increasingly active in the market, further increasing competition. If one or more of our competitors is able to acquire and develop desirable properties, because it has access to greater financial resources or otherwise, if we are unable to respond to such pressures as promptly as our competitors, or competition increases, our business and financial condition could be adversely affected.

All of IRSA’s shopping mall and commercial office properties are located in Argentina. There are other shopping malls and independent retail stores and residential properties that are within the geographic scope of each of our properties. The number of competing properties in a particular area could have a material adverse effect both on our ability to lease retail space in our shopping malls or sell units in our residential complexes and on the amount of rent or the sale price that we are able to charge. IRSA cannot assure you that other shopping mall operators will not invest in Argentina in the near future. If additional competitors become active in the shopping mall segment, such competition could have a material adverse effect on our results of operations.

Substantially all of IRSA’s offices and other non-shopping mall rental properties are located in developed urban areas. There are many office buildings, shopping malls, retail and residential premises in the areas where IRSA’s properties are located. This is a highly fragmented market, and the abundance of comparable properties in our vicinity may adversely affect our ability to rent or sell office space and other real estate and may affect the sale and lease price of our premises. In the future, both national and foreign companies may participate in Argentina’s real estate development market, competing with us for business opportunities.

Some potential losses are not covered by insurance and certain kinds of insurance coverage may become prohibitively expensive.

IRSA currently carry insurance policies that cover potential risks such as civil liability, fire, lost profit and floods, including extended coverage and losses from leases on all of IRSA’s properties. Although we believe the policy specifications and insured limits of these policies are customary, there are certain types of losses, such as lease and other contract claims, terrorism and acts of war that generally are not insured under the insurance policies offered in the Argentina. In the event of a loss that was not insured or a loss in excess of insured limits, IRSA could lose all or a portion of the capital IRSA has invested in a property, as well as its anticipated future revenue. In such an event, IRSA might nevertheless remain obligated for any mortgage debt or other financial obligations related to the property. IRSA cannot assure you that material losses in excess of insurance proceeds will not occur in the future. If any of IRSA’s properties were to experience a catastrophic loss, it could seriously disrupt our operations, delay revenue and result in large expenses to repair or rebuild the property. Insurance companies may no longer offer coverage against certain types of losses, such as losses due to terrorist acts and the existence of mold, or, if offered, these types of insurance may become too expensive.

46

IRSA does not has life or disability insurance for our key employees. If any of our key employees were to die or become disabled, IRSA could experience losses caused by a disruption in our operations which will not be covered by insurance, and this could have a material adverse effect on our financial condition and results of operations.

An uninsured loss or a loss that exceeds policies on IRSA’s properties could subject us to lost capital or revenue on those properties.

The terms of IRSA’s standard form property leases currently in effect, require tenants to indemnify and hold us harmless from liabilities resulting from injury to persons or property at or outside the premises, due to activities conducted on the properties, except for claims arising from negligence or intentional misconduct of IRSA’s agents. Tenants are generally required, at the tenant’s expense, to obtain and keep in full force during the term of the lease, liability insurance policies. IRSA cannot provide assurance that IRSA’s tenants will be able to properly maintain their insurance policies or have the ability to pay deductibles. If an uninsured loss occurs or a loss arises that exceeds the combined aggregate limits for the policies, or if a loss arises that is subject to a substantial deductible under an insurance policy, we could lose all or part of IRSA’s capital invested in, and anticipated revenue from, one or more of IRSA’s properties, which could have a material adverse effect on our business, financial condition and results of operations.

Demand for IRSA’s premium properties, aimed at high-income consumers, may not be sufficient.

IRSA have focused on development projects that cater to affluent consumers and IRSA has entered into property barter arrangements pursuant to which IRSA contributes undeveloped land parcels to joint venture entities with developers who agree to deliver units at premium development locations in exchange for IRSA’s land contribution. When the developers return these properties to us, demand for premium residential units could be significantly lower. In such case, IRSA would be unable to sell these residential units at the estimated prices or time frame, which could have an adverse effect on IRSA’s financial condition and results of operations.

IRSA is subject to risks affecting the hotel industry.

The full-service segment of the lodging industry in which our hotels operate is highly competitive. The operational success of IRSA’s hotels is highly dependent on our ability to compete in areas such as access, location, quality of accommodations, rates, quality food and beverage facilities and other services and amenities. IRSA’s hotels may face additional competition if other companies decide to build new hotels or improve their existing hotels to increase their attractiveness.

In addition, the profitability of our hotels depends on:

· our ability to form successful relationships with international and local operators to run our hotels;

· changes in tourism and travel trends, including seasonal changes and changes due to pandemic outbreaks, such as the Influenza A Subtype H1N1 and Zika viruses, a potential Ebola outbreak, COVID-19, monkeypox, among others, or weather phenomenons or other natural events, such as the eruption of the Puyehué and the Calbuco volcano in June 2011 and April 2015, respectively;

· affluence of tourists, which can be affected by a slowdown in global economy; and

· taxes and governmental regulations affecting wages, prices, interest rates, construction procedures and costs.

47

The shift by consumers to purchasing goods over the internet, where barriers to entry are low, may negatively affect sales at IRSA’s shopping malls.

In recent years, internet retail sales have grown significantly in Argentina, even though the market share of such sales is still modest. The Internet enables manufacturers and retailers to sell directly to consumers, diminishing the importance of traditional distribution channels such as retail stores and shopping malls. IRSA believes that our target consumers are increasingly using the Internet, from home, work or elsewhere, to shop electronically for retail goods, and this trend is likely to continue. Retailers at IRSA’s properties face increasing competition from online sales and this could cause the termination or non-renewal of their leases or a reduction in their gross sales, affecting our percentage rent based revenue. If e commerce and retail sales through the Internet continue to grow, retailers’ and consumers’ reliance on our shopping malls could be materially diminished, having a material adverse effect on our financial condition, results of operations and business prospects. For more information with respect to the COVID-19 pandemic and its impact on our business, see “Item 5.A. Operating Results – The Ongoing COVID-19 Pandemic.”

IRSA’s business is subject to extensive regulation and additional regulations may be imposed in the future.

IRSA’s activities are subject to Argentine federal, state and municipal laws, and to regulations, authorizations and licenses required with respect to construction, zoning, use of the soil, environmental protection and historical landmark preservation, consumer protection, antitrust and other requirements, all of which affect IRSA’s ability to acquire land, buildings and shopping malls, develop and build projects and negotiate with customers. In addition, companies in this industry are subject to increasing tax rates, the introduction of new taxes and changes in the taxation regime. IRSA’s is required to obtain permits from different government agencies in order to carry out our projects. Maintaining IRSA’s licenses and authorizations can be costly. If we fail to comply with such laws, regulations, licenses and authorizations, IRSA may face fines, project shutdowns, and cancellation of licenses and revocation of authorizations.

In addition, public agencies may issue new and stricter standards, or enforce or construe existing laws and regulations in a more restrictive manner, which may force us to incur expenditures in order to comply. Development activities are also subject to risks of potential delays in or an inability to obtain all necessary zoning, environmental, land-use, development, building, occupancy and other permits and authorizations. Any such delays or failures to obtain such government approvals may have an adverse effect on IRSA’s business.

In the past, the Argentine government issued regulations regarding leases in response to housing shortages, high rates of inflation and difficulties in accessing credit. Such regulations limited or prohibited increases on rental prices and prohibited eviction of tenants, even for failure to pay rent. Most of IRSA’s leases provide that tenants pay all costs and taxes related to their respective leased areas. In the event of a significant increase in such costs and taxes, the Argentine government may respond to political pressure to intervene by regulating this practice, thereby negatively affecting IRSA’s rental income. IRSA cannot assure you that the Argentine government will not impose similar or other regulations in the future. Changes in existing laws or the enactment of new laws governing the ownership, operation or leasing of shopping malls and office properties in Argentina could negatively affect the real estate and the rental market and materially and adversely affect IRSA’s operations and financial condition.

Labor relations may negatively impact IRSA.

As of June 30, 2022, 64.0% of IRSA’s workforce was represented by unions under collective bargaining agreements. Although IRSA currently enjoys good relations with IRSA’s employees and their unions, IRSA cannot assure you that labor relations will continue to be positive or that deterioration in labor relations will not materially and adversely affect us.

IRSA’s results of operations include unrealized revaluation adjustments on investment properties, which may fluctuate significantly over financial periods and may materially and adversely affect IRSA’s business, results of operations and financial condition.

During the year ended June 30, 2022, IRSA had fair value gain on investment properties of ARS 13,650 million. Although the upward or downward revaluation adjustments reflect unrealized capital gains or losses on our investment properties during the relevant periods, the adjustments do not reflect the actual cash flow or profit or losses generated from the sales or rental of our investment properties. Unless such investment properties are disposed of at similarly revalued amounts, IRSA will not realize the actual cash flow. The amount of revaluation adjustments has been, and will continue to be, significantly affected by the prevailing property markets and macroeconomic conditions prevailing in Argentina and will be subject to market fluctuations in those markets.

48

IRSA cannot guarantee whether changes in market conditions will increase, maintain or decrease the historical average fair value gains on our investment properties or at all. In addition, the fair value of our investment properties may materially differ from the amount we receive from any actual sale of an investment property. If there is any material downward adjustment in the revaluation of our investment properties in the future or if our investment properties are disposed of at significantly lower prices than their valuation or appraised value, our business, results of operations and financial condition may be materially and adversely affected.

Due to the currency mismatches between IRSA’s assets and liabilities, IRSA has high currency exposure.

As of June 30, 2022, the majority of its liabilities, such as its Series I, V, VII, VIII, IX, XI, XII and XIII Notes, were denominated in U.S. dollars (as well as Series XIV Notes, which was issued on July 8, 2022) while the Company’s revenues are mainly denominated in Pesos. This currency gap mainly affects our operational flows to pay interests of our U.S. dollar denominated debt, considering our assets are transacted in U.S dollars.  In addition, restrictions to access to MULC to acquire the required U.S. dollars to pay our U.S. dollar denominated debt or future regulations that may be enacted establishing a different exchange rate (higher than the current official exchange rate) to convert the Pesos into U.S. dollars  exposes us to a risk of volatility, which may adversely affect our financial results if the U.S. dollar appreciates against the Peso and may affected our ability to pay interests of our U.S. dollar denominated debt. Any depreciation of the Peso against the U.S. dollar increases the nominal amount of IRSA’s debt in Pesos, which further adversely affects the results of IRSA’s operations and financial conditions and may increase the collection risk of IRSA’s leases and other receivables from our tenants and mortgages, most of which generate Peso denominated revenue.

IRSA issue debt in the local and international capital markets as one of its main sources of funding and its capacity to successfully access the local and international markets on favorable terms affects its cost of funding.

IRSA’s ability to successfully access the local and international capital markets on acceptable terms depends largely on capital markets conditions prevailing in Argentina and internationally. IRSA has no control over capital markets conditions, which can be volatile and unpredictable. If IRSA is unable to issue debt in the local and/or international capital markets and on terms acceptable to IRSA, whether as a result of regulations and foreign exchange restrictions, a deterioration in capital markets conditions or otherwise, IRSA would likely be compelled to seek alternatives for funding, which may include short-term or more expensive funding sources. If this were to happen, IRSA may be unable to fund our liquidity needs at competitive costs and its business results of operations and financial condition may be materially and adversely affected.

Property ownership through joint ventures or investees may limit our ability to act exclusively in our interest.

We develop and acquire properties in joint ventures with other persons or entities or make minority investments in entities when we believe circumstances warrant the use of such structures.

As of June 30 2022, IRSA owns 50% of Quality Invest S.A. In the Sales and Developments segment, 50% of the equity of Puerto Retiro and 50% of the equity of Cyrsa S.A. In the Hotel segment, IRSA owns 50% of the equity of Hotel Llao Llao and the other 50% is owned by the Sutton Group.

In addition, IRSA holds approximately 29.91% of the equity of Banco Hipotecario, of which the Argentine government is the controlling shareholder.

IRSA could engage in a dispute with one or more of its joint venture partners or controlling shareholder in an investment that might affect its ability to operate a jointly-owned property. Moreover, its joint venture partners or controlling shareholder in an investment may, at any time, have business, economic or other objectives that are inconsistent with its objectives, including objectives that relate to the timing and terms of any sale or refinancing of a property. For example, the approval of certain of its investors is required with respect to operating budgets and refinancing, encumbering, expanding or selling any of these properties. In some instances, its joint venture partners or controlling shareholder in an investment may have competing interests in their markets that could create conflicts of interest. If the objectives of its joint venture partners or controlling shareholder in an investment are inconsistent with our own objectives, IRSA will not be able to act exclusively in our interests.

49

If one or more of the investors in any of its jointly owned properties were to experience financial difficulties, including bankruptcy, insolvency or a general downturn of business, there could be an adverse effect on the relevant property or properties and in turn, on IRSA’s financial performance. Should a joint venture partner or controlling shareholder in an investment declare bankruptcy, IRSA could be liable for its partner’s common share of joint venture liabilities or liabilities of the investment vehicle.

IRSA is dependent on our Board of Directors senior management and other key personnel.

IRSA’s success, to a significant extent, depends on the continued employment of Eduardo S. Elsztain and certain other members of our Board of Directors and senior management, who have significant expertise and knowledge of our business and industry. The loss or interruption of their services for any reason could have a material adverse effect on our business and results of operations. Our future success also depends in part upon our ability to attract and retain other highly qualified personnel. We cannot assure you that we will be successful in hiring or retaining qualified personnel, or that any of our personnel will remain employed by us, which may have a material adverse effect on our financial condition and results of operations.

IRSA may face potential conflicts of interest relating to our principal shareholders.

IRSA’s largest beneficial owner is Mr. Eduardo S. Elsztain, according to his indirect shareholding through Cresud S.A.C.I.F. y A. As of June 30, 2022, such beneficial ownership consisted of 434,263,346 common shares held by Cresud S.A.C.I.F. y A. Conflicts of interest between our management and that of our related companies may arise in connection with the performance of their respective business activities. As of June 30, 2022, Mr. Eduardo S. Elsztain also beneficially owned (i) approximately 55.7% of our common shares. IRSA cannot assure you that our principal shareholders and our affiliates will not limit or cause us to forego business opportunities that our affiliates may pursue or that the pursuit of other opportunities will be in our interest.

Risks Relating to IRSA’s Investment in Banco Hipotecario

As of June 30, 2022, IRSA owned approximately 29.91% of the outstanding capital stock of Banco Hipotecario S.A. (“Banco Hipotecario”). Banco Hipotecario’s assets as of such date were ARS 323,353.1 million. All of Banco Hipotecario’s operations, properties and customers are located in Argentina. Accordingly, the quality of Banco Hipotecario’s loan portfolio, financial condition and results of operations depend on economic, regulatory and political conditions prevailing in Argentina. These conditions include growth rates, inflation rates, exchange rates, changes to interest rates, changes to government policies, social instability and other political, economic or international developments either taking place in, or otherwise affecting, Argentina.

The short-term structure of the deposit base of the Argentine financial system, including Banco Hipotecario, could lead to a reduction in liquidity levels and limit the long-term expansion of financial intermediation.

Given the short-term structure of the deposit base of the Argentine financial system, credit lines are also predominantly short-term, with the exception of mortgages, which represent a low proportion of the existing credit base. Although liquidity levels are currently reasonable, no assurance can be given that these levels will not be reduced due to a future negative economic scenario. Therefore, there is still a risk of low liquidity levels that could increase funding cost in the event of a withdrawal of a significant amount of the deposit base of the financial system, and limit the long-term expansion of financial intermediation including Banco Hipotecario.

50

The growth and profitability of Argentina’s financial system partially depend on the development of long-term funding. During 2019, Central Bank reserves registered an abrupt fall mainly due to U.S. dollars sales by the Central Bank and the National Treasury to the private sector; cancellation of public debt; and outflow of dollar deposits from the private sector. As a consequence, there is a reduction of loans denominated in U.S. dollars. Since most deposits in the Argentine financial system are short-term, a substantial portion of the loans have the same or similar maturities, and there is a small portion of long-term credit lines. The uncertainty with respect to the level of inflation in future years is a principal obstacle to a faster recovery of Argentina’s private sector long-term lending. This uncertainty has had, and may continue to have a significant impact on both the supply of and demand for long-term loans as borrowers try to hedge against inflation risk by borrowing at fixed rates while lenders hedge against inflation risk by offering loans at floating rates. If longer-term financial intermediation activity does not grow, the ability of financial institutions, including Banco Hipotecario, to generate profits will be negatively affected.

Banco Hipotecario issues debt in the local and international capital markets as one of its sources of funding and its capacity to successfully access the local and international markets on favorable terms affects its cost of funding.

In recent years, Banco Hipotecario has diversified its financing sources by increasing deposits. Still, Banco Hipotecario remains having presence in the local and international capital markets. As of June 30, 2022, Banco Hipotecario’s financial indebtedness accounted for 12.6% of its financing. Likewise, as of June 30, 2022, the issuance of notes represented 5.04% of its total liabilities. The ability of Banco Hipotecario to successfully access the local and international capital markets and on acceptable terms depends largely on capital markets conditions prevailing in Argentina and internationally. Banco Hipotecario has no control over capital markets conditions, which can be volatile and unpredictable.

The stability of the financial system depends upon the ability of financial institutions, including Banco Hipotecario, to maintain and increase the confidence of depositors.

The measures implemented by the Argentine government in late 2001 and early 2002, in particular the restrictions imposed on depositors to withdraw money freely from banks and the “pesification” and restructuring of their deposits, were strongly opposed by depositors due to the losses on their savings and undermined their confidence in the Argentine financial system and in all financial institutions operating in Argentina.

If depositors once again withdraw their money from banks in the future, there may be a substantial negative impact on the manner in which financial institutions, including Banco Hipotecario, conduct their business, and on their ability to operate as financial intermediaries. Loss of confidence in the international financial markets may also adversely affect the confidence of Argentine depositors in local banks.

In the future, an adverse economic situation, even if it is not related to the financial system, could trigger a massive withdrawal of capital from local banks by depositors, as an alternative to protect their assets from potential crises. Any massive withdrawal of deposits could cause liquidity issues in the financial sector and, consequently, a contraction in credit supply.

The occurrence of any of the above could have a material and adverse effect on Banco Hipotecario’s expenses and business, results of operations and financial condition.

The asset quality of financial institutions is exposed to the non-financial public sector’s and Central Bank’s indebtedness.

Financial institutions carry significant portfolios of bonds issued by the Argentine government and by provincial governments as well as loans granted to these governments. The exposure of the financial system to the non-financial public sector’s indebtedness had been shrinking steadily, from 49.0% of total assets in 2002 to 15.3% as of June 30, 2022. To an extent, the value of the assets held by Argentine banks, as well as their capacity to generate income, is dependent on the creditworthiness of the non-financial public sector, which is in turn tied to the Argentine government’s ability to foster sustainable long-term growth, generate fiscal revenue and reduce public expenditure.

51

In addition, financial institutions currently carry securities issued by the Central Bank in their portfolios, which generally are short-term. As of June 30, 2022, such securities issued by the Central Bank represented approximately 28.6% of the total assets of the Argentine financial system. As of June 30, 2022, Banco Hipotecario’s total exposure to the public sector was ARS 48,977 million, which represented 26% of its assets as of that date, and the total exposure to securities issued by the Central Bank was ARS 97,165 million, which represented 51.8% of its total assets as of June 30, 2022.

The quality of Banco Hipotecario’s assets and that of other financial institutions may deteriorate if the Argentine private sector is affected by economic events in Argentina or international macroeconomic conditions.

The capacity of many Argentine private sector debtors to repay their loans has in the past deteriorated as a result of certain economic events in Argentina or macroeconomic conditions, materially affecting the asset quality of financial institutions, including Banco Hipotecario. The ratio of non-performing private sector loans has increased in recent years, as Argentina’s economic outlook deteriorated. Banco Hipotecario recorded non-performing loan ratios of 12.3%, 13.4% and 4.2% for June 30, 2020, 2021, and 2022, respectively. The quality of its loan portfolio is highly sensitive to economic conditions prevailing from time to time in Argentina, and as a result if Argentina were to experience adverse macroeconomic conditions, the quality of Banco Hipotecario’s loan portfolio and the recoverability of its loans would likely be adversely affected. This might affect the creditworthiness of Banco Hipotecario’s loan portfolio and the results of operations.

The Consumer Protection Law may limit some of the rights afforded to Banco Hipotecario.

Argentine Law No. 24,240 (the “Consumer Protection Law”) sets forth a series of rules and principles designed to protect consumers, which include Banco Hipotecario’s customers. The Consumer Protection Law was amended by Law No. 26,361 on March 12, 2008 to expand its applicability and the penalties associated with violations thereof. Additionally, Law No. 25,065 (as amended by Law No. 26,010 and Law No. 26,361, the “Credit Card Law”) also sets forth public policy regulations designed to protect credit card holders. Recent Central Bank regulations, such as Communication “A” 5,388, also protects consumers of financial services.

In addition, the Civil and Commercial Code has a chapter on consumer protection, stressing that the rules governing consumer relations should be applied and interpreted in accordance with the principle of consumer protection and that a consumer contract should be interpreted in the sense most favorable to it. The application of both the Consumer Protection Law and the Credit Card Law by administrative authorities and courts at the federal, provincial and municipal levels has increased. This trend has increased general consumer protection levels. If Banco Hipotecario is found to be liable for violations of any of the provisions of these laws, the potential penalties could limit some of Banco Hipotecario’s rights, for example, with respect to its ability to collect payments due from services and financing provided by us, and adversely affect Banco Hipotecario’s financial results of operations.

We cannot assure you that court and administrative rulings based on the newly-enacted regulation or measures adopted by the enforcement authorities will not increase the degree of protection given to Banco Hipotecario’s debtors and other customers in the future, or that they will not favor the claims brought by consumer groups or associations. This may prevent or hinder the collection of payments resulting from services rendered and financing granted by us, which may have an adverse effect on Banco Hipotecario’s business and results of operations.

Class actions against financial institutions for unliquidated amounts may adversely affect the financial system’s profitability.

Certain public and private organizations have initiated class actions against financial institutions in Argentina. The National Constitution and the Consumer Protection Law contain certain provisions regarding class actions. However, their guidance with respect to procedural rules for instituting and trying class action cases is limited. Nonetheless, through an ad hoc doctrine, Argentine courts have admitted class actions in some cases, including various lawsuits against financial entities related to “collective interests” such as alleged overcharging on products, interest rates and advice in the sale of public securities, etc. If class action plaintiffs were to prevail against financial institutions, their success could have an adverse effect on the financial industry in general and indirectly on Banco Hipotecario’s business.

52

Banco Hipotecario operates in a highly regulated environment and its operations are subject to capital controls regulations adopted by several regulatory agencies.

Financial institutions are subject to a major number of regulations concerning functions historically determined by the Central Bank and other regulatory authorities. The Central Bank may penalize Banco Hipotecario and its directors, members of the Executive Committee and members of its Supervisory Committee, in the event of any breach of the applicable regulation. Potential sanctions, for any breach on the applicable regulations may vary from administrative and/or disciplinary penalties to criminal sanctions. Similarly, the CNV, which authorizes securities offerings and regulates the capital markets in Argentina, has the authority to impose sanctions on us and Banco Hipotecario’s Board of Directors for breaches of corporate governance established in the capital markets laws and the CNV Rules. The Financial Information Unit (Unidad de Información Financiera, or “UIF” as per its acronym in Spanish) regulates matters relating to the prevention of asset laundering and has the ability to monitor compliance with any such regulations by financial institutions and, eventually, impose sanctions.

We cannot assure you whether such regulatory authorities will commence proceedings against Banco Hipotecario, its shareholders, directors or its Supervisory Committee, or penalize Banco Hipotecario. Banco Hipotecario has adopted “Know Your Customer” and other policies and procedures to comply with its duties under currently applicable rules and regulations.

In addition to regulations specific to the banking industry, Banco Hipotecario is subject to a wide range of federal, provincial and municipal regulations and supervision generally applicable to businesses operating in Argentina, including laws and regulations pertaining to labor, social security, public health, consumer protection, the environment, competition and price controls. We cannot assure you that existing or future legislation and regulation will not require material expenditures by Banco Hipotecario or otherwise have a material adverse effect on Banco Hipotecario’s consolidated operations.

The effects of legislation that restricts our ability to pursue mortgage foreclosure proceedings could adversely affect us.

The ability to pursue foreclosure proceedings through completion, in order to recover on defaulted mortgage loans, has an impact on financial institutions activities. On December 13, 2006, pursuant to Law No. 26,177, the “Restructuring Unit Law” was created to allow all mortgage loans to be restructured between debtors and the former Banco Hipotecario Nacional, insofar as such mortgages had been granted prior to the effectiveness of the Convertibility Law. Law No. 26,313, the “Pre-convertibility Mortgage Loans Restructuring Law,” was enacted by the Argentine Congress on November 21, 2007 and partially signed into law on December 6, 2007 to establish the procedure to be followed in the restructuring of mortgage loans within the scope of Section 23 of the Mortgage Refinancing System Law in accordance with the guidelines established by the Restructuring Unit Law. To this end, a recalculation was established for certain mortgage loans originated by the former Banco Hipotecario Nacional before April 1, 1991.

Executive Branch Decree No. 2,107/08 issued on December 19, 2008 regulated the Pre-convertibility Mortgage Loans Restructuring Law and established that the recalculation of the debt applies to the individual mortgage loans from global operations in effect on December 31, 2008 and agreed upon prior to April 1, 1991, and in arrears at least since November 2007 and remaining in arrears on December 31, 2008. In turn, the Executive Branch Decree No. 1,366/10, published on September 21, 2010, expanded the universe of Pre-convertibility loans subject to restructuring to include the individual mortgage loans not originating in global operations insofar as they met the other requirements imposed by Executive Branch Decree No. 2,107/08. In addition, Law No. 26,313 and its regulatory decrees also condoned the debts on mortgage loans granted before the Convertibility Law in so far as they had been granted to deal with emergency situations and in so far as they met the arrears requirement imposed on the loans subject to recalculation.

Subject to the Central Bank’s supervision, Banco Hipotecario implemented the recalculation of mortgage loans within the scope of the aforementioned rules by adjusting the value of the new installments to a maximum amount not in excess of 20% of household income. In this respect, we estimate that Banco Hipotecario has sufficient loan loss provisions to face any adverse economic impact on the portfolio involved. We cannot assure that the Argentine government will not enact additional laws restricting our ability to enforce our rights as a creditor and/or imposing a condition or a reduction of principal on the amounts unpaid in our mortgage loan portfolio. Any such circumstance could have a significant adverse effect on our financial condition and the results of our operations.

53

Increased competition and M&A activities in the banking industry may adversely affect Banco Hipotecario.

Banco Hipotecario foresees increased competition in the banking sector. If the trend towards decreasing spreads is not offset by an increase in lending volumes, the ensuing losses could lead to mergers in the industry. These mergers could lead to the establishment of larger, stronger banks with more resources than us. Therefore, although the demand for financial products and services in the market continues to grow, competition may adversely affect Banco Hipotecario’s results of operations, resulting in shrinking spreads and commissions.

Future governmental measures may adversely affect the economy and the operations of financial institutions.

The Argentine government has historically exercised significant influence over the economy, and financial institutions, in particular, have operated in a highly regulated environment. We cannot assure you that the laws and regulations currently governing the economy or the banking sector will remain unaltered in the future or that any such changes will not adversely affect Banco Hipotecario’s business, financial condition or results of operations and Banco Hipotecario’s ability to honor its debt obligations in foreign currency.

Several legislative bills to amend the Financial Institutions Law have been sent to the Argentine Congress. If the law currently in force were to be comprehensively modified, the financial system as a whole could be substantially and adversely affected. If any of these legislative bills were to be enacted or if the Financial Institutions Law were amended in any other way, the impact of the subsequent amendments to the regulations on the financial institutions in general, Banco Hipotecario’s business, its financial condition and the results of operations is uncertain.

Law No. 26,739 was enacted to amend the Central Bank’s charter, the principal aspects of which are: (i) to broaden the scope of the Central Bank’s mission (by establishing that such institution shall be responsible for financial stability and economic development while pursuing social equity); (ii) to change the obligation to maintain an equivalent ratio between the monetary base and the amount of international reserves; (iii) to establish that the Board of Directors of the institution will be the authority responsible for determining the level of reserves required to guarantee normal operation of the MULC based on changes in external accounts; and (iv) to empower the monetary authority to regulate and provide guidance on credit through the financial system institutions, so as to “promote long-term production investment.”

In addition, the Civil and Commercial Code, among other things, modifies the applicable regime for contractual provisions relating to foreign currency payment obligations by establishing that foreign currency payment obligations may be discharged in Pesos. This amends the legal framework, pursuant to which debtors may only discharge their foreign currency payment obligations by making payment in the specific foreign currency agreed upon in their agreements; provided however that the option to discharge in Pesos a foreign currency obligation may be waived by the debtor is still under discussion. However, in recent years some court decisions have established the obligation to pay in foreign currency when it was so freely agreed by the parties. We are not able to ensure that any current or future laws and regulations (including, in particular, the amendment to the Financial Institutions Law and the amendment to the Central Bank’s charter) will not result in significant costs to Banco Hipotecario, or will otherwise have an adverse effect on Banco Hipotecario’s operations.

Banco Hipotecario’s obligations as trustee of the Programa de Crédito Argentino del Bicentenario para la Vivienda Única Familiar (“PROCREAR”) trust are limited.

Banco Hipotecario currently acts as trustee of the PROCREAR Trust, which aims to facilitate access to housing solutions by providing mortgage loans for construction and developing housing complexes across Argentina. Under the terms and conditions of the PROCREAR Trust, all the duties and obligations under the trust have to be settled with the trust estate. Notwithstanding, if the aforementioned is not met, Banco Hipotecario could have its reputation affected. In addition, if the Argentine government decides to terminate the PROCREAR Trust and/or terminate Banco Hipotecario’s role as trustee of the PROCREAR Trust, this may adversely affect Banco Hipotecario’s results of operations.

54

The exposure of Banco Hipotecario to individual borrowers could lead to higher levels of past due loans, allowances for loan losses and charge-offs.

A substantial portion of Banco Hipotecario’s loan portfolio consists of loans to individual customers in the lower-middle to middle income segments of the Argentine population. The quality of Banco Hipotecario’s portfolio of loans to individuals is dependent to a significant extent on economic conditions prevailing from time to time in Argentina. Lower-middle to middle income individuals are more likely to be exposed to and adversely affected by adverse developments in the Argentine economy than corporations and high-income individuals. As a result, lending to these segments represents higher risk than lending to such other market segments. Consequently, Banco Hipotecario may experience higher levels of past due amounts, which could result in higher provisions for loan losses. Therefore, there can be no assurance that the levels of past due amounts and subsequent charge-offs will not be materially higher in the future.

An increase in fraud or transaction errors may adversely affect Banco Hipotecario.

As with other financial institutions, Banco Hipotecario is susceptible to, among other things, fraud by employees or outsiders, unauthorized transactions by employees and other operational errors (including clerical or record keeping errors and errors resulting from faulty computer or telecommunications systems). Given the high volume of transactions that may occur at a financial institution, errors could be repeated or compounded before they are discovered and remedied. In addition, some of our transactions are not fully automated, which may further increase the risk that human error or employee tampering will result in losses that may be difficult to detect quickly or at all. Losses from fraud by employees or outsiders, unauthorized transactions by employees and other operational errors might adversely affect Banco Hipotecario’s reputation, business, the results of operations and financial condition.

Risks Related to the ADSs and the Common Shares.

Shares eligible for sale could adversely affect the price of our common shares and ADSs.

The market prices of our common shares and ADS could decline as a result of sales by our existing shareholders of common shares or ADSs in the market, or the perception that these sales could occur. These sales also might make it difficult for us to sell equity securities in the future at a time and at a price that we deem appropriate. The ADSs are freely transferable under U.S. securities laws, including common shares sold to our affiliates. Cresud, which as of June 30, 2022, was the beneficial owner of approximately 36.63% of our common shares (or approximately 216,884,083 common shares which may be exchanged for an aggregate of 21,688,408 ADSs), is free to dispose of any or all of its common shares or ADSs at any time in its discretion. Sales of a large number of our common shares and/or ADSs would likely have an adverse effect on the market price of our common shares and the ADSs.

If we issue additional equity securities in the future, you may suffer dilution, and trading prices for our equity securities may decline.

We may issue additional shares of our common stock for financing future acquisitions or new projects or for other general corporate purposes. Any such issuance could result in a dilution of your ownership stake and/or the perception of any such issuances could have an adverse impact on the market price of the ADSs.

We are subject to certain different corporate disclosure requirements and accounting standards than domestic issuers of listed securities in the United States

There is less publicly available information about the issuers of securities listed on the Argentine stock exchanges than information publicly available about domestic issuers of listed securities in the United States and certain other countries.

55

Although the ADSs are listed on the NASDAQ Global Market, as a foreign private issuer we are able to rely on home country governance requirements rather than relying on the NASDAQ corporate governance requirements. See “Item 16G. Corporate Governance—Compliance with NASDAQ listing Standards on Corporate Governance.” Additionally, as a foreign private issuer, we are exempt from certain rules under the Exchange Act including (i) the sections of the Exchange Act regulating the solicitation of proxies, consents or authorizations in respect of a security registered under the Exchange Act; (ii) the sections of the Exchange Act requiring insiders to file public reports of their stock ownership and trading activities and liability for insiders who profit from trades made in a short period of time; and (iii) the rules under the Exchange Act requiring the filing with the SEC of quarterly reports on Form 10-Q containing unaudited financial and other specified information, or current reports on Form 8-K, upon the occurrence of specified significant events. In addition, foreign private issuers are not required to file their Annual Report on Form 20-F until four months after the end of each fiscal year, while United States domestic issuers that are accelerated filers are required to file their Annual Report on Form 10-K within 75 days after the end of each fiscal year. Foreign private issuers are also exempt from the Regulation Fair Disclosure, aimed at preventing issuers from making selective disclosures of material information. As a result of the above, you may not have the same protections afforded to shareholders companies that are not foreign private issuers.

Investors may not be able to effect service of process within the United States, limiting their recovery of any foreign judgment.

We are a publicly held corporation (sociedad anónima) organized under the laws of Argentina. Most of our directors and our senior managers are located in Argentina. As a result, it may not be possible for investors to effect service of process within the United States upon us or such persons or to enforce against us or them in United States courts judgments obtained in such courts predicated upon the civil liability provisions of the United States federal securities laws. We have been advised by our Argentine counsel, Zang, Bergel & Viñes, that there is doubt whether the Argentine courts will enforce, to the same extent and in as timely a manner as a United States or foreign court, an action predicated solely upon the civil liability provisions of the United States federal securities laws or other foreign regulations brought against such persons or against us.

If we are considered to be a passive foreign investment company for United States federal income tax purposes, United States holders of our common shares or ADSs would suffer negative consequences.

Based on the past and projected composition of our income and assets and the valuation of our assets, including goodwill, we do not believe we were a passive foreign investment company (a “PFIC”) for United States federal income tax purposes for the taxable year ending June 30, 2022, and do not currently expect to become a PFIC, although there can be no assurance in this regard. The determination of whether we are a PFIC is made annually. Accordingly, it is possible that we may be a PFIC in the current or any future taxable year due to changes in our asset or income composition or if our projections are not accurate. The volatility and instability of Argentina’s economic and financial system may substantially affect the composition of our income and assets and the accuracy of our projections. In addition, this determination is based on the interpretation of certain United States Treasury regulations relating to rental income, which regulations are potentially subject to different interpretation. If we become a PFIC, U.S. Holders (as defined in “Item 10. Additional Information—Taxation—United States Taxation”) of our common shares or ADSs will be subject to certain United States federal income tax rules that have negative consequences for them such as additional tax and an interest charge upon certain distributions by us or upon a sale or other disposition of our common shares or ADSs at a gain, as well as reporting requirements. See “Item 10. F—Taxation—United States Taxation—Passive Foreign Investment Company” for a more detailed discussion of the consequences if we are deemed a PFIC. You should consult your own tax advisors regarding the application of the PFIC rules to your particular circumstances.

Changes in Argentine tax laws may affect the tax treatment of our common shares or ADSs.

Law No. 26,893, which amended Law No. 20,628 (the “Income Tax Law”), was enacted on September 12, 2013, and published in the Official Gazette on September 23, 2013. According to the amendments, the distribution of dividends by an Argentine corporation was subject to income tax at a rate of 10.0%, unless such dividends were distributed to Argentine corporate entities (the “Dividend Tax”).

56

The Dividend Tax was repealed by Law No. 27,260, published in the Official Gazette on July 22, 2016, and consequently no income tax withholding was applicable on the distribution of dividends in respect of both Argentine and non-Argentine resident shareholders, except when dividends distributed were greater than the income determined according to the application of the Income Tax Law, accumulated at the fiscal year immediately preceding the year in which the distribution is made. In such case, the excess was subject to a rate of 35%, for both Argentine and non-Argentine resident shareholders. This treatment still applies to dividends to be distributed at any time out of retained earnings accumulated until the end of the last fiscal year starting before January 1, 2018.

However, pursuant to Law No. 27,430, as amended by Law No. 27,541 and Law No. 27,630, dividends distributed out of earnings accrued in fiscal years starting on or after January 1, 2018, and other profits paid in cash or in kind —except for stock dividends or quota dividends— by companies and other entities incorporated in Argentina referred to in the Income Tax Law, to Argentine resident individuals, resident undivided estates and foreign beneficiaries are subject to income tax at a 7% rate on profits accrued in fiscal years starting on January 1, 2018 and onwards. If dividends are distributed to Argentine corporate taxpayers (in general, entities organized or incorporated under Argentine law, certain traders and intermediaries, local branches of foreign entities, sole proprietorships and individuals carrying on certain commercial activities in Argentina), no dividend tax would apply.

In addition, capital gains originated from the disposal of shares and other securities, including securities representing shares and deposit certificates, are subject to capital gains tax. Law No. 27,430 effective as of January 1, 2018, provides that capital gains obtained by Argentine resident individuals from the disposal of shares and ADSs are exempt from capital gains tax in the following cases: (i) when the shares are placed through a public offering authorized by the CNV, (ii) when the shares are traded in stock markets authorized by the CNV, under segments that ensure priority of price-time and interference of offers, and/or (iii) when the sale, exchange or other disposition of shares is made through an initial public offering and/or exchange of shares authorized by the CNV.

Such law also provides that the capital gains tax applicable to non-residents for transactions entered into until December 30, 2017 is still due, although no taxes will be claimed to non-residents with respect to past sales of Argentine shares or other securities traded in the CNV’s authorized markets (such as ADSs) as long as the cause of the non-payment was the absence of regulations stating the mechanism of tax collection at the time the transaction was closed. The AFIP’s General Resolution No. 4,227, which came into effect on April 26, 2018, stipulates the procedures through which the income tax should be paid to the AFIP. The payment of capital gains tax applicable for transactions entered into before December 30, 2017 was due on June 11, 2018.

In addition, Decree No. 824/2019, published in the Official Gazette on December 6, 2019 and which introduced the new consolidated text of the Income Tax Law, maintains the 15% capital gains tax (calculated on the actual net gain or a presumed net gain equal to 90% of the sale price) on the disposal of shares or securities by non-residents. However, non-residents are exempt from the capital gains tax on gains obtained from the sale of (a) Argentine shares in the following cases: (i) when the shares are placed through a public offering authorized by the CNV, (ii) when the shares were traded in stock markets authorized by the CNV, under segments that ensure priority of price-time and interference of offers, and/or (iii) when the sale, exchange or other disposition of shares is made through an initial public offering and/or exchange of shares authorized by the CNV; and (b) depositary shares or depositary receipts issued abroad, when the underlying securities are shares (i) issued by Argentine companies, and (ii) with authorization of public offering. The exemptions will only apply to the extent the foreign beneficiaries reside in, and the funds used for the investment proceed from jurisdictions not considered as not cooperating for purposes of fiscal transparency.

In case the exemption is not applicable and, to the extent foreign beneficiaries neither reside in, nor the funds arise from, jurisdictions considered as not cooperating for purposes of fiscal transparency, the gain realized from the disposition of shares would be subject to Argentine income tax at a 13.5% effective rate on the gross price. In case such foreign beneficiaries reside in, or the funds arise from, jurisdictions considered as not cooperating for purposes of fiscal transparency, a 31.5% effective rate on the gross price should apply.

Therefore, holders of our common shares, including in the form of ADSs, are encouraged to consult their tax advisors as to the particular Argentine income tax consequences under their specific facts.

57

Holders of the ADSs may be unable to exercise voting rights with respect to the common shares underlying their ADSs.

As a holder of ADS, we will not treat you as one of our shareholders and you will not have shareholder rights. The depositary will be the holder of the common shares underlying your ADSs and holders may exercise voting rights with respect to the common shares represented by the ADSs only in accordance with the deposit agreement relating to the ADSs. There are no provisions under Argentine law or under our bylaws that limit the exercise by ADS holders of their voting rights through the depositary with respect to the underlying common shares. However, there are practical limitations on the ability of ADS holders to exercise their voting rights due to the additional procedural steps involved in communicating with these holders. For example, holders of our common shares will receive notice of shareholders’ meetings through publication of a notice in the CNV’s website, an Official Gazette in Argentina, an Argentine newspaper of general circulation and the bulletin of the Buenos Aires Stock Exchange, and will be able to exercise their voting rights by either attending the meeting in person or voting by proxy. ADS holders, by comparison, will not receive notice directly from us. Instead, in accordance with the deposit agreement, we will provide the notice to the ADS Depositary. If we ask the ADS Depositary to do so, the ADS Depositary will mail to holders of ADSs the notice of the meeting and a statement as to the manner in which instructions may be given by holders. To exercise their voting rights, ADS holders must then instruct the ADS Depositary as to voting the common shares represented by their ADSs. Under the deposit agreement, the ADS Depositary is not required to carry out any voting instructions unless it receives a legal opinion from us that the matters to be voted would not violate our by‑laws or Argentine law. We are not required to instruct our legal counsel to give that opinion. Due to these procedural steps involving the ADS Depositary, the process for exercising voting rights may take longer for ADS holders than for holders of common shares and common shares represented by ADSs may not be voted as you desire.

Under Argentine law, shareholder rights may be fewer or less well defined than in other jurisdictions.

Our corporate affairs are governed by our by-laws and by Argentine corporate law, which differ from the legal principles that would apply if we were incorporated in a jurisdiction in the United States, such as the States of Delaware or New York, or in other jurisdictions outside Argentina. In addition, your rights or the rights of holders of our common shares to protect your or their interests in connection with actions by our Board of Directors may be fewer and less well defined under Argentine corporate law than under the laws of those other jurisdictions. Although insider trading and price manipulation are illegal under Argentine law, the Argentine securities markets are not as highly regulated or supervised as the United States securities markets or markets in some other jurisdictions. In addition, rules and policies against self-dealing and regarding the preservation of shareholder interests may be less well defined and enforced in Argentina than in the United States, putting holders of our common shares and ADSs at a potential disadvantage.

Restrictions on the movement of capital out of Argentina may impair your ability to receive dividends and distributions on, and the proceeds of any sale of, the common shares underlying the ADSs.

Over the last twenty years in Argentina exchange controls and transfer restrictions have been periodically imposed, substantially limiting the ability of companies to retain foreign currency or make payments abroad. Since 2019, new regulations have significantly curtailed access to the foreign exchange market by individuals and private sector entities.

In this regard, the Argentine government imposed restrictions on the conversion of Argentine currency into foreign currencies and on the remittance to foreign investors of proceeds from their investments in Argentina. Argentine law currently permits the Argentine government to impose these kind of restrictions temporarily in circumstances where a serious imbalance develops in Argentina’s balance of payments or where there are reasons to foresee such an imbalance. We cannot assure you that ADS Depositary for the ADSs may hold the Pesos it cannot convert for the account of the ADS holders who have not been paid. No assurance can be given that payments to non-resident investors will not suffered delays under the current foreign exchange market regulations or be subject to any additional restrictions, such as a different exchange rate to convert the Pesos into U.S dollars, that may be higher than the current official exchange rate. In this regard, we suggest consulting with the corresponding custodian banks about the exchange regulations applicable. See “Item 10. Additional Information—D Exchange Controls.”

58

The protections afforded to minority shareholders in Argentina are different from and more limited than those in the United States and may be more difficult to enforce.

Under Argentine law, the protections afforded to minority shareholders are different from, and much more limited than, those in the United States and some other Latin American countries. For example, the legal framework with respect to shareholder disputes, such as derivative lawsuits and class actions, is less developed under Argentine law than under United States law as a result of Argentina’s short history with these types of claims and few successful cases. In addition, there are different procedural requirements for bringing these types of shareholder lawsuits. As a result, it may be more difficult for our minority shareholders to enforce their rights against us or our directors or controlling shareholder than it would be for shareholders of a United States company.

We may not pay any dividends.

In accordance with Argentine corporate law, we may pay dividends to shareholders out of net and realized profits, if any, as set forth in our Audited Financial Statements prepared in accordance with IFRS. The approval, amount and payment of dividends are subject to the approval by our shareholders at our annual ordinary shareholders meeting. The approval of dividends requires the affirmative vote of a majority of the shareholders entitled to vote present at the meeting. As a result, we cannot assure you that we will be able to generate enough net and realized profits so as to pay dividends or that our shareholders will decide that dividends will be paid.

Our ability to pay dividends is limited by law and our by-laws.

In accordance with Argentine corporate law, we may pay dividends in Pesos out of retained earnings, if any, to the extent set forth in our Audited Financial Statements prepared in accordance with IFRS. Our shareholders’ ability to receive cash dividends may be limited by the ability of the ADS Depositary to convert cash dividends paid in Pesos into U.S. dollars. Under the terms of our deposit agreement with the depositary for the ADSs, to the extent that the depositary can in its judgment convert Pesos (or any other foreign currency) into U.S. dollars on a reasonable basis and transfer the resulting U.S. dollars to the United States, the depositary will promptly as practicable convert or cause to be converted all cash dividends received by it on the deposited securities into U.S. dollars. If in the judgment of the depositary this conversion is not possible on a reasonable basis (including as a result of applicable Argentine laws, regulations and approval requirements), the depositary may distribute the foreign currency received by it or in its discretion hold such currency uninvested for the respective accounts of the owners entitled to receive the same. As a result, if the exchange rate fluctuates significantly during a time when the depositary cannot convert the foreign currency, you may lose some or all of the value of the dividend distribution.

You might be unable to exercise preemptive or accretion rights with respect to the common shares underlying your ADSs.

Under Argentine corporate law, if we issue new common shares as part of a capital increase, our shareholders will generally have the right to subscribe for a proportional number of common shares of the class held by them to maintain their existing ownership percentage, which is known as preemptive rights. In addition, shareholders are entitled to the right to subscribe for the unsubscribed common shares of either the class held by them or other classes which remain unsubscribed at the end of a preemptive rights offering, on a pro rata basis, which is known as accretion rights. Under the deposit agreement, the ADS Depositary will not exercise rights on your behalf or make rights available to you unless we instruct it to do so, and we are not required to give that instruction. In addition, you may not be able to exercise the preemptive or accretion rights relating to the common shares underlying your ADSs unless a registration statement under the U.S. Securities Act of 1933, as amended, is effective with respect to those rights or an exemption from the registration requirements of the Securities Act is available. We are not obligated to file a registration statement with respect to the common shares relating to these preemptive rights, and we cannot assure you that we will file any such registration statement. Unless we file a registration statement or an exemption from registration is available, you may receive only the net proceeds from the sale of your preemptive rights by the ADS Depositary or, if the preemptive rights cannot be sold, they will be allowed to lapse. As a result, U.S. holders of common shares or ADSs may suffer dilution of their interest in our company upon future capital increases.

59

Our shareholders may be subject to liability for certain votes of their securities.

Our shareholders are not liable for our obligations. Instead, shareholders are generally liable only for the payment of the shares they subscribe. However, shareholders who have a conflict of interest with us and do not abstain from voting may be held liable for damages to us, but only if the transaction would not have been approved without such shareholders’ votes. Furthermore, shareholders who willfully or negligently vote in favor of a resolution that is subsequently declared void by a court as contrary to Ley General de Sociedades No. 19,550 (Argentine General Corporation Law) or our bylaws may be held jointly and severally liable for damages to us or to other third parties, including other shareholders.

Our warrants are exercisable under limited circumstances and will expire.

On March 10, 2021, we issued an aggregate of 90,000,000 warrants to purchase 90,000,000 of our common shares, and will expire on March 10, 2026. Each warrant entitles its holder to purchase one common share. Each warrant will be exercisable only if the common share rights or ADS rights to which such warrant relates have been exercised, and such warrant will be exercisable after 90 days following its issuance during the nine-day period from and including the 17th through the 25th day of each February, May, September and November (to the extent such dates are business days in New York City and Buenos Aires, Argentina). As of the date of this Annual Report, there are 89,477,678 warrants outstanding.

Item 4. Information on the Company

A. History and Development of the Company

General Information

Our legal name is Cresud Sociedad Anónima Comercial, Inmobiliaria, Financiera y Agropecuaria, and our commercial name is “Cresud.” We were incorporated and organized on December 31, 1936 under Argentine law as a stock corporation (sociedad anónima) and were registered with the Public Registry of Commerce of the City of Buenos Aires (Inspección General de Justicia), on February 19, 1937 under number 26, on page 2, book 45 of National By-laws Volume. Pursuant to our bylaws, our term of duration expires on July 6, 2082.

Our common shares are listed and traded on the Bolsas y Mercados Argentinos (“BYMA”) and our ADSs representing our common shares are listed on the Nasdaq. Our headquarters are located at Carlos M. Della Paolera 261, 9th Floor (C1001ADA), City of Buenos Aires, Argentina. Our telephone is +54 (11) 4814-7800, and our website is www.cresud.com.ar. Information contained in or accessible through our website is not a part of this Annual Report. We assume no responsibility for the information contained on these sites.

Our depositary agent for the ADSs in the United States is The Bank of New York Mellon whose address is 240 Greenwich Street, New York, NY 10286, and whose telephone numbers are +1-888-BNY-ADRS (+1-888-269-2377) for U. S. calls and +1-201-680-6825 for calls outside U.S.

History

We were incorporated in 1936 as a subsidiary of Credit Foncier, a Belgian company engaged in the business of providing rural and urban loans in Argentina. We were incorporated to manage real estate holdings foreclosed by Credit Foncier. Credit Foncier was liquidated in 1959, and as part of such liquidation, our shares were distributed to Credit Foncier’s shareholders and in 1960 were listed on the Buenos Aires Stock Exchange (“BASE”). During the 1960s and 1970s, our business shifted to exclusively agricultural activities.

During 1993 and 1994, Consultores Asset Management acquired on behalf of certain investors approximately 22% of our outstanding shares on the Buenos Aires Stock Exchange. In late 1994, an investor group led by Consultores Asset Management (and including Dolphin Fund plc., currently Dolphin Fund Ltd.) purchased additional shares increasing their aggregate shareholding to approximately 51.4% of our outstanding shares. In 1995, we increased our capital through a rights offering and global public offering of ADRs representing our common shares and listed such ADRs on the NASDAQ. We started our agricultural activities with seven farmlands and 20,000 hectares under management.

60

In 2002, we acquired a 19.85% interest in IRSA, a real estate company related to certain shareholders of Cresud, and in 2009, we increased our ownership percentage in IRSA to 55.64% and IRSA became Cresud’s direct principal subsidiary. As of June 30, 2022, we had a 53.55% equity interest in IRSA (without considering treasury shares) and a majority of our directors are also directors of IRSA. IRSA is one of Argentina’s largest real estate companies and is engaged in a range of diversified real estate activities including residential properties, office buildings, shopping malls and luxury hotels, as well as the sales and development residential properties, it has a 29.9% interest in Banco Hipotecario, one of the main financial institutions in the country, and selected investments outside of Argentina.

In March 2008 we made a follow on offering for up to 180 million shares in the local and international markets, which were fully subscribed, for a total amount of USD 288 million. The proceeds allowed us to expand our international operations to Paraguay and Bolivia, currently we run these operations through our subsidiary BrasilAgro.

In line with our international expansion strategy, in September of 2005 we participated in the creation of BrasilAgro with the purpose of replicating our business model in Brazil. We created BrasilAgro together with our partners, Cape Town Llc, Tarpon Investimentos S.A., Tarpon Agro LLC, Agro Investments S.A. and Agro Managers S.A. On May 2, 2006, BrasilAgro’s shares were listed on the Novo Mercado of the Brazilian Stock Exchange (“BOVESPA”) with the symbol AGRO3 and on November 8, 2012, BrasilAgro’s ADRs became listed on the NYSE, under the ticker LND. In February 2021, it made a capital increase for BRL 440 million shares, we subscribed shares in the capitalization. In addition, in May 2021 we exercised warrants that had been granted to the founders of the Company at the initial public offering, before its maturity. As a result of our follow-on subscription and the warrants exercise we increased our stake in BrasilAgro, net of treasury shares, to 39.4%. As of June 30, 2022, our interest in BrasilAgro remained at 39.4%.

Also, we provide the best services for the agricultural community through our subsidiaries. We boost our clients’ businesses through the consulting, marketing and storage services operated by FyO, which main business is crop trading (crop brokerage, futures and options, consulting, logistics and financial services) and sale and distribution of own inputs and third-party products. As of June 30, 2022, we had a 51.1% equity interest in FyO.

We are pioneers in creating the first online agro marketplace, Agrofy S.A.U. (“Agrofy”), which is already operating in Argentina, Brazil and Uruguay with regional expansion plans. Agrofy continued to position itself this year as the leading online business platform for agriculture in Argentina, Brazil and Uruguay, exceeding 40 million visits. As of June 30, 2022, our interest in Agrofy is 17.7% and BrasilAgro acquired 1.6% of the capital stock. Looking ahead to next year, the company will continue working on its expansion plans to other countries in the region.

As of June 30, 2022, we owned, directly and through our subsidiaries, 26 farms, with a total area of 617,481 hectares distributed in Argentina, Brazil, Bolivia and Paraguay. In addition, we have the rights to hold approximately 132,000 hectares of land under concession for a 35-year period that can be extended for another 29 years.

On September 30, 2021, IRSA’s Board of Directors approved a corporate reorganization process and IRSA and IRSA CP executed a Preliminary Merger Agreement pursuant to which IRSA CP would merge into IRSA, by way of absorption by IRSA of IRSA CP, and IRSA would assume, by universal succession, all of the assets and liabilities and succeed to all of the rights and obligations of IRSA CP. On December 22, 2021, the shareholders of IRSA and IRSA CP approved the merger, whose effective date was established on July 1, 2021. On January 30, 2022, IRSA and IRSA CP executed a Definitive Merger Agreement. On May 9, 2022, the CNV informed IRSA that the merger by absorption of IRSA with IRSA CP, and the dissolution without liquidation of IRSA CP, have been registered, with IRSA as the surviving corporation.

61

Significant acquisitions, dispositions and development of business

Agricultural Business

Rio do Meio Farm

On December 29, 2021, the Company entered into a Purchase and Sale Commitment Agreement for a total area of 4,573 hectares (2,859 usable hectares) of Finca Rio do Meio, a rural property located in the Municipality of Correntina - BA, for the amount of 250 bags of soybeans per useful hectare, equivalent to BRL 130 million (corresponds to the value of soybeans at the date of the transaction). The payment will be made in 13 installments, the first in the form of an advance and the rest divided into 12 semi-annual payments due in June and October, with the last installment on October 10, 2027. The gain recognized for the sale amounted to BRL 51 million.

Although the signing of the agreement and disclosure of the transaction was in September, the gain from the sale of the farm is recognized on December, since the Purchase Agreement conditioned the transfer of ownership of the promised area to the full payment of the first installment, which consisted of 3 equal parts that were paid on September 20, 2021, November 15, 2021 and December 30, 2021. Transferred of ownership was completed in December 2021 upon the full payment of the first installment.

Sale of Alto Taquari

On October 10, 2021 BrasilAgro reported that it sold an area of 3,723 hectares (2,694 cultivable hectares) of the Alto Taquari Farm, a rural property located in the municipality of Alto Taquari - Mato Grosso state.

The total amount of the sale is 1,100 bags of soybeans per cultivable hectare or BRL 591 million (~ BRL 218,641 / cultivable ha). The handover of possession of the areas and, consequently, the recognition of sales income, will be carried out in two stages. In October 2021 with 2,566 hectares (1,537 cultivable hectares), for an approximate amount of BRL 336.0 million (corresponds to the value of soybeans at the date of the transaction) and September 2024 with 1,157 cultivable hectares, for an approximate value of ARS 253.0 million. BrasilAgro will continue to operate the areas until delivery.

The buyer made an initial payment of BRL 16.5 million and an additional payment of BRL 31.4 million during the fiscal year ended as of June 30, 2022, and the remaining balance is indexed in soy bags with annual payments and an average term of 3.9 years.

Agrofy capital round

In December 2021, Agrofy carried out a new round of capital for USD 29 million, with the aim of consolidating its regional growth, implementing transactionality on the platform and developing fintech solutions. Current shareholders, including Cresud, and a new foreign investor participated in it. As of June 30, 2022, Cresud had a direct and indirect participation in Agrofy of 17.7%.

Urban properties and investments business

Sale of Catalinas Tower building

On November 2, 2021, three medium-height floors of the tower “261 Della Paolera” located in the Catalinas district of the Autonomous City of Buenos Aires were sold for a total area of approximately 3,582 square meters and 36 parking spaces located in the building. The transaction price was approximately USD 32 million.

On December 15, 2021, a medium-height floor and 12 parking spaces were sold. The total of the transaction was USD 9.2 million.

62

On March 9, 2022, three medium-height floors of the tower were sold for a total leasable area of approximately 3,550 square meters, 30 parking spaces located in the building and other complementary units. The transaction price was approximately USD 31.6 million.

On March 29, 2022, two floors of the tower were sold for a total leasable area of approximately 2,370 square meters and 24 parking spaces located in the building. The transaction price was approximately USD 20.4 million.

On August 17, 2022, we sold and transferred one floor of the tower “200 Della Paolera” for a total leasable area of approximately 1,184 sqm and 8 parking lots located in the building. For more information see “Recent Developments – 200 Della Paolera tower floor sale”

Investment in Condor Hospitality Inc.

On September 22, 2021, Condor Hospitality Trust S.A. (“Condor”) has signed a sale agreement for its portfolio of 15 hotels in the United States with B9 Cowboy Mezz A LLC, an affiliate of Blackstone Real Estate Partners. Said sale was approved by the Condor Shareholders' Meeting held on November 12, 2021 and was completed on the 19th of the same month for an amount of USD 305 million. Within this framework, Condor announced a Liquidation and Dissolution Plan, with the intention of distributing certain net income from the sale of the hotel portfolio to the shareholders in one or more installments, which was approved by the Condor Shareholders' Meeting held on December 1, 2021.

 On December 10, 2021, in accordance with the aforementioned Plan, Condor's Board of Directors approved the distribution of a special dividend of USD 7.94 per share, which payment was made on December 30, 2021, corresponding to IRSA an approximate amount of USD 25.3 million for its direct and indirect holding of 3,191,213 common shares that, as of the date of issuance of the financial statements, have already been fully collected. As of December 31, 2021, Condor shares were delisted from the NYSE. On August 26, 2022, the company issued a statement informing that it had concluded the liquidation process, paying a final liquidation dividend of approximately USD 0.127 per ordinary share, corresponding to IRSA approximately USD 0.41 million.

Merger by absorption of IRSA and IRSA Propiedades Comerciales

On September 30, 2021, IRSA’s Board of Directors approved a corporate reorganization process and IRSA and IRSA CP executed a Preliminary Merger Agreement pursuant to which IRSA CP would merge into IRSA, by way of absorption by IRSA of IRSA CP, and IRSA would assume, by universal succession, all of the assets and liabilities and succeed to all of the rights and obligations of IRSA CP. The merger process must comply with the regulations of the General Companies’ Law in Argentina, as well as those issued by the CNV and the SEC.  

The Merger was carried out in order to streamline the technical, administrative, operational and economic resources of both Companies, standing out among others: (a) the operation and maintenance of a single transactional information system and centralization of the entire accounting registration process; (b) presentation of a single financial statement to the different control agencies with the consequent cost savings in accounting and advisory fees, tariffs and other related expenses; (c) simplification of the accounting information reporting and consolidation process, as a consequence of the reduction that the merger would imply for the corporate structure as a whole; (d) removal of the IRSA CP public offering listing on BYMA and NASDAQ with the associated costs that this represents; (e) cost reduction for legal fees and tax filings; (f) increase in the percentage of the capital stock that is listed in the different markets, increasing the liquidity of the listed shares; (g) tax efficiencies and (h) preventively avoid the potential overlap of activities between IRSA and IRSA CP.

In accordance with the commitments assumed in the Preliminary Merger Agreement, having obtained the administrative consent of the SEC, an entity to which both companies are subject, the shareholders' meetings of both companies were called.

63

On December 22, 2021, the Shareholders' Meetings of IRSA and IRSA CP were held, approving the merger by absorption, whose effective date was established on July 1, 2021. As of that date, all of the assets and liabilities, rights and obligations of the absorbed company were transferred to the absorbing company.

Likewise, and within the framework of the reorganization process, the Board of Directors has approved the exchange ratio, which has been established at 1.40 IRSA shares for each IRSA CP share, which is equivalent to 0.56 IRSA GDS for each ADS of IRSA CP. Within this framework, it was decided to increase the share capital by issuing 152,158,215 new shares in IRSA.

As of June 30, 2022, the merger was registered and approved in the corresponding control agencies, the exchange of IRSA CP shares for IRSA shares was carried out, and the listing of IRSA CP shares was canceled, and  CRESUD reduced its stake in IRSA to 53.6%.

Acquisition of Beruti real estate

On February 18, 2022, IRSA purchased by public auction from the Government of the Autonomous City of Buenos Aires (“GCBA”) a property located in Beruti, corner of Av. Coronel Díaz, in front of the Alto Palermo shopping center, owned by the Company, in one of the main commercial corridors of the city, in the neighborhood of Palermo.

The property, built on land with an area of approximately 2,386.63 square meters, consists of a ground floor, six upper levels, a basement and a total covered area of approximately 8,136.85 square meters and has potential for future expansion. The purchase price was ARS 2,159 million, which was paid in full.

As of today, the transfer deed of ownership was signed. Simultaneously with the deed, is required to sign a bailment agreement with the GCBA, with the latter holding the property free of charge for a period of up to 30 months, in accordance with the conditions agreed upon in the auction.

Republica Building Sale

On April 19, 2022, IRSA sold in block 100% of the “República” building, located next to “Catalinas Norte” area in the City of Buenos Aires. The tower has 19,885 square meters of gross leasable area on 20 office floors and 178 parking spaces.

The transaction price was set at USD 131.8 million (USD 6,629 per square meters), approximately 80% has already been paid in cash (USD 105.1 million or ARS 11,944.8 million), and the remaining amount has been paid with the delivery of a 46-hectare plot of land located on the Bs. As – La Plata Highway, in the district of Quilmes, Buenos Aires Province. This property has approved regulations and urban indicators to develop a mixed-use project with a construction capacity of approximately 521,400 square meters.

IRSA Shares Buyback Program

On March 11, 2022, IRSA’s Board of Directors has decided to establish the terms and conditions for the acquisition of the common shares issued by IRSA under the provisions of Section 64 of Law Nº 26,831 and the Rules of the CNV, for an amount up to ARS 1,000 million, with a daily limitation on market transactions up to 25% of the average volume of the daily transactions for the Shares and ADS in the markets during the previous 90 days, and a payable price up to USD 7.00 per ADS and up to a maximum value in Pesos of ARS 140,00 per Share. The period in which the acquisitions will take place: until 120 days, beginning the day following to the date of publication of the information in the Daily Bulletin of the Buenos Aires Stock Exchange.

As a subsequent event, on July 12, 2022, IRSA’s Board of Directors has resolved to extend the term of the shares repurchase plan that was determined by the Board of Directors on March 11, 2022, for an additional period of one hundred and twenty (120) days, maintaining the other terms and conditions that were duly informed.

64

As of June 30, 2022, IRSA acquired 3,808,472 of its ordinary shares for a total amount of ARS 348 million, which represent approximately 34.84% of the approved program. On September 21, 2022, it has completed the share buyback program, having acquired the equivalent of 9,419,623 IRSA ordinary shares, which represent approximately 99.51% of the approved program and 1.16% of the outstanding shares.

For information of significant acquisitions, dispositions and development of business after June 30, 2022, please see “Recent Developments”.

Recent Developments  

Cresud’s Recent Developments

BrasilAgro’s acquisition in Mato Grosso

On September 15, 2022, our subsidiary BrasilAgro informed that it has acquired a rural property located in the municipality of Querência, state of Mato Grosso, Brazil.

The property has an arable area of 5,400 hectares (10,800 hectares of total area), of which 80% are suitable for second crop. The farm has clay and rainfall levels and altitudes that allow cultivation of grains and cotton and is located less than 100 km from paved roads. The farm is in the eastern region of the state of Mato Grosso, which is characterized by the high growth of agricultural areas in the country, with the advancement of agriculture in pasture areas.

The acquisition value is BRL 285.6 million (302 soybean bags per arable hectare), which will be paid in two installments, a down payment and an annual installment.

Exchange Offer - Series XXIII Notes

As a consequence of the regulations established by the BCRA, on July 6, 2022, the company completed the exchange of its Series XXIII Notes, in an aggregate principal amount of USD 113,158,632, maturing on February 16, 2023. On July 6, 2022, the expiration of the exchange offer was announced, USD 98,422,999 of Series XXIII Notes were validly tendered and accepted, representing 86.98% of acceptance. On July 8, the exchange offer was settled, the Series XXXVIII Notes were issued, for an amount of USD 70.6 million, and Series XXIII Notes were partially canceled, consequently the outstanding amount is USD 14,735,633.

The exchange offer had two alternatives:

- Option A: Cash payment for up to 30% of the total amount of participation in the exchange, and the difference to complete the exchanged face value, in Series XXXVIII Notes. For every USD 1 offered, the holder received USD 0.6913 plus the remaining amount to complete USD 1 for each USD 1 of Series XXIII Notes presented for the exchange, in Series XXXVIII Notes. Under Option A, 43.40% of the notes were accepted.

- Option B: For each USD 1 of Series XXIII Notes tendered and accepted the bondholder received in exchange USD 1,03 Series XXXVIII Notes. Under Option B, 56.60% of the notes were accepted.

In both options, the interest accrued as of settlement date was paid.

Series XXXVIII Notes will mature on March 3, 2026 and will accrue interest at a fixed rate of 8.00%, with interest payable semi-annually on January 3 and July 3 from 2023 to 2026, and at maturity. Amortization will be in one installment on March 3, 2026. The issue price was 100%.

Shares Buyback Program

On July 22, 2022, the Board of Directors has approved the terms and conditions for the acquisition of the common shares issued by the Company under the provisions of Section 64 of Law Nº 26,831 and the CNV Rules.

65

· Maximum amount of the investment: Up to ARS 1,000 million.

· Maximum number of shares to be acquired: Up to 10% of the capital stock of the Company, in accordance with the provisions of the applicable regulations.

· Daily limitation on market transactions: In accordance with the applicable regulation, the limitation will be up to 25% of the average volume of the daily transactions for the Shares and ADS in the markets during the previous 90 days.

· Payable Price: Up to ARS 200 per Share and up to USD 6.00 per ADS.

· Period in which the acquisitions will take place: up to 120 days after the publication of the minutes, subject to any renewal or extension of the term, which will be informed to the investing public.

· Origin of the Funds: The acquisitions will be made with realized and liquid earnings pending of distribution of the Company.

To make such a decision, the Board of Directors has taken into account the economic and market situation, as well as the discount that the current share price has in relation to the fair value of the assets, determined by independent appraisers, and has as its objective to contribute to the strengthening of the shares in the market and reduce the fluctuations in the listed value that does not reflect the value or the economic reality that the assets currently have, resulting in the detriment of the interests of the Company’s shareholders.

On September 21, 2022, we have completed the share buyback program, having acquired the equivalent of 5,676,603 CRESUD ordinary shares, which represent approximately 99.00% of the approved program and 0.96% of the outstanding shares.

Local Bond Issuance – Series XXXIX Notes

On August 23, 2022, we issued in the local market a total amount of ARS 5,122.5 million (equivalent at the time of issuance to approximately USD 37.7 million) through Series XXXIX Notes which is denominated and payable in Pesos for ARS 5,122.5 million at a variable rate (private Badlar + 1.0%), with quarterly payments. The principal payment will be in one installment at maturity, on February 23, 2024. The price of issuance was 100.0% of the nominal value.

Panamby Farm

On September 15, 2022 BrasilAgro informed the acquisition of a farmland located in the municipality of Querệncia, state of Mato Grosso, Brazil. The property has an arable area of 5,400 hectares (10,800 hectares of total area), of which 80% are suitable for second crop. The farm has clay and rainfall levels and altitude that allow cultivation of grains and cotton and is located less than 100 km from paved roads. The farm is in the eastern region of the state of Mato Grosso, which is characterized by the high growth of agricultural areas in the country, with the advancement of agriculture in pasture areas. The acquisition value is BRL 285.6 million (equivalent to 302 soybean bags per arable hectare at the date of transaction), which will be paid in two installments, a down payment of BRL 140 million at the signing of the contract and a second installment of BRL 145.6 million that will be paid on August 21, 2023.

General Ordinary and Extraordinary Shareholders’ Meeting

On September 23, 2022, we informed that our Board of Directors has resolved to call a General Ordinary and Extraordinary Shareholders’ Meeting to be held on October 28, 2022, with the following agenda:

1. Appointment of two shareholders to sign the meeting’s minutes.

2. Consideration of documents contemplated in section 234, paragraph 1, of Law No. 19,550 for the fiscal year ended June 30, 2022.

3. Allocation of net income for the fiscal year ended June 30, 2022 for ARS 37,517,291,873, as follows: (i) to the absorption of the unappropriated retained earnings account for ARS 11,798,656,897: (ii) to the legal reserve for ARS 1,285,931,749, in accordance with the laws in force; (iii) to the distribution of a dividend to the shareholders for up to ARS 3,100,000,000 payable in cash and/or in kind and (iv) the balance of ARS 21,332,703,227, to an optional reserve.

4. Consideration of Board of Directors’ performance for the fiscal year ended June 30, 2022.

5. Consideration of Supervisory Committee’s performance for the fiscal year ended June 30, 2022.

66

6. Consideration of compensation payable to the Board of Directors (ARS 109,208,495, allocated sum) for the fiscal year ended June 30, 2022.

7. Consideration of compensation payable to the Supervisory Committee (ARS 3,919,000, allocated sum) for the fiscal year ended June 30, 2022.

8. Determination of the number and appointment of Regular Directors and Alternate Directors for a term of up to three fiscal years, as per section twelve of the Bylaws.

9. Appointment of regular and alternate members of the Supervisory Committee for a term of one fiscal year.

10. Appointment of Certifying Accountant for the fiscal year ending on June 30, 2023.

11. Approval of compensation payable to Certifying Accountant for the fiscal year ended June 30, 2022.

12. Amendment to sections sixteen (meetings), twenty-two (committees) and twenty-three (Supervisory Committee) of the Bylaws.

13. Consideration of the allocation of up to 5,676,603 own shares under the shares buyback program approved by the Board of Directors on July 22, 2022, equivalent to 0.96% of the capital stock, to the implementation of an incentive plan for the company’s employees, management and directors.

14. Authorization to carry out registration proceedings relating to this shareholders’ meeting before the Argentine Securities Commission and the General Superintendency of Corporations.

Exercise of Warrants

On October 7, 2021, we informed that between September 17 and 25, 2022, certain warrants holders have exercised their right to acquire additional shares. Therefore, a total of 76,391 ordinary shares of the Company were issued, with a face value of ARS 1. As a result of the aforementioned exercise, USD 43,237.31 were collected by the Company.

After the exercise of these warrants, the number of shares and the capital stock of the Company increased from 592,088,735 to 592,165,126, and the number of outstanding warrants decreased from 89,554,069 to 89,477,678.

Likewise, the exercise of the warrants has been carried out in accordance with the terms and conditions established in the issuance prospectus dated February 12, 2021, and complementary notices regarding the offer made by the Company of 90,000,000 ordinary book-entry shares and 90,000,000 options to subscribe ordinary shares (warrants).

IRSA’s Recent Developments

Exchange Offer - Series II Notes, originally issued by IRSA CP, for IRSA’s Series XIV Notes

On July 7, 2022, IRSA announced the results of the offer to exchange (the “Exchange Offer”) any and all of the USD 360,000,000 aggregate principal amount of outstanding 8.750% Notes due 2023 Series No. 2 (CUSIPs: 463588 AA1 (144A) / P5880U AB6 (Reg S); ISINs: US463588AA16 (144A) / USP5880UAB63 (Reg S)) originally issued by IRSA CP (the “Existing Notes”) for 8.750% Senior Notes due 2028 (the “New Notes”) and cash consideration. USD 238,985,000 aggregate principal amount of the Existing Notes (the “Tendered Notes”) were validly tendered in the Exchange Offer, which represents 66.38% of the outstanding aggregate principal amount of the Existing Notes. Of the aggregate principal amount of Tendered Notes, (i) USD 145,373,500, representing approximately 60.83% of the principal amount of Tendered Notes, were tendered under Option A, which included a cash payment, and (ii) USD 93,611,500, representing approximately 39.17% of the principal amount of Tendered Notes, were tendered under Option B, which included only New Notes as consideration. On July 8, 2022, IRSA issued USD 171,202,815 aggregate principal amount of New Notes and paid USD 77,794,596.59 cash consideration as total consideration for the Tendered Notes.

67

Following the cancellation of the Tendered Notes, the aggregate principal amount of the outstanding Existing Notes is USD 121,015,000.

The New Notes were issued under New York Law, will mature on June 22, 2028 and will accrue interest at a fixed rate of 8.75%, with interest payable semi-annually on June 22 and December 22 of each year, until expiration. Amortization will be in annual installments payable on June 22 of each year, each for 17.5% from 2024 to 2027 and the remaining 30% on June 22, 2028. The issue price was 100%.

General Ordinary Shareholders’ Meeting

On September 23, 2022, IRSA informed that its Board of Directors has resolved to call a General Ordinary and Extraordinary Shareholders’ Meeting to be held on October 28, 2022, with the following agenda:

1.	Appointment of two shareholders to sign the meeting’s minutes.
2.	Consideration of documents contemplated in section 234, paragraph 1, of Law No. 19,550 for the fiscal year ended June 30, 2022.
3.	Allocation of net income for the fiscal year ended June 30, 2022 for ARS 34,252,534,791, as follows: (i) to the absorption of the unappropriated retained earnings account for ARS 3,488,229,344: (ii) to the legal reserve for ARS 1,538,215,272, in accordance with the laws in force; (iii) to the distribution of a dividend to the shareholders for up to ARS 4,340,000,000 payable in cash and/or in kind and (iv) the balance of ARS 24,886,090,175, to an optional reserve.
4.	Consideration of board of directors’ performance for the fiscal year ended June 30, 2022.
5.	Consideration of supervisory committee’s performance for the fiscal year ended June 30, 2022.
6.	Consideration of compensation payable to the board of directors (ARS 1,278,420,382, allocated sum) for the fiscal year ended June 30, 2022.
7.	Consideration of compensation payable to the supervisory committee (ARS 3,919,000, allocated sum) for the fiscal year ended June 30, 2022.

68

8.	Determination of the number and appointment of regular directors and alternate directors for a term of up to three fiscal years, as per section twelve of the bylaws.
9.	Appointment of regular and alternate members of the supervisory committee for a term of one fiscal year.
10.	Appointment of certifying accountant for the fiscal year ending on June 30, 2023.
11.	Approval of compensation payable to certifying accountant for the fiscal year ended June 30, 2022.
12.	Amendment to sections sixteen (meetings), twenty-two (committees) and twenty-three (supervisory committee) of the bylaws.
13.	Consideration of the allocation of up to 9,419,623 own shares acquired under the shares buyback program approved by the board of directors on march 11, 2022, equivalent to 1.16% of the capital stock, to the implementation of an incentive plan for the company’s employees, management and directors.
14.	Authorization to carry out registration proceedings relating to this shareholders’ meeting before the Argentine Securities Commission and the general superintendency of corporations.

Exercise of Warrants

On October 3, 2022, IRSA informed that between September 17 and 25, 2022, certain warrants holders have exercised their right to acquire additional shares. Therefore, a total of 8,962 ordinary shares of IRSA will be registered, with a face value of ARS 1. As a result of the aforementioned exercise, USD 3,871.58 were collected by IRSA.

After the exercise of these warrants, the number of shares and the capital stock of IRSA increased from 810,879,553 to 810,888,515, and the new number of outstanding warrants decreased from 79,955,122 to 79,946,160.

Likewise, the exercise of the warrants has been carried out in accordance with the terms and conditions established in the issuance prospectus dated April 12, 2021, and complementary notices regarding the offer made by IRSA of 80,000,000 ordinary book-entry shares and 80,000,000 options to subscribe ordinary shares (warrants).

200 Della Paolera tower floor sale

On August 17, 2022, IRSA informed that it has sold and transferred one floor of the tower “200 Della Paolera” located in the Catalinas district of the Autonomous City of Buenos Aires for a total leasable area of approximately 1,184 sqm and 8 parking lots located in the building.

The transaction price was approximately USD 12.6 million (USD/sqm 10,600), which had already been paid.

After this transaction, IRSA retains its rights for 14 floors of the building with an approximate leasable area of 16,832 sqm, in addition to parking lots and other complementary spaces.

The financial result of this operation will be recognized in the Financial Statements for the first quarter of fiscal year 2023.

B.    Business Overview

General

We are a leading Latin American agricultural company engaged in the production of basic agricultural commodities with a growing presence in the agricultural sector of Brazil as well as in other Latin American countries, through our investment in BrasilAgro. We are currently involved in several farming activities including grains and sugarcane production and cattle raising. Our business model focuses on the acquisition, development and exploitation of agricultural properties having attractive prospects for agricultural production and/or value appreciation and the selective sale of such properties where appreciation has been realized. In addition, we lease land to third parties and perform agency and agro-industrial services, including a meat packing plant. Our shares are listed on ByMA and the NASDAQ.

69

We are also directly and indirectly engaged in the real estate business through our subsidiary IRSA and its subsidiaries and joint ventures, one of Argentina’s leading real estate companies. IRSA is engaged in the development, acquisition and operation of shopping malls, premium offices, and luxury hotels in Argentina. IRSA’s shares are listed on the ByMA and the NYSE. We own 53.6% of the outstanding common shares of IRSA.

During the fiscal year ended June 30, 2022 and 2021, we had consolidated revenues of ARS 95,850 million, and ARS 69,547 million, and consolidated profit from operation, before financing and taxation, of ARS 43,034 million and ARS 9,001 million, respectively. As of June 30, 2022 and 2021, our total consolidated assets decreased 5.09% from ARS 556,183 million to ARS 529,227 million, and our consolidated shareholders’ equity increased 16.03% from ARS 173,646 million to ARS 206,789 million.

Segment information is analyzed based on products and services: (i) agricultural business and (ii) urban properties and investment business.

After the merger of IRSA with IRSA CP, the urban properties and investment business structure is made up of the following five segments:

-Shopping Malls

-Offices

-Hotels

-Sales and development

-Others

The “Offices and Other Rental Properties” segment is renamed “Offices” and will exclusively include the results from the company’s six office buildings. The other rental properties that were part of this segment were allocated to the “Sales and Developments” segment, which will include the results generated by these assets, as well as those from Land Reserves, Barter Agreements and Properties for Sale. Likewise, the “Others” segment is incorporated, which will group the results from investments in associates and foreign companies that were previously allocated in the “Corporate” and “International” segments. The “Shopping Malls” and “Hotels” segments did not undergo any changes.

Agricultural Business

Our Agricultural business is further comprised of four reportable segments:

· The “Agricultural production” segment consists of planting, harvesting and sale of crops as wheat, corn, soybeans, cotton and sunflowers; breeding, purchasing and/or fattening of free-range cattle for sale to slaughterhouses and local livestock auction markets; leasing of the Company's farms to third parties; and planting, harvesting and sale of sugarcane. Our Agricultural production segment had assets of ARS 82,806 million and ARS 101,144 million as of June 30, 2022 and 2021, respectively, representing 90.82% and 93.82% respectively of our agricultural business assets at both dates. Our Agricultural production segment generated income from operations of ARS 10,792 million and ARS 11,000 million for fiscal years ended June 30, 2022, and 2021, respectively, representing 51.43% and 42.42%, of our consolidated profit from operations, from Agricultural Business for such years, respectively.

The segment “agricultural production” aggregate the crops, cattle, sugarcane and agricultural rental and services activities:

70

· Our “Crops” activity consists of planting, harvesting and sale of crops as wheat, corn, soybeans, cotton, and sunflowers. The Company is focused on the long-term performance of the land and seeks to maximize the use of the land through crop rotation, the use of technology and techniques. In this way, the type and quantity of harvested crops change in each agricultural campaign. Our Crops activity had assets of ARS 37,336 million and ARS 50,574 million as of June 30, 2022 and 2021, respectively, representing 40.95% and 46.91% of our Agricultural Business assets at such dates, respectively. Our Crops activity generated profit from operations of ARS 3,700 million and ARS 4,596 million for fiscal years ended June 30, 2022 and 2021, respectively, representing 17.63% and 17.72%, of our consolidated profit from operations from Agricultural Business for such years, respectively.

· Our “Cattle” activity consists of breeding, purchasing and/or fattening of free-range cattle for sale to meat processors and local livestock auction markets. Our Cattle activity had assets of ARS 12,896 million and ARS 12,903 million as of June 30, 2022 and 2021, respectively, representing 14.14% and 11.97% of our agricultural business assets at such dates, respectively. Our Cattle activity generated loss from operations of ARS (58) million and profit ARS 1,234 million for fiscal years ended June 30, 2022 and 2021, respectively, representing (0.28%) and 4.76%, of our consolidated profit from operations from Agricultural Business for such years, respectively.

· Our “Sugarcane” activity consists of planting, harvesting and sale of sugarcane. Our Sugarcane activity had assets of ARS 18,833 million and ARS 19,620 million as of June 30, 2022 and 2021, respectively, representing 20.66% and 18.20% of our agricultural business assets at such dates, respectively. Our Sugarcane activity generated profit from operations of ARS 6,630 million and ARS 4,313 million for fiscal years ended June 30, 2022, and 2021, representing 31.60% and 16.63% of our consolidated profit from operations from Agricultural Business for such years, respectively.

· Our “Agricultural rentals and Services” activity consists of agricultural services (for example: irrigation) and leasing of the Company’s farms to third parties. Our Agricultural Rentals and Services activity had assets of ARS 13,741 million and ARS 18,047 million as of June 30, 2022 and 2021, respectively, representing 15.07% and 16.74% of our agricultural business assets at such dates, respectively. Our Agricultural Rentals and Services activity generated profit from operations of ARS 520 million and ARS 857 million for fiscal years ended June 30, 2022, and 2021, respectively, representing 2.48% and 3.31% of our profit from operations from Agricultural Business for such years.

· Our “Land transformation and Sales” segment comprises gains from the disposal and development of farmlands activities. Our Land Transformation and Sales segment had assets of ARS 276 million and ARS 435 million as of June 30, 2022 and 2021, respectively, representing 0.3% and 0.4% of our agricultural business assets at such dates, respectively. Our Land Transformation and Sales segment generated profit from operations of ARS 8,791 million and ARS 13,985 million for fiscal years ended June 30, 2022, and 2021, respectively, representing 41.90% and 53.93% of our profit from operations from Agricultural Business for such years.

· Our “Other segments” includes, principally, feedlot farming, slaughtering and processing in the meat refrigeration plant, among others. Our Others segment had assets of ARS 8,096 million and ARS 6,232 million as of June 30, 2022 and 2021, respectively, representing 8.88% and 5.78% of our agricultural business assets at such dates, respectively. Our Others activity generated profit from operations of ARS 2,139 million and ARS 1,665 million for fiscal years ended June 30, 2022, and 2021, representing 10.19% and 6.42% of our consolidated operating income from Agricultural Business for such years, respectively. The segment “Other segments” aggregate the activities Agro-industrial and Others:

· The “Corporate” segment includes, principally, the corporate expenses related to the agricultural business. Our Corporate segment and corporate activity generated operating losses of ARS (739) million and ARS (720) million for fiscal years ended June 30, 2022, and 2021, representing (3.52%) and (2.78%) of our consolidated profit from operations from Agricultural Business for such years, respectively.

71

Urban properties and investment business

We operate our business in Argentina through five reportable segments, namely “Shopping Malls,” “Offices,” “Sales and Developments,” “Hotels” and “Others” as further described below:

· Our “Shopping Malls” segment includes the operating results from our portfolio of shopping malls principally comprising lease and service revenue from tenants. Our Shopping Malls segment had assets of ARS 92,217 million and ARS 89,654 million as of June 30, 2022 and 2021, respectively, representing 28.29% and 26.39% of our operating assets for the urban properties and investment business at such dates, respectively. Our Shopping Malls segment generated revenues of ARS 17,334 million and ARS 8,727 million for the fiscal year ended June 30, 2022, and 2021, respectively.

· Our “Offices” segment includes the operating results from lease revenues of offices, other rental spaces and other service revenues related to the office activities. Our Offices segment had assets of ARS 71,196 million and ARS 122,355 million as of June 30, 2022 and 2021, respectively, representing 21.84% and 36.01% of our operating assets for the urban properties and investment business at such dates, respectively. Our Offices segment generated revenues of ARS 3,041 million and ARS 4,401 million for the fiscal year ended June 30, 2022 and 2021, respectively.

· Our “Sales and Developments” segment includes the operating results of the development, maintenance and sales of undeveloped parcels of land and/or trading properties. Real estate sales results are also included. Our Sales and Developments segment had assets of ARS 144,673 million and ARS 107,829 million as of June 30, 2022 and 2021, respectively, representing 44.39% and 31.74% of our operating assets for the urban properties and investment business at such dates, respectively. Our Sales and Developments segment generated revenues of ARS 746 million and ARS 1,271 million for the fiscal years ended June 30, 2022 and 2021, respectively.

· Our “Hotels” segment includes the operating results of our hotels mainly comprised of room, catering and restaurant revenues. Our Hotels segment had assets of ARS 4,499 million and ARS 4,271 million as of June 30, 2022 and 2021, respectively, representing 1.38% and 1.26% of our operating assets for the urban properties and investment business, respectively. Our Hotels segment generated revenues of ARS 4,300 million and ARS 1,510 million for the fiscal years ended June 30, 2022 and 2021, respectively.

· Our “Others” primarily includes the entertainment activity through La Arena S.A. (former ALG Golf Center S.A.), La Rural S.A. and Buenos Aires Convention Center (Concession), We Are Appa, investments in associates such as TGLT and the financial activities carried out through BHSA / BACS, as well as other investments in associates for both years. Our Others segment had assets of ARS 13,356 million and ARS 15,658 million as of June 30, 2022 and 2021, respectively, representing 4.10% and 4.61% of our operating assets for the urban properties and investment business, respectively. Our Others segment generated revenues of ARS 172 million and ARS 676 million for the fiscal years ended June 30, 2022 and 2021, respectively.

Agricultural Business

As of June 30, 2022, we owned 26 farms with approximately 617,481 hectares distributed in Argentina, Brazil, Bolivia and Paraguay (considering the sale of 1,157 hectares of Alto Tacuarí).

During the fiscal year 2022 we used 98,073 hectares of the land we own for crop production, approximately 63,102 hectares are for cattle production, 85,000 hectares are for sheep production and approximately 25,103 hectares are leased to third parties for crop and cattle production.

The remaining 347,360 hectares of land reserves are primarily natural woodlands. In addition, we have the rights to hold approximately 132,000 hectares of land under concession for a 35-year period that can be extended for another 29 years. Out of this total, we have assigned 22,121 hectares for crop production and 2,845 hectares for cattle production. Also, during fiscal year 2022 ended on June 30, 2022, we leased 100,470 hectares to third parties for crop production and 12,590 hectares for cattle production.

72

The following table sets forth, at the dates indicated, the amount of land used for each production activity (including owned and leased land, and land under concession):

	2022(1)		2021(1)		2020(1)		2019(1)		2018(1)
Crops (2)		220,663		224,185		229,070		220,170		194,281
Cattle (3)		78,537		80,835		87,788		95,247		102,113
Milk/Dairy		—		—		—		—		—
Sheep		85,000		85,000		85,000		85,000		85,000
Land Reserves (4)		457,711		466,421		463,372		450,882		461,795
Own farmlands leased to third parties		25,103		25,908		23,655		16,100		9,603
Total		867,014		882,349		888,885		867,399		852,792

_____________________ 

(1)	Includes Brazil, Paraguay, Agro-Uranga S.A at 34.86% and 132,000 hectares in Concession.
(2)	Includes wheat, corn, sunflower, soybean, sorghum and others.
(3)	Breeding and fattening.
(4)	We use part of our land reserves to produce charcoal, rods and fence posts.

73

Our Principal Business Activities

During the fiscal year ended June 30, 2022, we conducted our operations on 26 owned farms and 94 leased farms.

The following charts show, for fiscal year 2022, the surface area in operation for each line of business, as well as the hectares held as land reserves:

Agricultural Business

Land Transformation and Sales

Land Acquisitions

We seek to increase our lands portfolio, through the acquisition of large areas of land with high potential for appreciation. We also aim to increase the productivity of the land by applying state-of-the-art technology to improve agricultural yields.

74

Several important intermediaries, with whom we usually work, bring farmlands available for sale to our attention. The decision to acquire farmlands is based on the assessment of a large number of factors. In addition to the land’s location, we normally carry out an analysis of soil and water, including the quality of the soil and its suitability for our intended use (crops, cattle, or milk production), classify the various sectors of the lot and the prior use of the farmland; analyze the improvements in the property, any easements, rights of way or other variables in relation to the property title; examine satellite photographs of the property (useful in the survey of soil drainage characteristics during the different rain cycles) and detailed comparative data regarding neighboring farms (generally covering a 50-km area). Based on the foregoing factors, we assess the farmland in terms of the sales price compared against the production potential of the land and capital appreciation potential. We consider that competition for the acquisition of farmlands is, in general, limited to small farmers for the acquisition of smaller lots, and that there is scarce competition for the acquisition of bigger lots.

Land Sales

During fiscal year 2022, our subsidiary BrasilAgro sold a portion of 3,723 hectares (2,694 productive hectares) of the “Alto Taquarí” farm located in the State of Mato Grosso, Brazil. After this transaction, a remainder of 1,380 hectares of this field remains in control of BrasilAgro. The value of the sale was BRL 589 million and the take over of possession of the hectares and consequently, the recognition of the sale, was carried out in two stages: 2,566 hectares (1,537 productive hectares) in October 2021 for an approximate value of BRL 336 million and 1,157 productive hectares in September 2024, for an approximate value of BRL 253 million. The field was book valued at BRL 31.3 million and the yield achieved in dollars was 12%. Likewise, in December 2021, BrasilAgro sold a fraction of 4,573 hectares (2,859 productive hectares) of the “Rio do Meio” field located in Correntina, State of Bahia, Brazil; which was acquired in January 2020. As a result of this operation, a remainder of 7,715 hectares of said establishment remains in control of the Company. The total amount of the transaction was set at BRL 130.1 million and the field was book valued at BRL 40 million.

Land productivity potential

We believe that our agricultural lands have significant productivity potential and, through the implementation of best agricultural practices and application of our accumulated knowledge and experience, we are able to enhance the value of our agricultural lands.

As of June 30, 2022, we owned land reserves in the region extending over more than 347,360 hectares of our own farmlands that were purchased at very attractive prices. In addition, we have a concession of 107,034 hectares reserved for future development. Of the total of this area, we maintain a 296,644 hectares green lung. We believe that there are technological tools available to improve productivity in these farms and, therefore, achieve appreciation in the long term.

During this fiscal year, we added to our portfolio 9,099 productive hectares in the region: 2,358 hectares in Argentina, 3,033 hectares in Paraguay and 3,708 hectares in Brazil.

Newly Developed Area	2022		2021
	(hectares)
Argentina		2,358		2,221
Brazil		3,033		6,797
Paraguay		3,708		2,313
Total		9,099		11,331

75

Results

The following table shows the land transformation segment results for fiscal year 2022, compared to the preceding fiscal year:

	FY2022			FY2021			YoY var
							2022 vs. 2021
	(in millions of ARS)						%
Revenues		—			—			—
Costs		(48	)		(59	)		(18.6	)
Gross Loss		(48	)		(59	)		(18.6	)
Net result for changes in fair value of investment properties		2,460			9,035			(72.8	)
Gain from disposition of farmlands		5,505			2,148			156.3
General and administrative expenses		(8	)		(8	)		—
Selling expenses		(189	)		(2	)		9350.0
Other operating results, net		1,071			2,871			(62.7	)
Profit from operations		8,791			13,985			(37.1	)
Segment profit		8,791			13,985			(37.1	)

Agricultural Production

Production

The following table shows, for the fiscal years indicated, our production volumes measured in tons:

Production Volume (1)	FY2022		FY2021		FY2020		FY2019
Corn		401,104		342,726		433,910		194,352
Soybean		327,176		339,954		359,055		355,670
Wheat		35,398		36,594		43,862		37,378
Sorghum		15,469		26,704		5,895		1,721
Sunflower		3,493		4,846		2,573		6,428
Cotton		7,157		8,781		3,519		1,586
Other		15,068		16,628		8,676		2,103
Total Crops (tons)		804,865		776,233		857,490		599,238
Sugarcane (tons)		2,187,134		2,364,535		2,360,965		1,999,335
Cattle (tons)		8,746		9,956		11,783		11,173

_________________

(1) Includes BrasilAgro. Agro-Uranga S.A. is not included.

Crops and Sugarcane

Our crop production is mainly based on crops and oilseeds and sugarcane. Our main crops include soybean, wheat, corn, and sunflower. Other crops, such as sorghum and peanut, are sown occasionally and represent only a small percentage of total sown land.

Below is the geographical distribution of our agricultural production for the last four fiscal years:

2022 Season	Argentina		Brazil		Bolivia		Paraguay		Total
	(in tons)
Corn		259,059		131,155		3,877		7,013		401,104
Soybean		129,276		180,509		17,391		—		327,176
Wheat		34,938		—		460		—		35,398
Sorghum		26,232		292		180		0		26,704
Sunflower		3,493		—		—		—		3,493
Cotton		—		7,157		—		—		7,157
Other		7,178		7,549		5		336		15,068
Total Crops and Other		448,477		327,306		21,733		7,349		804,865
Sugarcane		—		2,083,485		103,649		—		2,187,134

76

2021 Season	Argentina		Brazil		Bolivia		Paraguay		Total
	(in tons)
Corn		233,900		99,441		7,127		2,258		342,726
Soybean		151,808		168,747		15,907		3,492		339,954
Wheat		36,594		—		—		—		36,594
Sorghum		26,232		292		180		0		26,704
Sunflower		4,846		—		—		—		4,846
Cotton		—		8,781		—		—		8,781
Other		4,120		7,207		—		5,301		16,628
Total Crops and Other		457,500		284,468		23,214		11,051		776,233
Sugarcane		—		2,196,119		168,416		—		2,364,535

2020 Season	Argentina		Brazil		Bolivia		Paraguay		Total
	(in tons)
Corn		334,821		89,900		4,264		4,925		433,910
Soybean		179,023		157,949		19,608		2,475		359,055
Wheat		43,862		—		—		—		43,862
Bean		—		4,371		—		—		4,371
Sorghum		5,895		—		—		—		5,895
Sunflower		2,573		—		—		—		2,573
Cotton		—		3,519		—		—		3,519
Other		4,133		172		—		—		4,305
Total Crops and Other		570,307		255,911		23,872		7,400		857,490
Sugarcane		—		2,217,714		143,251		—		2,360,965

2019 Season	Argentina		Brazil		Bolivia		Paraguay		Total
	(in tons)
Corn		157,079		29,903		6,143		1,227		194,352
Soybean		177,503		138,506		21,174		18,486		355,670
Wheat		37,378		—		—		—		37,378
Sorghum		1,364		—		357		—		1,721
Sunflower		6,428		—		—		—		6,428
Cotton		—		1,586		—		—		1,586
Other		2,103		—		—		—		2,103
Total Crops and Other		381,855		169,995		27,674		19,713		599,238
Sugarcane		—		1,932,235		67,100		—		1,999,335

Sales

Below is the total volume sold broken down into geographical areas, measured in tons:

	FY2022						FY2021						FY2020						FY2019
Volume of Sales(3)	D.M.(1)		F.M.(2)		Total		D.M.(1)		F.M.(2)		Total		D.M.(1)		F.M.(2)		Total		D.M.(1)		F.M.(2)		Total
Corn		295.2		72.5		367.7		286.6		70.0		356.6		325.4		64.1		389.5		191.4		0.2		191.6
Soybean		255.0		128.0		383.0		229.3		56.1		285.4		310.2		110.2		420.4		166.4		101.9		268.3
Wheat		34.1		—		34.1		31.6		3.1		34.7		43.8		—		43.8		40.5		—		40.5
Sorghum		30.0		—		30.0		3.4		—		3.4		0.8		—		0.8		0.4		—		0.4
Sunflower		3.0		—		3.0		4.7		—		4.7		9.3		—		9.3		2.4		—		2.4
Cotton		3.3		1.3		4.6		7.2		—		7.2		2.4		2.1		4.5		—		—		—
Other		9.8		1.4		11.2		6.4		1.0		7.4		5.0		—		5.0		1.2		—		1.2
Total Crops (tons)		630.4		203.2		833.6		569.2		130.2		699.4		696.9		176.4		873.3		402.3		102.1		504.4
Sugarcane (tons)		1.997.3		—		1.997.3		2.169.9		—		2.169.9		2.226.2		—		2.226.2		1.965.4		—		1.965.4
Cattle (tons)		12.5		—		12.5		16.6		—		16.6		19.3		—		19.3		9.4		—		9.4

_______________

(1)	Volume of sales in domestic market.
(2)	Volume of sales in foreign market.
(3)	Includes BrasilAgro. Excludes Agro-Uranga.

77

The following table shows the sown surface area assigned to crop production, classified into own, under lease, under concession and leased to third parties for the fiscal years indicated below, measured in hectares:

	2022(1)		2021(1)		2020(1)		2019(1)
Own		113,452		109,576		105,799		94,062
Under lease		122,662		130,940		138,867		135,955
Under concession		22,121		22,771		26,409		18,638
Leased to third parties		23,778		24,133		13,837		14,325
Total		282,013		287,420		284,912		262,980

________________

(1) Includes double crops, all farms in Argentina, Bolivia, Paraguay and Brazil, and Agro-Uranga (Associated – 34.86%).

	Season
Stock of crops	2022		2021		Variation
	(in tons)				%
Corn		100,930		92,564		9.0
Soybean		53,394		135,177		(60.5	)
Sunflower		737		266		177.1
Sorghum		5,503		20,354		(73.0	)
Wheat		1,296		2,074		(37.5	)
Cotton		4,064		1,964		106.9
Other		6,286		4,924		27.7
Total		172,210		257,323		(33.1	)

We seek to diversify our mix of products and the geographic location of our farmlands to achieve an adequate balance between the two principal risks associated with our activities: weather conditions and the fluctuations in the prices of commodities. In order to reduce such risks, we own and lease land in several areas of Argentina with different climate conditions that allow us to sow a diversified range of products. Our leased land for crops is mostly located in the Pampas region, a favorable area for crop production. The leased farms are previously studied by technicians who analyze future production expectations based on the historic use of the land. The initial duration of lease agreements is typically one or three seasons. Leases of farms for production of crops generally consist of lease agreements with payments based on a fixed amount of Pesos per hectare or sharecropping agreements with payments in kind based on a percentage of the crops obtained or a fixed amount of tons of crops obtained or their equivalent value in Pesos. The principal advantage of leasing farms is that leases do not require us to commit large amounts of capital to the acquisition of lands but allow us to increase our scale in the short term and reduce the risk of inclement weather. The disadvantage of this strategy is that the cost of leasing can increase over time, in part, because increased demand for leased land increases the price of leased land.

In order to increase our production yields, we use, besides state-of-the-art technology, labor control methods which imply the supervision of the seeding’s quality (density, fertilization, distribution, and depth), crop monitoring (determination of natural losses and losses caused by harvester) and verification of bagged crop quality. In this way, we work jointly with our suppliers to achieve the best management of inputs, water and soil.

Wheat seeding takes place from June to August, and harvesting takes place from December to January. Corn, soybean and sunflower are sown from September to December and are harvested from February to August. Crops are available to be sold as commodities after the harvest from December to June and we usually store part of our production until prices recover after the drop that normally takes place during the harvesting season. A major part of production, especially soybean, wheat, corn and sorghum, is sold and delivered to buyers pursuant to agreements in which price conditions are fixed by reference to the market price at a specific time in the future that we determine. The rest of the production is either sold at current market prices or delivered to cover any futures contract that we may have entered into.

78

Agro-Uranga S.A.

As of June 30, 2022, our holding in Agro-Uranga was 34.86%. This company optimizes production processes with special emphasis in soil conservation, the application of rational techniques and care of the environment.

At present, with the assistance of its foreign trade team it is seeking to develop new products so as to significantly increase export volumes, encouraged by the world’s growing demand.

Lease of Farmlands

We conduct our business on owned and leased land. Rental payments increase our production costs, as the amounts paid as rent are accounted for as operating expenses. As a result, production costs per hectare of leased land are higher than for the land owned by us.

Our land leasing policy is designed to supplement our expansion strategy, using our liquidity to make production investments in our principal agricultural activities. On the other hand, our leasing strategy provides us with an added level of flexibility in the share of each of our products in total production, providing for greater diversification.

The initial duration of lease agreements is typically one crop season. Leases of farms for production of crops consist in lease agreements with payments based on a fixed amount of Pesos per hectare or sharecropping agreements with payments in kind based on a percentage of the crops obtained or a fixed amount of tons of crops obtained or their equivalent value in Pesos. Leases of farmlands for cattle breeding consist in lease agreements with fixed payments based on a fixed amount of Pesos per hectare or steer kilograms or capitalization agreements with payments in kind or in cash based on the weight gain in kilograms Sugarcane farm leases consideration is usually set in an amount of money resulting from a formula that includes the number of tons produced, the Total Recoverable Sugar Indicator (“ATR” for its acronym in Portuguese) and the plant’s production mix. Such lease agreements have a term of at least two seasons.

During fiscal year 2022, we leased to third parties a total of 94 fields, covering 116,377 hectares, including 50,747 hectares in Brazil. Out of the total leased area 122,662 hectares were assigned to agricultural production including double crops, and 12,590 hectares to cattle raising. The properties for agricultural production were leased, primarily, for a fixed price prior to harvest and only a small percentage consisted of sharecropping agreements.

The following table shows a breakdown of the number of hectares of leased land used for each of our principal production activities:

	2022		2021		2020		2019		2018
Crops (1)		100,470		107,013		111,001		117,397		66,333
Cattle		12,590		12,635		12,635		14,135		12,635

1) Includes sugarcane

Due to the rise in the price of land, we adopted a policy of not validating excessive prices and applying strict criteria upon adopting the decision to lease, selecting those lands with values that would ensure appropriate margins.

79

Results

The following table shows the Company’s results for fiscal year 2022 for Crops and Sugarcane activities, compared to the preceding fiscal year:

Crops

	FY 2022			FY 2021			YoY var 2022 vs. 2021
	(in millions of ARS)						%
Revenues		35,341			25,167			40.4
Costs		(34,527	)		(26,800	)		28.8
Initial recognition and changes in the fair value of biological assets and agricultural produce		12,166			17,904			(32.0	)
Changes in the net realizable value of agricultural produce		(1,995	)		(970	)		105.6
Gross profit		10,985			15,301			(28.2	)
General and administrative expenses		(1,374	)		(1,391	)		(1.2	)
Selling expenses		(3,792	)		(3,184	)		19.1
Other operating results, net		(2,226	)		(6,228	)		(64.3	)
Profit from operations		3,593			4,498			(20.1	)
Share of profit of associates and joint ventures		107			98			9.2
Activity profit		3,700			4,596			(19.5	)

Sugarcane

	FY 2022			FY 2021			YoY var 2022 vs. 2021
	(in millions of ARS)						%
Revenues		10,454			8,607			21.5
Costs		(9,655	)		(7,478	)		29.1
Initial recognition and changes in the fair value of biological assets and agricultural produce		6,286			4,337			44.9
Gross profit		7,085			5,466			29.6
General and administrative expenses		(379	)		(467	)		(18.8	)
Selling expenses		(191	)		(297	)		(35.7	)
Other operating results, net		115			(389	)		—
Profit from operations		6,630			4,313			53.7
Activity profit		6,630			4,313			53.7

Cattle

Our cattle production involves the breeding and fattening of our own animals. In some cases, if market conditions are favorable, we also purchase and fatten cattle which we sell to slaughterhouses and supermarkets. As of June 2022, our cattle aggregated 71,330 heads, and we had a total surface area of 78,537 hectares of own and leased lands devoted to this business activity. In addition, we have leased to third parties 1,325 hectares assigned to these activities.

During the fiscal year ended June 30, 2022, our production was 8,746 tons, a 12.2% year-on-year increase. The following table sets forth, for the fiscal years indicated below, the cattle production volumes measured in tons:

	2022		2021		2020		2019		2018
Cattle production(1)		8,746		9,956		11,783		11,173		10,751

________________

(1) Production measured in tons of live weight. Production is the sum of the net increases (or decreases) during a given period in live weight of each head of cattle owned by us.

80

Our cattle breeding activities are carried out with breeding cows and bulls and our fattening activities apply to steer, heifers and calves. Breeding cows calve approximately once a year and their productive lifespan is from six to seven years. Six months after birth, calves are weaned and transferred to fattening pastures. Acquired cattle are directly submitted to the fattening process. Upon starting this process, cattle have been grazing for approximately one year to one and a half year in order to be fattened for sale. Steer and heifers are sold when they have achieved a weight of 380–430 kg and 280–295 kg, respectively, depending on the breed.

Pregnancy levels, which have been improving over the years, showed satisfactory levels of efficiency notwithstanding the adverse weather conditions. Genetics and herd management are expected to further improve pregnancy levels in the coming years. Reproductive indicators improved thanks to the implementation of technologies, which have included handling techniques and females’ artificial insemination with cattle genetics especially selected for the stock which is purchased from specialized companies in quality semen elaboration for meat production. We use veterinarian products manufactured by leading national and international laboratories. It is important to emphasize the work of a veterinarian advising committee, who is external to us and visits each establishment monthly to control and agree tasks.

Currently, the cattle raising farms are officially registered as export farmlands pursuant to the identification and traceability rules in force in Argentina. Animals are individually identified, thus allowing for the development of special businesses in this area.

Our cattle stock is organized into breeding and fattening activities. The following table shows, for the fiscal years indicated, the number of heads of cattle for each activity:

	2022		2021		2020
Breeding stock		66,532		58,086		63,073
Winter grazing stock		4,798		4,972		10,539
Total Stock (heads)		71,330		63,058		73,612

We seek to improve cattle production and quality in order to obtain a higher price through advanced breeding techniques. We cross breed our stock of Indicus, British (Angus and Hereford) and Continental breeds to obtain herds with characteristics better suited to the pastures in which they graze. To enhance the quality of our herds even further, we plan to continue improving our pastures through permanent investment in seeds and fertilizers, an increase in the watering troughs available in pastures, and the acquisition of round bailers to cut and roll grass for storage purposes.

Our emphasis on improving the quality of our herd also includes the use of animal health-related technologies. We comply with national animal health standards that include laboratory analyses and vaccination aimed at controlling and preventing disease in our herd, particularly FMD.

Direct costs of beef production consist primarily of crops for feeding and dietary supplementation purposes, animal health and payroll costs, among others.

Results

The following table shows cattle activity’s results for fiscal year 2022, compared to the preceding fiscal years:

	FY 2022			FY 2021			YoY var 2022 vs. 2021
	(In millions of ARS)						%
Revenues		3,721			4,664			(20.2	)
Costs		(3,119	)		(3,886	)		(19.7	)
Initial recognition and changes in the fair value of biological assets and agricultural produce		(248	)		1,171			—
Changes in the net realizable value of agricultural produce after harvest		(3	)		3			—
Gross profit / (loss)		351			1,952			(82.0	)
General and administrative expenses		(204	)		(271	)		(24.7	)
Selling expenses		(196	)		(267	)		(26.6	)
Other operating results, net		(10	)		(180	)		(94.4	)
Profit/(loss) from operations		(59	)		1,234			—
Profit from Joint Ventures		1			—			—
Activity profit/(loss)		(58	)		1,234			—

81

Leases and Agricultural Services

We lease own farms to third parties for agriculture, cattle breeding and seed production, mainly in two types of farms. On the one hand, we lease our farms under irrigation in the Province of San Luis (Santa Bárbara and La Gramilla) to seed producers or enter into production agreements whereby we render production services to seed companies. These farms are ideal for obtaining steady production levels, given the quality of their soil and the weather conditions of the area, along with the even humidity provided by irrigation.

On the other hand, when market conditions are favorable, we lease farms recently put into production after agricultural development. In this way, we manage to reduce our production risk, ensuring fixed rental income until the new farms reach stable productivity levels.

In addition, in this segment we include the irrigation service we provide to our own farms leased to third parties.

Results

The following table shows Leases and Agriculture Services’s results for fiscal year 2022, compared to the preceding fiscal years:

	FY 2022			FY 2021			YoY var 2022 vs. 2021
	(In millions of ARS)						%
Revenues		1,554			1,523			2.0
Costs		(572	)		(397	)		44.1
Gross profit		982			1,126			(12.8	)
General and administrative expenses		(307	)		(121	)		153.7
Selling expenses		(179	)		(89	)		101.1
Other operating results, net		24			(59	)		—
Profit from operations		520			857			(39.3	)
Activity profit		520			857			(39.3	)

Others

We include within “Others” the results coming from our investment in FyO.

Results

The following table shows Others activities’s results for fiscal year 2022, compared to preceding fiscal year:

	FY 2022			FY 2021			YoY var 2022 vs. 2021
	(In millions of ARS)						%
Revenues		13,338			8,852			50.7
Costs		(9,731	)		(6,105	)		59.4
Gross profit		3,607			2,747			31.3
General and administrative expenses		(777	)		(592	)		31.3
Selling expenses		(933	)		(661	)		41.1
Other operating results, net		188			364			(48.4	)
Profit from operations		2,085			1,858			12.2
Profit from associates		54			(193	)		—
Segment Profit		2,139			1,665			28.5

82

Corporate

This segment includes, principally, the corporative expenses related to the agricultural business.

Results

The following table shows the “Corporate” segment’s results for fiscal year 2022, compared to preceding fiscal years:

	FY 2022			FY 2021			YoY var 2022 vs. 2021
	(In millions of ARS)						%
Revenues		—			—			—
Costs		—			—			—
Gross profit		—			—			—
General and administrative expenses		(739	)		(720	)		2.6
Loss from operations		(739	)		(720	)		2.6
Segment loss		(739	)		(720	)		2.6

Futuros y Opciones.Com S.A. (FyO)

Futuros y Opciones.com’s main business is crop trading (crop brokerage, futures and options, consulting and logistic and financial services) and sale and distribution of own inputs and providing comprehensive services to its clients related to:

· Grain brokerage, giving the possibility of offering different business alternatives.

· Futures and options, with specialized advisers who generate the best hedging strategies for clients, offering different investment alternatives, advising on price risk management, and seeking opportunities by arbitrating different positions, products and markets.

· Financial services, offering its clients the possibility of accessing the most varied sources of financing and placement of funds that are available in the capital markets.

· Sale of inputs, both own and distribution of third-party products.

· Consulting and logistics services Regarding the crop trading (brokerage-consignment) and inputs, such as agrochemicals and fertilizers, income grew compared to the previous year due to the increase in the volume invoiced and the increase in prices in dollars of agricultural products.

Net financial income decreased mainly due to the increase in external financing and the decrease in the placement of funds in financial assets. During this fiscal year, the Company opted to increase external financing through tools such as short-term sureties and bank overdrafts.

83

Among the objectives for next fiscal year, it should be noted that it is expected to continue growing in the commercialization and trading of grains, differentiating ourselves in the services provided to customers and continuing with the digital transformation of the company. In Supplies, the objectives are to increase sales, improve margins, incorporate biological and organic inputs into the product range and continue with the regionalization of the business in Brazil, Paraguay, Chile, and Bolivia.

Additionally, it is expected during the next fiscal year to explore the business of sale of specialties for export purposes.

Also, on October 22, 2021, FYO issued its first bond in the local market for an amount of USD 12.3 million. The note is dollar denominated and payable in Pesos at the applicable exchange rate, with an annual fixed rate of 0%, and maturity on October 22, 2023. As s subsequent event, on July 25, 2022, FYO issued its second bond in the local market for an amount of USD 15.0 million. The note is dollar denominated and payable in Pesos at the applicable exchange rate, with an annual fixed rate of 0.0%, and maturity on July 25, 2025.

AGROFY

Agrofy S.A.U. continued to position itself in 2022 as the leading online platform for agriculture in Latam, increasing the flow of annual visits and contacts per month when compared to the previous year.

In December 2021, Agrofy carried out a new round of capital for USD 29 million, with the aim of consolidating its regional growth, increasing transaction activity on the platform and developing fintech solutions. Current shareholders participated in this round of capital (including Cresud), and Yara Growth Ventures was incorporated with 9.6% of the share capital.

As of June 30, 2022, we had a direct and indirect participation in Agrofy of 17.7% and BrasilAgro acquired 1.6% of the capital stock.

Farmland Portfolio

As of June 30, 2022, we owned, together with our subsidiaries, 26 farms, with a total surface area of 617,481 hectares.

The following table sets forth our farm portfolio as of June 30, 2022:

Potential use of farms owned and under concession as of June 30, 2022

Locality

Province

Date of Acquisition

Surface Area (has)

Main Business

Cattle (has)(3)

Sheep (has) (3)

Agriculture (has) (3)

Cattle (2) (Head)

El Recreo

Recreo

Catamarca

May ‘95

12,395

Natural woodlands

Los Pozos

JV González

Salta

May ‘95

239,639

Cattle/ Agriculture/ Natural woodlands

33,360

16,402

35,930

San Nicolás (1)

Rosario

Santa Fe

May ‘97

1,396

Agriculture

1,171

Las Playas (1)

Idiazabal

Cordoba

May ‘97

1,497

Agriculture

1,474

La Gramilla/ Santa Bárbara

Merlo

San Luis

Nov ‘97

7,072

Agriculture Under irrigation

4,914

La Suiza

Villa Angela

Chaco

Jun ‘98

26,371

Agriculture/ Cattle

18,100

1,192

8,870

El Tigre

Trenel

La Pampa

Apr ‘03

8,360

Agriculture

240

6,523

3,055

San Pedro

Concepción de Uruguay

Entre Rios

Sep ‘05

3,584

Agriculture

1,255

1,987

8 De Julio/ Estancia Carmen

Puerto Deseado

Santa Cruz

May ‘07/ Sep ‘08

100,911

Sheep

85,000

Cactus Argentina

Villa Mercedes

San Luis

Dec ‘97

171

Natural woodlands

101

Finca Mendoza

Lujan de Cuyo

Mendoza

Mar ‘11

674

Natural woodlands

Establecimiento Mendoza

Finca Lavalle

Mendoza

Nov’03

9

Natural woodlands

Jatoba

Jaborandi/BA

Brazil

Mar’07

13,277

Agriculture

Alto Taquarí

Alto Taquarí/MT

Brazil

Aug’07

1,380

Agriculture

809

Araucaria

Mineiros/GO

Brazil

Apr’07

5,534

Agriculture

3,740

Chaparral

Correntina/BA

Brazil

Nov’07

37,182

Agriculture

17,951

Nova Buriti

Januária/MG

Brazil

Dec’07

24,212

Forestry

Preferência

Barreiras/BA

Brazil

Sep’08

17,799

Agriculture / Natural woodlands

7,990

10,035

São José

São Raimundo das Mangabeiras/MA

Brazil

Feb’17

17,566

Agriculture

9,549

Arrojadinho

Jaborandi/BA

Brazil

Jan’20

16,642

Agriculture

4,359

2,288

Rio do Meio

Correntina/BA

Brazil

Jan’20

7,715

Agriculture

2,217

Serra Grande

Baixa Grande do Ribeiro/PI

Brazil

Apr’20

4,489

Agriculture

2,734

Marangatu/Udra

Mariscal Estigarribia

Paraguay

Feb ‘09

59,585

Agriculture/ Natural woodlands

2,488

13,242

3,126

Las Londras

Santa Cruz

Bolivia

Nov ‘08

4,555

Agriculture

4,102

San Rafael

Santa Cruz

Bolivia

Nov ‘08

3,109

Agriculture

2,814

La Primavera

Santa Cruz

Bolivia

Jun ‘11

2,356

Agriculture

1,860

Subtotal Owned

617,481

63,533

85,000

97,229

63,304

Agropecuaria Anta S.A.

Las Lajitas

Salta

132,000

2,845

22,121

—

Subtotal Under Concession

132,000

2,845

22,121

—

Total

749,481

66,378

85,000

119,350

63,304

________________

(1)	Hectares in proportion to our 34.86% interest in Agro-Uranga S.A.
(2)	Does not include sheep or cattle in sold or rented fields.
(3)	Represents the maximum productivity capacity use of the farms.

84

Additional information about our Farmlands

Argentina

El Recreo

“El Recreo” farm, located 970 kilometers northwest of Buenos Aires, in the Province of Catamarca, was acquired in May 1995. It has semi-arid climate and annual rainfall, which do not excess of 400 mm. This farm is maintained as a productive reserve.

Los Pozos

“Los Pozos” farm located 1,600 kilometers northwest of Buenos Aires, in the Province of Salta, was acquired in May 1995. This property is located in a semi-arid area with average annual rainfall of 600 mm. The area is naturally suited to cattle raising and forestry activities (poles and fence posts), and it has agricultural potential for summer crops such as soybean, sorghum and corn, among others. For the fiscal year ended June 30, 2022, we used 16,402 hectares in agricultural production. As of June 30, 2022, there were 35,930 heads of cattle in this farm.

San Nicolás

“San Nicolás” is a 4,005 hectares farm owned by Agro-Uranga S.A., and is located in the Province of Santa Fe, approximately 45 kilometers from the Port of Rosario. As of June 30, 2022, 5,130 hectares were planted for agricultural production, including double crops. The farm has two plants of silos with a storage capacity of 14,950 tons.

Las Playas

“Las Playas” farm has a surface area of 4,294 hectares and is owned by Agro-Uranga S.A. It is located in the Province of Córdoba, and it is used for agricultural purposes. As of June 30, 2022, the farm had a sown surface area, including double crops, of 6,390 hectares for crop production.

La Gramilla and Santa Bárbara

These farms have a surface area of 7,014 hectares and it is located in Valle de Conlara, in the Province of San Luis. Unlike other areas in the Province of San Luis, this valley has a high-quality underground aquifer which makes these farms well suited for agricultural production after investments were made in the development of lands, wells and irrigation equipment. In the course of the 2021/2022 crop season, a total of 6,130 hectares were sown, including double crops.

85

La Suiza

“La Suiza” farm has, at the end of the fiscal year, a surface area of 26,371 hectares and is located in Villa Ángela, Province of Chaco. It is used for raising cattle. As of June 30, 2022, “La Suiza” had a stock of approximately 8,870 heads of cattle. During the 2021/2022 season, we used 1,296 hectares for agricultural production and 18,100 for livestock production.

El Tigre

“El Tigre” farm was acquired on April 30, 2003 and has a surface area of 8,360 hectares. It is located in Trenel, Province of La Pampa. As of June 30, 2022, 8,103 hectares were assigned to crop production, including double crops.

San Pedro

“San Pedro” farm was purchased on September 1, 2005. It has a surface area of 3,582 hectares (1,255 of which are used for breeding livestock) and is located in Concepción del Uruguay, Province of Entre Ríos, which is 305 kilometers north of Buenos Aires. In the course of the 2021/2022 crop season, 4,729 hectares were used for agricultural production, including double crops.

8 de Julio and Estancia Carmen

“8 de Julio” farm was acquired on May 15, 2007 and has a surface area of 90,000 hectares. It is in the Department of Deseado in the Province of Santa Cruz. Due to its large surface area, this farm offers excellent potential for sheep production. In addition, we believe the land has potential for future tourism and recreational activities, as the southeast border of the farm, a coast stretches over 20 kilometers. “Estancia Carmen” was acquired on September 5, 2008 and has a surface area of 10,911 hectares. It is in the Province of Santa Cruz, next to our “8 de Julio” farm. Due to the potential of the farm for wind fields installment, the entire surface of the farms -except 3,000 hectares- were rented to a company specialized in wind energy generation.

Cactus

The feedlot has a surface area of 171 hectares. It is located in Villa Mercedes, Province of San Luis. Given its degree of urban development and closeness to the city, we decided to discontinue fattening activities in this facility.

Finca Mendoza

On March 2, 2011, the Company purchased, jointly with Zander Express S.A., a rural property composed of thirteen plots of land located in the District of Perdriel, Luján de Cuyo Department, in the Province of Mendoza. As a result of this acquisition, Cresud has become owner of a 40% undivided estate in all and each of the properties, while Zander Express S.A. holds the remaining 60%. The total agreed price for this transaction was USD 4 million; therefore, the amount of USD 1.6 million was payable by Cresud.

On June 8, 2017, a title deed for the sale of 262 ha was signed. The total price was USD 2.2 million. The Company has recognized a gain of ARS 11.8 million as a result of this transaction.

On April 17, 2019, we have purchased to Zander Express S.A. the 60% of the property, and the total price was USD 1.25 million. As a result of this acquisition, we have become owner of a 100% of the property.

86

Agropecuaria Anta (concession)

The “Agropecuaria Anta” farm is located in the department of Anta, in the west of the Province of Salta. It is located 46 km from Las Lajitas and 87 km from Joaquín V. Gonzalez, both tows of the Province of Salta. It corresponds to a permit to use public land for 35 years with expiration in 2035, extendable to 29 more years.

Within the contracts framework with the state company Salta Forestal S.A., through which rural properties were granted to Cresud, the Government of the Province of Salta has decreed -through executive orders 815/20, 395/21, 396/21, 397 /21 and 398/21- the rejection of the hierarchical appeals filed by Cresud against the fees liquidation made by Salta Forestal S.A. and, depending on the campaign, by the Department of Agriculture Affairs for the 2013/2014, 2014/2015, 2016/2017, 2017/2018, 2018/2019 and 2019/2020  of corn, soybean and/or sorghum crops campaigns. In this context, Cresud has initiated the judicial action against the aforementioned executive orders and in return the province of Salta has initiated an executive lawsuit and a garnishment for the amounts of the disputed amounts. To date, garnishment have been processed within the framework of file 726737/20 and in relation to executive order 815/20, for the sum of ARS 42.5 million, in the framework of file 739946/21 and in relation to executive order 395/21, for the sum of ARS 44.7 million, in the framework of file 742573/21 and in relation to executive order 396/21, for the sum of ARS 45.5 million, in the framework of file 739937/21 and in relation to executive order 397/21, for the sum of ARS 69.2 million, and within the framework of file 740034/21 and in relation to executive order 398/21, for the sum of ARS 58.4 million  In this regard, and based on the executive orders issued by the Government of Salta and in accordance with what was reported by our external advisory lawyers, the contingency is estimated in the amount of ARS 284.5 million.

Brazil (through our subsidiary BrasilAgro)

Jatobá

Jatobá is a farm in the northeastern region of Brazil, with a total surface area of 13,277 hectares. Jatobá was acquired in March 2007 for BRL 33 million. We consider that this farm is in a very advantageous location for the movement of crops, as it is close to the Candeias Port, in the State of Bahia. During the 2021/2022 season, 9,755 hectares were leased to third parties who bought part of land in the past.

On June 13, 2018, the Company, through its subsidiary BrasilAgro, signed a purchase contract for a total area of 9,784 hectares (7,485 are agricultural hectares) of the Establishment.

On July 31, 2018, the buyer made the payment of the first installment for BRL 225 million in accordance with the conditions set forth in the contract, obtaining the transfer of possession and enabling the recognition of the income by the Company. The remaining balance will be paid in six annual installments.

In June 2019, the Company entered into a commitment to sell 3,124 hectares of the Jatobá field. The sale price is BRL 543 million. The buyer made an initial payment of BRL 58 million and made on July 31, 2019 the cancellation of the first installment equivalent to BRL 58 million; and the balance equivalent to 563,844 soybeans bags, will be paid in six annual installments. The delivery of the possession and the result of the operation will be recognized on June 30, 2019, which represents a gain of BRL 422 million.

On July 15, 2020 BrasilAgro entered into an agreement for the sale of 1,875 hectares (1,500 are production acres) of the Jatobá Establishment, a rural property located in the Municipality of Jaborandi, for a purchase price of 300 bags of soybeans, equivalent to BRL 45 million. At the time of sale, the buyer made an initial payment, equivalent to BRL 5 million. In August 2020, the buyer made a second payment, equivalent to an additional BRL 3.5 million. The remaining balance of the purchase price will be paid by the purchaser in six annual installments. The book value of the Jatobá field parcel that was sold is BRL 3.7 million (acquisition cost plus investments made).

During fiscal year 2021, BrasilAgro sold a fraction of 1,654 hectares of the “Jatobá” farm located in Jaborandi, State of Bahia, Brazil, for the sum of BRL 67.1 million. The field was valued on the books at BRL 2.8 million and the internal rate of return in dollars reached was 10.9%.

87

Araucária

Araucária is a farm located in the municipal district of Mineiros, in the State of Goiás, and it has a total surface area of 5,534 hectares, 4,051 of which are used for agriculture. Araucaria was acquired in 2007 for BRL 70.4 million. Before we purchased it, Araucária had been used for crop planting and sugarcane. The farm was transformed, and at present it is planted with sugarcane and soybeans.

In May 2013, an area of 394 hectares (310 of which are used for agriculture) was sold. The sale price was BRL 10.3 million. In May 2014, the sale of 1,164 hectares was agreed for a total amount of BRL 41.3 million.

In March 2017, an area of 274 hectares was sold, of which 196 are developed and productive hectares. The price of the sale is 1,000 bags of soybeans per hectare. The Company has recognized a gain of ARS 29.9 million as a result of this transaction.

In May 2017, an area of 1,360 hectares was sold, of which 918 are developed and productive hectares. The sale price is 280 bags of soybeans per hectare. The Company has recognized a gain of ARS 37.4 million as a result of this transaction. On May 3, 2018, has been subscribed a purchase-sale ticket for the sale of a fraction of 956 hectares (660 productive) at a price of 1,208 bags of soybeans per hectare or BRL 61.6 million (BRL/ha 93,356).

Alto Taquarí

Alto Taquarí is located in the municipal district of Alto Taquarí, State of Mato Grosso, and it has a total surface area of 5,103 hectares, of which 3,206 are used for agriculture. The farm was acquired in August 2007 for BRL 33.2 million. Before we purchased it, the farm had been used for agriculture and cattle raising. Following its transformation, it is being used for sugarcane production and crop planting.

On November 21, 2018, the Company, through its subsidiary BrasilAgro, entered into a commitment to sell 103 hectares of the Alto Taquarí field. The sale price is 1,100 bags of soybeans bags per hectare equivalent to BRL 63.4 million. The buyer made the initial payment of 22,656 soybean bags equivalent to BRL 17 million; and the balance will be paid in eight semiannual installments. The result of the operation recognized in this period was BRL 64 million.

On October 29, 2019, the Company, through its subsidiary BrasilAgro, entered into a commitment to sell 85 hectares (65 productive hectares) of the Alto Taquarí Establishment, a rural property located in the municipality of Alto Taquarí, for a purchase price of equivalent to BRL 5.5 million. On the closing date, the buyer made an initial payment of 14,300 bags of soybeans, equivalent to BRL 1 million. The remaining balance will be paid in four annual installments. The result of the operation recognized in this period was BRL 4 million.

On May 29, 2020, the Company, through its subsidiary BrasilAgro, entered into a commitment to sell 105 productive hectares of the Alto Taquarí field. The purchase price was 115,478 bags of soybeans, equivalent to BRL 11 million. On the closing date, the buyer made an initial payment of equivalent to BRL 1.8 million. The remaining balance will be paid in five annual installments. The result of the operation recognized in this period was BRL 8 million.

On October 8, 2021, BrasilAgro, informed that it has sold an area of 3,723 hectares (2,694 arable hectares) of Alto Taquarí Farm, rural property located in the municipality of Alto Taquarí – Mato Grosso state. The total amount of the sale is 1,100 soybean bags per arable hectare or BRL 589.0 million (~BRL 218,641/arable ha). The delivery of possession of the areas and, consequently, the recognition of sales revenue, will be carried out in two stages. In October 2021 with 2,566 hectares (1,537 arable ha), in the amount of approximately BRL 336.0 million and September 2024 with 1,157 arable ha, in the amount of approximately BRL 253.0 million. BrasilAgro will continue operating the areas until delivery it. The buyer made an initial payment of BRL 16.5 million. Later this year, there will be an additional payment of BRL 31.4 million and the remaining balance is indexed in soybean bags with annual payments and an average term of 3.9 years.

88

Considering this sale, we sell all the plateau areas of Alto Taquarí Farm, leaving 1,380 hectares (809 arable ha) in the portfolio. The remaining area is close to the areas already sold, but has different characteristics of soil and altitude and, even though it is not a plateau area, it is cultivated with sugarcane.

Chaparral

Chaparral is a 37,182-hectare farm, with 26,444 hectares of arable area. It is located in the municipal district of Correntina, State of Bahia. The farm was acquired in November 2007 for BRL 47.9 million. The farm is being transformed into a pasturing area, crop grains and cotton.

Nova Buriti

Located in the municipal district of Januária, State of Minas Gerais, Nova Buriti has a surface area of 24,212 hectares. Nova Buriti was acquired in December 2007 for BRL 21.6 million. It is located in the southeastern region of Brazil and it is close to the large iron industries. We are currently in the process of obtaining the necessary permits in order to begin operations. Due to the difficulties BrasilAgro has been facing in regard to obtaining licenses for the farm, they are studying alternatives for the property. One such option is to sell the farm to offset the legal reserve, a mechanism contemplated in the environmental code pursuant to which holders of a legal reserve deficit can acquire another area to solve certain issues.

Preferencia

Preferência is located in the municipal district of Barreiras, in the State of Bahia. It has a total surface area of 17,799, with 12,410 hectares of arable area. It was acquired for BRL 9.6 million in September 2008. The farm is being transformed into a pasturing area and will be later developed for agricultural purposes.

Sao José

Located in São Raimundo das Mangabeiras, in the state of Maranhão. With a total area of 17,566 hectares, with 10,137 hectares of arable area. It was acquired for a value of BRL 100 million in February 2017.

Arrojadinho

Located in Jaborandi, in the state of Bahia. With a total area of 16,642 hectares, of which 11,063 were used for agricultural activities and sugarcane. It was acquired in January 2020.

Rio do Meio

Located in Correntina, in the state of Bahia. With a total area of 7,715 hectares, of which 5,642 are used for agricultural activities. It was acquired in January 2020. During 2021 were transformed 1,200 hectare to cattle production.

On December 29, 2021, the Company entered into a Purchase and Sale Commitment Agreement for a total area of 4,573 hectares (2,859 usable hectares), for the amount of 250 bags of soybeans per useful hectare, equivalent to BRL 130 million. For more information see “Item 4. Information on the Company—A.History and Development of the Company—Significant acquisitions, dispositions and development of business—Agricultural business—Rio do Meio Farm”.

Serra Grande

Located in Baixa Grande do Ribeiro, in the state of Piauí. With a total area of 4,489 hectares, of which 2,904 are agricultural hectares. It was acquired in May 2020. This harvest season were development and started planting of grains.

Panamby

In September 2022, we acquired the Panamby farm, located in the municipality of Querência, in the State of Mato Grosso. The Panamby farm has an area of 10,844 hectares, 5,379 hectares of which are arable to be developed, suitable for the cultivation of grains and cotton. The acquisition price was approximately BRL 285.6 million (approximately BRL 53,100 per arable hectare). For more information see “Recent Developments—Cresud’s Recent Developments—Panamby Farm”.

89

Paraguay (through our subsidiary BrasilAgro)

Marangatú / Udra

We own, through BrasilAgro, the “Marangatú/UDRA” farms, located in Mariscal José Félix Estigarribia, Department of Boquerón, Paraguayan Chaco, Republic of Paraguay, totaling 59,585 hectares, with 34,053 hectares of arable area.

Bolivia (through our subsidiary BrasilAgro since fiscal year 2021)

In February 2021, the company sold 100% of the shares of its indirectly controlled subsidiaries, Agropecuaria Acres del Sud S.A., Ombu Agropecuaria S.A, Yatay Agropecuaria S.A. and Yuchan Agropecuaria S.A. owners of approximately 9,900 agricultural hectares in the core zone from Bolivia to BrasilAgro for the approximate sum of USD 31 million.

Las Londras

On January 22, 2009, the bill of purchase for “Las Londras” farm was cast into public deed; it has a surface area of 4,555 hectares, and is located in the Province of Guarayos, Republic of Bolivia. During the 2021/2022 crop season, it was used for agricultural production.

San Rafael

On November 19, 2008, the bill of purchase for “San Rafael” farm was cast into public deed. This farm is located in the Province of Guarayos, Republic of Bolivia, and has a surface area of 3,109 hectares, which were used for used for agricultural production during the 2021/2022 crop season.

La Primavera

On June 7, 2011, we acquired “La Primavera” farm, with a surface area of approximately 2,356 hectares. During the 2021/2022 season, this farm was used for agricultural production.

Land Management

In contrast to traditional Argentine farms, run by families, we centralize policy making in an Executive Committee that meets on a weekly basis in Buenos Aires. Individual farm management is delegated to farm managers who are responsible for farm operations. The Executive Committee lays down commercial and production rules based on sales, market expectations and risk allocation.

We rotate the use of our pasture lands between agricultural production and cattle feeding and the frequency depends on the location and characteristics of the farmland. The use of preservation techniques (including exploitation by no till sowing) frequently allows us to improve farm performance.

Subsequent to the acquisition of the properties, we make investments in technology in order to improve productivity and increase the value of the property. It may be the case that upon acquisition, a given extension of the property is under-utilized or the infrastructure may be in need of improvement. We have invested in traditional fencing and in electrical fencing, watering troughs for cattle herds, irrigation equipment and machinery, among other things.

90

Principal Markets

Crops

Our crop production is mostly sold in the domestic market. The prices of our crops are based on the market prices quoted in Argentine grains exchanges such as the Buenos Aires Grains Exchange (Bolsa de Cereales de Buenos Aires) and the cereal exchanges in each country, which take as reference the prices in international grains markets. The largest part of this production is sold to exporters who offer and ship this production to the international market. Prices are quoted in relation to the month of delivery and the port in which the product is to be delivered. Different conditions in price, such as terms of storage and shipment, are negotiated between the end buyer and ourselves.

Cattle

Our cattle production is sold in the local market. The main buyers are slaughterhouses and supermarkets.

Prices in the cattle market in Argentina are basically fixed by local supply and demand. The Liniers Market (on the outskirts of the Province of Buenos Aires) provides a standard in price formation for the rest of the domestic market. In this market live animals are sold by auction on a daily basis. At Liniers Market, prices are negotiated by kilogram of live weight and are mainly determined by local supply and demand. Prices tend to be lower than in industrialized countries. Some supermarkets and meat packers establish their prices by kilogram of processed meat; in these cases, the final price is influenced by processing yields.

Customers

For the fiscal year 2022, our sales from the agribusiness segment (excluding sales of farms) were made to approximately 30 customers. Sales to our ten largest customers represented approximately 55% to 60% of our net sales. Some of these customers included Cargill, FASA, Bunge Alimentos S.A., ACA, GLENCORE and QUILMES. We have signed non-binding letters of intent with some of our largest customers that allow us to estimate the volume of the demand for certain products and to plan production accordingly. We generally enter into short-term agreements with a term of less than a year.

Marketing Channels and Sales Methods

Crops

We normally work with grains brokers and other intermediaries to trade in the exchanges. We sell part of our production in advance through futures contracts and buy and sell options to hedge against a drop in prices. Approximately 87% of the futures and options contracts are closed through the Buenos Aires Grains Exchange and 13% in the Chicago Board of Trade for hedging purposes.

Our storage capabilities allow us to condition and store crops with no third-party involvement and thus to capitalize the fluctuations in the price of commodities. In addition, we store crops in silo bags. On the other hand, in Brazil we have a total storage capacity of approximately 52,000 tons.

Cattle

We have several marketing channels. We sell directly to local meat processors and supermarkets, as well as in markets and auctions. Our customers include Minerva Foods, Frigorífico La Anonima, Arre Beef S.A., Sáenz Valiente Bullrich, and Colombo y Magliano S.A.

We are usually responsible for the costs of the freight to the market and, in general, we pay commissions on our transactions.

91

Inputs

The current direct cost of our production of crops varies in relation to each crop and normally includes the following costs: tillage, seeds, agrochemicals and fertilizers. We buy in bulk and store seeds, agrochemicals and fertilizers to benefit from discounts offered during off-season sales.

Competition

The agricultural and livestock sector is highly competitive, with a huge number of producers. We are one of the leading producers in Argentina and the region. However, if we compare the percentage of our production to the country’s total figures, our production would appear as extremely low, since the agricultural market is highly atomized. Our leading position improves our bargaining power with suppliers and customers. In general, we obtain discounts in the region in the acquisition of raw materials and an excess price in our sales.

Historically, there have been few companies competing for the acquisition and leases of farmlands for the purpose of benefiting from land appreciation and optimization of yields in the different commercial activities. However, we anticipate the possibility that new companies, some of them international, may become active players in the acquisition of farmlands and the leases of sown land, which would add players to the market in coming years.

Seasonality

As is the case with any company in the agro-industrial sector, our business activities are inherently seasonal. Harvest and sales of crops (corn, soybean and sunflower) in general take place from February to June. Wheat is harvested from December to January. With respect to our international market, in Bolivia climate conditions allow a double season of soybean, corn and sorghum production and, accordingly, these crops are harvested in April and October, while wheat and sunflower are harvested during August and September, respectively. Other segments of our activities, such as our sales of cattle and our forestry activities tend to be more of a successive character than of a seasonal character. However, the production of beef is generally higher during the second quarter, when pasture conditions are more favorable. In consequence, there may be significant variations in results from one quarter to the other.

Urban Properties and Investments Business (through our subsidiary IRSA)

As of June 30, 2022, our investment in IRSA’s common shares amounts to 53.6%.

The following information corresponds to data of the segments extracted from our subsidiary IRSA’s Annual Report and Financial Statements as of June 30, 2022.

Overview

Shopping Malls

As of June 30, 2022, IRSA owned a majority interest in, and operated a portfolio of, 15 shopping malls in Argentina, six of which are located in the City of Buenos Aires (Abasto, Alcorta Shopping, Alto Palermo Shopping, Patio Bullrich, Dot Baires Shopping and Distrito Arcos), two are located in the greater Buenos Aires area (Alto Avellaneda and Soleil Premium Outlet), and the rest are located in different provinces of Argentina (Alto Noa in the City of Salta, Alto Rosario in the City of Rosario, Mendoza Plaza in the City of Mendoza, Córdoba Shopping Villa Cabrera and Patio Olmos (operated by a third party) in the City of Córdoba, La Ribera Shopping in Santa Fe (through a joint venture) and Alto Comahue in the City of Neuquén).

IRSA portfolio’s leasable area totaled 335,666 sqm of GLA. Real tenants’ sales of our shopping centers reached ARS 254,631 million in the fiscal year 2022, 105.2% higher than in 2021 and 9.5% higher than in 2019, not affected by the pandemic. Sales for the fourth quarter of fiscal year 2022 were ARS 71,292 million, exceeding sales for the same period of 2021 and 2019 by 180.9% and 23.7%, respectively. The tenants’ sales of our shopping centers are relevant to our income and profitability because they are one of the factors that determine the amount of rent that we can collect from them. They also affect the overall occupancy costs of tenants as a percentage of their sales.

92

The following table shows certain information about IRSA’s shopping malls as of June 30, 2022:

Shopping malls	Date of acquisition/ development	Location	GLA(1)		Number of stores		Occupancy rate (2)		Our ownership interest (3)		Rental revenue
			(sqm)				(%)		(%)		(in millions of ARS)
Alto Palermo	Dec‑97	City of Buenos Aires		20,507		142		98.0		100.0		2,765
Abasto Shopping(4)	Nov‑99	City of Buenos Aires		37,162		159		98.9		100.0		2,285
Alto Avellaneda	Dec‑97	Buenos Aires Province		39,944		123		81.4		100.0		1,557
Alcorta Shopping	Jun‑97	City of Buenos Aires		15,812		110		99.7		100.0		1,697
Patio Bullrich	Oct‑98	City of Buenos Aires		11,664		90		92.4		100.0		768
Dot Baires Shopping	May‑09	City of Buenos Aires		47,296		163		83.5		80.0		1,445
Soleil Premium Outlet	Jul‑10	Buenos Aires Province		15,734		74		100.0		100.0		853
Distrito Arcos	Dec‑14	City of Buenos Aires		14,457		64		100.0		90.0		1,301
Alto Noa Shopping	Mar‑95	Salta		19,388		84		96.7		100.0		577
Alto Rosario Shopping	Nov‑04	Santa Fe		33,957		135		96.3		100.0		2,049
Mendoza Plaza Shopping	Dec‑94	Mendoza		42,149		127		91.1		100.0		846
Córdoba Shopping	Dec‑06	Córdoba		15,368		100		100.0		100.0		614
La Ribera Shopping	Aug‑11	Santa Fe		10,531		69		97.1		50.0		139
Alto Comahue	Mar‑15	Neuquén		11,697		89		97.4		99.95		421
Patio Olmos(5)	Sep‑07	Córdoba				—						—
Total				335,666		1,529		93.1				17,317

_________________

(1)	Corresponds to gross leasable area (GLA) at each property. Excludes common areas and parking spaces.
(2)	Calculated dividing occupied square meters by leasable area as of the last day of the fiscal year.
(3)	IRSA’s effective interest in each of its business units.
(4)	Excludes Museo de los Niños which represents 3,732 square meters in Abasto
(5)	Does not include the rental revenues of Patio Olmos. IRSA owns the historic building where the Patio Olmos shopping mall is located in the province of Cordoba. The property is managed by a third party.

Tenant retail sales

During fiscal year 2022, the sales of IRSA’s shopping malls tenants reached ARS 254,631 million, increasing by 105.2% compared to the previous fiscal year and 47.8% compared to fiscal year 2020.

Tenants’ sales of shopping malls located in the City of Buenos Aires and Greater Buenos Aires increased a 145.3% compared to previous fiscal year, from ARS 71,066 million to ARS 174,303 million during fiscal year 2022, while those in the interior of the country increased a 51.5% compared to previous fiscal year, from ARS 53,015 million to ARS 80,328 million during the fiscal year 2022.

93

The following table sets forth the total retail sales of IRSA’s shopping mall tenants for the fiscal years indicated:

	For the fiscal years ended June 30, (1)
	2022		2021		2020		2019
	(in millions of ARS)
Alto Palermo		31,929		11,970		21,026		28,534
Abasto Shopping		32,619		10,420		21,382		30,262
Alto Avellaneda		22,876		8,671		18,892		27,141
Alcorta Shopping		21,824		9,094		12,536		16,097
Patio Bullrich		11,558		5,856		8,527		10,574
Buenos Aires Design (2)		—		—		—		1,384
Dot Baires Shopping		20,250		7,979		16,795		23,192
Soleil Premium Outlet		14,470		7,005		8,726		12,453
Distrito Arcos		18,777		10,188		9,854		11,456
Alto Noa Shopping		11,534		8,540		8,512		10,275
Alto Rosario Shopping		30,189		18,189		17,797		22,872
Mendoza Plaza Shopping		17,125		14,762		13,889		18,232
Córdoba Shopping Villa Cabrera		9,622		6,058		5,482		7,461
La Ribera Shopping (3)		4,588		2,243		3,632		5,338
Alto Comahue		7,270		3,316		5,202		7,330
Total		254,631		124,291		172,252		232,601

_________________

(1)	Retail sales based upon information provided to us by retailers and prior owners. The amounts shown reflect 100% of the retail sales of each shopping mall, although in certain cases we own less than 100% of such shopping malls. Includes sales from stands and excludes spaces used for special exhibitions.
(2)	End of concession term was December 5, 2018.
(3)	Owned by Nuevo Puerto Santa Fé S.A., in which we are a joint venture partner.

Total sales by type of business

The following table sets forth the retail sales of IRSA’s shopping mall tenants by type of business for the fiscal years indicated:

	For the fiscal years ended June 30, (1)
	2022		2021		2020		2019
	(in millions of ARS)
Department Store		—		3,016		9,173		12,589
Clothes and footwear		152,320		71,208		94,247		129,248
Entertainment		6,078		922		5,290		7,797
Home and decoration		6,890		3,727		3,519		5,165
Home Appliances		22,871		9,467		19,402		26,052
Restaurants		24,080		19,842		24,556		29,158
Miscellaneous		38,290		2,094		2,058		2,776
Services		4,102		14,016		14,006		19,816
Total		254,631		124,291		172,252		232,601

_________________

(1) Includes sales from stands and excludes spaces used for special exhibitions.

94

Occupancy rate

The following table sets forth the occupancy rate of IRSA’s shopping malls expressed as a percentage of gross leasable area of each shopping mall for the fiscal years indicated:

	As of June 30,
	2022		2021		2020		2019
	(%)
Alto Palermo		98.0		98.4		91.9		99.1
Abasto Shopping		98.9		99.7		94.9		98.7
Alto Avellaneda		81.4		64.8		97.4		98.6
Alcorta Shopping		99.7		90.6		97.3		97.9
Patio Bullrich		92.4		87.8		91.4		93.5
Dot Baires Shopping		83.5		80.7		74.6		74.5
Soleil Premium Outlet		100.0		90.3		97.1		99.0
Distrito Arcos		100.0		100.0		93.8		99.4
Alto Noa Shopping		96.7		98.1		99.0		99.5
Alto Rosario Shopping		96.3		95.4		97.2		99.6
Mendoza Plaza Shopping		91.1		97.3		97.8		97.3
Córdoba Shopping Villa Cabrera		100.0		91.4		95.4		99.3
La Ribera Shopping		97.1		96.2		99.0		94.6
Alto Comahue		97.4		92.4		96.2		96.2
Total		93.1		89.9		93.2		94.7

Rental price

The following table shows the annual average rental price per square meter of IRSA’s shopping malls for the fiscal years indicated:

	For the fiscal years ended June 30, (1)
	2022		2021		2020		2019
	(in ARS)
Alto Palermo		101,819		43,388		87,524		127,239
Abasto Shopping		50,562		16,984		39,836		62,031
Alto Avellaneda		33,021		11,828		28,517		47,627
Alcorta Shopping		86,770		38,172		56,069		75,324
Patio Bullrich		49,811		21,128		43,972		57,720
Dot Baires Shopping		24,378		7,612		22,108		32,780
Soleil Premium Outlet		46,651		21,351		31,285		48,680
Distrito Arcos		72,560		41,952		61,716		89,526
Alto Noa Shopping		26,718		17,449		20,057		26,775
Alto Rosario Shopping		52,773		28,905		29,605		40,463
Mendoza Plaza Shopping		17,533		12,331		13,620		19,416
Córdoba Shopping Villa Cabrera		36,049		21,083		22,310		32,191
La Ribera Shopping		11,680		3,581		11,141		16,784
Alto Comahue		32,487		8,384		75,452		72,825

_________________

(1) Corresponds to consolidated annual accumulated rental prices according to the IFRS divided by gross leasable square meters. Does not include revenue from Patio Olmos.

Revenues from the Shopping Malls segment

When analyzing the composition of the income of the shopping malls segment between 2022 and 2021, we can observe a recovery in the contingent rent, which is the one that depends on our tenants’ sales, which in 2022 represented about 48% of the income of the segment. Also, Base Rent represented approximately 34% of the segment’s income.

95

The following table sets forth IRSA’s revenue from cumulative leases by revenue category for the fiscal years presented:

	For the fiscal year ended June 30,
	2022		2021			2020			2019
	(in millions of ARS)
Base rent		5,903		4,036			7,704			11,774
Percentage rent		8,376		2,366			3,623			4,383
Total rent		14,279		6,402			11,327			16,157
Non-traditional advertising		398		180			453			548
Revenue from admission rights		1,403		1,292			2,224			2,587
Fees		209		221			259			292
Parking		576		61			729			1,164
Commissions		411		295			382			789
Other		41		294			52			532
Subtotal (1)		17,317		8,745			15,426			22,069
Patio Olmos		17		15			17			25
Adjustments and eliminations (2)		—		(33	)		(828	)		(1,057	)
Total		17,334		8,727			14,615			21,037

_________________

(1)	Does not include Patio Olmos.
(2)	Includes indirect incomes and eliminations between segments. In 2019, revenue from Buenos Aires Design is included. End of concession December 5, 2018.

Rental revenue

The following table sets forth total rental income for each of IRSA’s shopping malls for the fiscal years indicated:

	For the fiscal years ended June 30, (1)
	2022		2021			2020			2019 (2)
	(in millions of ARS)
Alto Palermo		2,765		1,294			2,455			3,468
Abasto Shopping		2,285		929			2,106			3,233
Alto Avellaneda		1,557		757			1,478			2,321
Alcorta Shopping		1,697		791			1,309			1,706
Patio Bullrich		768		347			757			993
Dot Baires Shopping		1,445		731			1,608			2,736
Soleil Premium Outlet		853		407			610			905
Distrito Arcos		1,301		681			1,130			1,556
Alto Noa Shopping		577		395			455			609
Alto Rosario Shopping		2,049		1,205			1,280			1,681
Mendoza Plaza Shopping		846		632			728			1,008
Córdoba Shopping Villa Cabrera		614		386			436			607
La Ribera Shopping(3)		139		52			145			215
Alto Comahue		421		138			929			1,031
Subtotal		17,317		8,745			15,426			22,069
Patio Olmos(4)		17		15			17			25
Reconciliation adjustments(5)		—		(33	)		(828	)		(1,057	)
Total		17,334		8,727			14,615			21,037

_________________

(1)	Includes base rent, percentage rent, admission rights, fees, parking, commissions, revenue from non-traditional advertising and others. Does not include Patio Olmos.
(2)	As comparative effect Revenue from Buenos Aires Design are not included. End of concession December 5, 2018.
(3)	Through our joint venture Nuevo Puerto Santa Fé S.A.
(4)	IRSA owns the historic building where the Patio Olmos shopping mall is located in the province of Cordoba. The property is managed by a third party.
(5)	Includes indirect incomes and eliminations between segments. In 2019, revenue from Buenos Aires Design is included. End of concession December 5, 2018.

96

Lease expirations ⁽¹⁾

The following table sets forth the schedule of estimated lease expirations for IRSA’s shopping malls for leases in effect as of June 30, 2022, assuming that none of our tenants exercises its option to renew or terminate its lease prior to expiration:

	As of June 30, 2022
Agreements’ Expiration	Number of agreements (1)		Square meters to expire		Due to expire		Total lease payments  (2)		Agreements
					(%)		(in millions of ARS)		(%)
Vacant Stores		41		23,283		0.0				0
Expired in-force		80		23,458		7.5		221		3.3
As of June 30, 2023		425		63,008		20.2		1,507		22.4
As of June 30, 2024		315		66,848		21.4		1,053		15.6
As of June 30, 2025		381		56,502		18.1		1,755		26.1
As of June 30, 2026 and subsequent years		287		102,567		32.8		2,195		32.6
Total (3)		1,488		312,383		100		6,731		100

_________________

(1)	Includes vacant stores as of June 30, 2022. A lease may be associated with one or more stores.
(2)	The amount expresses the annual base rent as of June 30, 2022 of agreements due to expire.
(3)	Does not include unoccupied stores.

New leases and renewals

The following table shows certain information about IRSA’s leases agreement as of June 30, 2022:

							Average annual base rent per sqm
Type of business	Number of agreements renewed		Annual base rent		Annual admission rights		New and renewed		Former agreements		Number of non‑renewed agreements (1)		Annual base rent amount per sqm Non‑renewed agreements (1)
			(in millions of ARS)				(ARS/sqm)						(in millions of ARS)
Clothing and footwear		549		2,121		444		29,630		13,461		273		26,020
Miscellaneous (2)		137		441		92		28,876		14,249		124		32,294
Restaurant		135		417		52		34,615		14,731		97		26,314
Services		21		52		3		11,618		3,702		40		10,796
Home appliances		44		200		17		18,293		8,953		13		17,524
Home and decoration		28		117		17		23,475		5,449		31		13,960
Supermarket		1		8		0		2,727		1,948		1		2,567
Entertainment		22		146		2		3,082		604		13		2,717
Total		937		3,502		628		20,622		9,037		592		19,289

_________________

(1)	Includes vacant stores as of June 30, 2022. Gross leasable area with respect to such vacant stores is included under the type of business of the last tenant to occupy such stores.
(2)	Miscellaneous includes anchor store.

Five largest tenants of the portfolio

The five largest tenants in our portfolio (in terms of sales) account for approximately 9.4% of IRSA’s gross leasable area as of June 30, 2022 and represent 13.4% of the annual basic rent for the fiscal year ending on that date.

97

The following table describes our portfolio’s five largest tenants:

Tenant	Type of Business	Sales		Gross Leasable Area
		(%)		(sqm)		(%)
Zara	Clothes and footwear		6.7		10,771		3.2
Nike	Clothes and footwear		4.7		8,105		2.4
Fravega	Home appliances		3.5		3,378		1.0
McDonald’s	Restaurant		2.1		4,550		1.4
Adidas	Clothes and footwear		1.9		4,581		1.4
Total			18.9		31,386		9.4

Principal Terms of our Leases

Under the Civil and Commercial Code of Argentina, the term of the leases cannot exceed twenty years for residential leases and fifty years for the other leases.

Leasable space in IRSA’s shopping malls is marketed through an exclusive arrangement with our wholly owned subsidiary and real estate broker Fibesa S.A., or “Fibesa.” IRSA use a standard lease agreement for most tenants at our shopping malls, the terms and conditions of which are described below. However, our largest or “anchor” tenants generally negotiate better terms for their respective leases. No assurance can be given that lease terms will be as set forth in the standard lease agreement.

Rent amount specified in IRSA’s leases generally is the higher of (i) a monthly Base Rent and (ii) a specified percentage of the tenant’s monthly gross sales in the store, which percentage generally ranges between 3% and 12% of tenant’s gross sales. Additionally, under the rent adjustment clause included in most of its rental contracts, the tenant’s basic rent is generally updated monthly or quarterly and cumulatively by the CPI index. These terms and conditions have not been applied during a period when the shopping malls remained closed due to the Social, Preventive and Mandatory Isolation decreed by the government of Argentina as a result of the novel COVID-19 virus since IRSA decided to defer the billing and collection of the Base Rent until September 30, 2020, with some exceptions and IRSA also suspended collection of the collective promotion fund during the same period, prioritizing the long-term relationship with its tenants.

In addition to rent, IRSA charge most of its tenants an admission right, which must be paid upon execution of the lease agreement and upon its renewal. The admission right is normally paid as a lump sum or in a small number of monthly installments. If the tenants pay this fee in installments, the tenants are responsible for paying the balance of any such unpaid amount if they terminate the lease prior to its expiration. In the event of unilateral termination and/or resolution for breach by the tenants, tenants will not be refunded their admission payment without our consent. IRSA lease our stores, kiosks and spaces in its shopping malls through our wholly-owned subsidiary Fibesa. IRSA charge its tenants a fee for the brokerage services, which usually amounts to approximately three months of the Base Rent plus the admission right.

IRSA is responsible, except in the mall Distrito Arcos, for providing each unit within its shopping malls with electricity, a main telephone switchboard, central air conditioning and a connection to a general fire detection system. IRSA also provide the food court tenants with sanitation and with gas systems connections. In Distrito Arcos, the connections are managed by the tenants. Each tenant is responsible for completing all necessary installations within its rental unit, in addition to paying direct related expenses, including electricity, water, gas, telephone and air conditioning. Tenants must also pay for a percentage of total expenses and general taxes related to common areas. IRSA determine this percentage based on different factors. The common area expenses include, among others, administration, security, operations, maintenance, cleaning and taxes.

IRSA carries out promotional and marketing activities to draw consumer traffic to its shopping malls. These activities are paid for with the tenants’ contributions to the Collective Promotion Fund, or “CPF,” which is administered by us. Tenants are required to contribute 15% of their rent (Base Rent plus Percentage Rent) to the CPF. IRSA may increase the percentage tenants must contribute to the CPF with up to 25% of the original amount set forth in the corresponding lease agreement for the contributions to the CPF. IRSA may also require tenants to make extraordinary contributions to the CPF to fund special promotional and marketing campaigns or to cover the costs of special promotional events that benefit all tenants. IRSA may require tenants to make these extraordinary contributions up to four times a year provided that each extraordinary contribution may not exceed 25% of the tenant’s preceding monthly lease payment.

98

Each tenant leases its rental unit as a shell without any fixtures and is responsible for the interior design of its rental unit. Any modifications and additions to the rental units must be pre-approved by IRSA. IRSA has the option to charge the tenant for all costs incurred in remodeling the rental units and for removing any additions made to the rental unit when the lease expires. Furthermore, tenants are responsible for obtaining adequate insurance for their rental units, which must cover, among other things, damage caused by fire, glass breakage, theft, flood, civil liability and workers’ compensation.

Control Systems

IRSA has computer systems equipped to monitor tenants’ sales in all of its shopping malls. IRSA also conducts revenue audits of our tenants’ accounting sales records in all of our shopping malls. IRSA uses the information generated from the computer monitoring system to prepare statistical data regarding, among other things, total sales, average sales and peak sale hours for marketing purposes and as a reference for the revenue audit. Most of its shopping mall lease agreements require the tenant to have its point of sale system linked to our server.

Competition

IRSA is the largest owner and operator of shopping malls, offices and other commercial properties in Argentina in terms of gross leasable area and number of rental properties. Given that most of our shopping malls are located in highly populated areas, there are competing shopping malls within, or in close proximity to, areas targeted by our real estate portfolio, as well as stores located on avenues or streets. The number of shopping malls in a particular area could have a material effect on the ability to lease space in shopping malls and on the amount of rent that we are able to charge. We believe that due to the limited availability of large plots of land and zoning restrictions in the City of Buenos Aires, it is difficult for other companies to compete in areas through the development of new shopping malls. The principal competitor is Cencosud S.A. which owns and operates Unicenter Shopping and the Jumbo hypermarket chain, among others.

The following table shows certain information concerning the most significant owners and operators of shopping malls in Argentina, as of June 30, 2022:

Entity	Shopping malls	Location	GLA		Market share (1)
					(%)
IRSA	Alto Palermo	City of Buenos Aires		20,507		1.76
	Abasto Shopping (2)	City of Buenos Aires		37,162		3.18
	Alto Avellaneda	Province of Buenos Aires		39,944		3.42
	Alcorta Shopping	City of Buenos Aires		15,812		1.35
	Patio Bullrich	City of Buenos Aires		11,664		1.00
	Dot Baires Shopping (3)	City of Buenos Aires		47,296		4.05
	Soleil	Province of Buenos Aires		15,734		1.35
	Distrito Arcos	City of Buenos Aires		14,457		1.24
	Alto Noa	City of Salta		19,388		1.66
	Alto Rosario	City of Rosario		33,957		2.91
	Mendoza Plaza	City of Mendoza		42,149		3.61
	Córdoba Shopping	City of Córdoba		15,368		1.32
	La Ribera Shopping (4)	City of Santa Fe		10,531		0.90
	Alto Comahue	City of Neuquén		11,697		1.00
Subtotal				335,666		28.74
Cencosud S.A.				277,203		23.74
Other operators				555,039		47.52
Total				1,167,908		100

(1)	Corresponding to gross leasable area in respect of total gross leasable area. Market share is calculated dividing sqm over total sqm.
(2)	Does not include Museo de los Niños (3,732 square meters in Abasto).
(3)	IRSA’s interest in PAMSA is 80%.
(4)	Owned by Nuevo Puerto Santa Fé S.A., in which we are a joint venture partner.

Source: INDEC.

99

Seasonality

IRSA business is directly affected by seasonality, influencing the level of our tenants’ sales. During Argentine summer holidays (January and February) its tenants’ sales typically reach their lowest level, whereas during winter holidays (July) and in Christmas (December) they reach their maximum level. Clothing retailers generally change their collections in spring and autumn, positively affecting our shopping malls’ sales. Discount sales at the end of each season are also one of the main seasonal factors affecting our business.

Information technology

IRSA keep investing in technological innovation. The advances of society and changes in consumer habits constantly challenge us and motivate us to apply the latest technological trends to serve the visitor’s experience in the shopping malls and learn more about our clients. IRSA continued with the company digital transformation, extending the use of cloud based purchases and auctions platform for cost optimization, Robotic Process Automation or RPA automation in different areas. IRSA also migrated its datacenter, aiming maximum system availability and signed a new lease to renew CCTV cameras, to improve security and enabling future capabilities, such as artificial intelligence of things (AIoT). 

This year IRSA continued the development of APPA, the application that facilitates the experience of consumers in shopping malls, through which you can pay for parking, reserve shifts, enter virtual lines, obtain discounts, benefits and participate in promotions, and prepares to launch payments and gift vouchers. During the year, users of ¡appa! carried out more than 900,000 transactions on the platform, including consumption in shopping malls, use of parking spaces, and redemption of Corporate benefits.

Offices

Management of office buildings

IRSA generally act as the manager of the office properties. IRSA typically owns the entire building or a substantial number of floors in the building. The buildings in which IRSA owns floors are generally managed pursuant to the terms of a condominium agreement that typically provides for control by a simple majority of the interests based on owned area. As building manager, IRSA handles services such as security, maintenance and housekeeping, which are generally outsourced. The cost of the services is passed through to, and paid for by, the tenants, except in the case of our units that have not been leased, if any, for which we bear the cost. IRSA market its leasable area through commissioned brokers or directly.

Leases

IRSA usually lease its offices by using contracts with an average term between three to ten years. Contracts for the rental of office buildings and other commercial properties are generally stated in U.S. dollars. Rental rates for renewed periods are negotiated at market value.

100

Properties

The following table sets forth certain information regarding IRSA’s office buildings, as of June 30, 2022:

	Date of acquisition/ development	GLA(1)		Occupancy rate (2)		IRSA’s ownership interest		Total rental income for the fiscal year ended June 30, 2022(4)
		(sqm)		(%)		(%)		(in million of ARS)
Offices
AAA & A buildings
República Building(6)	Dec 14		—		—		—		446.3
Bankboston Tower(6)	Dec 14		—		—		—		1.7
Intercontinental Plaza(3)	Dec 14		2,979		100.0		100		146.6
Dot Building	Nov 06		11,242		92.6		80		324.9
Zetta(5)	May-19		32,173		92.2		80	1.204.8
200 Della Paolera (7)	Dec-20		18,016		67.1		100		730.4
Total AAA & A buildings			64,410		85.5				2,854.7
B buildings
Philips	Jun 17		8,017		81.4		100		175.2
Suipacha 652/64	Dec 14		11,465		—		100		11.2
Total B buildings			19,482		33.5		100		186.4
Total Offices			83,892		73.3				3,041.1

___________________

(1)	Corresponds to the total leasable surface area of each property as of June 30, 2022. Excludes common areas and parking spaces.
(2)	Calculated by dividing occupied square meters by total gross leasable area of the relevant property as of June 30, 2022.
(3)	IRSA owns 13.2% of the building which covers an area of 22,535 square meters of gross leasable area, meaning IRSA owns 2,979 square meters of gross leasable area.
(4)	Corresponds to the accumulated income of the period.
(5)	Excludes 815 square meters from the occupancy calculation because they are under construction for the development of “Flex Offices” project.
(6)	The office buildings were sold during the fiscal year.
(7)	IRSA owns 51.4% of the building that has 35,000 square meters of gross leasable area, meaning we own 18,016 square meters of gross leasable area. As a subsequent event, on August 17, 2022, IRSA sold and transferred one floor of the tower “200 Della Paolera” for a total leasable area of approximately 1,184 sqm and 8 parking lots located in the building. For more information see “IRSA’s Recent Developments – 200 Della Paolera tower floor sale”.

Occupancy rate

The following table shows IRSA’s offices occupancy percentage as of the end of fiscal years ended June 30:

	Occupancy rate(1)
	As of June 30,
	2022		2021		2020		2019
	(%)
Offices:
República Building (2)		—		66.9		86.9		95.2
Bankboston Tower (2)		—		—		96.4		93.5
Intercontinental Plaza		100.0		100.0		100.0		100.0
Bouchard 710 (2)		—		—		92.5		100.0
DOT Building		92.6		84.9		84.9		100.0
Zetta Building (3)		92.2		84.7		97.5		97.5
200 Della Paolera		67.1		80.2		—		—
Philips Building		81.4		93.1		82.7		45.7
Suipacha 652/64		—		17.3		31.2		44.6
Total		73.3		74.7		86.1		88.3

____________________

(1)	Leased square meters pursuant to lease agreements in effect as of the end of fiscal year over gross leasable area of offices for the same fiscal year.
(2)	The office buildings were sold during the fiscal year.
(3)	Excludes 815 sqm from the occupancy calculation because they are under construction for the development of “Flex Offices” project.

101

Annual average income per surface area as of June 30, 2022, 2021, 2020 and 2019 (1):

	Income per square meter (1)
	As of June 30,
	2022		2021		2020		2019
	(ARS/sqm)
República Building (2)		—		62,441		61,754		57,791
Bankboston Tower (2)		—		—		55,718		59,289
Intercontinental Plaza		49,196		77,992		33,420		37,929
Bouchard 710 (2)		—		—		65,945		60,343
DOT Building		31,207		47,642		59,997		49,244
Zetta Building		41,685		54,574		59,745		39,223
200 Della Paolera (3)		60,394		36,734		—		—
Philips Building		26,834		30,598		27,554		63,526
Suipacha 652/64		—		47,020		26,860		54,997

__________________

(1)	Calculated by dividing annual rental income by the gross leasable area of offices based on our interest in each building as of June 30 for each fiscal period.
(2)	The office buildings were sold during the fiscal year.
(3)	The building became operational in December 2020, due to which the contracts and related revenues are not comparable to previous years.

New agreements and renewals

The following table sets forth certain Information on lease agreements as of June 30, 2022:

Property	Number of lease agreement (1) (5)		Annual rental price (2)		Rental income per sqm (new and renewed) (3)		Previous rental income per sqm (3)		Number of non‑ renewed leases		Non‑ renewed leases annual base rent amount (4)
			(in millions of ARS)		(ARS)		(ARS)				(in millions of ARS)
Dot Building		5		135		1,720		2,581		1		38
Philips Building		1		7		1,126		2,763		1		20
Intercontinental Plaza		3		90		2,532		3,011		—		—
200 Della Paolera (6)		4		128		2,982		546		4		162
Zetta Building		1		74		2,208		2,509		1		72
Total (7)		14		434		2,208		2,208		7		292

__________________

(1)	Includes new and renewed leases executed in fiscal 2022.
(2)	Leases in U.S. dollars converted to Pesos at the exchange rate prevailing on the first month of the agreement, multiplied by 12 months.
(3)	Monthly value.
(4)	Leases in U.S. dollars converted to Pesos at the exchange rate prevailing on the last month of the agreement, multiplied by 12 months.
(5)	It does not include leases over parking spaces, antennas or terrace area.
(6)	The building became operational in December 2020, due to which the contracts and related revenues are not comparable to previous years.
(7)	Weighted average for total rental income per sqm (new and renewed) and previous rental income per sqm.

102

The following table sets forth the schedule of estimated lease expirations for IRSA’s offices and other properties for leases in effect as of June 30, 2022. This data is presented assuming that none of IRSA’s tenants exercises its option to renew or terminate its lease prior to expiration (most leases have renewal clauses):

Expiration year	Number of leases due to expire (1)		Square meters of leases due to expire		Square meter of leases due to expire			Annual rental income amount of leases due to expire		Annual rental income amount of leases to expire
			(sqm)		(%)			(in millions of ARS)		(%)
As of June 30, 2022		—		—		—			—		—
As of June 30, 2023		5		5,922		10	%		213		10	%
As of June 30, 2024		15		34,151		56	%		1,295		61	%
As of June 30, 2025 and thereafter		25		20,842		34	%		600		28	%
Total		45		60,915		100	%		2,109		100	%

__________________

(1)	Includes offices with leases that have not been renewed as of June 30, 2022.
(2)	It does not include square meters or revenue from parking spaces, terraces or antennas.

Intercontinental Plaza, City of Buenos Aires

Intercontinental Plaza is a modern 24-story building located next to the Intercontinental Hotel in the historic neighborhood of Monserrat in downtown City of Buenos Aires. IRSA owns a 13.2% interest in the building which has footage averaging 22,535 square meters of gross leasable area; meaning IRSA owns 2,979 square meters of gross leasable area in this building. The principal tenant currently is Total Austral, and as an added value Banco Supervielle (Bank Branch) and Starbucks Coffee providing different services to the building.

Dot Building, City of Buenos Aires

IRSA’s subsidiary Panamerican Mall S.A. developed an office building of 11,242 square meters of gross leasable area next to Dot Baires Shopping. This building was inaugurated in July 2010, which meant IRSA’s arrival at the growing corridor of the Northern Area with respect to offices for rent. The building’s principal tenants include Farmanet, Astrazeneca S.A., G.E. Healthcare and HP, among others.

Zetta Building

IRSA’s subsidiary Panamerican Mall S.A. built an office building of 32,173 square meters of gross leasable area and 11 floors located in the commercial complex “Polo Dot” in Buenos Aires City. This new A+, and potentially LEED, building was inaugurated in May 2019, continuing to consolidate IRSA’s position in the North Zone corridor of offices for rent. As of June 30, 2022, the building was occupied approximately 91% by Mercado Libre. IRSA is currently developing its first Flex office space in one of the vacant 815 sqm sectors (Ground Floor Office “B”). The project offers private offices, fully equipped, furnished and fully operational, ready to use.

200 Della Paolera Building

200 Della Paolera is a 126-meters high triangular-shaped tower of AAA offices and 55,000 square meters of surface, plus 70 linear meters of Curtain Wall on the Río de la Plata, developed on the last vacant land plot of Catalinas Norte, one of the most premium corporate areas of Argentina. The building has 35,000 square meters of GLA, 318 parking spaces, changing rooms, security, gastronomy services and has become an icon of the city, built sustainability in mind and high quality design. The commercialization process is moving forward with encouraging occupancy from premium tenants such as Globant, Merryl Lynch, Fiserv, La Brioche Dorée and us together with Cresud S.A.C.I. F. y A. (“CRESUD”) as owners and tenants.

Suipacha 652/64, City of Buenos Aires

Suipacha 652/64 is a 7-story office building located in the office district of the City of Buenos Aires. We own the entire building and 62 parking spaces. The building has unusually large floors, most measuring 1,580 square meters. The average footage of the building is 11,465 square meters of gross leasable area.

103

Phillips Building, City of Buenos Aires

The historic Philips Building adjoins Dot Baires shopping mall, and faces Avenida General Paz, in the City of Buenos Aires. It has 4 office floors, a total GLA of approximately 8,017 sqm, and a remaining construction capacity of approximately 20,000 sqm. IRSA is owner of 100% of the building. It is currently one of the assets with the highest occupancy, with companies such as Philips, Salentein and a Maternity Garden, which opening generates a differential service to the Polo Dot.

Competition

Virtually all IRSA office’s properties and other commercial properties other than shopping malls are in developed urban areas. There is a great number of office buildings, shopping malls, retail stores and residential houses in the zones where IRSA’s properties are located. It is a highly fragmented market and the abundant number of comparable properties in the vicinities may have an adverse impact on the ability to lease or sell office space and other properties and may have an adverse impact on the sale and rental price of properties.

In the future, both domestic and foreign companies are likely to participate in the real estate market in Argentina, hence competing with us when it comes to business opportunities. In addition, in the future IRSA may participate in the development of a market for foreign real property, and we are likely to find well-established competitors.

In the premium office segment, IRSA competes with other relevant market players, such as RAGHSA, who together with IRSA represent the 2 most important players.

Hotels

The hotel activity, one of the most affected by the pandemic, showed a good performance during this recovery exercise, mainly motivated by the boom in domestic tourism. The Llao Llao hotel, which the company owns in the city of Bariloche, in southern Argentina, reached record occupancy levels and is an interesting attraction for high-income international and local tourism. Hotels in Buenos Aires, including the Libertador and Intercontinental, are expected to have a greater influx of international tourism and the full recovery of corporate event and convention activity to reach pre-pandemic revenue levels.

During fiscal year 2022, IRSA kept its 76.34% interest in Intercontinental hotel, 100% interest in Libertador hotel and 50.00% interest in Llao Llao.

The following chart shows certain information regarding IRSA’s luxury hotels:

Hotels	Date of Acquisition	IRSA’s Interest		Number of rooms		Occupancy (1)		Average Price per Room(2)		Fiscal Year Sales as of June 30 (in millions of ARS)
		(%)				(%)		ARS		2022		2021		2020		2019
Intercontinental (3)	11/01/1997		76.34		313		35.1		11,468		800		215		1,776		2,583
Libertador (4)	03/01/1998		100		200		26.3		9,544		295		71		621		1,456
Llao Llao (5)	06/01/1997		50		205		61.2		37,153		3,205		1,225		2,584		3,234
Total					718		40.1		22,307		4,300		1,511		4,981		7,273

__________________

(1)	Accumulated average in the twelve-month period.
(2)	Accumulated average in the twelve-month period.
(3)	Through Nuevas Fronteras S.A.
(4)	Through Hoteles Argentinos S.A.U.
(5)	Through Llao Llao Resorts S.A.

104

Hotel Intercontinental, City of Buenos Aires

In November 1997, IRSA acquired 76.34% of the Hotel Intercontinental. The Hotel Intercontinental is located in the downtown City of Buenos Aires neighborhood of Montserrat, near the Intercontinental Plaza office building. Intercontinental Hotels Corporation, a United States corporation, currently owns 23.66% of the Hotel Intercontinental. The hotel’s meeting facilities include eight meeting rooms, a convention center and a divisible 588 sqm ballroom. Other amenities include a restaurant, a business center, a sauna and a fitness facility with swimming pool. The hotel was completed in December 1994 and has 313 rooms.

Hotel Libertador, City of Buenos Aires

In March 1998 IRSA acquired 100% of the Sheraton Libertador Hotel from Citicorp Equity Investment for an aggregate purchase price of USD 23 million. In March 1999, IRSA sold a 20% interest in the Sheraton Libertador Hotel for USD 4.7 million to Hoteles Sheraton de Argentina.

During the fiscal year 2019, IRSA reacquired 20% of the shares of Hoteles Argentinos S.A.U. (“HASAU”), reaching 100% of the capital stock of HASAU and beginning to operate the hotel directly under the name “Libertador.” The hotel is in downtown Buenos Aires. The hotel contains 193 rooms and 7 suites, eight meeting rooms, a restaurant, a business center, a spa and fitness facilities with a swimming pool.

Hotel Llao Llao, San Carlos de Bariloche, Province of Rio Negro

In June 1997 IRSA acquired the Hotel Llao Llao from Llao Llao Holding S.A. Fifty percent is currently owned by the Sutton Group. The Hotel Llao Llao is located on the Llao Llao peninsula, 25 kilometers from the City of San Carlos de Bariloche, and it is one of the most important tourist hotels in Argentina. Surrounded by mountains and lakes, this hotel was designed and built by the famous architect Bustillo in a traditional alpine style and first opened in 1938. The hotel was renovated between 1990 and 1993 and has a total constructed surface area of 15,000 sqm and 158 original rooms. The hotel-resort also includes an 18-hole golf course, tennis courts, fitness facility, spa, game room and swimming pool. The hotel is a member of The Leading Hotels of the World, Ltd., a prestigious luxury hospitality organization representing 430 of the world’s finest hotels, resorts, and spas. The Hotel Llao Llao is currently being managed by “IRSA- Galerías Pacífico S.A. – UT”, a Transitory Union constituted 50% by IRSA and 50% by Grupo Sutton. During 2007, the hotel was subject to an expansion and the number of suites in the hotel rose to 205 rooms. In 2019, began the remodeling of the Bustillo Wing in the hotel, where 42 rooms that were already operational at the end of the year were modernized and valued.

Bariloche Plot, “El Rancho,” San Carlos de Bariloche, Province of Río Negro

On December 14, 2006, through IRSA’s hotel operator subsidiary, Llao Llao Resorts S.A., IRSA acquired a land covering 129,533 sqm of surface area in the City of San Carlos de Bariloche in the Province of Río Negro. The total price of the transaction was USD 7 million. The land is in the border of the Lago Gutiérrez, close to the Llao Llao Hotel in an outstanding natural environment and it has a large cottage covering 1,000 sqm of surface area designed by the architect Ezequiel Bustillo.

Sale and Development of Properties and Land Reserves

Residential Development Properties

The acquisition and development of residential apartment complexes and residential communities for sale is one of our core activities. IRSA developments of residential apartment complexes consists of the new construction of high-rise towers or the conversion and renovation of existing structures such as factories or warehouses. In connection with its developments of residential communities, IRSA frequently acquire vacant land, develop infrastructure such as roads, utilities, and common areas, and sell plots of land for construction of single-family homes. IRSA may also develop or sell portions of land for others to develop complementary facilities such as shopping areas within residential developments.

In fiscal year ended June 30, 2022, revenues from the sale and development of properties amounted to ARS 746 million, compared to ARS 1,271 million posted in the fiscal year ended June 30, 2021.

105

Construction and renovation works on IRSA’s residential development properties are performed, under its supervision, by independent Argentine construction companies that are selected through a bidding process. IRSA enter into turnkey contracts with the selected company for the construction of residential development properties pursuant to which the selected company agrees to build and deliver the development for a fixed price and at a fixed date. IRSA is generally not responsible for any additional costs based upon the turnkey contract. All other aspects of the construction, including architectural design, are performed by third parties.

Another modality for the development of residential undertakings is the exchange of land for constructed square meters. In this way, IRSA deliver undeveloped pieces of land and another firm is in charge of building the project. In this case, IRSA receive finished square meters for commercialization, without taking part in the construction works.

The following table shows information about IRSA’s land reserves as of June 30, 2022:

	IRSA’s ownership interest		Date of acquisition	Land Surface		Buildable surface		GLA		Salable Surface		Book Value
	(%)			(sqm)								(in millions of ARS)
RESIDENTIAL - BARTER AGREEMENTS
CONIL - Güemes 836 – Mz. 99 & Güemes 902 – Mz. 95 & Commercial stores - Buenos Aires (4)		100	Jul-96		—		—		—		1,461		160
Córdoba Shopping Adjoining plots – Residential		100	May-15		—		—		—		1,080		81
Libertador 7400 (Quantun Bellini) Trust		100	Feb-21		—		—		—		186		91
Ancón (Luis M. Campos)Trust		100	Feb-21		—		—		—		1,014		311
Av Figueroa Alcorta 6464 Trust		100	Feb-21		—		—		—		1,786		812
Coto Abasto air space – Tower 1 - City of Buenos Aires		100	Sep-97		—		—		—		2,018		608
Total Intangibles (Residential)					—		—		—		7,545		2,063
LAND RESERVES:
UOM Luján - Buenos Aires(5)		100	May-08		1,160,000		464,000		—		—		2,238
San Martin Plot (Ex Nobleza Piccardo) - Buenos Aires(5)		50	May-11		159,996		500,000		—		—		11,476
La Adela - Buenos Aires		100	Aug-14		9,868,500		3,951,227		—		—		3,145
Puerto Retiro – City of Buenos Aires (8)		50	May-97		82,051		246,153		—		—		-
Ezpeleta plot (Quilmes)		100	Apr-22		465,642		521,399		—		—		4,065
Costa Urbana – City of Buenos Aires (9)		100	Jul-97		716,180		895,225		—		693,445		89,309
La Plata - Greater Buenos Aires (5)		100	Mar-18		78,614		116,553		—		—		2,390
Caballito plot - City of Buenos Aires		100	Jan-99		23,791		86,387		10,518		75,869		7,782
Subtotal Mixed-uses					12,616,998		6,924,904		99,523		933,091		137,832
Coto Abasto air space – Tower 2 - City of Buenos Aires (2)		100	Sep-97		—		10,768		—		8,193		85
Caballito Block 35 – City of Buenos Aires		100	Oct-98	9879			57,192		—		30,064		1,037
Zetol – Uruguay		90	Jun-09		—		—		—		64,080		763
Vista al Muelle – Uruguay		90	Jun-09		—		—		—		60,360		867
Córdoba Shopping Adjoining plots – Córdoba (2)		100	May-15		2,636		9,000		—		1,080		89
Neuquén - Residential plot – Neuquén (2) (6)		100	Jul-99		13,000		57,000		—		—		196
Subtotal residential					25,515		133,960		—		163,777		3,037
Polo Dot commercial expansion – City of Buenos Aires (7)		80	Nov-06		—		—		15,940		—		3,238
Beruti y Coronel Diaz Building		100	Jun-22		2,387		—		5,067		—		—
Paraná plot - Entre Ríos (3)		100	Aug-10		10,022		5,000		5,000		—		—
Subtotal retail					12,409		5,000		26,007		—		6,369
Polo Dot - Offices 2 & 3 - City of Buenos Aires		80	Nov-06		12,800		—		38,400		—		5,812
Intercontinental Plaza II - City of Buenos Aires		100	Feb-98		6,135		—		19,598		—		2,205
Córdoba Shopping adjoining plots – Córdoba (2)		100	May-15		5,365		5,000		5,000		—		4
Subtotal offices					24,300		5,000		62,998		—		8,021
Total future developments					12,616,998		6,924,904		99,523		933,091		137,832
Other land reserves (1)					3,279,564		—		7,297		262		4,350
Total land reserves					15,896,562		6,924,904		106,820		933,353		142,182

__________________

(1)	Includes Zelaya 3102-3103, Chanta IV, Anchorena 665, Alto II Condominiums, Ocampo parking spaces, DOT adjoining plot. adjoining plot Mendoza Shopping, Pilar R8 Km 53, Pontevedra, San Luis Land and Llao Llao Land.
(2)	These lands are classified as Property for sale; therefore, their value is maintained at book value. The rest of the land is classified as Investment Properties, valued at market value.
(3)	Pending deed subject to certain conditions.
(4)	Classified as Intangible Assets, therefore their value is maintained at book value.
(5)	Estimated maximum buildable area according to the projects, still pending final approvals.
(6)	Estimated buildable area according to the first draft, which to date is about 45,000 sqm according to the latest news from the Municipality.
(7)	Applicable to the expansion of the Zetta Building.
(8)	This land is in judicial litigation.
(9)	Previous of the transfer of lots to the GCBA (in this case the meters will be 693,445 sqm of land surface and 866,806 sqm of salable surface).

106

The following table shows information about IRSA’s expansions on its current assets as of June 30, 2022

Expansions	IRSA’s ownership interest		Surface		Locations
	(%)		(sqm)
Alto Palermo		100		4,336	City of Buenos Aires
Paseo Alcorta		100		1,337	City of Buenos Aires
Alto Avellaneda		100		23,737	City of Buenos Aires
Alto Noa		100		3,068	City of Buenos Aires
Soleil		100		17,718	City of Buenos Aires
Alto Comahue		100		3,325	City of Buenos Aires
Subtotal future expansions				53,521
Total Shopping Malls				53,521
Patio Bullrich - Offices / Hotel (1)		100		20,000	City of Buenos Aires
Alto Palermo		100		14,119	City of Buenos Aires
Córdoba Shopping		100		7,000	Cordoba
Alto Rosario (2)		100		15,000	Rosario
Philips Building		100		19,706	City of Buenos Aires
Subtotal future expansions				75,905
Total offices + residential				75,905
Total expansions				129,426

Residential Properties (available for sale)

In the residential market, we acquire undeveloped properties strategically located in densely populated areas of the City of Buenos Aires, particularly properties located near shopping malls and hypermarkets or those to be constructed. We then develop multi-building high-rise complexes targeting the middle- and high- income market. These are equipped with modern comforts and services, such as open “green areas,” swimming pools, sports and recreation facilities and 24-hour security.

Condominios del Alto II – City of Rosario, Province of Santa Fe

The project will be comprised of two opposing building blocks, commercially divided into 10 sub-blocks. The project consists of a total of 189 apartments distributed over 6 floors and 195 parking spaces located in two basements. Amenities include a swimming pool with sundeck, multipurpose room, sauna, fitness center with locker rooms, and laundry facility. As of June 30, 2022, the works on parcel H have been completed, having received all the units committed to the exchange and being available for sale at this date, 1 parking space.

107

Horizons, Vicente López, Olivos, Province of Buenos Aires.

The IRSA-CYRELA Project, developed over two adjacent blocks, was launched in March 2008 under the name Horizons. Horizons is one of the most significant developments in Greater Buenos Aires, featuring a new concept in residential complexes given its emphasis on the use of common spaces. This project includes two complexes with a total of six buildings: one complex faces the river and consists of three 14-floor buildings, the “Río” complex, and the other one, facing Libertador Avenue, consists of three 17-floor buildings, it is known as the “Parque” complex, thus totaling 59,000 square meters built of saleable area distributed in 467 units (excluding the units to be delivered as consideration for the purchase of the lands). Horizons is a unique and style-innovating residential complex offering 32 amenities, including a meeting room, work zone, heated swimming pools, mansion with spa, sauna, gym, children room, teen room, thematically landscaped areas, and aerobic trail. The showroom was opened to the public in March 2008 with great success. As of June 30, 2022, all units were sold and the stock available for sale consisted of 1 parking space and 18 storage spaces.

Pereiraola (Greenville), Hudson – Province of Buenos Aires

In April de 2010 IRSA sold Pereiraola S.A., a company owner of certain lands adjacent to Abril Club de Campo that comprised 130 hectares, for USD 11.7 million. The purchaser would develop a project that includes the fractioning into lots, a condo-hotel, two polo fields, and apartment buildings. The delivery to IRSA of 39,634 square meters of lots amounting to approximately USD 3 million was included in the sale price. As of June 30, 2022, the balance of the price of the sale operation has been received and all the lots that remained to be received have been transferred as the balance of the price of the sale carried out in 2010, the assignment was made on October 14, 2020.

Intangibles – Units to be received under barter agreements

Conil – Avellaneda, Province of Buenos Aire

These plots of land we own, through IRSA, face Alto Avellaneda shopping mall, totaling 2,398 square meters distributed in two opposite corners and, according to urban planning standards, around 6,000 square meters may be built. Its intended use, either through our own development or sale to a third party, is residential with the possibility of a retail space as well. In November 2014, a barter deed was executed to carry out a residential development, in consideration of which IRSA will receive 1,389 square meters of retail stores located on the ground floors of blocks 99 and 95 at Güemes 836 and Güemes 902, respectively. The barter was valued at USD 0.7 million. Considerations for block 95 and 99 were estipulated to be delivered in January 2018 and September 2018, respectively. In June 2018 an extension to the barter agreement was signed. In consideration for the delay and as compensation, IRSA will receive an additional apartment (55.5 square meters) and one parking lot (14 square meters).

Mixed uses

Costa Urbana – formerly Solares de Santa María – Costanera Sur, City of Buenos Aires

On December 21, 2021, the law from Buenos Aires City congress approving a New Zoning Regulations for the development of the property, was passed, and published. The Plot of approximately 71 hectares, owned by the Company since 1997, previously known as “Solares de Santa María”, is in the riverfront of the Río de la Plata, in the South Coast of the Autonomous City of Buenos Aires, southeast of Puerto Madero. The published law grants a New Zoning Area, designated: “U73 - Public Park and Costa Urbana Urbanization”, which enables a mixed-use development, combining, residential, office buildings, retail, services, public spaces, education, and entertainment.

The Project will have a construction capacity of approximately 895.000 sqm (28,194 sqm will be transferred, as consideration, to the Government of the Autonomous City of Buenos Aires, leaving a total of 866,806 sqm net), which will drive growth for the coming years through the development of mixed-use project.

IRSA will transfer ownership to the City of 50.8 hectares destinated for public use, which represent approximately 71% of the total area of the property and will contribute with three additional lots of the property, two for the Sustainable Urban Development Fund and one for the Innovation Trust, Science and Technology of the Government of the Autonomous City of Buenos Aires, to which the sum of USD 2,6 million in cash and the amount of 3,000,000 sovereign bonds (AL35) was also contributed according to the terms agreed by the new law.

Likewise, IRSA will oversee putting in place the infrastructure and road works on the property serving the new city blocks generated and will carry out the public space works contributing up to USD 40 million, together with the maintenance of the public spaces (assigned for 10 years or until the sum of USD 10 million is completed).

“Costa Urbana” will change the landscape of the City of Buenos Aires, bringing life to an undeveloped area and will be an exceptional project due to its size, location and connectivity, providing the City the possibility of expanding and recovering its access to the Río de la Plata coast with walkable areas, recreation, green spaces and public parks.

On October 29, 2021, a notification was received in relation to a collective legal protection action, requesting the convening of a public hearing prescribed by art. 63 of the Constitution of the City of Buenos Aires and the suspension of the processing of Bill 1831 - J 2021 (Trial Court of Administrative and Tax Law No. 10, Sec. 19 – Cause “Civil Association Observatory of the Right to City AND OTHERS AGAINST GCBA AND OTHERS ON PROTECTION ACTION (AMPARO) – OTHERS” - EXP J-01-00166469-3/2021-0). The Company proceeded to answer the lawsuit on November 12, 2021, requesting its rejection and on March 10, 2022, the court issued a ruling partially upholding the (amparo) legal protection. On March 15, 2022, IRSA as well as the Government of the City of Buenos Aires -codefendant in the case- appealed the ruling. On March 17, 2022, the court granted the appeals with suspensive effect of the contested sentence (in accordance with the provisions of Law No. 2145). As of the date of this Annual Report, the issue is to be resolved by Room IV of the “Contentious-Administrative, Tax and Consumer Relations” Chamber (Room IV).

108

Ex UOM – Luján, Province of Buenos Aires

This 116-hectare plot of land is located in the 62 Km of the West Highway, in the intersection with Route 5 and was originally purchased by Cresud from Birafriends S.A. for USD 3 million on May 31, 2008. In May 2012, IRSA acquired the property through a purchase and sale agreement entered into between related parties, thus becoming the current owner. IRSA intention is to carry out a mixed-use project, taking advantage of the environment consolidation and the strategic location of the plot. At present, dealings are being carried out so as to change the zoning parameters, thus enabling the consummation of the project.

Ex Nobleza Piccardo Plant – San Martín, Province of Buenos Aires

This plot of land is owned by Quality Invest. On May 31, 2011, Quality Invest S.A. and Nobleza Picardo S.A.I.C. y F. (Nobleza) executed the title deed for the purchase of a plot of land extending over 160,000 square meters located in the District of San Martín, Province of Buenos Aires, currently intended for industrial purposes and suitable in terms of characteristics and scales for mixed-use developments.

The Master Plan, by which it is projected to develop a large-scale integral urbanization (residential, commercial, etc.), which includes the construction of approximately 540,000 sqm, was endorsed by the Municipality of San Martin through Decree 1589/19 and registered before the General Directorate of Urbanism and Directorate of Urban Planning of the Municipality. Likewise, the subdivision plan in accordance with the urban indicators was presented to the Directorate of Cadastre of the Province of Bs. As.

Additionally, during fiscal year 2022, Quality Invest S.A. and the Municipality of San Martín signed the following documents:

- Peretz Club Agreement Closing Minutes: IRSA paid the certificates owed for the work in question already completed, releasing both parties from any claim regarding the documents signed on January 20, 2015. The amount owed was ARS 18,926,541 and the execution of the works are described, detailed and carried out.

- Complementary Agreement with the Municipality of San Martin: The ending of the Rodriguez Peña work and the relocation and start-up of the Edenor substation are agreed, in accordance with the plan and specifications drawn up by TIS and that are part of the annexes of the same. In return, the certifications owed will be paid as follows: The total is ARS 26,085,086: ARS 15,000,000 have already been paid; and the remaining amount (without any adjustment clause) will be paid at the time of provisional reception of the work, where will sign the Certificate of Delivery.

Córdoba Shopping Mall Project

IRSA owns a few plots adjacent to Córdoba Shopping Mall with a construction capacity of approximately 13,500 square meters in the center of the City of Córdoba.

In May 2016, a preliminary barter agreement was signed for 13,500 square meters out of the total construction capacity, subject to certain conditions, for a term of one year, at the end of which the deed will be signed. It will be a mixed residential and office project and, as part of the consideration, IRSA will receive 2,160 square meters in apartments, parking spaces, shopping space, plus the management of permits, unifications and subdivisions in 3 plots. The delivery of the consideration will be at most, for Tower I in May 2022, and for Tower II in July 2024. The value of the barter was USD 4 million.

As a subsequent event, in August 2022, a plot of 3,240 sqm was exchanged, where a housing tower will be built. IRSA will receive as consideration, within a period of between 36 and 44 months, functional units that represent 16% of the square meters, with a minimum of 1,080 square meters, together with garage units and, if built, also storage units. The value of the swap is USD 2 million.

La Plata Plot of land

On March 22, 2018, IRSA acquired 100% of a plot of land of 78,000 sqm of surface in the town of La Plata, province of Buenos Aires. The transaction was consummated through the purchase of 100% of the shares of Entertainment Center La Plata S.A. that owns 61.85% of the property and the direct purchase of the remaining 38.15% from unrelated third parties.

109

The price of the acquisition was USD 7.5 million which have been fully paid. IRSA intends to use the property to develop a mixed-use project, given the property’s characteristics for a commercial development in a district with high potential.

On January 21, 2019, Ordinance No. 11,767 approved by the “Honorable Consejo Deliberante de La Plata” on December 26, 2018, has been enacted. With this enactment, the uses and indicators requested to develop a project of 116,553 square meters were formally confirmed.

As of June 30, 2022, the mixed-use project is advanced.

Caballito Plot – City of Buenos Aires

Caballito is a property of approximately 23,791 sqm in the City of Buenos Aires, neighborhood of Caballito, one of the most densely populated of the city, which IRSA purchased in November 1997. This plot will be used for the development of residential with retail and public spaces, with more than 85,000 sqm. This Project is approved by the GCBA authorities.

On December 23, 2019, IRSA transferred Parcel 1 of the land reserve located at Av. Avellaneda and Olegario Andrade 367 in the Caballito neighborhood of the City of Buenos Aires to an unrelated third party.

The amount of the operation was set at the sum of USD 5.5 million to be paid in future functional units of Building 1. The aforementioned consideration is guaranteed by a real mortgage right on Parcel 1 and Building 1. The buyer has an Option to acquire Parcel 2 of the same property, subject to certain conditions precedent.

On July 20, 2020, IRSA was notified of the filing of a protection action (amparo) that is processed before the Administrative and Tax Litigation Jurisdiction of the City of Buenos Aires, where the plaintiff has requested the nullity of: 1) Administrative act that grants the certificate of environmental aptitude and 2) Administrative act that registered the plans. On October 1, 2020, the Court of Appeal confirmed the precautionary measure. The Government of the City of Buenos Aires appealed the measure by filing a Constitutional Challenge that was denied filling a complaint appeal, which was denied in October 2021. For more information, see “ITEM 8. Financial Information—A. Consolidated Statements and Other Financial Information—Legal or Arbitration Proceedings—Caballito.”

As of June 30, 2022, the development is awaiting the resolution of an appeal filed with the Government of the City of Buenos Aires.

La Adela – Buenos Aires

During 2015 IRSA acquired the “La Adela” land reserve with an area of approximately 1,058 hectares, located in the District of Luján, Province of Buenos Aires, that was previously owned by Cresud for a total amount of ARS 210 million. Given its degree of development and closeness to the City of Buenos Aires, IRSA intends to develop a new real estate project.

Puerto Retiro – City of Buenos Aires

During fiscal year 1998, the Company initiated negotiations with the authorities of the Government of the City of Buenos Aires in order to obtain a rezoning permit for the property, allowing a change in the use of the property and setting forth new regulations for its development.

At present, Puerto Retiro S.A. has a 8.3 hectare plot of land, which is affected by a zoning regulation defined as U.P. which prevents the property from being used for any purposes other than strictly port activities.

Puerto Retiro S.A. was involved in a bankruptcy extension judicial action initiated by the Argentine government, to which the Board of Directors is totally unrelated. Management and the Company’s legal advisors consider that there are sufficient legal technical arguments to consider that the request for the extension of bankruptcy will be rejected by the court. However, given the current state of the case, the resolution is uncertain.

110

In turn, Tandanor filed a civil action against Puerto Retiro S.A. and the other defendants in the criminal case for violation of Section 174 (5) based on Section 173 (7) of the Criminal Code. Such action seeks -on the basis of the nullity of the decree that approved the bidding process involving the Dársena Norte property- the restitution of the property and a reimbursement in favor of Tandanor for all such amounts it has allegedly lost as a result of a suspected fraudulent transaction involving the sale of the property. Puerto Retiro has presented the allegation on the merit of the evidence, highlighting that the current shareholders of Puerto Retiro did not participate in any of the suspected acts in the criminal case since they acquired the shares for consideration and in good faith several years after the facts told in the process. Likewise, it was emphasized that the company Puerto Retiro is foreign - beyond its founders - to the bidding / privatization carried out for the sale of Tandanor shares.

On September 7, 2018, the Oral Federal Criminal Court No. 5 released the operative part of the Sentence, from which it follows that the prescription exception filed by Puerto Retiro was allowed. However, in the criminal case, where Puerto Retiro is not a party, it was ordered, among other issues, the confiscation (decomiso) of the property owned by Puerto Retiro known as Planta I. The reasons for the Court’s sentence were read on November 11, 2018. From that moment, all the parties might file the appeals. Faced with this fact, an extraordinary appeal was filed, which was rejected, and as a result, a complaint was filed for a rejected appeal, which was granted. Consequently, the appeal is under study in the Supreme Court of Justice of the Nation.

In the framework of the criminal case, the complainant denounced the non-compliance by Puerto Retiro S.A. of the precautionary measure decreed in the criminal court consisting of the prohibition to innovate and contract with respect to the property that is the object of the civil action. As a result of this complaint, the Oral Federal Criminal Court No. 5 filed an incident and ordered and executed the closure of the property where the lease contracts with Los Cipreses S.A. and Flight Express S.A. were being fulfilled, in order to enforce compliance with the aforementioned measure. As a result of this circumstance, it was learned that the proceedings were turned to the Criminal Chamber for the assignment of a court to investigate the possible commission of a disobedience crime. As of the date of issuance of these financial statements, there have been no news regarding the progress of this case.

In the face of the evolution of the legal cases affecting it and based on the reports of its legal advisors, the Management of Puerto Retiro has decided to record, during fiscal year 2019, an impairment equivalent to 100% of the book value of its investment property, without prejudice to the reversal of the same in the event that a favorable judgment is obtained in the actions brought.

111

Terreno Ezpeleta – Quilmes, Provincia de Buenos Aires

Acquired in April 2022 as part of the payment for the sale of the Republica Building. The property is made up of four plots and has a frontage of 851 meters on the Bs As - La Plata Highway, on the side of the urbanized area the property has a frontage of 695 meters on Río Gualeguay Street between Tupungato and La Guarda streets. It has a total area of 465,642 sqm, with a usable area of 242,151 sqm and a buildable area of 521,399 sqm.

Residential

Coto Residential Project

IRSA owns the right to construct above the premises of the Coto hypermarket that is close to Abasto Shopping in the heart of the City of Buenos Aires which we acquired in September 24, 1997. IRSA estimates it has a construction capacity of 23,000 square meters (it also includes the right to receive certain parking units). The premises are located within the area between Agüero, Lavalle, Guardia Vieja and Gallo streets, in the Abasto neighborhood.

On October 25, 2019, IRSA transferred to a non-related third party the rights to develop a residential building (“Tower 1”) on Coto Supermarket airspace located in Abasto neighborhood in the City of Buenos Aires. Tower 1 will have 22 floors of 1 to 3 rooms apartments, totaling an area of 8,400 sqm.

The operation was set for the total of USD 4.5 million: USD 1 million was paid in cash and the balance in at least 35 functional units of departments, representing the equivalent of 24.20% of the square meters to build, with a guaranteed minimum of 1,982 sqm.

As of June 30, 2022, the construction work of Tower 1 has started.

Neuquén Residential Plot– Neuquén, Province of Neuquén

Through Shopping Neuquén S.A., IRSA owns a plot of 13,000 square meters with an estimated construction capacity of 57,000 square meters of residential properties in an area with significant growth potential. This area is located close to the shopping mall Alto Comahue and the hypermarket currently in operation.

112

Caballito Plot – City of Buenos Aires

On June 29, 2011, IRSA and GCDI S.A. (formerly TGLT S.A.), a residential developer, entered into an agreement to barter for the development of a plot of land located at Méndez de Andes street in the neighborhood of Caballito in the City of Buenos AiresA neighborhood association named Asociación Civil y Vecinal SOS Caballito secured a preliminary injunction which suspended the works to be carried out by GCDI S.A. in the abovementioned property. On April 2018 GCDI S.A. and us terminated the barter agreement and we recovered the land. In July 2018, the Supreme Court of Justice issued a favorable final decision allowing the construction of 57,192 sqm of apartments on the plot.

As of June 30, 2022, the completion work for the concrete structure of Tower 3 is in the process of being awarded and should be completed in the first quarter of fiscal year 2023.

Zetol S.A. and Vista al Muelle S.A. – District of Canelones – Uruguay

In the course of fiscal year 2009 IRSA acquired a 100% ownership interest in Liveck S.A., a company organized under the laws of Uruguay. In June 2009, Liveck had acquired a 90% stake in the capital stock of Vista al Muelle S.A. and Zetol S.A., for USD 7.8 million. The remaining 10% ownership interest in both companies is in the hands of Banzey S.A. These companies have undeveloped lands in Canelones, Uruguay, close to the capital city of Uruguay, Montevideo.

IRSA intends to develop in these 13 plots, with a construction capacity of 182,000 sqm, an urban project that consists of the development and comercialization of 1,860 apartments. Such project has the “urban feasibility” status for the construction of approximately 200,000 sqm for a term of 10 years, which was granted by the Mayor’s Office of the Canelones department and by its Local Legislature. Zetol S.A. and Vista al Muelle S.A. agreed to carry out the infrastructure works for USD 8 million as well as minimum amount of sqm of properties. The satisfaction of this commitment under the terms and conditions agreed upon will grant an additional 10-year effective term to the urban feasibility status.

The total purchase price for Zetol S.A. was USD 7 million; of which USD 2 million were paid. Sellers may opt to receive the balance in cash or through the delivery of units in the buildings to be constructed in the land owned by Zetol S.A. equivalent to 12% of the total marketable meters to be constructed.

Besides, Vista al Muelle S.A. IRSA owned since September 2008 a plot of land purchased for USD 0.83 million. Then, in February 2010, plots of land were acquired for USD 1 million. In December 2010, Vista al Muelle S.A. executed the title deed of other plots for a total amount of USD 2.66 million, of which USD 0.3 million were paid. The balance will be repaid by delivering 2,334 sqm of units and/or retail stores to be constructed or in cash.

On June 30, 2009, IRSA sold a 50% stake in Liveck S.A. to Cyrela Brazil Realty S.A. for USD 1.3 million. On December 17, 2010, together with Cyrela Brazil Realty S.A. IRSA executed a stock purchase agreement pursuant to which IRSA repurchased from Cyrela Brazil Realty S.A. a 50% shareholding in Liveck S.A. for USD 2.7 million. Accordingly, as of June 30, 2022, our stake, through Tyrus, in Liveck is 100%.

As a result of the plot barter agreements executed in due time between the IMC, Zetol S.A. and Vista al Muelle S.A. in March 2014, the parcel redistribution dealing was concluded. This milestone, as set forth in the amendment to the Master Agreement executed in 2013, initiates the 10-year term for the investment in infrastructure and construction of the buildings mentioned above. Construction capacity of the 13 plots is 182,000 sqm.

On November 15, 2018, the translation deed of sale of the first plot where the first Tower of Departments, Villas and single and double parking spaces is currently being built has been signed, the total exchange price was USD 7,298,705 equivalent to 16% of all of the marketable built meters in the first Tower. 12% of it has been used to cancel part of the price balance maintained to date with the sellers of the plots acquired by Zetol S.A in June 2009.

As of June 30, 2022, 6 units were received for the consideration of Tower 1, built on plot 2, and the infrastructure work concerning sectors A and B of the property has been contracted and is 20% complete. Including, among others, the road coastal, roundabouts, lights, landfills and stormwater and sewage connections for USD 3.2 million.

113

Offices

Polo Dot 2^nd and 3^rd Stages – City of Buenos Aires

These two parcels of 6,400 square meters with a construction capacity of 33,485 square meters each, are located adjoining to where the extension of Dot Baires Shopping is planned. In April 2018, both plots were unified into a single one of 12,800 square meters.

Coronel Diaz and Beruti Building – City of Buenos Aires

On February 2022, IRSA purchased by means of public auction from the GCBA, a property located at the corner of the intersections of Beruti Street and Coronel Díaz Avenue. Such property is located in front of Alto Palermo Shopping, a shopping center owned by the Company, located in in the neighborhood of Palermo, one of the main commercial corridors of the City of Buenos Aires

The property has an area of approximately 2,386.63 sqm, consisting of a first floor, six upper levels and a basement area. Furthermore, it has a total covered area of approximately 8,136.85 sqm with future expansion potential.

The purchase price was ARS 2,158,647,620, which was paid in full.

As of June 30, 2022, the transfer deed of ownership was signed. Simultaneously with the deed, IRSA is required to sign a bailment agreement with the GCBA, with the latter holding the property free of charge for a period of up to 30 months, in accordance with the conditions agreed upon in the auction.

Intercontinental Plaza II Plot - City of Buenos Aires

In the heart of the neighborhood of Monserrat, just a few meters from the most trafficked avenue in the city and the financial center, is the Intercontinental Plaza complex consisting of an office tower and the exclusive Intercontinental Hotel. In the current plot of 6,135 square meters a second office tower of 19,600 square meters and 25 stories could be built to supplement the tower currently located in the intersection of Moreno and Tacuarí streets.

Other Land Reserves

Other Land Reserves – Pilar, Pontevedra, Mariano Acosta, Merlo, San Luis Plot, Llao Llao Plot and Casona Abril remaining surface.

IRSA grouped here those plots of land with a significant surface area the development of which is not feasible in the short term either due to their current urban and zoning parameters, their legal status or the lack of consolidation of their immediate environment. This group totals around 3.3 million sqm.

Others

La Rural (convention centers and fairs activities) and La Arena (Directv Arena concession)

In relation to the investment in La Rural S.A., its main activity includes the organization of congresses, fairs, exhibitions, events, corporate and incentive trips and is carried out by LRSA, both at the Palermo Fairgrounds and at the “Centro de Exposiciones y Convenciones de la Ciudad Autónoma de Buenos Aires” through a Transitory Union of Companies that obtained, by public tender, the concession of this property for a period of 15 years and the “Punta del Este Convention and Exhibition Center”. IRSA has an indirect participation of 35%.

114

Ogden Argentina S.A (“OASA”), indirectly controlled by IRSA by 70%, owns an 82.85% stake in “La Arena S.A.”, a company that developed and operates the stadium known as “DirecTV Arena”, located in the kilometer 35.5 of the Pilar branch, Tortuguitas, in the province of Buenos Aires.

During this fiscal year, IRSA had different moments in relation to the return to business activity of the fair and entertainment industry after the two years of the pandemic.

During the first quarter of the fiscal year, the prohibition on holding events was maintained and, as of September 2021, through specific protocols, activity was resumed with limitations on both the number of people and indoor space. Exhibitions began at La Rural and different corporate events and congresses were held both at La Rural and at the Buenos Aires Convention Center. As of March 2022, all the protocols for holding events as normal were released and in this way the operations of La Rural, the Buenos Aires and Punta del Este Convention Centers were able to resume their operations.

GCDI S.A. (formerly TGLT S.A.) (real estate)

GCDI S.A. is a construction company listed on the BYMA which is mainly engaged in the construction of third-party projects and residential development projects in Argentina and Uruguay. As of June 30, 2022, IRSA hold a 27.82% interest.

After the end of the fiscal year, TGLT S.A. changed its name to GCDI S.A.

We are appa S.A. (formerly Pareto S.A.)

On October 8, 2018, the company Pareto S.A. was incorporated, with the social purpose of design, programming and development of software, mobile and web applications. As of June 30, 2022, IRSA’s share of We are appa reaches 93.63%.

We are appa’s mission is to minimize the friction of physical shopping by applying data science and artificial intelligence, connecting buyers and sellers in a unique experience.

Through its application, ¡appa!, We are appa provides shopping malls and tenants a 100% digital customer loyalty system that promotes benefits and discounts by facilitating the consumer experience in shopping malls and offices

During the year, users of ¡appa! carried out more than 900,000 transactions on the platform, including consumption in shopping malls, use of parking spaces, and redemption of Corporate benefits. Of these, approximately 242,000 visitor transactions were identified in IRSA shopping malls, corresponding to consumption of more than ARS 2,200 million by 127,600 users. This information allows the teams of the shopping malls to manage their communications and actions in a more efficient and segmented way that results in greater loyalty and attractiveness of the shopping malls’ proposal towards its visitors.

Avenida Inc.

As of June 30, 2022, IRSA indirectly owned 4.1% of Avenida Inc., a company dedicated to the e-commerce business.

Compara en casa

Compara en casa is a digital insurance broker that compares the policies of the main insurers in one place. They operate in Argentina, Brazil, Mexico, Paraguay and Uruguay.

115

As of June 30, 2022, IRSA indirectly owned 14.87% of Comparaencasa S.A.

Banco Hipotecario

As of June 30, 2022, IRSA held a 29.91% interest in Banco Hipotecario. Established in 1886 by the Argentine government and privatized in 1999, Banco Hipotecario has historically been Argentina’s leading mortgage lender, provider of mortgage-related insurance and mortgage loan services. All its operations are located in Argentina where it operates a nationwide network of 63 branches in the 23 Argentine provinces and the City of Buenos Aires.

Banco Hipotecario is an inclusive commercial bank that provides universal banking services, offering a wide variety of banking products and activities, including a wide range of individual and corporate loans, deposits, credit and debit cards and related financial services to individuals, small-and medium-sized companies, and large corporations. As of April 2022, Banco Hipotecario ranked sixteenth in the Argentine financial system in terms of totals assets and seventeenth in terms of loans. As of June 30, 2022, Banco Hipotecario’s shareholders’ equity was ARS 33,754.5 million, its consolidated assets were ARS 323,353.1 million, and its net income for the six-month period ended June 30, 2022, was ARS 2,737.2 million. Since 1999, Banco Hipotecario’s shares have been listed on the Buenos Aires Stock Exchange in Argentina, and since 2006 it has had a Level I ADR program.

Banco Hipotecario’s business strategy is to continue diversifying its loan portfolio. The Bank’s non-mortgage loans to the non-financial private sector, in nominal terms, were ARS 36,851 millon as of December 31, 2019, ARS 40,522.8 million as of December 31, 2020, ARS 48,760.9 million as of December 31, 2021 and ARS 51,480.9 million as of June 30, 2022.

Also, Banco Hipotecario has diversified its funding sources by developing its presence in the local and international capital markets, as well as increasing its deposit base. Its financial debt in total funding was 12.6% as of June 30, 2022.

Banco Hipotecario’s subsidiaries include BACS Banco de Crédito y Securitización S.A., a bank specialized in investment banking, asset securitization and asset management, from which Banco Hipotecario owns directly 62.3% and IRSA owns directly 37.7%; BHN Vida S.A., a life insurance company; and BHN Seguros Generales S.A., a property insurance company.

Regulation and Government Supervision of our Agricultural Business

Farming and Animal Husbandry Agreements

Agreements relating to farming and animal husbandry activities are regulated by Argentine law, the Argentine Civil and Commercial Code and local customs.

According to Law No. 13,246, as amended by Law No. 22,298, all lease agreements related to rural properties and land are required to have a minimum duration of 3 years, except in the case of those designated as “accidental agreements” pursuant to Section 39, subsection a), Law No. 13,246. Upon death of the tenant farmer, the agreement may continue with his successors. Upon misuse of the land by the tenant farmer or default in payment of the rent, the landowner may initiate an eviction proceeding.

Law No. 13,246, amended by Law No. 22,298, also regulates sharecropping agreements pursuant to which one of the parties furnishes the other with animals or land for the purpose of sharing benefits between the parties. These agreements are required to have a minimum term of duration of 3 years, although the rule of Section 39 of Law No. 13,246 on accidental agreements for smaller terms also applies in this case. The agreement is not assignable under any circumstance whatsoever, unless expressly agreed by the parties. Upon death, disability of the tenant farmer or other impossibility, the agreement may be terminated.

116

Quality control of Crops and Cattle

The quality of the crops and the health measures applied on the cattle are regulated and controlled by the Servicio Nacional de Sanidad y Calidad Agroalimentaria (“SENASA”), which is an entity within the Agro-industry Ministry that oversees farming and animal sanitary activities.

Argentine law establishes that the brands should be registered with each provincial registry and that there cannot be brands alike within the same province.

Sale and Transportation of Cattle

Even though the sale of cattle is not specifically regulated, general contract provisions are applicable. Further, every province has its own rural code regulating the sale of cattle.

Argentine law establishes that the transportation of cattle is lawful only when it is done with the respective certificate that specifies the relevant information about the cattle. The required information for the certificate is established by the different provincial regulations, the inter-provinces treaties and the regulations issued by the SENASA.

Environment

The development of our agribusiness activities is regulated by a series of national, provincial, and municipal laws and regulations that promote the protection of the environment.

Section 41 of the Argentine Constitution, as amended in 1994, provides that all Argentine inhabitants have the right to a healthy and balanced environment fit for human development and have the duty to preserve it. Environmental damage shall bring about primarily the obligation to redress it as provided by applicable law. The authorities shall protect this right, the rational use of natural resources, the preservation of the natural and cultural heritage and of biodiversity and shall also provide for environmental information and education. The National Government shall establish minimum standards for environmental protection and Provincial and Municipal Governments shall determine specific standards and issue the applicable regulations.

On November 6, 2002, the Argentine Congress passed Law No. 25,675. This law regulates the minimum standards for the achievement of a sustainable environment and the preservation and protection of biodiversity and sets environmental policy goals. Moreover, Law No. 25,675 establishes the activities that will be subject to an environmental impact assessment procedure and certain requirements applicable thereto. In addition, the Law sets forth the duties and obligations that will be triggered by any damage to the environment and imposes the obligation to restore it to its former condition or, if that is not technically feasible, to pay a compensation in lieu thereof. The Law also fosters environmental education and provides for certain minimum obligations to be fulfilled by natural and artificial persons.

On November 28, 2007, the Argentine Congress passed a law known as the Forest Law which sets minimum standards for the conservation of native forests and incorporates minimum provincial expenditures to promote the protection, restoration, conservation and sustainable use of native forests. The Forest Law prevents landowners, including owners of native forests, from deforesting or converting forested areas into non-forested land for other commercial uses without prior permission from each local government that gives the permit and requires the preparation, assessment and approval of an environmental impact report. The Forest Law also provides that each province should adopt its own legislation and regional regulation map within a term of one year. Until such provincial implementation is carried into effect, no new areas may be deforested. In addition, the Forest Law also establishes a national policy for sustainable use of native forests and includes the recognition of native communities and aims to provide preferential use rights to indigenous communities living and farming near the forest. In case a project affects such communities, the relevant provincial authority may not issue permits without formal public hearings and written consent of the communities.

117

As a consequence of non-compliance with re rules we may be subject to criminal and administrative penalties, including taking action to reverse the adverse impact of our activities on the environment and to reimburse third parties for damages resulting from contraventions of environmental laws and regulations. Under the Argentine Criminal Code, persons (including directors, officers and managers of corporations) who commit crimes against public health, such as poisoning or dangerously altering water, food or medicine used for public consumption and selling products that are dangerous to health, without the necessary warnings, may be subject to fines, imprisonment or both. Some courts have enforced these provisions in the Argentine Criminal Code to sanction the discharge of substances which are hazardous to human health. At the administrative level, the penalties vary from warnings and fines to the full or partial suspension of the activities, which may include the revocation or annulment of tax benefits, cancellation or interruption of credit lines granted by state banks and a prohibition against entering into contracts with public entities.

The Forestry Legislation of Argentina prohibits the devastation of forests and forested lands, as well as the irrational use of forest products. Landowners, tenants, and holders of natural forests require an authorization from the Forestry Competent Authority for the cultivation of forest land. The legislation also promotes the formation and conservation of natural forests in properties used for agriculture and farming purposes.

In accordance with legislative requirements, we have applied for approval to develop certain parts of our land reserves and were authorized to develop them partially and to maintain other areas as land reserves. We cannot assure you that current or future development applications will be approved, and if so, to what extent we will be allowed to develop our land reserves. We intend to use genetically modified organisms in our agricultural activities. In Argentina, the development of genetically modified organisms is subject to special laws and regulations and special permits.

In addition to the current legislation, the CNV Rules provide that publicly traded companies whose corporate purpose includes environmentally hazardous activities should report to their shareholders, investors and the general public their compliance with the applicable environmental laws and risks inherent to such activities, so as to be able to reasonably assess such hazards.

Leases

Laws and regulations governing the acquisition and transfer of real estate, as well as municipal zoning ordinances, are applicable to the development and operation of the Company’s properties.

Currently, Argentine law does not specifically regulate shopping mall lease agreements. Since our shopping mall leases generally differ from ordinary commercial leases, we have created provisions which govern the relationship with our shopping mall tenants.

Argentine law imposes certain restrictions on property owners, including:

(1) a three-year minimum lease term is established for all purposes, except in particular cases such as embassy, consulate or international organization venues, room with furniture for touristic purposes for less than three months, custody and bailment of goods, exhibition or offering of goods in fairs or in cases where they are entered into for a specific purpose expressly stated in the agreement that is usually fulfilled within an agreed shorter term.

Limits on lease terms

Under the Argentine Civil and Commercial Code lease terms may not exceed fifty years, irrespective of the intended use of the property (save in case of residential use, where the maximum term is twenty years). Generally, terms in ours lease agreements go from 3 to 10 years.

118

Early termination rights

The Argentine Civil and Commercial Code provides that tenants of properties may declare the early termination of lease agreements with others destiny than home destiny after the first six months of the effective date. Such termination is subject to penalties which range from one to one and a half months of rent. If the tenant terminates the agreement during the first year of the lease, the penalty is one and a half month’s rent and, if the termination occurs after the first year of lease, the penalty is one month’s rent.

Other

Most of our leases provide that the tenants pay all costs and taxes related to the property in proportion to their respective leasable areas. Notwithstanding the foregoing, in accordance with the latest amendment to article 1209 of the Argentine Civil and Commercial Code, the tenant is not responsible for the payment of the charges and contributions levied on the property or extraordinary common expenses. In the event of a significant increase in the amount of such costs and taxes, the Argentine government may respond to political pressure to intervene by regulating this practice, thereby adversely affecting our rental income. Although, the Argentine Civil and Commercial Procedural Code enables the lessor to pursue collection of outstanding rental payments through an “executory proceeding” upon lessee’s payment default, there is a large number of jurisprudence that holds that shopping center lease agreements do not fulfill the requirements of the law in force to be collected through the “executory proceeding”. In those cases, in which the “executory proceedings” is granted, debtors have fewer defenses available to prevent foreclosure, making these proceedings substantially shorter than ordinary ones. In executory proceedings, the origin of the debt is not under discussion; the trial focuses on the formalities of debt instrument itself. The Procedural Code also permits special eviction proceedings, which are carried out in the same way as ordinary proceedings. The Argentine Civil and Commercial Code requires that a notice be given to the tenant demanding payment of the amounts due in the event of breach prior to eviction, of no less than ten days for leases for residential purposes, and establishes no limitation or minimum notice for leases for other purposes. However, historically, large court dockets and numerous procedural hurdles have resulted in significant delays to eviction proceedings, which generally last from six months to two years from the date of filing of the suit to the time of actual eviction.

Development and Use of the Land

Buenos Aires Urban Planning Code. Our real estate activities are subject to several municipal zoning, building, occupation, and environmental regulations. In the City of Buenos Aires, where the vast majority of the real estate properties are located, the Buenos Aires Urban Planning Code (Código de Planeamiento Urbano de la Ciudad de Buenos Aires) generally restricts the density and use of property and controls physical features of improvements on property, such as height, design, set-back and overhang, consistent with the city’s urban landscape policy. The administrative agency in charge of the Urban Planning Code is the Secretary of Urban Planning of the City of Buenos Aires.

Buenos Aires Building Code. The Buenos Aires Building Code (Código de Edificación de la Ciudad de Buenos Aires) supplements the Buenos Aires Urban Planning Code and regulates the structural use and development of property in the City of Buenos Aires. The Buenos Aires Building Code requires builders and developers to file applications for building permits, including the submission to the Secretary of Work and Public Services (Secretaría de Obras y Servicios Públicos) of architectural plans for review, to assure compliance therewith.

We believe that all our real estate properties are in material compliance with all relevant laws, ordinances and regulations.

Sales and Ownership

Buildings Law. Buildings Law No. 19,724 (Ley de Pre horizontalidad) was repealed by the new Argentine Civil and Commercial Code which became effective on August 1, 2015. The new regulations provide that for purposes of execution of agreements with respect to built units or units to be built under this regime, the owner is required to purchase insurance in favor of prospective purchasers against the risk of frustration of the operation pursuant to the agreement for any reason. A breach of this obligation prevents the owner from exercising any right against the purchaser – such as demanding payment of any outstanding installments due – unless he/she fully complies with his/her obligations, but does not prevent the purchaser from exercising its rights against the seller.

119

Protection for the Disabled Law. The Protection for the Disabled Law No. 22,431, enacted on March 20, 1981, as amended, provides that in connection with the construction and renovation of buildings, obstructions to access must be eliminated in order to enable access by handicapped individuals. In the construction of public buildings, entrances, transit pathways and adequate facilities for mobility-impaired individuals must be provided for.

Buildings constructed before the enforcement of the Protection for the Disabled Law must be adapted to provide accesses, transit pathways and adequate facilities for mobility-impaired individuals.

Those pre-existing buildings, which due to their architectural design may not be adapted to the use by mobility-impaired individuals, are exempted from the fulfillment of these requirements.

The Protection for the Disabled Law provides that residential buildings must ensure access by mobility-impaired individuals to elevators and aisles. Architectural requirements refer to pathways, stairs, ramps and parking.

Real Estate Installment Sales Law. The Real Estate Installment Sales Law No. 14,005, as amended by Law No. 23,266 and Decree No. 2015/85, imposes a series of requirements on contracts for the sale of subdivided real estate property regarding, for example, the sale price which is paid in installments and the deed, which is not conveyed until final payment of such price. The provisions of this law require, among other things:

The registration of the intention to sell the property in subdivided plots with the Real Estate Registry (Registro de la Propiedad Inmueble) corresponding to the jurisdiction of the property. Registration will only be possible with regard to unencumbered property. Mortgaged property may only be registered where creditors agree to divide the debt in accordance with the subdivided plots. However, creditors may be judicially compelled to agree to the division.

The preliminary registration with the Real Estate Registry of the purchase instrument within 30 days of execution of the agreements.

Once the property is registered, the installment sale may not occur in a manner inconsistent with the Real Estate Installment Sales Law, unless seller registers its decision to desist from the sale in installments with the Real Estate Registry. In the event of a dispute over the title between the purchaser and third-party creditors of the seller, the installment purchaser who has duly registered the purchase instrument with the Real Estate Registry will obtain the deed to the plot. Further, the purchaser can demand conveyance of title after at least 25% of the purchase price has been paid, although the seller may demand a mortgage to secure payment of the balance of the purchase price.

After payment of 25% of the purchase price or the construction of improvements on the property equal to at least 50% of the property value, the Real Estate Installment Sales Law prohibits the termination of the sales contract for failure by the purchaser to pay the balance of the purchase price. However, in such event, the seller may take action under any mortgage on the property.

Plan for the Transformation and Reconversion of the City of Buenos Aires Downtown.

In December 2021, the law for the transformation of the downtown area of the City of Buenos Aires was passed in order to convert that area into a residential, intelligent and sustainable urban area, through the promotion of the development of economic activities strategic activities, granting tax benefits to those who make investments aimed at the development of said area (such as the exemption of gross income tax derived from the development of strategic activities that will be exempt until December 2023). Additionally, it is expected that the Banco de la Ciudad will grant lines of credit aimed at promoting the realization of reconversion projects of real estate located within the downtown area (for example, incentives for the acquisition of housing and/or rental, “Move to the Microcentro” program), as well as for the acquisition of equipment related to the strategic activities to be developed in said area. Reconversion projects may be submitted until January 31, 2024.

120

Other Regulations

Consumer Relationship. Consumer or End User Protection. The Argentine Constitution expressly establishes in Section 42 that consumers and users of goods and services have a right to protection of health, safety and economic interests in a consumer relationship. Consumer Protection Law No. 24,240, as amended, regulates several issues concerning the protection of consumers and end users in a consumer relationship, in the arrangement and execution of contracts.

The Consumer Protection Law, and the applicable sections of the Argentine Civil and Commercial Code are intended to regulate the constitutional right conferred under the Constitution on the weakest party of the consumer relationship and prevent potential abuses deriving from the stronger bargaining position of vendors of goods and services in a mass-market economy where standard form contracts are widespread.

As a result, the Consumer Protection Law and the Argentine Civil and Commercial Code deem void and unenforceable certain contractual provisions included in consumer contracts entered into with consumers or end users, including those which:

(2)	deprive obligations of their nature or limit liability for damages;
(3)	imply a waiver or restriction of consumer rights and an extension of seller rights; and
(4)	impose the shifting of the burden of proof against consumers.

In addition, the Consumer Protection Law imposes penalties ranging from warnings to fines from ARS 100 to ARS 5,000,000, the seizure of merchandise, closing down of establishments for a term of up to thirty (30) days, suspension of up to 5 years in the State suppliers register, the forfeiture of concession rights, privileges, tax regimes or special credits to which the sanctioned party was entitled. These penalties may be imposed separately or jointly.

The Consumer Protection Law and the Argentine Civil and Commercial Code define consumers or end users as the individuals or legal entities that acquire or use goods or services free of charge or for a price for their own final use or benefit or that of their family or social group. In addition, both laws provide that those who though not being parties to a consumer relationship as a result thereof acquire or use goods or services, for consideration or for non-consideration, for their own final use or that of their family or social group are entitled to such protection rights in a manner comparable to those engaged in a consumer relationship.

In addition, the Consumer Protection Law defines the suppliers of goods and services as the individuals or legal entities, either public or private, that in a professional way, even occasionally, produce, import, distribute or commercialize goods or supply services to consumers or users.

The Argentine Civil and Commercial Code defines a consumer agreement as such agreement that is entered into between a consumer or end user and an individual or legal entity that acts professionally or occasionally or a private or public company that manufactures goods or provides services, for the purpose of acquisition, use or enjoyment of goods or services by consumers or users for private, family or social use.

It is important to point out that the protection under the laws afforded to consumers and end users encompasses the entire consumer relationship process (from the offering of the product or service) and it is not only based on a contract, including the consequences thereof.

In addition, the Consumer Protection Law establishes a joint and several liability system under which for any damages caused to consumers, if resulting from a defect or risk inherent in the thing or the provision of a service, the producer, manufacturer, importer, distributor, supplier, seller and anyone who has placed its trademark on the thing or service shall be liable.

121

The Consumer Protection Law excludes the services supplied by professionals that require a college degree and registration in officially recognized professional organizations or by a governmental authority. However, this law regulates the advertisements that promote the services of such professionals.

The Consumer Protection Law determines that the information contained in the offer addressed to undetermined prospective consumers, binds the offeror during the period in which the offer takes place and until its public revocation. Further, it determines that specifications included in advertisements, announcements, prospectuses, circulars or other media bind the offeror and are considered part of the contract entered into by the consumer.

Pursuant to Resolution No. 104/05 issued by the Secretariat of Technical Coordination reporting to the Argentine Ministry of Economy, the Consumer Protection Law adopted Resolution No. 21/2004 issued by the Mercosur's Common Market Group which requires that those who engage in commerce over the Internet (E-Business) shall disclose in a precise and clear manner the characteristics of the products and/or services offered and the sale terms. Failure to comply with the terms of the offer is deemed an unjustified denial to sell and gives rise to sanctions.

On September 17, 2014, a new Consumer Protection Law was enacted by the Argentine Congress –Law No. 26,993–. This law, known as “System for Conflict Resolution in Consumer Relationships,” provided for the creation of new administrative and judicial procedures for this field of Law. It created a two-instance administrative system: the Preliminary Conciliation Service for Consumer Relationships (Servicio de Conciliación Previa en las Relaciones de Consumo, COPREC) and the Consumer Relationship Audit, and a number of courts assigned to resolution of conflicts between consumers and producers of goods and services (Fuero Judicial Nacional de Consumo). To file a claim, the amount so claimed should not exceed a fixed amount equivalent to 55 adjustable minimum living wages, which are determined by the Ministry of Labor, Employment and Social Security. The claim is required to be filed with the administrative agency. If an agreement is not reached between the parties, the claimant may file the claim in court. The administrative system known as Preliminary Conciliation Service for Consumer Relationships (COPREC) is currently in full force and effect. However, the court system (fuero judicial nacional de consumo) is not in force yet, therefore, any court claims should be currently filed with the existing applicable courts. A considerable volume of claims filed against us are expected to be settled pursuant to the system referred to above, without disregarding the full force and effect of different instances for administrative claims existing in the provincial sphere and the City of Buenos Aires, which remain in full force and effect, where potential claims related to this matter could also be filed.

Antitrust Law

Antitrust Law. Law No. 27,442, and its administrative regulation, its goals are to prevent and punish anticompetitive conducts. The Law 27,442 also requires administrative authorization for transactions that according to the Antitrust Law constitute an economic concentration. According to this law, mergers, transfers of goodwill, acquisitions of property or rights over shares, capital or other convertible securities, or similar operations by which the acquirer controls or substantially influences a company, are considered as an economic concentration. Whenever an economic concentration involves a company or companies and the aggregate volume of business of the companies concerned concept that excludes companies from the selling group exceeds in Argentina the amount of ARS 4,061,000,000, in such case the respective concentration should be submitted for authorization to the CNDC. The request for authorization may be filed, either prior to the transaction or within a week after its completion. Once 1 year has elapsed since the establishment of the new National Competition Authority, the file asking authorization may only be presented in advance.

When a request for authorization is filed, the CNDC may (i) authorize the transaction, (ii) subordinate the authorization of the transaction to the accomplishment of certain conditions, or (iii) reject the authorization.

The Antitrust Law provides that economic concentrations in which the transaction amount and the value of the assets absorbed, acquired, transferred, or controlled in Argentina, do not exceed the 20 million mobile units that, according to the aforementioned Resolution of the Secretaría de Comercio Interior del Ministerio de Desarrollo Productivo, represent ARS 1.105.000.800 each are exempted from the administrative authorization. Notwithstanding the foregoing, when the transactions effected by the companies concerned during the prior 12-month period exceed in the aggregate ARS 1,105,000,800 the 60 million mobile units that, according to said Resolution of the Secretaría de Comercio Interior del Ministerio de Desarrollo Productivo, is equivalent to the sum of ARS 3,317,400 in the last 36 months, these operations they must be notified to the CNDC.

122

As our consolidated annual sales volume and our parent’s consolidated annual sales volume exceed ARS 1.105.000.800, in cases of concentrations in which we are the acquiring party we should give notice to the CNDC of any concentration provided for by the Antitrust Law, provided that the cases of exception of the notification obligation of article 11 Law 27,442 are not presented.

Sustainability

Sustainability is a central pillar of our organization. Our policy is based on the United Nations Sustainable Development Goals, and we work in this direction internally within our organization and externally through our value chain, operating as agents of social and environmental change. We seek to apply the best agricultural practices in our fields through the responsible use of natural resources and the most modern and sustainable technologies, with the mission of producing quality food for a growing world population.

The agricultural activity that we develop allows us to relate to communities throughout the national territory since we own farms from Salta to Santa Cruz. We live daily with nature and the social challenges that each region has in store for us. We listen to the communities and give specific answers to each one to accompany them in their development.

We work with schools, community centers and NGOs throughout Argentina. In the eight rural schools located in Salta, Santa Fe and Chaco, we focus our Social Responsibility programs taking education, health, and care for the environment as pillars, while we have made building improvements. In our “Los Pozos” farm, located in the north of Argentina and where we have six rural schools, many students are already studying and graduating from high school remotely through satellite internet and we plan to improve the educational level by working together with civil organizations.

We promote transformations that boost economic activity in the territory, hand in hand with access to social, health and educational services, as well as housing and better infrastructure, including communications technology. Our view of development goes beyond business profitability and adds aspects associated with quality of life, in its broadest sense. The company contributes with its own role, but also intends to be an actor of innovation, social cohesion, and construction of possibilities.

Environmental management

Environmental management is a commitment assumed by CRESUD, which is declared through its Environmental Policy, and manifests itself in everyday management.

· We are committed to the environment.

· We innovate in the use of best practices for the development of our activities.

· We work to achieve a balance between the efficient use of resources and a growing production.

· We care about the relationship with our people and the communities where we choose to work, of which we are a part.

· We plan for the long term, seeking to develop in a sustainable way so that our environment can also be enjoyed by future generations.

· We work towards continuous improvement and compliance with current legislation and regulations, including those to which we voluntarily subscribe.

· We are part of a process of cultural change, which we share and extend to the people with whom we interact.

123

We are aware of the impacts caused by the activities we develop, and we strive to prevent and mitigate them. The responsible management of natural and human resources and the protection of the environment is part of our daily tasks:

· We comply with applicable and current regulations at the municipal, provincial, and national levels.

· We evaluate the environmental aspects and impacts of our operations and take prevention and control measures to reduce and mitigate them: We work in interdisciplinary teams to address the impacts and prevention and control measures.

· We make rational and efficient use of natural resources, applying the best practices in our fields, homes, and offices.

· We promote differentiated waste management through reduction, reuse, and recycling

· The gates of our fields are open to the community, regulatory bodies, customers, suppliers, employees, and other interested parties to share our work model, technological innovations and the results achieved.

Environmental Certifications

We implement an Environmental Management System that serves as a tool for proper management in each establishment, with improvement and environmental protection objectives. We have a specialized internal team to carry out annual audits detecting deficiencies and working towards their improvement.

Agroriego farm in the province of San Luis serves as an example, which for more than ten years has been consecutively certified by the Environmental Management Standard ISO 14001-2015. It was also achieved, in joint work with its contractors, the certification of the ISO 14130 standard for the implementation of “Good Practices for Agricultural Work”.

Technological innovation

We know that investment in new technologies contributes not only to productive efficiency but also to the development of a sustainable and efficient activity in the use of resources. It is because of that:

· We strive to implement good agricultural practices such as crop rotation, direct seeding, integrated pest management.

· We use inputs efficiently to ensure the maximum return with the minimum environmental impact. Using tools such as directed applications of agrochemicals as well as variable planting by adjusting the number of seeds and fertilizers.

· Through the flight of unmanned aircraft with remote sensors, we monitor crops and obtain vegetation indices for a better agronomic diagnosis.

· Using satellite images, soil maps and rainfall maps, we define the capacity for land use and carry out activities based on their suitability, whether for livestock or agriculture. Soil analyzes are carried out every year to assess their condition and if any correction is needed based on the crop to be planted. We are working with INTA to define an indicator that can help us monitor the state of our soils and their evolution.

124

· Every year we increase the area of “cover crops”. With the aim of improving soil fertility and water quality, controlling weeds and pests, and increasing biodiversity in agroecological production systems (Lu et al, 2000). Reducing the use of fertilizers and phytosanitary products, making a more rational and efficient use of water, whether from rain or irrigation.

· We also work on the integrated control of pests and weeds, carrying out constant monitoring and applications. In the case of weeds through the "WeedSeeker" technology, which applies phytosanitary products only where the weeds are found. In this way we reduce the unnecessary use of chemical products protecting the soil, water, flora, and local fauna.

· A large part of the planting area is carried out using variable planting technology, determining the potential of each environment within each lot with the aim of improving the use of inputs and making an optimal distribution of them, whether seeds or fertilizers. In some cases, the "Precision Planting" system is used to further improve planting quality.

· We carry out quality controls in all our tasks, sowing, harvesting, spraying, fertilization, etc. In addition, checks are carried out on each of our machines, before and during the work, to have the best quality in all our work.

· In irrigation, soil moisture, forecasts and satellite images are permanently monitored, to use the least amount of water possible. We have underground drip irrigation that increases the efficiency of the system, avoiding resource losses due to evapotranspiration. The groundwater is also monitored to ensure that there are no agrochemical residues.

· All the farms have meteorological stations for weather monitoring and the possibility of making productive decisions.

· Monitoring of natural resources is carried out through measurements of energy consumption, water, flora and fauna, quality of productive and reserve soils.

Fundación IRSA

Fundación IRSA was created in 1996 with the purpose of generating programs and accompanying initiatives that promote the integral development of people with a special focus on education, human well-being and social inclusion. Likewise, it supports organizations in society with the conviction that only through joint work and networking can be achieved the true changes necessary to achieve full citizenship and an equitable and inclusive society.

The work of the Fundación IRSA is framed in 4 lines of action that open innovative paths in the construction of a sense of community. These pillars are:

Education: training, cultural learning and research in education are promoted to enhance the development of people. With the intention of accompanying and developing projects that provide new training opportunities in the formal and non-formal educational field for the growth of society.

Together with other social organizations, it works for the recognition of the value that exists in identity and respect for diversity, since its inception it finances the “Education Observatory” for the construction of statistical data on Argentine Education with evidence, consensus, and collaboration. Social. And for 6 years, it has been promoting the training of young professionals in technical and bachelor's degrees that make up the Argentine medical care system, with a special focus on nutrition, early childhood and nursing.

Human well-being: understanding human well-being as an aspect that crosses the whole human being and brings it closer to its needs for access to information, material goods, psychological, affective, inspiring to lead a dignified life, good health, food, and good social relations. Fundación IRSA seeks to focus on research and assistance to help reduce differences in a context concerned with health. Since 2014, it has been investing in improving hospital equipment and providing state-of-the-art devices and health supplies to hospitals and health centers in our country. Fundación IRSA, together with other entities, financed the creation of the GDFE Health Observatory, an initiative that seeks to contribute to the construction of public-private consensus for the design, implementation, and support of State policies with health rationality, a legal perspective and effectiveness tested.

125

Also, with the aim of contributing to the most vulnerable populations having a healthy diet, it allocates economic resources for more than 20 community kitchens and 2,900 people with the objective that they complement the monthly diet with fruits, vegetables, meats, and dairy products and can provide themselves with cleaning and personal hygiene items.

Insertion / inclusion: contributes with special interest in an area that worries society, in the context of an economic and health crisis; with two specific lines of action, associated with “Employability” and “Violence”. “Employability”, associated with the set of skills and talents that allow a person to be able to find and keep a job. With a focus on the age group over 40 years old, generating new opportunities for job insertion and reinvention. And “Violence” through research and generating evidence that can collaborate with the updating and improvement of the public policy system.

Since 2021, Fundación IRSA has been the main investor in the creation of the first “Observatory on First Practices for Addressing Child Abuse”. During the first year, together with “Red por la Infancia”, a first survey was carried out on the regulatory framework and current public policies on all forms of violence that have an impact on the lives of children and adolescents. After completing its first stage, it is proposed to gather evidence to contribute to the construction of a diagnosis of the situation and identify the degree of normative development, the pending challenges at the legislative level, the degree of progress in public policies and in the administration of justice in protection of children against violence.

The need to influence 4 fundamental axes to generate a virtuous circle that produces systemic changes in prevention and response was confirmed:

1. Strengthen regulatory frameworks for the protection of children against violence.

2. Improve the architecture and design of prevention, protection, and response systems for violence against children and adolescents.

3. Influence the customs, beliefs, mandates, and values that tolerate, minimize, and therefore perpetuate violence against children intergenerationally.

4. Involve the private sector and the media in the protection of violence against children and adolescents.

Strengthening: strengthens the institutional capacity of non-profit organizations through their cooperation and alliance. In this sense, Fundación IRSA accompanies social organizations throughout the country so that they can achieve their mission, grow and develop.

Since March, for example, more than 1,060 outerwear and 170 items have been delivered to 5 foundations and NGOs through the “Revaluation of Materials” program, in which finds are collected and classified (lost objects of customers in shopping malls) to then be distributed.

Also, it continues with the internal MultipliDAR program through which all employees of the IRSA Group companies are offered the possibility of multiplying their personal donations to civil society organizations in their reference world to strengthen their solidarity initiative. Through the Multiplidar program, the amount that the collaborator has previously donated to the entity is equalized, doubled, and tripled.

During fiscal year 2022, the Fundación IRSA worked with 66 civil society organizations making a direct social investment of ARS 93.8 million.

126

Puerta 18 Foundation

“Puerta 18” Foundation is a free space for artistic and technological creation for young people from 13 to 24 years old. Through a non-formal education proposal, it encourages the development of skills, vocations and talents in young people through the multiple resources offered by technology.

Throughout its 15 years, more than 5,000 young people received free training and today there are more than 250 who have found employment in areas related to their training at the institution. Two years ago, the foundation for pursuing objectives of “common good” achieved recognition from the IGJ (General Inspection of Justice) so that through article 81c, the donations received can be deductible from profits, encouraging more companies to join and amplify the impact.

Our gaze is based on placing the young person at the center of the proposal, which revolves around his interests and needs, and where educators act as facilitators using technology as a tool. Some of the disciplines we work with are: Graphic Design, Photography, UX, Programming, Comprehensive Video Production, 3D Modeling and Animation, Videogames, Robotics, among others.

New normality

After years of pandemic and quarantine, the Foundation resumed face-to-face activities, focusing on “remote” proposals. Slowly, contact with the young people who had not participated so much virtually was resumed, and by June 2022, a level of activity and impact similar to pre-pandemic levels was achieved.

Currently, the Foundation offers activities for +70 young people per day on average, both in the 13-18 age bracket and +18, concentrating all its actions at the headquarters on Zelaya Street. In turn, together with #DigitAR, they awarded scholarships to 12 young people to continue their training studies in other study centers, expanding their social capital, deepening their knowledge, and significantly improving their job opportunities.

Fundación Museo de los Niños

Museo de los Niños Abasto is an interactive museum that recreates the spaces of a city where children can play to be a doctor, cameraman, captain, sailor, banker, cook, broadcaster, journalist, nurse, actress, mom, dad and many more things.

The Museum proposes an enriching and alternative meeting space that integrates play, movement, perception, understanding and expression, encouraging curiosity, interest in knowing and imagination from a transforming point of view. Based on the Declaration of the Rights of the Child, it has been designed to encourage each child to develop their own potential: “learning by doing” and “playing and having fun while learning” are fundamental concepts for the Museum.

The Museum is dedicated to children up to 12 years of age, their families, educators and, through all of them, the community. And for the little ones, up to 3 years old, it has two soft rooms specially built to stimulate their activity.

In addition, it has an Exhibition Hall and an Auditorium where shows, film screenings, conferences, book presentations and various events are held.

Museo de los Niños has been declared:

- Of educational interest by the Argentina’s Ministry of Education. Resolution No. 123.

- Of cultural interest by the Secretary of Culture and Communication of the Presidency of Argentina. Resolution No. 1895.

- Of cultural interest by the Secretary of Culture of the Buenos Aires City Government.

127

- Of cultural interest by the INADI (National Institute against Discrimination, Xenophobia and Racism).

- Of tourist interest by the Secretary of Tourism of the Presidency of Argentina. Resolution No. 281.

- Sponsorship of the Secretary of Education of the Government of the City of Buenos Aires. Resolution No. 537.

C.    Organizational Structure

Subsidiaries and associated companies

The following table includes a description of our direct subsidiaries and associated companies as of June 30, 2022:

Companies	Effective Ownership and Voting Power Percentage	Property/Activity
Agro-Uranga S.A.	34.86%	Agro-Uranga S.A. is an agricultural company which owns 2 farmlands (Las Playas and San Nicolás) that have 8.299 hectares on the state of Santa Fe and Córdoba.
Uranga Trading S.A.	34.86%	Uranga Trading S.A. is committed to facilitate and optimally manage the trade of grains of the highest quality, locally and internationally.
BrasilAgro Companhia Brasileira de Propiedades Agrícolas	39.56%(1)(3)	BrasilAgro is mainly involved in four areas: sugar cane, crops and cotton, forestry activities, and livestock.
Futuros y Opciones.Com S.A.	50.10%	A leading agricultural web site which provides information about markets and services of economic and financial consulting through the Internet. The company has begun to expand the range of commercial services offered to the agricultural sector by developing direct sales of supplies, crops brokerage services and cattle operations.
Amauta Agro S.A. (formerly known as FyO Trading S.A.)	98.57%(2)	Amauta Agro S.A.’s purpose is to engage, in its own name or on behalf of or associated with third parties, in activities related to the production of agricultural products and raw materials, export and import of agricultural products and national and international purchases and sales of agricultural products and raw materials.
FyO Acopio S.A. (formerly known as Granos Olavarria S.A.)	98.57%(2)	FyO Acopio S.A. is principally engaged to the warehousing of cereals and brokering of grains.
Helmir S.A.	100%	Helmir S.A. is involved in investments in entities organized in Uruguay or abroad through the purchase and sale of bonds, shares, debentures and any kind of securities and commercial paper under any of the systems or forms created or to be created, and to the management and administration of the capital stock it owns on companies controlled by it.
IRSA Inversiones y Representaciones Sociedad Anónima	53.94%(1)(3)	It is a leading Argentine company devoted to the development and management of real estate.

_________________

(1)	Excludes effect of treasury stock.
(2)	Includes Futuros y Opciones.Com S.A.’s interest.
(3)	Includes Helmir’s interest.

128

D.    Property, Plants and Equipment

Overview of Agricultural Properties

As of June 30, 2022, we owned, together with our subsidiaries, 26 farmlands, which have a total surface area of 617,481, hectares.

The following table sets forth our properties’ size (in hectares), primary current use and book value:

	Facility	Province	Country	Gross Size (in hectares)	Date of Acquisition	Primary Current Use	Net Book Value (ARS Millions) (1)
1	El Recreo	Catamarca	Argentina	12,395	may-95	Natural woodlands	52
2	Los Pozos	Salta	Argentina	239,639	May ’95	Cattle/ Agriculture/ Natural woodlands	5,055
3	San Nicolás/Las Playas (2)	Santa Fe/Córdoba	Argentina	2,893	May ‘97	Agriculture/ Dairy	-
4	La Gramilla/ Santa Bárbara	San Luis	Argentina	7,072	Nov ‘97	Agriculture Under irrigation	1,486
5	La Suiza	Chaco	Argentina	26,371	Jun ‘98	Agriculture/ Cattle	1,149
6	El Tigre	La Pampa	Argentina	8,360	Apr ‘03	Agriculture/ Dairy	1,493
7	San Pedro	Entre Rios	Argentina	3,584	Sep ‘05	Agriculture	1,198
8	8 De Julio/ Estancia Carmen	Santa Cruz	Argentina	100,911	May ‘07/ Sep ‘08	Sheep	369
9	Administración Cactus	San Luis	Argentina	171	Dec ‘97	Natural woodlands	23
10/11/12	Las Londras/San Rafael/ La Primavera	Santa Cruz	Bolivia	10,021	Nov-08/Jan-11	Agriculture	—
13	Finca Mendoza	Mendoza	Argentina	674	Mar ‘11	Natural woodlands	—
14	Establecimiento Mendoza	Mendoza	Argentina	9	Nov’03	Natural woodlands	214
15	Marangatú/Udra (3)	Mariscal Estigarribia	Paraguay	59,585	feb-09	Agriculture /Natural Woodlands	6,209
16/25	BrasilAgro(3)		Brazil	145,795		Agriculture/ Forestry/Cattle	19,820
	Subtotal			617,481			37,068

___________________

(1)	Acquisition costs plus improvements and furniture necessary for the production, less depreciation.
(2)	Hectares and carrying amount in proportion to our 34.86% interest in Agro-Uranga S.A.
(3)	See the section “Overview of BrasilAgro’s Properties”.

Overview of BrasilAgro’s Properties

As of June 30, 2022, we owned, together with our subsidiaries, 14 farmlands, which have a total surface area of 215,400 hectares, acquired at a highly convenient value compared to the average of the region, all of them with a great appreciation potential.

		Total Area					Net book Value
Properties	Place	(ha)			Use		(ARS Millions)		(USD Millions)
Jatobá Farmland	Jaborandi/BA			13,276	Agriculture			3,180		25
Alto Taquari Farmland	Alto Taquari/MT			1,380	Agriculture			441		4
Araucária Farmland	Mineiros/GO			5,534	Agriculture			1,633		13
Chaparral Farmland	Correntina/BA			37,182	Agriculture			3,535		28
Nova Buriti Farmland	Januária/MG			24,212	Forestry			578		5
Preferência Farmland	Barreiras/BA			17,799	Cattle			838		7
São José Farmland	Maranhão/MA			17,566	Agriculture			2,801		22
Marangatu/ Udra Farmlands	Boqueron Paraguay			59,585	Agriculture			6,209		50
Arrojadinho Farmland	Barreiras/BA			16,642	Agriculture			2,453		20
Rio do Meio Farmland	Correntina/BA			7,715	Agriculture			3,358		27
Serra Grande Farmland	Piaui/BA			4,489	Agriculture			1,003		8
Las Londras	Santa Cruz/Bolivia		4,555	Agriculture		1,887		15
San Rafael	Santa Cruz/Bolivia		3,109	Agriculture		747		6
La Primavera	Santa Cruz/Bolivia		2,356	Agriculture		1,015		8
				215,400				29,678		238

129

Overview of Urban Properties and investment business

In the ordinary course of business, the leases property or spaces for administrative or commercial use both in Argentina and Israel under operating lease arrangements. The agreements entered into include several clauses, including but not limited, to fixed, variable or adjustable payments.

The following table sets forth certain information about our properties for the Urban Properties and investment business as of June 30, 2022:

Property(6)	Date of Acquisition	Leasable/ Sale sqm / Rooms		Location	Net Book Value ARS(2)		Use	Occupancy rate
Bankboston Tower(3)(13)	Aug-07		-	City of Buenos Aires		409	Office Rental		N/A
Bouchard 551	Mar-07		-	City of Buenos Aires		644	Office Rental		N/A
Intercontinental Plaza Building	Nov-97		2,979	City of Buenos Aires		2,846	Office Rental		100.0	%
Dot Building	Nov-06		11,242	City of Buenos Aires		9,722	Office Rental		92.6	%
Zetta Building	Jun-19		32,173	City of Buenos Aires		27,749	Office Rental		92.2	%
Phillips Building	Jun-17		8,017	City of Buenos Aires		6,104	Office Rental		81.4	%
San Martín plot (ex Nobleza Picardo)	May-11		109,610	Province of Buenos Aires, Argentina		8,818	Other Rentals		22.5	%
Other Properties(5)	N/A		N/A	City and Province of Buenos Aires / Detroit U.S		8,173	Other Rentals		N/A
Abasto Shopping	Nov-99		37,162	City of Buenos Aires, Argentina		12,380	Shopping Mall		98.9	%
Alto Palermo Shopping	Dec-97		20,507	City of Buenos Aires, Argentina		14,223	Shopping Mall		98.0	%
Alto Avellaneda	Dec-97		39,944	Province of Buenos Aires, Argentina		9,231	Shopping Mall		81.4	%
Alcorta Shopping (12)	Jun-97		15,812	City of Buenos Aires, Argentina		8,962	Shopping Mall		99.7	%
Patio Bullrich	Oct-98		11,664	City of Buenos Aires, Argentina		3,920	Shopping Mall		92.4	%
Alto Noa	Nov-95		19,388	City of Salta, Argentina		1,996	Shopping Mall		96.7	%
Mendoza Plaza	Dec-94		42,149	Mendoza, Argentina		3,374	Shopping Mall		91.1	%
Alto Rosario	Dec-04		33,957	Santa Fe, Argentina		7,487	Shopping Mall		96.3	%
Córdoba Shopping –Villa Cabrera(11)	Dec-06		15,368	City of Córdoba, Argentina		2,215	Shopping Mall		100.0	%
Dot Baires Shopping	May-09		47,296	City of Buenos Aires, Argentina		11,290	Shopping Mall		83.5	%
Soleil Premium Outlet	Jul-10		15,734	Province of Buenos Aires, Argentina		3,384	Shopping Mall		100.0	%
La Ribera Shopping	Aug-11		10,531	Santa Fe, Argentina		570	Shopping Mall		97.1	%
Distrito Arcos	Dec-14		14,457	City of Buenos Aires, Argentina		4,818	Shopping Mall		100.0	%
Alto Comahue	Mar-15		11,697	Neuquén, Argentina		3,632	Shopping Mall		97.4	%
Patio Olmos	Sep-97		-	City of Córdoba, Argentina		2,081	Shopping Mall		N/A
Beruti Parking Space	N/A		-	City of Buenos Aires		1,149	Shopping Mall		N/A
Caballito Plot of Land	Nov-97		-	City of Buenos Aires		7,782	Land Reserve		N/A
Costa Urbana	Oct-97		693,445	City of Buenos Aires		89,309	Other Rentals		N/A
Ezpeleta Plot of land	May-22		-	Province of Buenos Aires, Argentina		4,065	Other Rentals		N/A
Beruti and Coronel Diaz Building	Jun-22		-	City of Buenos Aires		3,131	Other Rentals		N/A
Catalinas Building	Dec-20		18,016	City of Buenos Aires		18,691	Offices and Other Rentals		67.1	%
Luján plot of land	May-08		1,160,000	Province of Buenos Aires, Argentina		2,238	Mixed uses		N/A
Other Land Reserves(4)	N/A		N/A	City and Province of Buenos Aires		14,717	Land Reserve		N/A
Other Developments(15)	N/A		0	City of Buenos Aires		567	Properties under development		N/A
Buildable potentials(14)	N/A		N/A	City of Buenos Aires, Córdoba and Santa Fé		6,714	Other Rentals		N/A
Intercontinental Hotel(7) (12)	Nov-97		313	City of Buenos Aires		1,273	Hotel		35.1	%
Libertador Hotel(8) (12)	Mar-98		200	City of Buenos Aires		526	Hotel		26.3	%
Llao Llao Hotel(9) (10) (12)	Jun-97		205	City of Bariloche		2,324	Hotel		61.2	%
Others (3)	N/A		N/A	City and Province of Buenos Aires		291	Others		N/A

130

____________________

(1)	Total leasable area for each property. Excludes common areas and parking spaces.
(2)	Shopping Malls, Offices and Land Reserves are valued at fair value. Our Hotels are valued at cost of acquisition or development plus improvements, less accumulated depreciation, less allowances.
(3)	Includes the following properties: EH UT and DirecTV Arena Stadium.
(4)	Includes the following land reserves: Pontevedra plot, San Luis Plot, Pilar plot, Intercontinental Plot, the building and plot annexed to Dot, Mendoza Plot, Luján plot, Mendoza and La Plata plot.
(5)	Includes the following properties: Anchorena 665, Anchorena 545 (Chanta IV), Zelaya 3102, 3103 y 3105, Madero 1020, La Adela, Paseo del Sol, Libertador 498 and Detroit properties.
(6)	Percentage of occupation of each property. Land reserves are assets that the company keeps in the portfolio for future developments.
(7)	Through Nuevas Fronteras S.A.
(8)	Through Hoteles Argentinos S.A.U.
(9)	Through Llao Llao Resorts S.A.
(10)	Includes “Terreno Bariloche.”
(11)	The cinema building located at Córdoba Shopping – Villa Cabrera is included in Investment Properties, which is encumbered by a right of antichresis as a result of loan due to Empalme by NAI INTERNACIONAL II Inc. Includes “Ocampo parking spaces”.
(12)	Express in number of rooms.
(13)	The offices were totally sold during the fiscal year ended June 30, 2021.
(14)	Includes buildable potentials related to the following shopping malls: Patio Bullrich, Alto Palermo, Córdoba Shopping and Alto Rosario.
(15)	Includes the following developments: PH Office Park, Phillips Building and Alto Avellaneda (Wal-Mart).

Insurance

Agricultural Business

We carry insurance policies with insurance companies that we consider to be financially sound. We employ multi-risk insurance for our farming facilities and industrial properties, which covers property damage, negligence liability, fire, falls, collapse, lightning and gas explosion, electrical and water damages, theft, and business interruption. Such insurance policies have specifications, limits and deductibles which we believe are customary. Nevertheless, they do not cover damages to our crops. We carry directors and officer’s insurance covering management’s civil liability, as well as legally mandated insurance, including employee personal injury. We also provide life or disability insurance for our employees as benefits.

We believe our insurance policies are adequate to protect us against the risks for which we are covered. Nevertheless, some potential losses are not covered by insurance and certain kinds of insurance coverage may become prohibitively expensive.

131

The types of insurance used by us are the following:

Insured Property	Risk Covered	Amount Insured (in Millions of ARS)		Book Value (in Millions of ARS)
Buildings, machinery, silos, installation and furniture and equipment	Theft, fire and technical insurance		5,161		13,986
Vehicles	Theft, fire and civil and third parties liability		253		129

Urban Properties and Investment Business

IRSA carries all-risk insurance for the shopping malls and other buildings covering property damage caused by fire, terrorist acts, explosion, gas leak, hail, storms and wind, earthquakes, vandalism, theft and business interruption. In addition, IRSA carries liability insurance covering any potential damage to third parties or property caused by the conduct of our business throughout Argentina. IRSA is in compliance with all legal requirements related to mandatory insurance, including insurance required by the Occupational Risk Law (Ley de Riesgos del Trabajo), life insurance required under collective bargaining agreements and other insurance required by laws and executive orders. IRSA’s history of damages is limited to one single claim resulting from a fire in Alto Avellaneda Shopping in March 2006, a loss which was substantially recovered from our insurers. These insurance policies contain specifications, limits and deductibles which we believe are adequate to the risks to which we are exposed in our daily operations. IRSA also maintains liability insurance covering the liability of our directors and corporate officers.

Control Systems

IRSA has computer systems equipped to monitor tenants’ sales in all of its shopping malls. IRSA also conducts regular audits of our tenants’ accounting sales records in all of our shopping malls. IRSA uses the information generated from the computer monitoring system to prepare statistical data regarding, among other things, total sales, average sales and peak sale hours for marketing purposes and as a reference for the internal audit. Most of its shopping mall lease agreements require the tenant to have its point of sale system linked to our server.

Item 4A. Unresolved Staff Comments

This item is not applicable.

Item 5. Operating and Financial Review and Prospects

A.    Operating Results

The following management’s discussion and analysis of our financial condition and results of operations should be read together with our Audited Consolidated Financial Statements and related notes appearing elsewhere in this Annual Report. This discussion and analysis of our financial condition and results of operations contains forward-looking statements that involve risks, uncertainties and assumptions. These forward-looking statements include such words as, “expects,” “anticipates,” “intends,” “believes” and similar language. Our actual results may differ materially and adversely from those anticipated in these forward-looking statements as a result of many factors, including without limitation those set forth elsewhere in this Annual Report. See Item 3 “Key Information – D. Risk Factors” for a more complete discussion of the economic and industry-wide factors relevant to us.

132

The objective of this Management’s Discussion and Analysis section is to provide a description of our economic and financial condition as of June 30, 2022, particularly considering that the operating results for fiscal years 2021 and 2020 have been affected by the restrictions due to the COVID19 pandemic. Our shopping malls and hotels were closed for most of the years 2021 and 2020 while the offices remained operational, even though most of the tenants adopted the remote work modality. In this sense, the purpose of this management’s discussion and analysis are to describe the impact of the pandemic and other macroeconomic or operational drivers over our business segments in order to explain the reasons or causes that originate our results of operations.

General

We prepare our Audited Consolidated Financial Statements in pesos and in accordance with IFRS, as issued by the IASB, and with CNV Rules.

Our Audited Consolidated Financial Statements and the financial information included elsewhere in this Annual Report have been prepared in accordance with IFRS. We have determined that, as of July 1, 2018, the Argentine economy qualifies as a hyperinflationary economy according to the guidelines of IAS 29 since the total cumulative inflation in Argentina in the 36 months prior to July 1, 2018 exceeded 100%. IAS 29 requires that the financial information recorded in a hyperinflationary currency be adjusted by applying a general price index and expressed in the measuring unit (the hyperinflationary currency) current at the end of the reporting period. Therefore, our Audited Consolidated Financial Statements included in this Annual Report have been adjusted by applying a general price index and expressed in the measuring unit (the hyperinflationary currency) current at the end of the reporting period (June 30, 2022). See “Risk Factors—Risks Relating to Argentina—A high level of uncertainty with regard to these economic variables, and a general lack of stability in terms of inflation, could have a negative impact on economic activity and adversely affect our financial condition.

Revenue Recognition

The Company identifies contracts with customers and evaluates the goods and services committed therein to determine performance obligations and their classification between performance obligations that are satisfied at a given time or over time.

Revenue from satisfaction of performance obligations at a given time is recognized when the client obtains control of the committed asset or service considering whether there is a right to collection, if the client has the physical possession, if the client has the legal right and if they have the transferred the risks and benefits.

In accordance with IFRS 15, the Company recognizes revenues over time from the sales of real estate developments in which there is no alternative use for the asset and the Company has the right to demand payment of the contract. When these conditions are not met, the income is recognized at the time of delivery or deed, depending on the case, when the risk transfers are completed, the collection is reasonably assured and there is a price already determined.

Revenue from satisfaction of performance obligations over time for real estate developments is recognized by measuring progress towards compliance with the obligation when it can be measured reliably. For this measurement, the Company uses the input method, that is, the effort consumed by the entity and determines the percentage of progress based on the estimate of the total development costs.

The Company’s revenue is recognized at the probable value of the consideration to which it will be entitled in exchange for transferring the products or services to the customer which is not expected to suffer significant changes.

Agricultural activities

Revenue from our agricultural activities comes primarily from sales of agricultural produce and biological assets, from provision of services related to the activity and from leases of farmlands.

We also provide agricultural-related (including but not limited to watering and feedlot services) and brokerage services to third parties. Revenue from services is recognized when services are effectively rendered.

133

We also lease land to third parties under operating lease agreements. Lease income is recognized on a straight-line basis over the period of the lease.

· Sale of goods

Revenue from sales of grains and sugarcane sales is recognized when performance obligations are met, which consists of transforming the significant risks and benefits of ownership of the goods are transferred to the purchaser, usually when the products are delivered to the purchaser at the determined location, according to the agreed sales terms.

In the case of grains, the Company normally enters into forward contracts under which the Company is entitled to determine the sale price for the total or partial volume of grains sold, through the delivery date, based on formulas contractually agreed upon. In some cases, the formulas used to determine the sales price are stated in U.S. dollars.

Upon the delivery of grains, revenue is recognized based on the price determined for each client considering the foreign exchange rate on the delivery date when applicable. After the grains are delivered to the client, the quality and final weight are assessed, and the final price of the transaction is agreed upon, which result in adjusting the original contractual amounts, and any foreign exchange rate variation through the settlement date.

· Sale of farms

Revenue from sale of farms is not recognized until performance obligations are met, which consists of: (i) the sale be in completed, (ii) the Company has determined that it is probable the buyer will pay, (iii) the amount of revenue can be measured reliably, and (iv) the Company has transferred all risks and rewards to the buyer and does not have a continuing involvement. Usually this coincides with the buyer making the first down payment, moment when the transfer of possession is completed, according to the contractual terms. The result from sales of farms is presented in the statement of income as “Gain from disposal of farmlands” net of the related cost.

· Sales of beef cattle

Revenue from the sale of beef cattle is recognized when performance obligations are met, which consists of transferring the material risks and the benefits of cattle ownership to the buyer, usually when the cattle is delivered to the buyer at the specified place, in accordance with the terms of the sale agreed upon.

As for the sale of beef cattle, the Company’s operation consists basically of a project involving the production and sale of beef calves after weaning (this process is called rearing). However, some animals that prove to be infertile may be sold to meat packers for slaughtering. At Paraguay operations, the project consists in fattening and selling these animals for slaughtering. The pricing for sale of cattle is based on the market price of the arroba of fed cattle in the respective market (the arroba price is verified on the transaction date), the animal weight, plus the premium related to the category. The sale of cattle in Brazil and Paraguay operations, in turn, considers the price of the arroba of fed cattle or heifer/cow on the date of sale in the respective market, applied to carcass yields.

Urban properties and investments activities

· Rental and services - Shopping malls portfolio

Revenues derived from business activities developed in our shopping malls mainly include rental income under operating leases, admission rights, commissions and revenue from several complementary services provided to our lessees.

The Argentine Civil and Commercial Code section 1221 provides that tenants may rescind commercial lease within the initial six months by means of written notification. If option is used within the first year of the lease, the Tenant shall pay the Lessor, as compensation, the equivalent of one-and-a-half month’s rent, and one month’s rent if the tenant makes use of the option after that period. Given that the rule does not provide for advance notice, Lease Agreements include a provision whereby the lessee must give at least 60 days advance notice of its intention to terminate the lease. The exercise of such early termination could materially and adversely affect us.

134

We have determined that, in all operating leases, the lease term for accounting purposes matches the term of the contract. We concluded that, even though a lease is cancellable under law, tenants would incur significant “economic penalties” if the leases are terminated prior to expiry. We considered that these economic penalties are of such amount that continuation of the lease contracts by tenants appears to be reasonably certain at the inception of the respective agreements. We reached this conclusion based on factors such as: (i) the strategic geographical location and accessibility to customers of our investment properties; (ii) the nature and tenure of tenants (mostly well-known local and international retail chains); (iii) limited availability of identical revenue-producing space in the areas where our investment properties are located; (iv) the tenants’ brand image and other competitive considerations; (v) tenants’ significant expenses incurred in renovation, maintenance and improvements on the leased space to fit their own image; (vi) the majority of our tenants only have stores in shopping malls with a few or none street stores. See details in Note 22 to our Audited Consolidated Financial Statements.

Lessees of rental space located within shopping malls are generally required to pay the higher of: (i) a base monthly rent (the “Base Rent”) and (ii) a specific percentage of gross monthly sales recorded by the Lessee (the “Contingent Rent”), which generally ranges between 3% and 12% of the lessees’ gross sales. In addition, in accordance with the standard terms of the typical commercial lease, the Base Rent is usually increased at that time by the Consumer Price Index (CPI) in Argentina.

In addition, some leases include provisions that set forth variable rent based on specific volumes of sales revenue and other types of ratios.

Rental income from shopping mall, admission rights and commissions, are recognized in the Consolidated Statements of Income and Other Comprehensive Income on a straight-line basis over the term of the leases. When lease incentives are granted, they are recognized as an integral part of the net consideration for the use of the property and are therefore recognized on the same straight-line basis.

Contingent rents, i.e. lease payments that are not fixed at the inception of a lease, are recorded as income in the periods in which they are known and can be determined. Rent revisions are recognized when such reviews have been agreed with tenants.

Tenants in our shopping malls are also generally charged a non-refundable admission right upon entering a lease contract or renewing an existing one. Admission rights are treated as additional rental income and recognized in the Consolidated Statements of Income and other Comprehensive Income on a straight-line basis over the term of the respective lease agreement.

We act as our own leasing agent for arranging and closing lease agreements for our shopping malls properties and consequently earn letting fees. Letting fees are paid by tenants upon the successful closing of an agreement. A transaction is considered successfully concluded when both parties have signed the related lease contract. Letting fees received by us are treated as additional rental income and are recognized in the Consolidated Statements of Income and Other Comprehensive Income on a straight-line basis over the term of the lease agreements.

Our lease contracts also provide that common area maintenance charges and collective promotion funds of our shopping malls are borne by the corresponding lessees, generally on a proportional basis. These common area maintenance charges include all expenses necessary for various purposes including, but not limited to, the operation, maintenance, management, safety, preservation, repair, supervision, insurance and enhancement of the shopping malls. The lessor is responsible for determining the need and suitability of incurring a common area expense. We make the original payment for such expenses, which are then reimbursed by the lessees. We consider that it acts as a principal in these cases. Service charge income is presented separately from property operating expenses. Property operating expenses are expensed as incurred.

135

Under the terms of the leases, lessees also agree to participate in collective promotion funds (“CPF”) to be used in advertising and promoting our shopping malls. Each lessee’s participation generally equals a percentage calculated based on the monthly accrued rental prices.

Revenue so derived is also included under rental income and services segregated from advertising and promotion expenses. Such expenses are charged to income when incurred.

On the other hand, revenue includes income from managed operations and other services such as car parking spaces. Those revenues are recognized on an accrual basis as services are provided.

· Rental and services - Offices and other rental properties

Rental income from offices and other rental properties include rental income from offices leased out under operating leases, income from services and expenses recovery paid by tenants.

Rental income from offices and other rental properties is recognized in the Consolidated Statements of Income and Other Comprehensive Income on a straight-line basis over the term of the leases. When lease incentives are granted, they are recognized as an integral part of the net consideration for the use of the property and are therefore recognized on the same straight-line basis.

A substantial portion of our leases requires the tenant to reimburse us for a substantial portion of operating expenses, usually a proportionate share of the allocable operating expenses. Such property operating expenses include necessary expenses such as property operating, repairs and maintenance, security, janitorial, insurance, landscaping, leased properties and other administrative expenses, among others. We manage our own rental properties. We make the original payment for these expenses, which are then reimbursed by the lessees. We consider that we act as a principal in these cases. We accrue reimbursements from tenants as service charge revenue in the period the applicable expenditures are incurred and are presented separately from property operating expenses. Property operating expenses are expensed as incurred.

· Revenue from communication services and sale of communication equipment

Revenue derived from the use of our communication networks, including mobile phones, Internet services, international calls, fixed line calls, interconnection rates and roaming service rates and television, are recognized when the service is provided, proportionally to the extent the transaction has been realized, and provided all other criteria have been met for revenue recognition.

Revenue from the sale of mobile phone cards is initially recognized as deferred revenue and then recognized as revenue as they are used or upon expiration, whichever takes place earlier.

A transaction involving the sale of equipment to a final user normally also involves a service sale transaction. In general, this type of sale is performed without a contractual obligation by the client to consume telephone services for a minimum amount over a predetermined period. As a result, we record the sale of equipment separately of the performance obligations and recognize revenue pursuant to the transaction value upon delivery of the equipment to the client. Revenue from telephone services is recognized and accounted for as they are provided over time. When the client is bound to make a minimum consumption of services during a predefined period, the contract formalizes a transaction of several elements and, therefore, revenue from the sale of equipment is recorded at an amount that should not exceed its fair value and is recognized upon delivery of the equipment to the client and provided the criteria for recognition are met. We ascertain the fair value of individual elements, based on the price at which it is normally sold, after taking into account the relevant discounts.

Revenue derived from long-term contracts is recognized at the present value of future cash flows, discounted at market rates prevailing on the transaction date. Any difference between the original credit and its net present value is accounted for as interest income over the credit term.

136

These revenues have been recognized in discontinued operations (see Note 35 to our Audited Consolidated Financial Statements).

· Revenue from hotels

Revenue income from hotel operations mainly includes room services, gastronomy and other services. Revenue from the sale of products is recognized when the product is delivered and the significant risks and rewards of ownership are transferred to the buyer. Revenue from the sale of services is recognized when the service is provided. When the sale of products or services is covered by a customer loyalty program, revenues billed to the customer are allocated between the product or service sold and the award credits granted by the third party that awards the program points. The consideration assigned to the credits, which is measured in reference to the fair value of the points awarded, is deferred and recognized as income when the customer redeems the credits, that is, when a prize is received in exchange for converting the program points.

Effects of the global macroeconomic factors

Most of our assets are located in Argentina, where we conduct our operations. Therefore, our financial condition and the results of our operations are significantly dependent upon economic conditions prevailing in such country.

The table below shows Argentina’s GDP, inflation rates, dollar exchange rates, the appreciation (depreciation) of the Peso against the U.S. dollar for the indicated periods (inter-annual information—which is the 12 month period preceding the dates presented—is presented to conform to our fiscal year periods).

	Fiscal year ended June 30,
	2022			2021			2020
	(inter‑annual data)
GDP (1)		6.9	%		17.9	%		(19.1	)%
Inflation (IPIM) (2)		57.3	%		65.1	%		39.7	%
Inflation (CPI)		64.0	%		50.2	%		42.8	%
Depreciation of the Peso against the U.S. dollar	(30.9		%)	(35.9		%)		(66.1	)%
Average exchange rate per USD 1.00 (3)	ARS 125.13			ARS 95.62			ARS 70.36

___________________

(1)	Represents inter annual growth of the second quarter GDP at constant prices (2004). Historical data is maintained, as exposed originally by us in previous 20-Fs.
(2)	IPIM (Índice de Precios Internos al por Mayor) is the wholesale price index as measured by the Argentine Ministry of Treasury.
(3)	Represents average of the selling and buying exchange rate quoted by Banco de la Nación Argentina as of June 30. As of October 26, 2022, the exchange rate was 155.29 per U.S. dollar.

Sources: INDEC and Banco de la Nación Argentina.

Argentine GDP increased 6.9% interannually during the second quarter of 2022, compared to an increase of 17.9% in the same period of 2021. Nationally, shopping mall sales at current prices in the month of June 2022 relevant to the survey reached a total of ARS 57,994.6 million, which represents an increased of 266.9% compared to June 2021. Accumulated sales for the first six months, represent a 185.7% in current terms and 70.9% increase in real terms as compared to the same period of 2021. The monthly estimate of economic activity (“EMAE”) as of June 30, 2022, increased by 6.4% compared to the same month in 2021. As of June 30, 2022, the unemployment rate was at 6.9% of the country’s economically active population, compared to 9.6% as of June 30, 2021. On the other hand, in the second quarter of 2022, the activity rate stood at 47.9% compared to 45.9% in the same quarter of the previous year. While the employment rate rose to 44.6% in the second quarter of 2022, compared to 41.5% in the second quarter of the previous year.

137

Changes in short- and long-term interest rates, unemployment and inflation rates may reduce the availability of consumer credit and the purchasing power of individuals who frequent shopping malls. These factors, combined with low GDP growth, may reduce general consumption rates at our shopping malls. Since most of the lease agreements at our shopping malls, our main source of revenue, require tenants to pay a percentage of their total sales as rent, a general reduction in consumption may reduce our revenue. A reduction in the number of shoppers at our shopping malls and, consequently, in the demand for parking, may also reduce our revenue from services rendered.

Effects of inflation

The following are annual inflation rates during the fiscal years indicated, based on information published by the INDEC, an entity dependent of the Argentine Ministry of Treasury.

	Consumer price index			Wholesale price index
Fiscal year ended June 30,	(inter‑annual data)
2020		42.8	%		39.7	%
2021		50.2	%		65.1	%
2022		64.0	%		57.3	%

The current structure of IRSA lease contracts for shopping mall tenants generally includes provisions that provide for payment of variable rent, which is a percentage of IRSA’s shopping mall tenants’ sales. Therefore, the projected cash flows for these shopping malls generally are highly correlated with GDP growth and consumption power.

For the leases of spaces at our shopping malls we use for most tenants a standard lease agreement, the terms and conditions of which are described elsewhere in this Annual Report. However, our largest tenants generally negotiate better terms for their respective leases. No assurance can be given that lease terms will be as set forth in the standard lease agreement.

The rent specified in our leases generally is the higher of (i) a monthly Base Rent and (ii) a specified percentage of the store’s monthly gross sales, which generally ranges between 3% and 12% of such sales. In addition, pursuant to the rent escalation clause in most of our leases, a tenant’s Base Rent generally increases on a monthly or quarterly and cumulative basis following the IPC index. In the event of litigation regarding these adjustment provisions, there can be no assurance that we may be able to enforce such clauses contained in our lease agreements. See “Information of the Company—Business Overview—Our Shopping Malls—Principal Terms of our Leases.”

Continuing increases in the rate of inflation are likely to have an adverse effect on our operations. Although higher inflation rates in Argentina may increase minimum lease payments, given that tenants tend to pass on any increases in their expenses to consumers, higher inflation may lead to an increase in the prices our tenants charge consumers for their products and services, which may ultimately reduce their sales volumes and consequently the portion of rent we receive based on our tenants’ gross sales. In addition, we measure the fair market value of our shopping malls based upon the estimated cash flows generated by such assets which, as discussed in previous paragraphs, is directly related to consumer spending since a significant component of the rent payment received from our tenants is tied to the sales realized by such tenants (i.e is a percentage of the sales of our tenants). Therefore, macroeconomic conditions in Argentina have an impact in the fair market value of our shopping malls as measured in Pesos. Specifically, since our tenant’s products have been adjusted (increased) to account for inflation of the Argentine Peso, our expected cash flows from our shopping malls have similarly increased in nominal terms since rent is largely dependent on sales of our tenants in Pesos.

138

Seasonality

Our agricultural business is highly seasonal due to its nature and cycle. The harvest and sale of crops (corn, soybean and sunflower) generally occurs from February to June. Wheat is harvested from December to January. Our operations and sales are affected by the growing cycle of the crops we process and by decreases during the summer in the price of the cattle we fatten. As a result, our results of operations have varied significantly from period to period, and are likely to continue to vary, due to seasonal factors.

Our urban business is directly affected by seasonality, influencing the level of our tenants’ sales. During Argentine summer holidays (January and February) our tenants’ sales typically reach their lowest level, whereas during winter holidays (July) and in Christmas (December) they reach their maximum level. Clothing retailers generally change their collections in spring and autumn, positively affecting our shopping malls’ sales. Discount sales at the end of each season are also one of the main seasonal factors affecting our business. See “Item 5.A. Operating Results – COVID-19 Pandemic.”

Effects of interest rate fluctuations

Most of our U.S. dollar-denominated debt accrues interest at a fixed rate. An increase in interest rates will result in a significant increase in our financing costs and may materially affect our financial condition or our results of operations.

In addition, a significant increase of interest rates could deteriorate the terms and conditions in which our tenants obtain financing from banks and financial institutions in the market. As a consequence of that, if they suffer liquidity problems the collection of our lease contracts could be affected by an increase in the level of delinquency.

Effects of foreign currency fluctuations

A significant portion of our financial debt is denominated in U.S. dollars. Therefore, a devaluation or depreciation of the Peso against the U.S. dollar would increase our indebtedness measured in Pesos and materially affect our results of operations. Foreign currency exchange restrictions imposed by the Argentine government could prevent or restrict our access to U.S. dollars, affecting our ability to service our U.S. dollar denominated‑ liabilities.

In addition, contracts for the rental of office buildings are generally stated in U.S. dollars, so a devaluation or depreciation of the Peso against the U.S. dollar would increase the risk of delinquency on our lease receivables.

As discussed above, we calculate the fair market value of our office properties based on comparable sales transactions. Typically real estate transactions in Argentina are transacted in U.S. dollars. Therefore, a devaluation or depreciation of the Peso against the U.S. dollar would increase the value of our real estate properties measured in Pesos and an appreciation of the Peso would have the opposite effect. In addition, foreign currency exchange restrictions imposed by Argentine government could prevent or restrict the access to U.S. dollars for the acquisition of real estate properties, which are denominated and transacted in U.S dollars in Argentina, that could affect our ability to sell or acquire real estate properties and could have an adverse impact in real estate prices.

For more information about the evolution of the U.S dollar / Peso exchange rate, see “Exchange Rate and Exchange Controls.”

Fluctuations in the market value of our investment properties as a result of revaluations

Currently, our interests in investment properties are revalued quarterly. Any increase or decrease in the fair value of our investment properties, based on appraisal reports prepared by appraisers, is recorded in our consolidated statement of income and other comprehensive income for the fiscal year during which the revaluation occurs. The revaluation of our properties may therefore result in significant fluctuations in the results of our operations.

139

Property values are affected by, among other factors, a) shopping malls, which are mainly impacted by the discount rate used (WACC), the projected GDP growth and the projected inflation and devaluation of the Argentine Peso for future periods and b) office buildings, which are mostly impacted by the supply and demand of comparable properties and the U.S. dollar / Peso exchange rate at the reporting period, as office buildings fair value is generally established in U.S. dollars. For example:

· during the 2020 fiscal year, there was a 66.1% depreciation of the Peso from ARS 42.363 to USD 1.00 as of June 30, 2019 to ARS 70.36 to USD 1.00 as of June 30, 2020;

· during the 2021 fiscal year, there was a 35.9% depreciation of the Peso from ARS 70.36 to USD 1.00 as of June 30, 2020 to ARS 95.62 to USD 1.00 as of June 30, 2021; and

· during the 2022 fiscal year, there was a 30.9% depreciation of the Peso from ARS 95.62 to USD 1.00 as of June 30, 2021 to ARS 125.13 to USD 1.00 as of June 30, 2022.

The value of the Company investment properties is determined in U.S. dollar pursuant to the methodologies further described in “Critical Accounting Policies and estimates” and then determined in Pesos (the Company functional and presentation currency).

In the past, purchases and sales of office buildings were usually settled in U.S. dollars, However, as a consequence of the restrictions imposed by the Central Bank on foreign exchange transactions, purchase and sales of office buildings are now usually settled in Argentine Pesos, using an implicit exchange rate that is higher than the official one (as it was the case in the operations carried out by IRSA in the last two years).

Factors Affecting Comparability of our Results

Comparability of information

COVID-19 Pandemic

The impacts of the COVID-19 pandemic on us as of the date of this Annual Report are described below:

· During the fourth quarter of fiscal year 2021, shopping centers in the Buenos Aires Metropolitan Area suspended their operations between April 16 and June 11, operating only those segments considered essential such as pharmacies, supermarkets, and banks. The impact on Revenues for the closing months due to the pandemic was 40.3% in fiscal year 2021. Due to the flexibility that has occurred in the economic activities since the beginning of this fiscal year 2022, and as of the date of this Annual Report, 100% of the shopping malls are operational.

· Regarding the office segment, although most of the tenants continue to work in the home office mode, they are operational with strict safety and hygiene protocols. As of today, we have experienced a slight increase in the vacancy rates, although we have not suffered a deterioration in collections.

· La Rural, the Buenos Aires and Punta del Este Convention Centers and the Arena stadium, establishments that we own directly or indirectly, were closed from March 20, 2020, to July 12, 2021, date from which the protocols for holding events, conferences and exhibitions were activated. Exhibitions began at La Rural and different corporate events and congresses were held both at La Rural and at the Buenos Aires Convention Center. As of March 2022, all the protocols for holding events as normal were released and in this way the operations of La Rural, the Buenos Aires and Punta del Este Convention Centers were able to resume their operations.

· The Libertador and Intercontinental hotels in the City of Buenos Aires have been operating since December 2020, although with low occupancy levels. The Llao Llao Resort, located in Bariloche, was able to operate during the fourth quarter with average occupancy levels thanks to the domestic tourism.

140

The final extent of the Coronavirus outbreak and its impact on the country’s economy is still uncertain. However, although it has produced significant short-term effects, they are not expected to affect business continuity and the Company’s ability to meet its financial commitments for the next twelve months.

We are closely monitoring the situation and taking all necessary measures to preserve human life and the Company’s businesses.

Office buildings

During the year ended June 30, 2020, we have incorporated as an investment property the building “Della Paolera” located in Catalinas District in Buenos Aires. It consists of 35,208 square meters of gross leasable area over 30 office floors and includes 316 parking spaces in 4 basements. On April 29, 2021, the Company inaugurated its newest office development in Buenos Aires, which was operative since December 2020. During the fiscal years 2022 and 2021, we sold and transferred floors of the building for a total area of approximately 9,674 sqm and 2,369 sqm, respectively. As a subsequent event, on August 17, 2022, we sold and transferred one floor for a total leasable area of approximately 1,184 sqm and 8 parking lots located in the building. As of the date of this Annual Report, IRSA retains its rights for 14 floors of the building with an approximate leasable area of 16,832 sqm.

On July 15, 2020, we signed an agreement to sell a mid-rise floor with an area of approximately 1,063 sqm and 5 parking spaces of BankBoston Tower located at 265 Della Paolera in Catalinas district of City of Buenos Aires. Likewise, on August 25, 2020, we sold and transferred 5 additional floors with a gross rental area of 6,235 sqm and 25 garages located in the building. On November 5, 2020, we signed a purchase and sale agreement with possession of 4 floors for a gross rental area of approximately 3,892 square meters and 15 parking lots located in the building, and on November 12, 2020, we have entered into a purchase and sale agreement with an unrelated third party pursuant to which it has sold 3 floors for a gross rental area of approximately 3,266 square meters, a commercial space located on the ground floor of approximately 225 square meters and 15 parking lots located in the building. After this transaction, IRSA has no remaining offices leasable area in the building.

On July 30, 2020, we sold the entire “Bouchard 710” tower, located in Plaza Roma District of City of Buenos Aires. The building has 15,014 sqm of gross leasable area 12 office floors and 116 parking spaces.

On April 19, 2022, we sold in block 100% of the “República” building, located next to “Catalinas Norte” area in the City of Buenos Aires. The tower has 19,885 sqm of gross leasable area on 20 office floors and 178 parking spaces.

Shopping malls

During the fiscal years ended June 30, 2022, 2021 and 2020, we maintained the same portfolio of operating shopping malls.

Business Segment Information

IFRS 8 requires an entity to report financial and descriptive information about its reportable segments, which are operating segments or aggregations of operating segments that meet specified criteria. Operating segments are components of an entity about which separate financial information is available that is evaluated regularly by the CODM. According to IFRS 8, the CODM represents a function whereby strategic decisions are made and resources are assigned. The CODM function is carried out by the President of the Company, Mr. Eduardo S. Elsztain.

Segment information is reported from the perspective of products and services: (i) agricultural business and (ii) urban properties and investment business.

After the merger of IRSA with IRSA CP, the structure of the urban properties and investment business segment is made up of the following five segments: Shopping Malls, Offices, Hotels, Sales and development, and Others.

141

The “Offices and Other Rental Properties” segment is renamed “Offices” and will exclusively include the results from the company’s six office buildings. The other rental properties that were part of this segment were allocated to the “Sales and Developments” segment, which will include the results generated by these assets, as well as those from Land Reserves, Barter Agreements and Properties for Sale. Likewise, the “Others” segment is incorporated, which will group the results from investments in associates and foreign companies that were previously allocated in the “Corporate” and “International” segments. The “Shopping Malls” and “Hotels” segments did not undergo any changes.

Below is the segment information prepared as follows:

Agricultural business

· Agricultural production: segment consists of planting, harvesting and sale of crops as wheat, corn, soybeans, cotton and sunflowers; the sale of grain derivatives, such as flour and oil, breeding, purchasing and/or fattening of free-range cattle for sale to meat processors and local livestock auction markets.; agricultural services; leasing of the Company's farms to third parties; and planting, harvesting and sale of sugarcane

· Land transformation and sales: comprises gains from the disposal and development of farmlands activities.

· Corporate: includes corporate expenses related to agricultural business.

· Other segments: includes, principally, brokerage activities, among others.

Urban properties and investments business

· The “Shopping Malls” segment includes results principally comprised of lease and service revenues related to rental of commercial space and other spaces in the shopping malls of the Company.

· The “Offices” segment includes the operating results from lease revenues of offices and other service revenues related to the office activities.

· The “Sales and Developments” segment includes the operating results of the development, maintenance and sales of undeveloped parcels of land and/or trading properties. Real estate sales results and other rental spaces are also included.

· The “Hotels” segment includes the operating results mainly consisting of room, catering and restaurant revenues.

· The “Others” segment includes the entertainment activities through ALG Golf Center S.A., La Rural S.A. and Centro de Convenciones Buenos Aires (concession), We Are Appa investments in associates such as TGLT and the financial activities carried out through BHSA / BACS, as well as other investments in associates.

142

The CODM periodically reviews the results and certain asset categories and assesses performance of operating segments based on a measure of profit or loss of the segment composed by the operating income plus the share of profit / (loss) of joint ventures and associates. The valuation criteria used in preparing this information are consistent with IFRS standards used for the preparation of our Audited Financial Statements, except for the following:

o Operating results from joint ventures are evaluated by the CODM applying proportional consolidation method. Under this method the profit/loss generated and assets are reported in the Statement of Income line-by-line based on the percentage held in joint ventures rather than in a single item as required by IFRS. Management believes that the proportional consolidation method provides more useful information to understand the business return. On the other hand, the investment in the joint venture La Rural S.A. is accounted for under the equity method since this method is considered to provide more accurate information in this case.

o Operating results from Shopping Malls and Offices segments do not include the amounts pertaining to building administration expenses and collective promotion funds (“FPC”, as per its Spanish acronym) as well as total recovered costs, whether by way of expenses or other concepts included under financial results (for example default interest and other concepts). The CODM examines the net amount from these items (total surplus or deficit between building administration expenses and FPC and recoverable expenses).

The assets’ categories examined by the CODM are: investment properties, property, plant and equipment, trading properties, inventories, right to receive future units under barter agreements, investment in associates and goodwill. The sum of these assets, classified by business segment, is reported under “assets by segment”. Assets are allocated to each segment based on the operations and/or their physical location.

Most revenue from its operating segments is derived from, and their assets are located in, Argentina, except for some share of profit / (loss) of associates included in the “Others” segment located in the United States.

Revenues for each reporting segment derive from a large and diverse client base and, therefore, there is no revenue concentration in any particular segment.

Until September 2020 we used to report our financial performance separately in two Operations Centers. However, as described in Note 1 to the Consolidated Financial Statements as of June 30, 2020, during September 2020 we lost control of IDBD and, then, have reclassified the results of the Israel Operations Center to discontinued operations. As a consequence of the situation described, from October 1, 2020, we report our financial performance through a single Operation Center. Segment information for the previous fiscal years has been recast for comparability purposes.

143

Below is a summarized analysis of the lines of business for the year ended June 30, 2022:

	Agricultural business (I)			Urban property and investment business (II)			Total segment information			Joint ventures (i)			Adjustments (ii)			Elimination of inter-segment transactions and non-reportable assets / liabilities (iii)			Total Statement of Income and Other Comprehensive Income / Financial Position
	(million of ARS)
Revenues		64,408			25,593			90,001			(233	)		6,725			(643	)		95,850
Costs		(57,652	)		(5,350	)		(63,002	)		91			(6,874	)		-			(69,785	)
Initial recognition and changes in the fair value of biological assets and agricultural products at the point of harvest		18,204			-			18,204			-			-			192			18,396
Changes in the net realizable value of agricultural products after harvest		(1,998	)		-			(1,998	)		-			-			-			(1,998	)
Gross profit		22,962			20,243			43,205			(142	)		(149	)		(451	)		42,463
Net gain from fair value adjustment of investment properties		2,460			12,801			15,261			1,322			-			-			16,583
Gain from disposal of farmlands		5,505			-			5,505			-			-			-			5,505
General and administrative expenses		(3,788	)		(5,367	)		(9,155	)		27			-			81			(9,047	)
Selling expenses		(5,480	)		(2,241	)		(7,721	)		5			-			375			(7,341	)
Other operating results, net		(838	)		28			(810	)		-			56			(11	)		(765	)
Management fees		-			-			-			-			(4,169	)		-			(4,169	)
Profit from operations		20,821			25,464			46,285			1,212			(4,262	)		(6	)		43,229
Share of profit of associates and joint ventures		162			466			628			(821	)		-			(2	)		(195	)
Segment profit		20,983			25,930			46,913			391			(4,262	)		(8	)		43,034
Reportable assets		91,178			325,941			417,119			(1,902	)		-			114,010			529,227
Reportable liabilities		-			-			-			-			-			(322,438	)		(322,438	)
Net reportable assets		91,178			325,941			417,119			(1,902	)		-			(208,428	)		206,789

Below is a summarized analysis of the lines of business for the year ended June 30, 2021:

	Agricultural business (I)			Urban property and investment business (II)			Total segment information			Joint ventures (i)			Adjustments (ii)			Elimination of inter-segment transactions and non-reportable assets / liabilities (iii)			Total Statement of Income and Other Comprehensive Income / Financial Position
	(million of ARS)
Revenues		48,813			16,585			65,398			(82	)		4,828			(597	)		69,547
Costs		(44,725	)		(5,654	)		(50,379	)		115			(5,215	)		-			(55,479	)
Initial recognition and changes in the fair value of biological assets and agricultural products at the point of harvest		23,412			-			23,412			-			-			311			23,723
Changes in the net realizable value of agricultural products after harvest		(967	)		-			(967	)		-			-			-			(967	)
Gross profit		26,533			10,931			37,464			33			(387	)		(286	)		36,824
Net gain/ (loss) from fair value adjustment of investment properties		9,035			(12,520	)		(3,485	)		(198	)		-			-			(3,683	)
Gain from disposal of farmlands		2,148			-			2,148			-			-			-			2,148
General and administrative expenses		(3,570	)		(5,075	)		(8,645	)		21			-			151			(8,473	)
Selling expenses		(4,500	)		(2,478	)		(6,978	)		35			-			143			(6,800	)
Other operating results, net		(3,621	)		(257	)		(3,878	)		(33	)		176			(7	)		(3,742	)
Profit/ (loss) from operations		26,025			(9,399	)		16,626			(142	)		(211	)		1			16,274
Share of loss of associates and joint ventures		(95	)		(6,541	)		(6,636	)		(631	)		-			(6	)		(7,273	)
Segment profit/ (loss)		25,930			(15,940	)		9,990			(773	)		(211	)		(5	)		9,001
Reportable assets		107,811			339,767			447,578			(2,433	)		-			111,038			556,183
Reportable liabilities		-			-			-			-			-			(382,537	)		(382,537	)
Net reportable assets		107,811			339,767			447,578			(2,433	)		-			(271,499	)		173,646

144

Below is a summarized analysis of the lines of business for the year ended June 30, 2020:

	Agricultural business (I)			Urban property and investment business (II)			Operations Center in Israel			Subtotal			Total segment information			Joint ventures (i)			Adjustments (ii)			Elimination of inter-segment transactions and non-reportable assets / liabilities (iii)			Total Statement of Income and Other Comprehensive Income / Financial Position
	(million of ARS)
Revenues		49,337			27,434			-			27,434			76,771			(150	)		7,638			(2,015	)		82,244
Costs		(41,022	)		(6,786	)		-			(6,786	)		(47,808	)		131			(7,954	)		-			(55,631	)
Initial recognition and changes in the fair value of biological assets and agricultural products at the point of harvest		6,436			-			-			-			6,436			-			-			333			6,769
Changes in the net realizable value of agricultural products after harvest		1,617			-			-			-			1,617			-			-			-			1,617
Gross profit		16,368			20,648			-			20,648			37,016			(19	)		(316	)		(1,682	)		34,999
Net gain from fair value adjustment of investment properties		1,921			82,423			-			82,423			84,344			(647	)		-			-			83,697
Gain from disposal of farmlands		2,065			-			-			-			2,065			-			-			-			2,065
General and administrative expenses		(3,084	)		(5,521	)		-			(5,521	)		(8,605	)		35			-			130			(8,440	)
Selling expenses		(5,012	)		(3,032	)		-			(3,032	)		(8,044	)		41			-			50			(7,953	)
Other operating results, net		3,901			28			-			28			3,929			44			149			(22	)		4,100
Management fees		-			-			-			-			-			-			(518	)		-			(518	)
Profit/ (loss) from operations		16,159			94,546			-			94,546			110,705			(546	)		(685	)		(1,524	)		107,950
Share of profit / (loss) of associates and joint ventures		303			17,367			-			17,367			17,670			414			-			52			18,136
Segment profit/ (loss)		16,462			111,913			-			111,913			128,375			(132	)		(685	)		(1,472	)		126,086
Reportable assets		91,304			389,132			1,105,190			1,494,322			1,585,626			(1,653	)		-			107,976			1,691,949
Reportable liabilities		-			-			(984,847	)		(984,847	)		(984,847	)		-			-			2,375,928			1,391,081
Net reportable assets		91,304			389,132			120,343			509,475			600,779			(1,653	)		-			2,483,904			3,083,030

(i) Represents the equity value of joint ventures that were proportionately consolidated for information by segment purposes.

(ii) Includes ARS (149) million, ARS (387) million and ARS (316) million corresponding to Expenses and FPC as of June 30, 2022, 2021 and 2020, respectively, and ARS 4,169 million and ARS 518 million to management fees, as of June 30, 2022 and 2020.

(iii) Includes deferred income tax assets, income tax and MPIT credits, trade and other receivables, investment in financial assets, cash and cash equivalents and intangible assets except for rights to receive future units under barter agreements, net of investments in associates with negative equity which are included in provisions in the amount of ARS 8 million, ARS 23 million and ARS 43 million, as of June 30, 2022, 2021 and 2020, respectively.

145

(I) Agriculture line of business

The following tables present the reportable segments of the agriculture line of business:

	06.30.2022
	Agricultural production			Land transformation and sales			Corporate			Others			Total Agricultural business
	(million of ARS)
Revenues		51,070			-			-			13,338			64,408
Costs		(47,873	)		(48	)		-			(9,731	)		(57,652	)
Initial recognition and changes in the fair value of biological assets and agricultural products at the point of harvest		18,204			-			-			-			18,204
Changes in the net realizable value of agricultural products after harvest		(1,998	)		-			-			-			(1,998	)
Gross profit / (loss)		19,403			(48	)		-			3,607			22,962
Net gain from fair value adjustment of investment properties		-			2,460			-			-			2,460
Gain from disposal of farmlands		-			5,505			-			-			5,505
General and administrative expenses		(2,264	)		(8	)		(739	)		(777	)		(3,788	)
Selling expenses		(4,358	)		(189	)		-			(933	)		(5,480	)
Other operating results, net		(2,097	)		1,071			-			188			(838	)
Profit / (loss) from operations		10,684			8,791			(739	)		2,085			20,821
Share of profit of associates and joint ventures		108			-			-			54			162
Segment profit / (loss)		10,792			8,791			(739	)		2,139			20,983
Investment properties		-			13,672			-			-			13,672
Property, plant and equipment		46,616			276			-			212			47,104
Investments in associates		999			-			-			748			1,747
Other reportable assets		21,519			-			-			7,136			28,655
Reportable assets		69,134			13,948			-			8,096			91,178

From all of the revenues corresponding to Agricultural Business, ARS 32,291 million are originated in Argentina and ARS 32,117 million in other countries, principally in Brazil for ARS 29,665 million. From all of the assets included in the segment corresponding to Agricultural Business, ARS 30,876 million are located in Argentina and ARS 60,302 million in other countries, principally in Brazil.

	06.30.2021
	Agricultural production			Land transformation and sales			Corporate			Others			Total Agricultural business
	(million of ARS)
Revenues		39,961			-			-			8,852			48,813
Costs		(38,561	)		(59	)		-			(6,105	)		(44,725	)
Initial recognition and changes in the fair value of biological assets and agricultural products at the point of harvest		23,412			-			-			-			23,412
Changes in the net realizable value of agricultural products after harvest		(967	)		-			-			-			(967	)
Gross profit / (loss)		23,845			(59	)		-			2,747			26,533
Net gain from fair value adjustment of investment properties		-			9,035			-			-			9,035
Gain from disposal of farmlands		-			2,148			-			-			2,148
General and administrative expenses		(2,250	)		(8	)		(720	)		(592	)		(3,570	)
Selling expenses		(3,837	)		(2	)		-			(661	)		(4,500	)
Other operating results, net		(6,856	)		2,871			-			364			(3,621	)
Profit / (loss) from operations		10,902			13,985			(720	)		1,858			26,025
Share of profit/ (loss) of associates and joint ventures		98			-			-			(193	)		(95	)
Segment profit / (loss)		11,000			13,985			(720	)		1,665			25,930
Investment properties		-			18,040			-			-			18,040
Property, plant and equipment		54,001			435			-			151			54,587
Investments in associates		981			-			-			357			1,338
Other reportable assets		28,122			-			-			5,724			33,846
Reportable assets		83,104			18,475			-			6,232			107,811

146

From all of the revenues corresponding to Agricultural Business, ARS 26,438 million are originated in Argentina and ARS 22,375 million in other countries, principally in Brazil for ARS 21,375 million. From all of the assets included in the segment corresponding to Agricultural Business, ARS 33,538 million are located in Argentina and ARS 74,273 million in other countries, principally in Brazil.

	06.30.2020
	Agricultural production			Land transformation and sales			Corporate			Others			Total Agricultural business
	(million of ARS)
Revenues		42,329			-			-			7,008			49,337
Costs		(36,145	)		(62	)		-			(4,815	)		(41,022	)
Initial recognition and changes in the fair value of biological assets and agricultural products at the point of harvest		6,436			-			-			-			6,436
Changes in the net realizable value of agricultural products after harvest		1,617			-			-			-			1,617
Gross profit / (loss)		14,237			(62	)		-			2,193			16,368
Net gain from fair value adjustment of investment properties		-			1,921			-			-			1,921
Gain from disposal of farmlands		-			2,065			-			-			2,065
General and administrative expenses		(2,369	)		(7	)		(417	)		(291	)		(3,084	)
Selling expenses		(4,470	)		(2	)		-			(540	)		(5,012	)
Other operating results, net		1,121			2,369			-			411			3,901
Profit / (loss) from operations		8,519			6,284			(417	)		1,773			16,159
Share of profit of associates and joint ventures		131			-			-			172			303
Segment profit / (loss)		8,650			6,284			(417	)		1,945			16,462
Investment properties		-			10,170			-			-			10,170
Property, plant and equipment		51,443			441			-			137			52,021
Investments in associates		1,032			-			-			719			1,751
Other reportable assets		17,937			815			-			8,610			27,362
Reportable assets		70,412			11,426			-			9,466			91,304

From all of the revenues corresponding to Agricultural Business, ARS 29,405 million are originated in Argentina and ARS 19,932 million in other countries, principally in Brazil for ARS 17,927 million. From all of the assets included in the segment corresponding to Agricultural Business, ARS 32,682 million are located in Argentina and ARS 58,622 million in other countries, principally in Brazil for ARS 46.581 million.

(II) Urban properties and investments line of business

                Below is a summarized analysis of the urban properties and investments line of business for the fiscal years ended June 30, 2022, 2021 and 2020:

	06.30.2022
	Shopping Malls			Offices			Sales and developments			Hotels			Others			Total
	(million of ARS)
Revenues		17,334			3,041			746			4,300			172			25,593
Costs		(1,495	)		(293	)		(581	)		(2,473	)		(508	)		(5,350	)
Gross profit / (loss)		15,839			2,748			165			1,827			(336	)		20,243
Net gain/(loss) from fair value adjustment of investment properties		553			(5,264	)		17,452			-			60			12,801
General and administrative expenses		(2,862	)		(381	)		(1,058	)		(730	)		(336	)		(5,367	)
Selling expenses		(847	)		(77	)		(922	)		(340	)		(55	)		(2,241	)
Other operating results, net		(142	)		(23	)		(48	)		(59	)		300			28
Profit / (Loss) from operations		12,541			(2,997	)		15,589			698			(367	)		25,464
Share of profit of associates and joint ventures		-			-			-			-			466			466
Segment profit / (loss)		12,541			(2,997	)		15,589			698			99			25,930
Investment and trading properties		91,770			66,860			139,307			-			430			298,367
Property, plant and equipment		261			4,177			2,382			4,439			1,072			12,331
Investment in associates and joint ventures		-			-			-			-			11,578			11,578
Other reportable assets		186			159			2,984			60			276			3,665
Reportable assets		92,217			71,196			144,673			4,499			13,356			325,941

147

From all the revenues, ARS 25,579 million are originated in Argentina, and ARS 14 million in the United States. No external client represents 10% or more of revenue of any of the reportable segments. From all of the assets corresponding to the business of urban properties and investments ARS 324,005 million are located in Argentina and ARS 1,936 million in other countries, principally in the United States for ARS 296 million and Uruguay for ARS 1,630 million.

	06.30.2021
	Shopping Malls			Offices			Sales and developments			Hotels			Others			Total
	(million of ARS)
Revenues		8,727			4,401			1,271			1,510			676			16,585
Costs		(1,428	)		(236	)		(1,373	)		(1,746	)		(871	)		(5,654	)
Gross profit / (loss)		7,299			4,165			(102	)		(236	)		(195	)		10,931
Net (loss) / gain from fair value adjustment of investment properties		(33,349	)		9,235			11,538			-			56			(12,520	)
General and administrative expenses		(2,348	)		(713	)		(1,164	)		(699	)		(151	)		(5,075	)
Selling expenses		(740	)		(307	)		(1,145	)		(231	)		(55	)		(2,478	)
Other operating results, net		(207	)		(8	)		(8	)		(20	)		(14	)		(257	)
(Loss) / Profit from operations		(29,345	)		12,372			9,119			(1,186	)		(359	)		(9,399	)
Share of loss of associates and joint ventures		-			-			(26	)		-			(6,515	)		(6,541	)
Segment (loss)/ profit		(29,345	)		12,372			9,093			(1,186	)		(6,874	)		(15,940	)
Investment and trading properties		89,070			118,827			102,415			-			420			310,732
Property, plant and equipment		395			3,367			2,143			4,223			349			10,477
Investment in associates and joint ventures		-			-			-			-			14,611			14,611
Other reportable assets		189			161			3,271			48			278			3,947
Reportable assets		89,654			122,355			107,829			4,271			15,658			339,767

From all the revenues, included in the segments corresponding to the business of urban properties and investments ARS 15,968 million are originated in Argentina and ARS 617 million are originated in the United States. No external client represents 10% or more of revenue of any of the reportable segments. From all of the assets corresponding to the business of urban properties and investments ARS 335,115 million are located in Argentina and ARS 4,658 million in other countries, principally in the United States for ARS 3,329 million and Uruguay for ARS 1,329 million.

	06.30.2020
	Shopping Malls			Offices			Sales and developments			Hotels			Others			Total
	(million of ARS)
Revenues		14,569			5,616			2,025			4,978			246			27,434
Costs		(1,401	)		(209	)		(1,873	)		(3,064	)		(239	)		(6,786	)
Gross profit		13,168			5,407			152			1,914			7			20,648
Net (loss) / gain from fair value adjustment of investment properties		(5,185	)		54,723			33,224			-			(339	)		82,423
General and administrative expenses		(2,044	)		(601	)		(1,217	)		(897	)		(762	)		(5,521	)
Selling expenses		(1,751	)		(185	)		(502	)		(566	)		(28	)		(3,032	)
Other operating results, net		42			(20	)		(111	)		(49	)		166			28
Profit / (Loss) from operations		4,230			59,324			31,546			402			(956	)		94,546
Share of profit of associates and joint ventures		-			-			-			-			17,367			17,367
Segment profit		4,230			59,324			31,546			402			16,411			111,913
Investment and trading properties		120,956			147,513			86,036			-			941			355,446
Property, plant and equipment		456			128			2,359			4,786			396			8,125
Investment in associates and joint ventures		-			-			1,310			-			21,532			22,842
Other reportable assets		192			224			1,935			64			304			2,719
Reportable assets		121,604			147,865			91,640			4,850			23,173			389,132

From all the revenues included in the segments corresponding to the business of urban properties and investments ARS 27,406 million and ARS 28 million are originated in the United States. No external client represents 10% or more of revenue of any of the reportable segments. From all of the assets corresponding to the business of urban properties and investments ARS 382,022 million are located in Argentina and ARS 7,110 million in other countries, principally in the United States for ARS 5,692 million and Uruguay for ARS 1,418 million.

148

Results of Operations for the fiscal years ended June 30, 2022 and 2021

	Agricultural business									Urban Properties and Investment business									Total segment information									Joint ventures (i)									Adjustments (ii)									Elimination of inter-segment transactions and non-reportable assets / liabilities									Total Statement of Income / Financial Position
	06.30.22			06.30.21			Var.			06.30.22			06.30.21			Var.			06.30.22			06.30.21			Var.			06.30.22			06.30.21			Var.			06.30.22			06.30.21			Var.			06.30.22			06.30.21			Var.			06.30.22			06.30.21			Var.
	(in million of ARS)
Revenues		64,408			48,813			15,595			25,593			16,585			9,008			90,001			65,398			24,603			(233	)		(82	)		(151	)		6,725			4,828			1,897			(643	)		(597	)		(46	)		95,850			69,547			26,303
Costs		(57,652	)		(44,725	)		(12,927	)		(5,350	)		(5,654	)		304			(63,002	)		(50,379	)		(12,623	)		91			115			(24	)		(6,874	)		(5,215	)		(1,659	)		—			—			—			(69,785	)		(55,479	)		(14,306	)
Initial recognition and changes in the fair value of biological assets and agricultural products at the point of harvest		18,204			23,412			(5,208	)		—			—			—			18,204			23,412			(5,208	)		—			—			—			—			—			—			192			311			(119	)		18,396			23,723			(5,327	)
Changes in the net realizable value of agricultural products after harvest		(1,998	)		(967	)		(1,031	)		—			—			—			(1,998	)		(967	)		(1,031	)		—			—			—			—			—			—			—			—			—			(1,998	)		(967	)		(1,031	)
Gross profit		22,962			26,533			(3,571	)		20,243			10,931			9,312			43,205			37,464			5,741			(142	)		33			(175	)		(149	)		(387	)		238			(451	)		(286	)		(165	)		42,463			36,824			5,639
Net gain/ (loss) from fair value adjustment of investment properties		2,460			9,035			(6,575	)		12,801			(12,520	)		25,321			15,261			(3,485	)		18,746			1,322			(198	)		1,520			—			—			—			—			—			—			16,583			(3,683	)		20,266
Gain from disposal of farmlands		5,505			2,148			3,357			—			—			—			5,505			2,148			3,357			—			—			—			—			—			—			—			—			—			5,505			2,148			3,357
General and administrative expenses		(3,788	)		(3,570	)		(218	)		(5,367	)		(5,075	)		(292	)		(9,155	)		(8,645	)		(510	)		27			21			6			—			—			—			81			151			(70	)		(9,047	)		(8,473	)		(574	)
Selling expenses		(5,480	)		(4,500	)		(980	)		(2,241	)		(2,478	)		237			(7,721	)		(6,978	)		(743	)		5			35			(30	)		—			—			—			375			143			232			(7,341	)		(6,800	)		(541	)
Other operating results, net		(838	)		(3,621	)		2,783			28			(257	)		285			(810	)		(3,878	)		3,068			—			(33	)		33			56			176			(120	)		(11	)		(7	)		(4	)		(765	)		(3,742	)		2,977
Management fees		—			—			—			—			—			—			—			—			—			—			—			—			(4,169	)		—			(4,169	)		—			—			—			(4,169	)		—			(4,169	)
Profit / (Loss) from operations		20,821			26,025			(5,204	)		25,464			(9,399	)		34,863			46,285			16,626			29,659			1,212			(142	)		1,354			(4,262	)		(211	)		(4,051	)		(6	)		1			(7	)		43,229			16,274			26,955
Share of profit/ (loss) of associates and joint ventures		162			(95	)		257			466			(6,541	)		7,007			628			(6,636	)		7,264			(821	)		(631	)		(190	)		—			—			—			(2	)		(6	)		4			(195	)		(7,273	)		7,078
Segment profit / (loss)		20,983			25,930			(4,947	)		25,930			(15,940	)		41,870			46,913			9,990			36,923			391			(773	)		1,164			(4,262	)		(211	)		(4,051	)		(8	)		(5	)		(3	)		43,034			9,001			34,033

(I)	Represents the equity value of joint ventures that were proportionately consolidated for information by segment purposes.
(II)	Includes gross profit/ (loss) of ARS (149) million and ARS (387) million corresponding to Building Administration Expenses and Collective Promotion Fund (FPC), as of June 30, 2022 and 2021, respectively.

149

Agricultural Business

The following table shows a summary of the Agricultural Business lines for the fiscal years ended June 30, 2022 and 2021.

	Agricultural production									Land transformation and sales									Corporate									Others									Total
	06.30.22			06.30.21			Var.			06.30.22			06.30.21			Var.			06.30.22			06.30.21			Var.			06.30.22			06.30.21			Var.			06.30.22			06.30.21			Var.
	(in million of ARS)
Revenues		51,070			39,961			11,109			—			—			—			—			—			—			13,338			8,852			4,486			64,408			48,813			15,595
Costs		(47,873	)		(38,561	)		(9,312	)		(48	)		(59	)		11			—			—			—			(9,731	)		(6,105	)		(3,626	)		(57,652	)		(44,725	)		(12,927	)
Initial recognition and changes in the fair value of biological assets and agricultural products at the point of harvest		18,204			23,412			(5,208	)		—			—			—			—			—			—			—			—			—			18,204			23,412			(5,208	)
Changes in the net realizable value of agricultural products after harvest		(1,998	)		(967	)		(1,031	)		—			—			—			—			—			—			—			—			—			(1,998	)		(967	)		(1,031	)
Gross profit / (loss)		19,403			23,845			(4,442	)		(48	)		(59	)		11			—			—			—			3,607			2,747			860			22,962			26,533			(3,571	)
Net gain from fair value adjustment of investment properties		—			—			—			2,460			9,035			(6,575	)		—			—			—			—			—			—			2,460			9,035			(6,575	)
Gain from disposal of farmlands		—			—			—			5,505			2,148			3,357			—			—			—			—			—			—			5,505			2,148			3,357
General and administrative expenses		(2,264	)		(2,250	)		(14	)		(8	)		(8	)		—			(739	)		(720	)		(19	)		(777	)		(592	)		(185	)		(3,788	)		(3,570	)		(218	)
Selling expenses		(4,358	)		(3,837	)		(521	)		(189	)		(2	)		(187	)		—			—			—			(933	)		(661	)		(272	)		(5,480	)		(4,500	)		(980	)
Other operating results, net		(2,097	)		(6,856	)		4,759			1,071			2,871			(1,800	)		—			—			—			188			364			(176	)		(838	)		(3,621	)		2,783
Profit / (Loss) from operations		10,684			10,902			(218	)		8,791			13,985			(5,194	)		(739	)		(720	)		(19	)		2,085			1,858			227			20,821			26,025			(5,204	)
Share of profit/ (loss) of associates and joint ventures		108			98			10			—			—			—			—			—			—			54			(193	)		247			162			(95	)		257
Segment profit / (loss)		10,792			11,000			(208	)		8,791			13,985			(5,194	)		(739	)		(720	)		(19	)		2,139			1,665			474			20,983			25,930			(4,947	)

Urban Properties and Investment Business

The following table shows a summary of the Urban Properties and Investment Business lines for the fiscal years ended June 30, 2022 and 2021.

	Shopping Malls									Offices									Sales and developments									Hotels									Others									Total
	06.30.22			06.30.21			Var.			06.30.22			06.30.21			Var.			06.30.22			06.30.21			Var.			06.30.22			06.30.21			Var.			06.30.22			06.30.21			Var.			06.30.22			06.30.21			Var.
	(in millions of ARS)
Revenues		17,334			8,727			8,607			3,041			4,401			(1,360	)		746			1,271			(525	)		4,300			1,510			2,790			172			676			(504	)		25,593			16,585			9,008
Costs		(1,495	)		(1,428	)		(67	)		(293	)		(236	)		(57	)		(581	)		(1,373	)		792			(2,473	)		(1,746	)		(727	)		(508	)		(871	)		363			(5,350	)		(5,654	)		304
Gross profit / (loss)		15,839			7,299			8,540			2,748			4,165			(1,417	)		165			(102	)		267			1,827			(236	)		2,063			(336	)		(195	)		(141	)		20,243			10,931			9,312
Net gain/ (loss) from fair value adjustment of investment properties		553			(33,349	)		33,902			(5,264	)		9,235			(14,499	)		17,452			11,538			5,914			—			—			—			60			56			4			12,801			(12,520	)		25,321
General and administrative expenses		(2,862	)		(2,348	)		(514	)		(381	)		(713	)		332			(1,058	)		(1,164	)		106			(730	)		(699	)		(31	)		(336	)		(151	)		(185	)		(5,367	)		(5,075	)		(292	)
Selling expenses		(847	)		(740	)		(107	)		(77	)		(307	)		230			(922	)		(1,145	)		223			(340	)		(231	)		(109	)		(55	)		(55	)		—			(2,241	)		(2,478	)		237
Other operating results, net		(142	)		(207	)		65			(23	)		(8	)		(15	)		(48	)		(8	)		(40	)		(59	)		(20	)		(39	)		300			(14	)		314			28			(257	)		285
Profit / (Loss) from operations		12,541			(29,345	)		41,886			(2,997	)		12,372			(15,369	)		15,589			9,119			6,470			698			(1,186	)		1,884			(367	)		(359	)		(8	)		25,464			(9,399	)		34,863
Share of (loss)/ profit of associates and joint ventures		—			—			—			—			—			—			—			(26	)		26			—			—			—			466			(6,515	)		6,981			466			(6,541	)		7,007
Segment profit / (loss)		12,541			(29,345	)		41,886			(2,997	)		12,372			(15,369	)		15,589			9,093			6,496			698			(1,186	)		1,884			99			(6,874	)		6,973			25,930			(15,940	)		41,870

150

Revenues 2022 vs. 2021

Agricultural Business

Agricultural Production. Revenues from the Agricultural Production segment increased by 27.8% from ARS 39,961 million during the fiscal year ended June 30, 2021 to ARS 51,070 million during the fiscal year ended June 30, 2022. Such increase is mainly attributable to:

· ARS 10,174 million increase in revenues from crop sales, resulting from an increase in the volume of crops sold (699,500 tons in fiscal year ended June 30, 2021 versus 833,600 tons in fiscal year ended June 30, 2022), standing out corn and soy beans;

· ARS 1,847 million increase in revenues from sugarcane sales, resulting from an increase in sales in the current fiscal year, due to the strong increase in prices, mainly caused by the increase in the price of oil, which caused ethanol (fuel component, made from sugarcane) increase its demand, and consequently its price (from BRL 0.9 to BRL 1.3 per Kg of sugar), this in the face of a slight drop in volume produced and sold;

· ARS 943 million decrease in revenues from cattle sales, primarily attributable to a 25% decrease in tons of cattle sold in the fiscal year ended June 30, 2022 compared to the previous fiscal year.

· ARS 31 increase in revenues from leases and services attributable to an increase in services for seed multiplication due to better prices and more tons treated and the increase in leased hectares in Argentina, offset by a decrease in the area in leased hectares in Brazil.

Others. Revenues from the Others segment increased by 50.7% from ARS 8,852 million during the fiscal year ended June 30, 2021 to ARS 13,338 million during the fiscal year ended June 30, 2022. Such increase is mainly attributable to an ARS 4,486 million increase in revenues from sales on consignment, brokerage and others, and fees and others.

Urban Properties and Investment Business

Shopping Malls. Revenues from the Shopping Malls segment increased by 98.6% from ARS 8,727 million during the fiscal year ended June 30, 2021, to ARS 17,334 million during the fiscal year ended June 30, 2022. Such increase is due to the fact that during the fiscal year ended in 2021, a support policy was maintained for tenants in all shopping malls, where, due to the pandemic, the contractual monthly insured value (VMA) was not invoiced, but rather a percentage of sales. In the current fiscal year, although these policies were maintained in the first part of it, in the second half of the fiscal year there was evidence of a recovery in rental income, generating: (i) an increase of ARS 3,365 million in base rent revenue; (ii) an increase of ARS 6,005 million in contingent rent revenue; (iii) an ARS 516 million increase in revenue from parking; partially offset by (iv) an ARS 1,279 million decrease in the revenue from averaging of scheduled rent escalation.

Offices. Revenues from the Offices segment decreased by 30.9% from ARS 4,401 million during the fiscal year ended June 30, 2021, to ARS 3,041 million during the fiscal year ended June 30, 2022. This variation is mainly explained by a decrease in revenue from leases due to the sale of Bouchard Building and sale of floors in Boston Tower during the fiscal year ended June 30, 2021 and the sale of República Building in the current fiscal year.

Sales and Developments. Revenues from the Sales and Developments segment recorded a 41.3% decrease from ARS 1,271 million during the fiscal year ended June 30, 2021, to ARS 746 million during the fiscal year ended June 30, 2022. This segment often varies significantly from period to period due to the non-recurrence of different sales transactions carried out by us over time.

Hotels. Revenues from our Hotels segment increased by 184.8% from ARS 1,510 million during the fiscal year ended June 30, 2021, to ARS 4,300 million during the fiscal year ended June 30, 2022, mainly due to higher occupancy with the consequent increase in revenue. The Intercontinental and Libertador hotels have not reached the pre-pandemic occupancy levels yet.

151

Others. Revenues from the Others segment decreased by 74.6% from ARS 676 million during the fiscal year ended June 30, 2021, to ARS 172 million during the fiscal year ended June 30, 2022, mainly due to the sale of Stowe House in USD 3.45 million during the fiscal year ended June 30, 2021, generating a profit of USD 0.3 million.

Costs 2022 vs. 2021

Agricultural Business

Agricultural Production. The costs of the Agricultural Production segment increased by 24.1% from ARS 38,561 million during the fiscal year ended June 30, 2021 to ARS 47,983 million during the fiscal year ended June 30, 2022, primarily as a consequence of:

· ARS 7,727 million increase in costs of crop sales, mainly resulting from an 8% increase in the average cost per ton of crops sold in the fiscal year, from ARS 38,313 million in the fiscal year ended June 30, 2021 to ARS 41,421 million in the fiscal year ended June 30, 2022; and an increase of 134,059 tons in the volume of crops sold in the fiscal year ended June 30, 2022 as compared to the previous fiscal year;

· ARS 2,177 million increase in the costs of sugarcane sales, mainly as a result of 40% rise in the average cost of sugarcane per ton sold in the fiscal year, from ARS 3,446 per ton in the fiscal year ended June 30, 2021 to ARS 4,834 per ton in the fiscal year ended June 30, 2022, offset by a decrease of 172,636 tons (8%) in the volume of sugarcane sold in the fiscal year ended June 30, 2022 compared to the previous fiscal year;

· ARS 767 million decrease in the costs of cattle sales, mainly as a result of 4,672 tons decrease in cattle sold in the fiscal year ended June 30, 2022 compared to the previous fiscal year; and a 6% rise in the average cost of cattle sold in the fiscal year.

· ARS 175 million increase in costs of leases and services, mainly attributable to a ARS 203 million increase in lease costs and seed purchases and an ARS 29 million decrease in the Feedlot service cost.

Costs of the Agricultural Production segment, measured as a percentage of revenues from this segment, decreased from 96.5% during the fiscal year ended June 30, 2021 to 93.7% during the fiscal year ended June 30, 2022.

Land transformation and sales. The costs of the Land transformation and sales segment decreased by 18.6% from ARS 59 million during the fiscal year ended June 30, 2021 to ARS 48 million during the fiscal year ended June 30, 2022.

Others. The costs of the Others segment increased by 59.4% from ARS 6,105 million during the fiscal year ended June 30, 2021 to ARS 9,731 million during the fiscal year ended June 30, 2022, mainly as a result of ARS 3,438 million increase in other segments. The costs of the Others segment, measured as a percentage of revenues from this segment, increased from 69.0% during the fiscal year ended June 30, 2021 to 71.5% during the fiscal year ended June 30, 2022.

Urban Properties and Investment Business

Shopping Malls. Costs associated with the Shopping Malls segment increased by 4.7%, from ARS 1,428 million during the fiscal year ended June 30, 2021, to ARS 1,495 million during the fiscal year ended June 30, 2022, mainly due to: (i) an increase in maintenance expenses of ARS 84 million; (ii) an increase in leases and expenses of ARS 37 million and (iii) an increase in taxes, rates and contributions of ARS 14 million; partially offset by: (iv) a decrease in amortization and depreciation charges of ARS 45 million and (v) a decrease of ARS 36 million in salaries, social security charges and other personnel administrative expenses. Costs associated with the Shopping Malls segment, measured as a percentage of the revenues from this segment, decreased from 16.4% during the fiscal year ended June 30, 2021, to 8.6% during the fiscal year ended June 30, 2022.

152

Offices. Costs associated with the Offices segment increased by 24.2%, from ARS 236 million during the fiscal year ended June 30, 2021, to ARS 293 million during the fiscal year ended June 30, 2022, mainly due to (i) an increase in amortization and depreciation charges of ARS 39 million; (ii) an increase in leases and expenses of ARS 28 million; (iii) an increase in taxes, rates and contributions of ARS 24 million; partially offset by: (iv) a decrease in maintenance expenses of ARS 15 million and (v) a decrease of ARS 14 million in salaries, social security charges and other personnel administrative expenses. Costs associated with the Offices segment, measured as a percentage of the revenues from this segment, increased from 5.4% during the fiscal year ended June 30, 2021, to 9.6% during the fiscal year ended June 30, 2022.

Sales and Developments. Costs associated with our Sales and Developments segment recorded a 57.7% decrease from ARS 1,373 million during the fiscal year ended June 30, 2021, to ARS 581 million during the fiscal year ended June 30, 2022 mainly due to (i) a decrease of ARS 770 million in the cost of sale of goods and services; (ii) a decrease in maintenance expenses of ARS 35 million; and (iii) an ARS 19 million decrease in taxes, rates and contributions; partially offset by: (iv) an increase in leases and expenses of ARS 17 million. Costs in the Sales and Developments segment, measured as a percentage of revenues from this segment, decreased from 108.0% during the fiscal year ended June 30, 2021, to 77.9% during the fiscal year ended June 30, 2022.

Hotels. Costs in the Hotels segment increased by 41.6%, from ARS 1,746 million during the fiscal year ended June 30, 2021, to ARS 2,473 million during the fiscal year ended June 30, 2022, mainly as a result of (i) an ARS 275 million increase in the costs of salaries, social security and other personnel expenses; (ii) an ARS 244 million increase in food, beverages and other hotel expenses; (iii) an ARS 148 million increase in maintenance expenses; and (iv) an ARS 56 million increase in fees and compensation services. Costs in the Hotels segment, measured as a percentage of revenues from this segment, decreased from 115.6% during the fiscal year ended June 30, 2021, to 57.5% during the fiscal year ended June 30, 2022.

Others. Costs in the Others segment decreased by 41.7%, from ARS 871 million during the fiscal year ended June 30, 2021, to ARS 508 million during the fiscal year ended June 30, 2022, mainly as a result of the cost of selling properties due to the sale of Stowe House and also due to the development and implementation of Appa Shops generating and increase en salaries, social security costs and other personnel administrative expenses, both events in the comparative fiscal year.

Initial recognition and changes in the fair value of biological assets and agricultural produce at the point of harvest 2022 vs. 2021

According to information by segments (taking into account the profit / (loss) from operations from our joint ventures and excluding those related to building administration expenses and collective promotion fund and business inter-segment transactions), the profit / (loss) from the total initial recognition and changes in the fair value of biological assets and agricultural produce at the point of harvest decreased by ARS 5,208 million (22.2%), from ARS 23,412 million in the fiscal year ended June 30, 2021 to ARS 18,204 million in the fiscal year ended June 30, 2022.

Such variation was mainly as a result of:

· A decrease in profits from crops production of ARS 5,738 million, coming both from Argentina, due to a decrease in yields and margins of Corn and Sorghum, and Brazil, mainly attributable to soy beans and corn, due to higher costs, offset by a slight increase in yields and cultivated area, and beans due to a smaller cultivated area, yields and prices.

· An increase in profits from sugarcane production of ARS 1,949 million, as a result of better prices, offset by a lower volume produced; and

· A decrease in profits from production and cattle holding for ARS 1,419 million, generated mainly in Argentina, where farm prices this fiscal year had a worse performance against inflation generating a negative variation in the result. Likewise, a decrease in the production result is observed, as a result of a lower volume accompanied by higher costs.

153

Changes in the net realizable value of agricultural produce after harvest 2022 vs. 2021

Loss from total changes in the net realizable value of agricultural produce after harvest, according to information by segments, increased by ARS 1,031 million (106.6%), from a loss of ARS 967 million in the fiscal year ended June 30, 2021 to a loss of ARS 1,998 million in the fiscal year ended June 30, 2022.

Such variation is mainly generated by Argentina, since in the previous fiscal year prices had a better performance against inflation, while in this fiscal year, the variation in prices was lower than inflation in periods of higher stock, mainly of Corn.

Gross profit 2022 vs. 2021

Agricultural Business

Agricultural Production. Gross profit from this segment decreased by 18.6% from ARS 23,845 million in the fiscal year ended June 30, 2021 to ARS 19,403 million in the fiscal year ended June 30, 2022.

Land Transformation and Sales. Loss profit from this segment decreased by 18.6% from a loss of ARS 59 million in the fiscal year ended June 30, 2021 to a loss of ARS 48 million in the fiscal year ended June 30, 2022.

Others. Gross profit from this segment increased by 31.3% from ARS 2,747 million in the fiscal year ended June 30, 2021 to ARS 3,607 million in the fiscal year ended June 30, 2022.

Urban Properties and Investment Business

Shopping Malls. Gross profit from the Shopping Malls segment increased by 117.0%, from ARS 7,299 million during the fiscal year ended June 30, 2021, to ARS 15,839 million during the fiscal year ended June 30, 2022, mainly as a result of a reopening of shopping malls in the current fiscal year unlike the fiscal year ended June 30, 2021 which had progressive openings and with more restrictions. Gross profit from the Shopping Malls segment as a percentage of the segment revenues, increased from 83.6% during the fiscal year ended June 30, 2021, to 91.4% during the fiscal year ended June 30, 2022. 

Offices. Gross profit from the Offices segment decreased by 34.0%, from ARS 4,165 million during the fiscal year ended June 30, 2021, to ARS 2,748 million during the fiscal year ended June 30, 2022. Gross profit from the Offices segment, measured as percentage of revenues from this segment, decreased from 94.6% during the fiscal year ended June 30, 2021, to 90.4% during the fiscal year ended June 30, 2022.

Sales and developments. Gross profit from the Sales and Developments segment increased by 261.8%, from a loss of ARS 102 million during the fiscal year ended June 30, 2021, to an ARS 165 million profit during the fiscal year ended June 30, 2022. Gross profit from the Sales and Developments segment, measured as a percentage of revenues from this segment, increased from 8.0% negative during the fiscal year ended June 30, 2021, to 22.1% positive during the fiscal year ended June 30, 2022.

Hotels. Gross profit from the Hotels segment increased by 874.2%, from a loss of ARS 236 million during the fiscal year ended June 30, 2021, to an ARS 1,827 million profit during the fiscal year ended June 30, 2022. Gross profit from the Hotels segment, measured as a percentage of revenues from this segment, increased from 15.6% negative during the fiscal year ended June 30, 2021, to 42.5% positive during the fiscal year ended June 30, 2022.

154

Others. Gross profit from the Others segment decreased by 72.3%, from a loss of ARS 195 million during the fiscal year ended June 30, 2021, to an ARS 336 million loss during the fiscal year ended June 30, 2022. Gross profit from the Others segment, measured as a percentage of revenues from this segment, decreased from 28.8% negative during the fiscal year ended June 30, 2021, to 195.3% negative during the fiscal year ended June 30, 2022.

Net gain (loss) from changes in the fair value of investment properties 2022 vs. 2021

Agricultural Business

According to information by segments (taking into account all our joint ventures and inter-segment eliminations), the total net gain /(loss) from changes in the fair value of investment properties decreased by ARS 6,575 million (72.8%), from ARS 9,035 million in the fiscal year ended June 30, 2021 to ARS 2,460 million in the fiscal year ended June 30, 2022, caused mainly because in the previous fiscal year there was a considerable increase in the price of soybeans in Brazil, which caused a considerable revaluation of the farmlands.

Urban Properties and Investment Business

Total consolidated net gain / (loss) from fair value adjustment of investment properties, according to the income statement, increased by ARS 26,841 million, from a net loss of ARS 12,718 million during the fiscal year ended June 30, 2021, to a net profit of ARS 14,123 million during the fiscal year ended June 30, 2022.

According to information by segments, the net gain / (loss) from fair value adjustment of investment properties went from a loss of ARS 12,520 million (out of which an ARS 33,349 million loss derives from our Shopping Malls segment; an ARS 9,235 million gain from our Offices segment; an ARS 11,538 million gain from our Sales and Developments segment and an ARS 56 million gain from our Others segment) during the fiscal year ended June 30, 2021, to a gain of ARS 12,801 million during the fiscal year ended June 30, 2022 (out of which an ARS 553 million profit derives from our Shopping Malls segment; an ARS 5,264 million loss from our Offices segment; an ARS 17,452 million gain from our Sales and Developments segment and an ARS 60 million gain from our Others segment).

The net impact in the peso value of our Shopping Malls was primarily a consequence of: (i) a solid real recovery in the performance of the Shopping Malls during the fiscal year ended June 30, 2022 and better future revenue prospects, (ii) more favorable macroeconomic projections, and (iii) improvements in operating margins, (iv) this was partially offset by a 100 basis point increase in the dollar discount rate at which projected cash flow is discounted.

The offices market in Argentina is a liquid market, in which a great number of counterparties participates carrying out sale-purchase transactions. This situation results in significant and representative sale-purchase prices. Furthermore, lease agreements are denominated in U.S. dollars and are usually executed for three-year terms, hence this business produces stable cash flows in U.S. dollars. In this sense, we use the Market Approach method to determine the fair value of our Offices and Others segment, the value per sqm, being the most representative measurement. The consolidated net (loss) from fair value adjustment of investment properties of our Offices segment was mainly due to the appreciation of the Peso against “dólar MEP”.

The consolidated net gain from fair value adjustment of investment properties of our Sales and development segment was mainly due to the increase in the fair value adjustment of “Costa Urbana” and sales of República Building and floors of Catalinas Building.

155

Gain from disposal of farmlands 2022 vs. 2021

The total gain from disposal of farmlands, according to the income statement and the information by segment (taking into account all our joint ventures and inter-segment eliminations), increased by ARS 3,357 million (156,3%), from ARS 2,148 million in the fiscal year ended June 30, 2021 to ARS 5,505 million in the fiscal year ended June 30, 2022.

Fiscal year ended June 30, 2022

· On December 29, 2021, BrasilAgro sold 4,573 hectares (2,859 cultivable hectares) of the Rio do Meio farm, a rural property located in the Municipality of Correntina. The agreement signed on September 1, 2021 set the price of the area at 714,835 bags of soybeans, equivalent to BRL 130 million on the date of the transaction. Payments were divided into 13 installments, the first in the form of an advance and the rest in 12 semi-annual payments due in June and October, with the last installment on October 10, 2027. The gain recognized for the sale amounted to BRL 58 million.

· On October 8, 2021, BrasilAgro sold an area of 3,723 hectares (2,694 cultivable hectares) of the Alto Taquari farm, a rural property located in the Municipality of Alto Taquari - state of Mato Grosso. The total amount of the sale was 1,100 bags of soybeans per arable hectare or BRL 589 million (BRL 218,641 / arable ha). The handover of possession of the areas and, consequently, the recognition of sales income will be carried out in two stages. In October 2021 with 2,566 hectares (1,537 cultivable hectares), for an approximate amount of BRL 336 million and September 2024 with 1,157 cultivable hectares, for an approximate value of BRL 253 million. BrasilAgro will continue to operate the areas until handover. In the current fiscal year, the portion corresponding to the first stage is recognized as a gain of ARS 5,073 million.

Fiscal year ended June 30, 2021

· On May 6, 2021, BrasilAgro sold a total of 1,654 hectares of the Jatóba farm. The first installment was divided into 2 payments of BRL 6 million, on May 6 the first payment was received as a condition prior to the transfer of the property and on June 30 the second. The remaining balance will be paid in six annual installments. The result of the operation was BRL 47.31 million (ARS 1,383 million).

· The Company has signed a bill of sale with possession of a fraction of 2,440 hectares of its “San Pedro” farm, which includes 1,950 productive hectares of agricultural activity and its historic center. After this operation, a remnant of approximately 3,580 hectares of said establishment remains in the hands of the Company. The total amount of the operation was set at USD 8.6 million, of which USD 6.5 million have been collected to date. The remaining balance is approximately USD 2.1 million, and USD 0.8 million will be charged at the time of writing the fraction corresponding to the historic center planned for July 2021 and in 2 installments of USD 0.7 million in December 2021 and USD 0.6 million in December 2022. This generated a recognition of results for the approximate sum of ARS 464 million.

General and administrative expenses 2022 vs. 2021

Agricultural Business

Agricultural Production. General and administrative expenses associated with the Agricultural Production segment increased by 0.6 %, from ARS 2,250 million in the fiscal year ended June 30, 2021 to ARS 2,264 million in the fiscal year ended June 30, 2022, mainly due to an ARS 17 million decreased in expenses associated with crop operations; an ARS 88 million decrease in expenses associated with sugarcane operations: an ARS 67 million decrease in expenses associated with cattle activities; an ARS 186 million increase in expenses associated with the agricultural lease and services business. General and administrative expenses of the Agricultural Production segment, measured as a percentage of revenues from this segment, decreased from 5.6% during the fiscal year ended June 30, 2021 to 4.4% during the fiscal year ended June 30, 2022.

Land Transformation and Sales. General and administrative expenses associated with the Land Transformation and Sales segment remained constant in ARS 8 million during the fiscal years ended June 30, 2022 and 2021.

156

Corporate. General and administrative expenses associated with the Corporate segment increased by 2.6%, from ARS 720 million during the fiscal year ended June 30, 2021 to ARS 739 million during the fiscal year ended June 30, 2022.

Others. General and administrative expenses associated with the Others segment increased by 31.3%, from ARS 592 million during the fiscal year ended June 30, 2021 to ARS 777 million during the fiscal year ended June 30, 2022. General and administrative expenses of the Others segment, measured as a percentage of revenues from this segment, decreased from 6.7% during the fiscal year ended June 30, 2021 to 5.8% during the fiscal year ended June 30, 2022.

Urban Properties and Investment Business

Shopping Malls. General and administrative expenses of Shopping Malls increased by 21.9%, from ARS 2,348 million during the fiscal year ended June 30, 2021, to ARS 2,862 million during the fiscal year ended June 30, 2022, mainly due to: (i) an increase of ARS 341 million in salaries, social security charges and other personnel administrative expenses; (ii) an increase of ARS 168 million in fees and compensation for services; and (iii) an increase in travelling, transportation and stationery of ARS 43 million; partially offset by: (v) a decrease of ARS 37 million in taxes, rates and contributions. General and administrative expenses of Shopping Malls, measured as a percentage of revenues from such segment, decreased from 26.9% during the fiscal year ended June 30, 2021, to 16.5% during the fiscal year ended June 30, 2022.

Offices. The general and administrative expenses of our Offices segment decreased by 46.6%, from ARS 713 million during the fiscal year ended June 30, 2021, to ARS 381 million during the fiscal year ended June 30, 2022, mainly as a result of: (i) a decrease in fees payable to directors of ARS 149 million; (ii) a decrease of ARS 130 million in salaries, social security charges and other personnel administrative expenses; (iii) an ARS 25 million decrease in maintenance expenses; (iv) a decrease of ARS 20 million in fees and compensation for services; and (v) a decrease in leases and expenses of ARS 16 million. General and administrative expenses, measured as a percentage of revenues from the same segment, decreased from 16.2% during the fiscal year ended June 30, 2021, to 12.5% during the fiscal year ended June 30, 2022.

Sales and Developments. General and administrative expenses associated with our Sales and Developments segment decreased by 9.1%, from ARS 1,164 million during the fiscal year ended June 30, 2021, to ARS 1,058 million during the fiscal year ended June 30, 2022. General and administrative expenses, measured as a percentage of revenues from the same segment, increased from 91.6% during the fiscal year ended June 30, 2021, to 141.8% during the fiscal year ended June 30, 2022.

Hotels. General and administrative expenses associated with our Hotels segment increased by 4.4%, from ARS 699 million during the fiscal year ended June 30, 2021, to ARS 730 million during the fiscal year ended June 30, 2022, mainly as a result of: (i) an ARS 28 million increase in taxes, rates and contributions; (ii) an ARS 13 million increase in fees and compensation for services; and (iii) an ARS 9 million increase in bank expenses; partially offset by: (iv) a decrease of ARS 24 million in salaries, social security charges and other personnel administrative expenses. General and administrative expenses associated with the Hotels segment, measured as a percentage of revenues from this segment, decreased from 46.3% during the fiscal year ended June 30, 2021, to 17.0% during the fiscal year ended June 30, 2022.

Others. General and administrative expenses associated with our Others segment increased by 122.5%, from ARS 151 million during the fiscal year ended June 30, 2021, to ARS 336 million during the fiscal year ended June 30, 2022, mainly due to (i) an increase of ARS 171 million in fees and compensation for services; and (ii) an ARS 28 million increase in taxes, rates and contributions.

157

Selling expenses 2022 vs 2021

Agricultural Business

Agricultural Production. Selling expenses from the Agricultural Production segment increased by 13.6% from ARS 3,837 million in the fiscal year ended June 30, 2021 to ARS 4,358 million in the fiscal year ended June 30, 2022, mainly as a result of an ARS 608 million increase in selling expenses related with crop operations, an ARS 106 million decrease in expenses for sugarcane operations, an ARS 71 million decrease in selling expenses for cattle and an ARS 90 million increase in selling expenses associated with leases and agricultural services. Selling expenses of the Agricultural Production segment, measured as a percentage of revenues from this segment, decreased from 9.6% during the fiscal year ended June 30, 2021 to 8.5% during the fiscal year ended June 30, 2022.

Land Transformation and Sales. Selling expenses from the Land Transformation and Sales segment increased by ARS 187, from ARS 2 million in the fiscal year ended June 30, 2021 to ARS 189 million in the fiscal year ended June 30, 2022.

Others. Selling expenses from the Others segment increased by 41.1% from ARS 661 million in the fiscal year ended June 30, 2021 to ARS 933 million in the fiscal year ended June 30, 2022. Selling expenses from the Others segment, measured as a percentage of revenues from this segment, decreased from 7.5% during the fiscal year ended June 30, 2021 to 7.0% during the fiscal year ended June 30, 2022.

Urban Properties and Investment Business

Shopping Malls. Selling expenses of the Shopping Malls segment increased by 14.5%, from ARS 740 million during the fiscal year ended June 30, 2021, to ARS 847 million during the fiscal year ended June 30, 2022, mainly as a result of: (i) an increase in the charge of taxes, rates and contributions of ARS 303 million; ii) an increase in the charge of publicity, advertising and other commercial expenses of ARS 170 million; partially offset by: (iii) a decrease in the charge of doubtful accounts of ARS 326 million, and (iv) a decrease of ARS 40 million in salaries, social security charges and other personnel administrative expenses. Selling expenses, measured as a percentage of revenues from the Shopping Malls segment, increased from 8.5% negative during the fiscal year ended June 30, 2021, to 4.9% negative during the fiscal year ended June 30, 2022.

Offices. Selling expenses associated with our Offices segment decreased by 74.9%, from ARS 307 million during the fiscal year ended June 30, 2021, to ARS 77 million during the fiscal year ended June 30, 2022. Such variation was mainly generated as a result of: (i) an ARS 145 million decrease in the charge of taxes, rates and contributions; (ii) a decrease in the charge of doubtful accounts of ARS 56 million; (iii) an ARS 22 million decrease in salaries, social security and other personnel administrative expenses; and (iv) an ARS 6 million decrease in fees and compensation for services. Selling expenses associated with our Offices segment, measured as a percentage of revenues from this segment, decreased from 7.0% during the fiscal year ended June 30, 2021, to 2.5% during the fiscal year ended June 30, 2022.

Sales and Developments. Selling expenses associated with our Sales and Developments segment decreased by 19.5%, from ARS 1,145 million during the fiscal year ended June 30, 2021, to ARS 922 million during the fiscal year ended June 30, 2022. Such variation was mainly generated by: (i) an ARS 282 million decrease in the charge of taxes, rates and contributions; partially offset by: (ii) an increase of ARS 36 million in fees and compensation for services, and (iii) an increase of ARS 29 million in the charge of publicity, advertising and other commercial expenses. Selling expenses associated with our Sales and Developments segment, measured as a percentage of revenues from this segment, increased from 90.1% during the fiscal year ended June 30, 2021, to 123.6% during the fiscal year ended June 30, 2022.

Hotels. Selling expenses associated with our Hotels segment increased by 47.2%, from ARS 231 million during the fiscal year ended June 30, 2021, to ARS 340 million during the fiscal year ended June 30, 2022, mainly as a result of: (i) an ARS 118 million increase in taxes, rates and contributions; and (ii) an ARS 28 million increase in fees and compensation for services; partially offset by: (iii) an ARS 21 million decrease in salaries, social security and other personnel administrative expenses; and (iv) an ARS 16 million decrease in leases and expenses. Selling expenses associated with our Hotels segment, measured as a percentage of revenues from this segment, decreased from 15.3% during the fiscal year ended June 30, 2021, to 7.9% during the fiscal year ended June 30, 2022.

Others. Selling expenses associated with our Others segment remained constant in ARS 55 million during the fiscal years ended June 30, 2022 and 2021. Selling expenses associated with our Others segment, measured as a percentage of revenues from this segment, increased from 8.1% during the fiscal year ended June 30, 2021, to 32.0% during the fiscal year ended June 30, 2022.

158

Other operating results, net 2022 vs 2021

Agricultural Business

Agricultural Production. Other operating results, net, associated with our Agricultural Production segment increased by ARS 4,759 million, from a loss of ARS 6,856 million in the fiscal year ended June 30, 2021 to a loss of ARS 2,097 million in the fiscal year ended June 30, 2022.

Land Transformation and Sales. Other operating results, net, from this segment decreased by ARS 1,800 million from a gain of ARS 2,871 million in the fiscal year ended June 30, 2021 to a gain of ARS 1,071 million in the fiscal year ended June 30, 2022.

Others. Other operating results, net, associated with the Others segment decreased by ARS 176 million, from a gain of ARS 364 million in the fiscal year ended June 30, 2021 to a gain of ARS 188 million in the fiscal year ended June 30, 2022.

Urban Properties and Investment Business

Shopping Malls. Other operating results, net associated with our Shopping Malls segment increased by 31.4 %, from a net loss of ARS 207 million during the fiscal year ended June 30, 2021, to a net loss of ARS 142 million during the fiscal year ended June 30, 2022, mainly as a result of: (i) an increase of ARS 101 million in interest and discount generated by operating credits, (ii) an increase of ARS 16 million in management fees, partially offset by; (iii) an increase of ARS 62 million in the loss for lawsuits. Other operating results, net, from this segment, as a percentage of revenues from this segment, increased from 2.4% negative during the fiscal year ended June 30, 2021, to 0.8% negative during the fiscal year ended June 30, 2022.

Offices. Other operating results, net associated with our Offices segment decreased by 187.5%, from a net loss of ARS 8 million during the fiscal year ended June 30, 2021, to a net loss of ARS 23 million during the fiscal year ended June 30, 2022, mainly as a consequence of (i) an increase of ARS 51 million in discount generated by operating credits; partially offset by: (ii) a decrease of ARS 19 million in donations; and (iii) a decrease of ARS 10 million in the loss for lawsuits. Other operating results, net from this segment, as a percentage of the revenues from this segment, decreased from 0.2% negative during the fiscal year ended June 30, 2021, to 0.8% negative during the fiscal year ended June 30, 2022.

Sales and Developments. Other operating results, net associated with our Sales and Developments segment decreased by 500.0%, from a net loss of ARS 8 million during the fiscal year ended June 30, 2021, to a net loss of ARS 48 million during the fiscal year ended June 30, 2022, mainly due to (i) an decrease of ARS 60 million due to the sale of shares of Manibil S.A. in the comparative fiscal year; (ii) a decrease of ARS 18 million in management fees; and (iii) an increase of ARS 16 million in the loss for lawsuits; partially offset by: (iv) a decrease of ARS 64 million in donations. Other operating results, net from this segment, as a percentage of the revenues of this segment, decreased from 0.6% negative during the fiscal year ended June 30, 2021, to 6.4% negative during the fiscal year ended June 30, 2022.

Hotels. Other operating results, net associated with the Hotels segment decreased by 195.0%, from a net loss of ARS 20 million during the fiscal year ended June 30, 2021, to a net loss of ARS 59 million during fiscal year ended June 30, 2022, mainly due to (i) an increase of ARS 118 million in taxes, rates and contributions; and (ii) an increase of ARS 28 million in fees and compensation for services; partially offset by: (iii) a decrease of ARS 21 million in salaries, social security charges and other personnel administrative expenses; and (iv) an ARS 16 million decrease in leases and expenses. Other operating results, net from this segment, as a percentage of the revenues from this segment, decreased from 1.3% negative during the fiscal year ended June 30, 2021, to 1.4% negative during the fiscal year ended June 30, 2022.

159

Others. Other operating results, net associated with the Others segment increased by 2,242.9%, from a net loss of ARS 14 million during the fiscal year ended June 30, 2021, to a net profit of ARS 300 million during the fiscal year ended June 30, 2022, mainly due to an ARS 184 million recovery of fees for consultancy in Dolphin for and the income of fee charged to La Rural S.A in the current fiscal year. Other operating results, net from this segment, as a percentage of the revenues from this segment, increased from 2.1% negative during the fiscal year ended June 30, 2021, to 174.4% positive during the fiscal year ended June 30, 2022.

Management fees 2022 vs 2021

The company entered into a management agreement with Consultores Asset Management S.A., which provides for payment of fees equivalent to 10% of our profits for advisory services in relation to any matters related to business and investments, such as farming, real estate, finance, hotel, etc. Management fees amounted to ARS 4,169 million and ARS 518 million for the fiscal years ended June 30, 2022 and 2020, respectively. During fiscal year 2021 no results were recognized on this account.

Operating results 2022 vs 2021

Agricultural Business

Agricultural Production. Operating results of the Agricultural Production segment decreased by ARS 218 million, from a profit of ARS 10,902 million in the fiscal year ended June 30, 2021 to a profit of ARS 10,684 million in the fiscal year ended June 30, 2022.

Land Transformation and Sales. Operating results of the Land Transformation and Sales segment decreased by ARS 5,194 million, from a profit of ARS 13,985 million in the fiscal year ended June 30, 2021 to a profit of ARS 8.791 million in the fiscal year ended June 30, 2022.

Corporate. Operating results of this Corporate segment decreased by ARS 19 million from a loss of ARS 720 million in the fiscal year ended June 30, 2021 to a loss of ARS 739 million in the fiscal year ended June 30, 2022.

Others. Operating results of the Others segment increased by ARS 227 million from a ARS 1,858 million in the fiscal year ended June 30, 2021 to ARS 2,085 million in the fiscal year ended June 30, 2022.

Urban Properties and Investment Business

Shopping Malls. Operating results associated with the Shopping Malls segment increased from a loss of ARS 29,345 million during the fiscal year ended June 30, 2021, to a profit of ARS 12,541 million during the fiscal year ended June 30, 2022. Operating results associated with the Shopping Malls segment, as a percentage of revenues from such segment, increased from 336.3% negative during the fiscal year ended June 30, 2021, to 72.3% positive during the fiscal year ended June 30, 2022.

Offices. Operating results associated with our Offices segment decreased by 124.2%, from a net profit of ARS 12,372 million during the fiscal year ended June 30, 2021, to a net loss of ARS 2,997 million during the fiscal year ended June 30, 2022. Such variation was mainly due to an ARS 14,499 million decrease in the net gain / (loss) from fair value adjustments of investment properties. Operating results associated with the Offices segment, as a percentage of revenues from such segment, decreased from 281.1% positive during the fiscal year ended June 30, 2021, to 98.6% negative during the fiscal year ended June 30, 2022.

Sales and Developments. Operating results associated with our Sales and Developments segment increased by 71.0%, from ARS 9,119 million during the fiscal year ended June 30, 2021, to ARS 15,589 million during the fiscal year ended June 30, 2022. Such increase is mainly due to the net gain / (loss) from fair value adjustments of investment properties. Operating results associated with the Sales and Developments segment, as a percentage of revenues from this segment, increased from 717.5% during the fiscal year ended June 30, 2021, to 2,089.7% during the fiscal year ended June 30, 2022.

160

Hotels. Operating results associated with the Hotels segment increased by 158.9%, from a net loss of ARS 1,186 million during the fiscal year ended June 30, 2021, to a net profit of ARS 698 million during the fiscal year ended June 30, 2022. Such increase is mainly due to higher occupancy with the consequent increase in income, which was affected in the comparative fiscal year, due to COVID 19 pandemic. Operating results associated with the Hotels segment, as a percentage of revenues from such segment, increased from 78.5% negative during the fiscal year ended June 30, 2021, to 16.2% positive during the fiscal year ended June 30, 2022.

Others. Operating results associated with the Others segment decreased from a net loss of ARS 359 million during the fiscal year ended June 30, 2021, to a net loss of ARS 367 million during the fiscal year ended June 30, 2022. Such increase is mainly due to the decrease in gross loss and administrative expenses partially offset by a positive result in other operating results, net. Operating results associated with the Others segment, as a percentage of revenues from such segment, increased from 53.1% negative during the fiscal year ended June 30, 2021, to 213.4% positive during the fiscal year ended June 30, 2022.

Share of profit/ (loss) of associates and joint ventures 2022 vs 2021

Agricultural Business

According to information by segments (taking into account all our joint ventures and inter-segment eliminations), the total share of profit/(loss) of associates and joint ventures increased by ARS 257 million (270.5%), from a loss of ARS 95 million in the fiscal year ended June 30, 2021 to a profit of ARS 162 million in the fiscal year ended June 30, 2022.

Agricultural Production. The share of profit/(loss) of associates and joint ventures in the Agricultural Production segment increased by 10.2% from a profit of ARS 98 million in the fiscal year ended June 30, 2021 to a profit of ARS 108 million in the fiscal year ended June 30, 2022.

Others. The operating results in the Others segment increased by 128.0% from a loss of ARS 193 million in the fiscal year ended June 30, 2021 to a profit of ARS 54 million in the fiscal year ended June 30, 2022.

Urban Properties and Investment Business

According to information by segments (taking into account all our joint ventures and inter-segment eliminations), the total share of profit/(loss) of associates and joint ventures increased by ARS 7,007 million (107.1%), from ARS 6,541 million loss in the fiscal year ended June 30, 2021 to ARS 466 million profit in the fiscal year ended June 30, 2022.

Shopping Malls. In the information by segments, the share of profit / (loss) of the joint venture Nuevo Puerto Santa Fe S.A. is recorded on a consolidated basis, line by line in this segment.

Offices. This segment does not show results from the share of profit / (loss) of associates and joint ventures.

Sales and Developments. The share of profit / (loss) of the joint ventures Quality S.A., Cyrsa S.A. and Puerto Retiro S.A is recorded on a consolidated basis, line by line.

Hotels. This segment does not show results from the share of profit / (loss) of associates and joint ventures.

Other. The share of profit / (loss) of associates from the Others segment increased by 107.2%, from a net loss of ARS 6,541 million during the fiscal year ended June 30, 2021, to a net profit of ARS 466 million during the fiscal year ended June 30, 2022, mainly as a result of the variation from our investments in TGLT by ARS 2,783 million positive, Banco Hipotecario by ARS 2,113 positive and New Lipstick by ARS 922 million positive.

161

Financial results, net 2022 vs 2021

The Group financial results, net recorded a variation of ARS 11,766 million, from a profit of ARS 10,177 million in the fiscal year ended June 30, 2021 to a profit of ARS 21,943 million in the fiscal year ended June 30, 2022. This was mainly due to: (i) an increase in foreign exchange rate, net in the Agricultural Business and Urban Properties and Investment Business of ARS 12,257 million, from a profit of ARS 17,192 million, to a profit of ARS 29,449 million because of the appreciation of the peso against the dollar in real terms, compared to the devaluation in the previous year; and (ii) a decrease in interest expense of non-convertible notes of ARS 9,230 million due to the payment of non-convertible notes Series XXV, XXVI, XXVII and XXVIII, partially offset by (iii) a decrease of ARS 10,637 million in the gain from the valuation at fair value of financial assets and financial liabilities.

Income Tax 2022 vs 2021

The Company adopts the deferred tax method to calculate the income tax for the reported periods, thus recognizing temporary differences as tax assets and liabilities. The income tax charge for the year went from a loss of ARS 45,817 million during the fiscal year ended June 30, 2021, to a loss of ARS 1,977 million during the fiscal year ended June 30, 2022, due to the impact on deferred income tax, out of which a gain of ARS 934 million derives from the agricultural business and a loss of ARS 2,911 million derives from the urban properties and investment. Such variation is mainly due to the modification in the income tax rates in Argentina according to the Law 27,630 published in the Official Gazette on June 16, 2021, which explains the increase in the expense on income tax during the fiscal year ended June 30, 2021, due to the impact on deferred income tax.

Net profit/(loss) 2022 vs 2021

As a result of the factors described above, our net profit/(loss) for the year, including the effect of discontinued operations, increased by ARS 103,179 million from a net loss of ARS 40,179 million in the fiscal year ended on June 30, 2021 to a net profit of ARS 63,000 million in the fiscal year ended June 30, 2022, out of which a profit of ARS 27,905 million derives from the agricultural business, and a profit of ARS 35,095 million derives from the urban properties and investment business.

162

Results of Operations for the fiscal years ended June 30, 2021 and 2020

	Agricultural business									Urban Properties and Investment business									Total segment information									Joint ventures (i)									Adjustments (ii)									Elimination of inter-segment transactions and non-reportable assets / liabilities									Total Statement of Income / Financial Position
	06.30.21			06.30.20			Var.			06.30.21			06.30.20			Var.			06.30.21			06.30.20			Var.			06.30.21			06.30.20			Var.			06.30.21			06.30.20			Var.			06.30.21			06.30.20			Var.			06.30.21			06.30.20			Var.
	(in million of ARS)
Revenues		48,813			49,337			(524	)		16,585			27,434			(10,849	)		65,398			76,771			(11,373	)		(82	)		(150	)		68			4,828			7,638			(2,810	)		(597	)		(2,015	)		1,418			69,547			82,244			(12,697	)
Costs		(44,725	)		(41,022	)		(3,703	)		(5,654	)		(6,786	)		1,132			(50,379	)		(47,808	)		(2,571	)		115			131			(16	)		(5,215	)		(7,954	)		2,739			—			—			—			(55,479	)		(55,631	)		152
Initial recognition and changes in the fair value of biological assets and agricultural products at the point of harvest		23,412			6,436			16,976			—			—			—			23,412			6,436			16,976			—			—			—			—			—			—			311			333			(22	)		23,723			6,769			16,954
Changes in the net realizable value of agricultural products after harvest		(967	)		1,617			(2,584	)		—			—			—			(967	)		1,617			(2,584	)		—			—			—			—			—			—			—			—			—			(967	)		1,617			(2,584	)
Gross profit / (loss)		26,533			16,368			10,165			10,931			20,648			(9,717	)		37,464			37,016			448			33			(19	)		52			(387	)		(316	)		(71	)		(286	)		(1,682	)		1,396			36,824			34,999			1,825
Net gain/ (loss) from fair value adjustment of investment properties		9,035			1,921			7,114			(12,520	)		82,423			(94,943	)		(3,485	)		84,344			(87,829	)		(198	)		(647	)		449			—			—			—			—			—			—			(3,683	)		83,697			(87,380	)
Gain from disposal of farmlands		2,148			2,065			83			—			—			—			2,148			2,065			83			—			—			—			—			—			—			—			—			—			2,148			2,065			83
General and administrative expenses		(3,570	)		(3,084	)		(486	)		(5,075	)		(5,521	)		446			(8,645	)		(8,605	)		(40	)		21			35			(14	)		—			—			—			151			130			21			(8,473	)		(8,440	)		(33	)
Selling expenses		(4,500	)		(5,012	)		512			(2,478	)		(3,032	)		554			(6,978	)		(8,044	)		1,066			35			41			(6	)		—			—			—			143			50			93			(6,800	)		(7,953	)		1,153
Other operating results, net		(3,621	)		3,901			(7,522	)		(257	)		28			(285	)		(3,878	)		3,929			(7,807	)		(33	)		44			(77	)		176			149			27			(7	)		(22	)		15			(3,742	)		4,100			(7,842	)
Management fees		—			—			—			—			—			—			—			—			—			—			—			—			—			(518	)		518			—			—			—			—			(518	)		518
Profit / (loss) from operations		26,025			16,159			9,866			(9,399	)		94,546			(103,945	)		16,626			110,705			(94,079	)		(142	)		(546	)		404			(211	)		(685	)		474			1			(1,524	)		1,525			16,274			107,950			(91,676	)
Share of (loss) / profit of associates and joint ventures		(95	)		303			(398	)		(6,541	)		17,367			(23,908	)		(6,636	)		17,670			(24,306	)		(631	)		414			(1,045	)		—			—			—			(6	)		52			(58	)		(7,273	)		18,136			(25,409	)
Segment profit / (loss)		25,930			16,462			9,468			(15,940	)		111,913			(127,853	)		9,990			128,375			(118,385	)		(773	)		(132	)		(641	)		(211	)		(685	)		474			(5	)		(1,472	)		1,467			9,001			126,086			(117,085	)

(I)	Represents the equity value of joint ventures that were proportionately consolidated for information by segment purposes.
(II)	Includes gross profit/ (loss) of ARS (387) million and ARS (316) million corresponding to Building Administration Expenses and Collective Promotion Fund (FPC), as of June 30, 2021 and 2020, respectively.

163

Agricultural Business

The following table shows a summary of the Agricultural Business lines for the fiscal years ended June 30, 2021 and 2020.

	Agricultural production									Land transformation and sales									Corporate									Others									Total
	06.30.21			06.30.20			Var.			06.30.21			06.30.20			Var.			06.30.21			06.30.20			Var.			06.30.21			06.30.20			Var.			06.30.21			06.30.20			Var.
	(in million of ARS)
Revenues		39,961			42,329			(2,368	)		—			—			—			—			—			—			8,852			7,008			1,844			48,813			49,337			(524	)
Costs		(38,561	)		(36,145	)		(2,416	)		(59	)		(62	)		3			—			—			—			(6,105	)		(4,815	)		(1,290	)		(44,725	)		(41,022	)		(3,703	)
Initial recognition and changes in the fair value of biological assets and agricultural products at the point of harvest		23,412			6,436			16,976			—			—			—			—			—			—			—			—			—			23,412			6,436			16,976
Changes in the net realizable value of agricultural products after harvest		(967	)		1,617			(2,584	)		—			—			—			—			—			—			—			—			—			(967	)		1,617			(2,584	)
Gross profit / (loss)		23,845			14,237			9,608			(59	)		(62	)		3			—			—			—			2,747			2,193			554			26,533			16,368			10,165
Net gain from fair value adjustment of investment properties		—			—			—			9,035			1,921			7,114			—			—			—			—			—			—			9,035			1,921			7,114
Gain from disposal of farmlands		—			—			—			2,148			2,065			83			—			—			—			—			—			—			2,148			2,065			83
General and administrative expenses		(2,250	)		(2,369	)		119			(8	)		(7	)		(1	)		(720	)		(417	)		(303	)		(592	)		(291	)		(301	)		(3,570	)		(3,084	)		(486	)
Selling expenses		(3,837	)		(4,470	)		633			(2	)		(2	)		—			—			—			—			(661	)		(540	)		(121	)		(4,500	)		(5,012	)		512
Other operating results, net		(6,856	)		1,121			(7,977	)		2,871			2,369			502			—			—			—			364			411			(47	)		(3,621	)		3,901			(7,522	)
Profit / (loss) from operations		10,902			8,519			2,383			13,985			6,284			7,701			(720	)		(417	)		(303	)		1,858			1,773			85			26,025			16,159			9,866
Share of profit/ (loss) of associates and joint ventures		98			131			(33	)		—			—			—			—			—			—			(193	)		172			(365	)		(95	)		303			(398	)
Segment profit / (loss)		11,000			8,650			2,350			13,985			6,284			7,701			(720	)		(417	)		(303	)		1,665			1,945			(280	)		25,930			16,462			9,468

Urban Properties and Investment Business

The following table shows a summary of the Urban Properties and Investment Business lines for the fiscal years ended June 30, 2021 and 2020.

	Shopping Malls									Offices									Sales and developments									Hotels									Others									Total
	06.30.21			06.30.20			Var.			06.30.21			06.30.20			Var.			06.30.21			06.30.20			Var.			06.30.21			06.30.20			Var.			06.30.21			06.30.20			Var.			06.30.21			06.30.20			Var.
	(in millions of ARS)
Revenues		8,727			14,569			(5,842	)		4,401			5,616			(1,215	)		1,271			2,025			(754	)		1,510			4,978			(3,468	)		676			246			430			16,585			27,434			(10,849	)
Costs		(1,428	)		(1,401	)		(27	)		(236	)		(209	)		(27	)		(1,373	)		(1,873	)		500			(1,746	)		(3,064	)		1,318			(871	)		(239	)		(632	)		(5,654	)		(6,786	)		1,132
Gross profit / (loss)		7,299			13,168			(5,869	)		4,165			5,407			(1,242	)		(102	)		152			(254	)		(236	)		1,914			(2,150	)		(195	)		7			(202	)		10,931			20,648			(9,717	)
Net (loss)/ gain from fair value adjustment of investment properties		(33,349	)		(5,185	)		(28,164	)		9,235			54,723			(45,488	)		11,538			33,224			(21,686	)		—			—			—			56			(339	)		395			(12,520	)		82,423			(94,943	)
General and administrative expenses		(2,348	)		(2,044	)		(304	)		(713	)		(601	)		(112	)		(1,164	)		(1,217	)		53			(699	)		(897	)		198			(151	)		(762	)		611			(5,075	)		(5,521	)		446
Selling expenses		(740	)		(1,751	)		1,011			(307	)		(185	)		(122	)		(1,145	)		(502	)		(643	)		(231	)		(566	)		335			(55	)		(28	)		(27	)		(2,478	)		(3,032	)		554
Other operating results, net		(207	)		42			(249	)		(8	)		(20	)		12			(8	)		(111	)		103			(20	)		(49	)		29			(14	)		166			(180	)		(257	)		28			(285	)
(Loss)/ profit from operations		(29,345	)		4,230			(33,575	)		12,372			59,324			(46,952	)		9,119			31,546			(22,427	)		(1,186	)		402			(1,588	)		(359	)		(956	)		597			(9,399	)		94,546			(103,945	)
Share of (loss)/ profit of associates and joint ventures		—			—			—			—			—			—			(26	)		—			(26	)		—			—			—			(6,515	)		17,367			(23,882	)		(6,541	)		17,367			(23,908	)
Segment (loss)/ profit		(29,345	)		4,230			(33,575	)		12,372			59,324			(46,952	)		9,093			31,546			(22,453	)		(1,186	)		402			(1,588	)		(6,874	)		16,411			(23,285	)		(15,940	)		111,913			(127,853	)

164

Revenues 2021 vs. 2020

Agricultural Business

Agricultural Production. Revenues from the Agricultural Production segment decrease by 5.6% from ARS 42,329 million during the fiscal year ended June 30, 2020 to ARS 39,961 million during the fiscal year ended June 30, 2021. Such decrease is mainly attributable to:

· ARS 3,064 million decrease in revenues from crop sales, resulting from a decrease of 173,794 (20.0%) tons in the volume of crops sold in fiscal year ended June 30, 2021 as compared to the previous fiscal year, offset by 11% increase in the average price of crops sold, from ARS 32,327 per ton in fiscal year ended June 30, 2020 to ARS 35,977 per ton in fiscal year ended June 30, 2021.

· ARS 782 million increase in revenues from sugarcane sales, resulting from a decrease of 56,240 tons (3%) in the volume of sugarcane sold in the fiscal year ended June 30, 2021 compared to the previous fiscal year, coupled with a 13% increase in the average price of sugarcane sold, from ARS 3,516 per ton in fiscal year ended June 30, 2020 to ARS 3,967 per ton in fiscal year ended June 30, 2021, as a result of an improvement in sugarcane quality (higher TRS, i.e., total recoverable sugar);

· ARS 68 million increase in revenues from cattle sales, primarily attributable to a 14% decrease in tons of cattle sold in the fiscal year ended June 30, 2021 compared to the previous fiscal year, coupled with a 18% increase in the average price of cattle; and

· ARS 154 decrease in revenues from leases and services attributable to: (i) a decrease of ARS 4,373 million (0.29%) in revenues from seed production mainly caused by an increase in the hectares leased to third parties in Brazil plus the collection of an additional amount on account of productivity over the yields, offset by a decrease in the sales price of the corn and soybean seed service in Argentina; and (ii) a ARS 150,332 million decrease in revenues from feedlot services and pastures.

Others. Revenues from the Others segment increased by 26.3% from ARS 7,008 million during the fiscal year ended June 30, 2020 to ARS 8,852 million during the fiscal year ended June 30, 2021. Such increase is mainly attributable to an ARS 1,844 million increases in revenues from sales on consignment, brokerage and others. and o fees and others.

Urban Properties and Investment Business

Shopping Malls. Revenues from the Shopping Malls segment decreased by 40.1% from ARS 14,569 million during the fiscal year ended June 30, 2020, to ARS 8,727 million during the fiscal year ended June 30, 2021. Such fall is mainly attributable to the closing of the Shopping Malls as a consequence of the COVID 19 pandemic, which had an impact in the fiscal year 2021, generating: (i) a decrease of ARS 3,809 million in revenue base rent; (ii) a decrease of ARS 1,283 million in revenue contingent rent; (iii) an ARS 930 million decrease in revenue from admission rights; (iv) an ARS 669 million decrease in revenue from parking; partially offset by (v) an ARS 813 million increase in the revenue from averaging of scheduled rent escalation.

Offices. Revenues from the Offices segment decreased by 21.6% from ARS 5,616 million during the fiscal year ended June 30, 2020, to ARS 4,401 million during the fiscal year ended June 30, 2021. This variation is mainly explained by a decrease in revenue from leases by 22.8%, from ARS 5,567 million during the fiscal year ended June 30, 2020 to ARS 4,299 million during the fiscal year ended June 30, 2021, mainly as a result of less income from leases due to the sale of Bouchard Building and sale of floors in Boston Tower during the period ended June 30, 2021.

Sales and Developments. Revenues from the Sales and Developments segment recorded a 37.2% decrease from ARS 2,025 million during the fiscal year ended June 30, 2020, to ARS 1,271 million during the fiscal year ended June 30, 2021. This segment often varies significantly from period to period due to the non-recurrence of different sales transactions carried out by the Group over time.

165

Hotels. Revenues from our Hotels segment decreased by 69.7% from ARS 4,978 million during the fiscal year ended June 30, 2020, to ARS 1,510 million during the fiscal year ended June 30, 2021, mainly due to a decrease in revenues as a result of the fall in the tourist industry during this period because of COVID 19.

Others. Revenues from the Others segment increased by 174.8% from ARS 246 million during the fiscal year ended June 30, 2020, to ARS 676 million during the fiscal year ended June 30, 2021, mainly due to the sale of Stowe House in USD 3.45 million, generating a profit of USD 0.3 million.

Costs 2021 vs. 2020

Agricultural Business

Agricultural Production. The costs of the Agricultural Production segment increase by 6.7% from ARS 36,145 million during the fiscal year ended June 30, 2020 to ARS 38,561 million during the fiscal year ended June 30, 2021, primarily as a consequence of:

· ARS 2,695 million increase in costs of crop sales, mainly resulting from an 39% increase in the average cost per ton of crops sold in the fiscal year ended June 30, 2020, from ARS 27,603 million in the fiscal year ended June 30, 2020 to ARS 38,312 million in the fiscal year ended June 30, 2021; offset by a decrease of 173,794 tons in the volume of crops sold in the fiscal year ended June 30, 2021 as compared to the previous fiscal year.

· ARS 107 million increase in the costs of sugarcane sales, mainly as a result of 4% rise in the average cost of sugarcane per ton sold in the fiscal year, from ARS 3,311 per ton in the fiscal year ended June 30, 2020 to ARS 3,445 per ton in the fiscal year ended June 30, 2021, coupled with a decrease of 56,240 tons (3%) in the volume of sugarcane sold in the fiscal year ended June 30, 2021 compared to the previous fiscal year

· ARS 108 million decrease in the costs of cattle sales, mainly as a result of 2,748 tons of cattle sold decrease in the fiscal year ended June 30, 2021 compared to the previous fiscal year.

· ARS 278 million decrease in costs of leases and services, mainly attributable to a ARS 159 million decrease in the Feedlot service cost and an ARS 115 million drop in lease costs and seed production.

Costs of the Agricultural Production segment, measured as a percentage of revenues from this segment, increased from 85.4% during the fiscal year ended June 30, 2020 to 96.5% during the fiscal year ended June 30, 2021.

Land transformation and sales. The costs of the Land transformation and sales segment decreased by 4.8% from ARS 62 million during the fiscal year ended June 30, 2020 to ARS 59 million during the fiscal year ended June 30, 2021.

Others. The costs of the Others segment increased by 26.8% from ARS 4,815 million during the fiscal year ended June 30, 2020 to ARS 6,105 million during the fiscal year ended June 30, 2021, mainly as a result of ARS 1,290 million increase in other segments.

The costs of the Others segment, measured as a percentage of revenues from this segment, increased from 68.7% during the fiscal year ended June 30, 2020 to 69.0% during the fiscal year ended June 30, 2021.

166

Urban Properties and Investment Business

Shopping Malls. Costs associated with the Shopping Malls segment increased by 1.9%, from ARS 1,401 million during the fiscal year ended June 30, 2020, to ARS 1,428 million during the fiscal year ended June 30, 2021, mainly due to: (i) an increase in leases and expenses of ARS 232 million and (ii) an increase in taxes, rates and contributions of ARS 39 million; partially offset by: (iii) a decrease in maintenance expenses of ARS 230 million and (iv) an ARS 21 million decrease in fees and compensation services. Costs associated with the Shopping Malls segment, measured as a percentage of the revenues from this segment, increased from 9.6% during the fiscal year ended June 30, 2020, to 16.4% during the fiscal year ended June 30, 2021.

Offices. Costs associated with the Offices segment increased by 12.9%, from ARS 209 million during the fiscal year ended June 30, 2020, to ARS 236 million during the fiscal year ended June 30, 2021, mainly due to (i) an increase of ARS 16 million in salaries, social security charges and other personnel administrative expenses; (ii) an increase in maintenance cost of ARS 10 million; (iii) an increase in leases and expenses of ARS 9 million; and (iv) an ARS 4 million increase in fees and compensation services. Costs associated with the Offices segment, measured as a percentage the revenues from this segment, increased from 3.7% during the fiscal year ended June 30, 2020, to 5.4% during the fiscal year ended June 30, 2021.

Sales and Developments. Costs associated with our Sales and Developments segment recorded a 26.7% decrease from ARS 1,873 million during the fiscal year ended June 30, 2020, to ARS 1,373 million during the fiscal year ended June 30, 2021 mainly due to (i) a decrease of ARS 241 million in the cost of sale of goods and services; (ii) an ARS 136 million decrease in fees and compensation services; (iii) a decrease in maintenance expenses of ARS 33 million; and (iv) a decrease in taxes, rates and contributions of ARS 17 million. Costs in the Sales and Developments segment, measured as a percentage of revenues from this segment, increased from 92.5% during the fiscal year ended June 30, 2020, to 108.0% during the fiscal year ended June 30, 2021.

Hotels. Costs in the Hotels segment decreased by 43.0%, from ARS 3,064 million during the fiscal year ended June 30, 2020, to ARS 1,746 million during the fiscal year ended June 30, 2021, mainly as a result of (i) an ARS 564 million decrease in the costs of salaries, social security and other personnel expenses; (ii) an ARS 392 million decrease in maintenance, repair, and services; (iii) an ARS 163 million decrease in food, beverages and other hotel expenses; and (iv) an ARS 112 million decrease in fees and compensation services. Costs in the Hotels segment, measured as a percentage of revenues from this segment, increased from 61.6% during the fiscal year ended June 30, 2020, to 115.6% during the fiscal year ended June 30, 2021.

Others. Costs in the Others segment increased by 264.4%, from ARS 239 million during the fiscal year ended June 30, 2020, to ARS 871 million during the fiscal year ended June 30, 2021, mainly as a result of an increase in cost of selling properties of ARS 502 million due to the sale of Stowe House and also an increase in fees and payments for services and an increase in charge salaries, social security costs and other personnel administrative expenses related to the development and implementation of Appa Shops.

Initial recognition and changes in the fair value of biological assets and agricultural produce at the point of harvest 2021 vs. 2020

The result from the total initial recognition and changes in the fair value of biological assets and agricultural produce at the point of harvest, according to the income statement, increased by ARS 16,954 million (250.5%), from ARS 6,769 million in the fiscal year ended June 30, 2020 to ARS 23,723 million in the fiscal year ended June 30, 2021.

The result from the total initial recognition and changes in the fair value of biological assets and agricultural produce at the point of harvest generated by inter-segment transactions decreased by ARS 22 million (6.6%), from ARS 333 million in the fiscal year ended June 30, 2020 to ARS 311 million in the fiscal year ended June 30, 2021.

According to information by segments (taking into account the profit / (loss) from operations from our joint ventures and excluding those related to building administration expenses and collective promotion fund and business inter-segment transactions), the profit / (loss) from the total initial recognition and changes in the fair value of biological assets and agricultural produce at the point of harvest increased by ARS 16,976 million (263.8%), from ARS 6,436 million in the fiscal year ended June 30, 2020 to ARS 23,412 million in the fiscal year ended June 30, 2021.

167

Such variation was mainly as a result of:

· An increase in profits from cattle production of ARS 15,008 million, coming both from Brazil due to better prices and a bigger area planted with corn, and from Argentina, mainly generated by the real profits of soybeans and corn due to the effect of price increases and a better perform; and an expected profit of corn as a result of both the significant rise in the price and a bigger area planted;

· An increase in profits from sugarcane production of ARS 1,275 million, as a result of better prices, a smaller planted area (approx. 1,000 ha), lower yields and higher production costs; and

· An increase in profits from production and farm holding for ARS 693 million, generated mainly by a notable increase in prices in both Brazil and Argentina, where farm prices this year had a better performance against inflation, offset by a lower volume of kilos produced.

Changes in the net realizable value of agricultural produce after harvest 2021 vs. 2020

 Profits /(losses) from total changes in the net realizable value of agricultural produce after harvest, according to information by segments, decreased by ARS 2,584 million (159.8%), from a profit of ARS 1,617 million in the fiscal year ended June 30, 2020 to a loss of ARS 967 million in the fiscal year ended June 30, 2021.

Such variation is mainly generated by Argentina, due to the increase in prices as a result of the Peso depreciation, boosted by a bigger grain stock obtained during the 2020-2021 crop year.

Gross profit 2021 vs. 2020

Agricultural Business

Agricultural Production. Gross profit from this segment increased by 67.5% from ARS 14,237 million in the fiscal year ended June 30, 2020 to ARS 23,845 million in the fiscal year ended June 30, 2021.

Land Transformation and Sales. Gross profit from this segment decreased by 4.8% from ARS 62 million in the fiscal year ended June 30, 2020 to ARS 59 million in the fiscal year ended June 30, 2021.

Others. Gross profit from this segment increased by 25.3% from ARS 2,193 million in the fiscal year ended June 30, 2020 to ARS 2,747 million in the fiscal year ended June 30, 2021.

Urban Properties and Investment Business

Shopping Malls. Gross profit from the Shopping Malls segment decreased by 44.6%, from ARS 13,168 million during the fiscal year ended June 30, 2020, to ARS 7,299 million during the fiscal year ended June 30, 2021, mainly as a result of a decrease in total sales of our lessees in real terms, thus resulting in lower percentage rentals under our lease agreements attributable to COVID-19. Gross profit from the Shopping Malls segment as a percentage of the segment revenues, decreased from 90.4% during the fiscal year ended June 30, 2020, to 83.6% during the fiscal year ended June 30, 2021.

Offices. Gross profit from the Offices segment decreased by 23%, from ARS 5,407 million during the fiscal year ended June 30, 2020, to ARS 4,165 million during the fiscal year ended June 30, 2021. Gross profit from the Offices segment, measured as percentage of revenues from this segment, decreased from 96.3% during the fiscal year ended June 30, 2020, to 94.6% during the fiscal year ended June 30, 2021.

Sales and developments. Gross profit from the Sales and Developments segment decreased by 167.1%, from a profit of ARS 152 million during the fiscal year ended June 30, 2020, to an ARS 102 million loss during the fiscal year ended June 30, 2021. Gross profit from the Sales and Developments segment, measured as a percentage of revenues from this segment, decreased from 7.5% positive during the fiscal year ended June 30, 2020, to 8% negative during the fiscal year ended June 30, 2021.

168

Hotels. Gross profit from the Hotels segment decreased by 112.3%, from a profit of ARS 1,914 million during the fiscal year ended June 30, 2020, to an ARS 236 million loss during the fiscal year ended June 30, 2021. Gross profit from the Hotels segment, measured as a percentage of revenues from this segment, decreased from 38.4% positive during the fiscal year ended June 30, 2020, to 15.6% negative during the fiscal year ended June 30, 2021.

Others. Gross profit from the Others segment decreased by 2,885.7%, from a profit of ARS 7 million during the fiscal year ended June 30, 2020, to an ARS 195 million loss during the fiscal year ended June 30, 2021. Gross profit from the Others segment, measured as a percentage of revenues from this segment, decreased from 2.8% positive during the fiscal year ended June 30, 2020, to 28.8% negative during the fiscal year ended June 30, 2021.

Net gain (loss) from changes in the fair value of investment properties 2021 vs. 2020

Agricultural Business

According to information by segments (taking into account all our joint ventures and inter-segment eliminations), the total net gain /(loss) from changes in the fair value of investment properties increased by ARS 7,114 million (370.3%), from ARS 1,921 million in the fiscal year ended June 30, 2020 to ARS 9,035 million in the fiscal year ended June 30, 2021.

Urban Properties and Investment Business

According to information by segments (taking into account all our joint ventures and inter-segment eliminations), total net gain / (loss) from changes in the fair value of investment properties decreased by ARS 94,943 million (115.2%), from a profit of ARS 82,423 million in the fiscal year ended June 30, 2020 to ARS 12,520 million loss in the fiscal year ended June 30, 2021.

The decrease in our Shopping Malls’ peso value was primarily a consequence of: (i) an increase in the income tax rate from 25% to 35%, with a consequent decrease in the projected cash flows; (ii) between June 30, 2020 to June 30, 2021, the Argentinian peso depreciated 36% against U.S. dollar (from ARS 70.26 per U.S. dollar to ARS 95.52 per U.S. dollar), which generated a reduction in the projected cash flows as measured in U.S. dollar terms from our Shopping Malls segment; and (iii) increase of 135 basis points in the discount rate, that is used to discount the projected cash flows from the Shopping Malls segment.

The offices market in Argentina is a liquid market, in which a great number of counterparties participates carrying out sale-purchase transactions. This situation results in significant and representative sale-purchase prices. Furthermore, lease agreements are denominated in U.S. dollars and are usually executed for three-year terms, hence this business produces stable cash flows in U.S. dollars. In this sense, we use the Market Approach method to determine the fair value of our Offices and Others segment, the value per sqm, being the most representative measurement.

Since September 2019, the real estate market experienced certain operational changes due to the adoption of foreign exchange regulations. As a result, it is very likely that office buildings/lands reserved sales be settled in Pesos at an implied exchange rate higher than the official exchange rate, which can be observed in the transactions conducted by the Company before and after closing of these financial statements. Therefore, we have valued our offices and lands reserved in Pesos as of closing of these financial statements considering the aforementioned situation, thus resulting in a gain with respect to the previously recorded values.

169

Gain from disposal of farmlands 2021 vs. 2020

The total gain from disposal of farmlands, according to the income statement and the information by segment (taking into account all our joint ventures and inter-segment eliminations), increased by ARS 83 million (4%), from ARS 2,065 million in the fiscal year ended June 30, 2020 to ARS 2,148 million in the fiscal year ended June 30, 2021.

Fiscal year ended June 30, 2021

· On May 6, 2021, BrasilAgro sold a total of 1,654 hectares of the Jatóba farm. The first installment was divided into 2 payments of BRL 6 million, on May 6 the first payment was received as a condition prior to the transfer of the property and on June 30 the second. The remaining balance will be paid in six annual installments. The result of the operation was BRL 47.31 million (ARS 1,383 million).

· The Company has signed a bill of sale with possession of a fraction of 2,440 hectares of its “San Pedro” farm, which includes 1,950 productive hectares of agricultural activity and its historic center. After this operation, a remnant of approximately 3,580 hectares of said establishment remains in the hands of the Company. The total amount of the operation was set at USD 8.6 million, of which USD 6.5 million have been collected to date. The remaining balance is approximately USD 2.1 million, and USD 0.8 million will be charged at the time of writing the fraction corresponding to the historic center planned for July 2021 and in 2 installments of USD 0.7 million in December 2021 and USD 0.6 million in December 2022. This generated a recognition of results for the approximate sum of ARS 464 million.

Fiscal year ended June 30, 2020

· On June 30, 2020, BrasilAgro entered into an agreement for the sale of 1,875 hectares (1,500 arable hectares) of the Jatobá farm. The sales value was ARS 930 million, out of which ARS 103 million have already been collected. The balance will be paid in six annual installments. The Group recognized a gain of ARS 677 million as a result of this transaction.

· On May 29, 2020, BrasilAgro entered into an agreement for the sale of 105 arable hectares in the Alto Taquarí farm. The sales value was ARS 228 million. The buyer made a down payment of ARS 36 million.

General and administrative expenses 2021 vs. 2020

Agricultural Business

Agricultural Production. General and administrative expenses associated with the Agricultural Production segment decreased by 5 %, from ARS 2,369 million in the fiscal year ended June 30, 2020 to ARS 2,250 million in the fiscal year ended June 30, 2021, mainly due to a ARS 24 million increase in expenses associated with crop operations; a ARS 151 million decrease in expenses associated with sugarcane operations: a ARS 42 million increase in expenses associated with cattle activities; a ARS 34 million decrease in expenses associated with the agricultural lease and services business. General and administrative expenses of the Agricultural Production segment, measured as a percentage of revenues from this segment, remained at 5.6%.

Land Transformation and Sales. General and administrative expenses associated with the Land Transformation and Sales segment increased by 14.3%, from ARS 7 million during the fiscal year ended June 30, 2020 to ARS 8 million during the fiscal year ended June 30, 2021.

Corporate. General and administrative expenses associated with the Corporate segment increased by 72.7%, from ARS 417 million during the fiscal year ended June 30, 2020 to ARS 720 million during the fiscal year ended June 30, 2021.

Others. General and administrative expenses associated with the Others segment increased by 103.4%, from ARS 291 million during the fiscal year ended June 30, 2020 to ARS 592 million during the fiscal year ended June 30, 2021. General and administrative expenses of the Others segment, measured as a percentage of revenues from this segment, increased from 4.2% during the fiscal year ended June 30, 2020 to 6.7% during the fiscal year ended June 30, 2021.

170

Urban Properties and Investment Business

Shopping Malls. General and administrative expenses of Shopping Malls increased by 14.9%, from ARS 2,044 million during the fiscal year ended June 30, 2020, to ARS 2,348 million during the fiscal year ended June 30, 2021, mainly due to: (i) an increase of ARS 286 million in fees payable to directors; (ii) an increase of ARS 124 million in salaries, social security charges and other personnel administrative expenses; (iii) an increase in maintenance expenses of ARS 25 million; (iv) an increase of ARS 15 million in taxes, rates and contributions; partially offset by: (v) a decrease of ARS 99 million in fees and compensation for services. General and administrative expenses of Shopping Malls, measured as a percentage of revenues from such segment, increased from 14.0% during the fiscal year ended June 30, 2020, to 26.9% during the fiscal year ended June 30, 2021.

Offices. The general and administrative expenses of our Offices segment increased by 18.6%, from ARS 601 million during the fiscal year ended June 30, 2020, to ARS 713 million during the fiscal year ended June 30, 2021, mainly as a result of: (i) an increase in fees payable to directors of ARS 75 million; (ii) an increase of ARS 32 million in salaries, social security charges and other personnel administrative expenses; partially offset by (iii) a decrease in fees and compensation for services of ARS 27 million. General and administrative expenses, measured as a percentage of revenues from the same segment, increased from 10.7% during the fiscal year ended June 30, 2020, to 16.2% during the fiscal year ended June 30, 2021.

Sales and Developments. General and administrative expenses associated with our Sales and Developments segment decreased by 4.4%, from ARS 1,217 million during the fiscal year ended June 30, 2020, to ARS 1,164 million during the fiscal year ended June 30, 2021. General and administrative expenses, measured as a percentage of revenues from the same segment, increased from 60.1% during the fiscal year ended June 30, 2020, to 91.6% during the fiscal year ended June 30, 2021.

Hotels. General and administrative expenses associated with our Hotels segment decreased by 22.1%, from ARS 897 million during the fiscal year ended June 30, 2020, to ARS 699 million during the fiscal year ended June 30, 2021, mainly as a result of: (i) an ARS 70 million decrease in salaries, social security and other personnel administrative expenses; (ii) an ARS 53 million decrease in maintenance, security, cleaning, repairs and related expenses; (iii) an ARS 34 million decrease in taxes, rates and contributions; and (iv) an ARS 26 million decrease in fees and compensation for services. General and administrative expenses associated with the Hotels segment, measured as a percentage of revenues from this segment, increased from 18.0% during the fiscal year ended June 30, 2020, to 46.3% during the fiscal year ended June 30, 2021.

Others. General and administrative expenses associated with our Others segment decreased by 80.2%, from ARS 762 million during the fiscal year ended June 30, 2020, to ARS 151 million during the fiscal year ended June 30, 2021, mainly due to (i) a decrease of ARS 356 million in fees and compensation for services; (ii) an ARS 172 million decrease in salaries, social security and other personnel administrative expenses; and (iii) a decrease of ARS 81 million in maintenance, repairs and services.

Selling expenses 2021 vs 2020

Agricultural Business

Agricultural Production. Selling expenses from the Agricultural Production segment decreased by 14.2% from ARS 4,470 million in the fiscal year ended June 30, 2020 to ARS 3,837 million in the fiscal year ended June 30, 2021, mainly as a result of an ARS 641 million decrease in selling expenses related with crop operations, an ARS 19 million increase in expenses for sugarcane operations, an ARS 16 million increase in selling expenses for cattle and an ARS 5 million increase in selling expenses associated with leases and agricultural services. Selling expenses of the Agricultural Production segment, measured as a percentage of revenues from this segment, decreased from 10.6% during the fiscal year ended June 30, 2020 to 9.6% during the fiscal year ended June 30, 2021.

Land Transformation and Sales. Selling expenses from the Land Transformation and Sales segment remains constant in ARS 2 million for both fiscal years.

171

Others. Selling expenses from the Others segment increased by 22.4% from ARS 540 million in the fiscal year ended June 30, 2020 to ARS 661 million in the fiscal year ended June 30, 2021. Selling expenses from the Others segment, measured as a percentage of revenues from this segment, decreased from 7.7% during the fiscal year ended June 30, 2020 to 7.5% during the fiscal year ended June 30, 2021.

Urban Properties and Investment Business

Shopping Malls. Selling expenses of the Shopping Malls segment decreased by 57.7%, from ARS 1,751 million during the fiscal year ended June 30, 2020, to ARS 740 million during the fiscal year ended June 30, 2021, mainly as a result of: (i) a decrease in the charge of taxes, rates and contributions of ARS 470 million; ii) a decrease in the charge of doubtful accounts of ARS 458 million; and iii) a decrease in the charge of publicity, advertising and other commercial expenses of ARS 47 million. Selling expenses, measured as a percentage of revenues from the Shopping Malls segment, decreased from 12.0% during the fiscal year ended June 30, 2020, to 8.5% during the fiscal year ended June 30, 2021.

Offices. Selling expenses associated with our Offices segment increased by 65.9%, from ARS 185 million during the fiscal year ended June 30, 2020, to ARS 307 million during the fiscal year ended June 30, 2021. Such variation was mainly generated as a result of: (i) an ARS 97 million increase in the charge of taxes, rates and contributions; (ii) an increase in the charge of doubtful accounts of ARS 26 million, partially offset by (ii) an ARS 5 million decrease in salaries, social security and other personnel administrative expenses. Selling expenses associated with our Offices segment, measured as a percentage of revenues from this segment, increased from 3.3% during the fiscal year ended June 30, 2020, to 7.0% during the fiscal year ended June 30, 2021.

Sales and Developments. Selling expenses associated with our Sales and Developments segment increased by 128.1%, from ARS 502 million during the fiscal year ended June 30, 2020, to ARS 1,145 million during the fiscal year ended June 30, 2021. Such variation was mainly generated by: (i) an ARS 388 million increase in fees and compensation; and (ii) an ARS 295 million increase in taxes, rates and contributions, both charges related to the sale of Bouchard Building and sale of floors in Boston Tower; partially offset by: (iii) a decrease of ARS 17 million in the charge of publicity, advertising and other commercial expenses, and, (iv) a decrease of ARS 8 million in salaries, social security and other personnel administrative expenses. Selling expenses associated with our Sales and Developments segment, measured as a percentage of revenues from this segment, increased from 24.8% during the fiscal year ended June 30, 2020, to 90.1% during the fiscal year ended June 30, 2021.

Hotels. Selling expenses associated with our Hotels segment decreased by 59.2%, from ARS 566 million during the fiscal year ended June 30, 2020, to ARS 231 million during the fiscal year ended June 30, 2021, mainly as a result of: (i) an ARS 157 million decrease in taxes, rates and contributions; (ii) an ARS 54 million decrease in salaries, social security and other personnel administrative expenses; (iii) an ARS 41 million decrease in publicity, advertising and other commercial expenses; and (iv) an ARS 40 million decrease in fees and compensation for services. Selling expenses associated with our Hotels segment, measured as a percentage of revenues from this segment, increased from 11.4% during the fiscal year ended June 30, 2020, to 15.3% during the fiscal year ended June 30, 2021.

Others. Selling expenses associated with our Others segment increased by 96.4%, from ARS 28 million during the fiscal year ended June 30, 2020, to ARS 55 million during the fiscal year ended June 30, 2021. Selling expenses associated with our Others segment, measured as a percentage of revenues from this segment, decreased from 11.4% during the fiscal year ended June 30, 2020, to 8.1% during the fiscal year ended June 30, 2021.

Other operating results, net 2021 vs 2020

Agricultural Business

Agricultural Production. Other operating results, net, associated with our Agricultural Production segment decreased by ARS 7,977 million, from a gain of ARS 1,121 million in the fiscal year ended June 30, 2020 to a loss of ARS 6,856 million in the fiscal year ended 2021.

172

Land Transformation and Sales. Other operating results, net, from this segment increased by ARS 502 million from a gain of ARS 2,369 million in the fiscal year ended June 30, 2020 to a gain of ARS 2,871 million in the fiscal year ended June 30, 2021.

Others. Other operating results, net, associated with the Others segment decreased by ARS 47 million, from a gain of ARS 411 million in the fiscal year ended June 30, 2020 to a gain of ARS 364 million in the fiscal year ended June 30, 2021.

Urban Properties and Investment Business

Shopping Malls. Other operating results, net associated with our Shopping Malls segment decreased by 592.9 %, from a net profit of ARS 42 million during the fiscal year ended June 30, 2020, to a net loss of ARS 207 million during the fiscal year ended June 30, 2021, mainly as a result of: (i) a decrease of ARS 262 million in interest and discount generated by operating credits, (ii) a decrease of ARS 25 million in management fees, partially offset by; (iii) a decrease of ARS 26 million in donations; and (iv) a decrease of ARS 22 million in the loss for lawsuits. Other operating results, net, from this segment, as a percentage of revenues from this segment, decreased from 0.3% positive during the fiscal year ended June 30, 2020, to 2.4% negative during the fiscal year ended June 30, 2021.

Offices. Other operating results, net associated with our Offices segment increased by 60.0%, from a net loss of ARS 20 million during the fiscal year ended June 30, 2020, to a net loss of ARS 8 million during the fiscal year ended June 30, 2021, mainly as a consequence of (i) a decrease of ARS 7 million in donations; and (ii) a decrease of ARS 3 million in the loss for lawsuits. Other operating results, net from this segment, as a percentage of the revenues from this segment, increased from 0.4% negative during the fiscal year ended June 30, 2020, to 0.2% negative during the fiscal year ended June 30, 2021.

Sales and Developments. Other operating results, net associated with our Sales and Developments segment increased by 92.8%, from a net loss of ARS 111 million during the fiscal year ended June 30, 2020, to a net loss of ARS 8 million during the fiscal year ended June 30, 2021, mainly due to (i) a decrease of ARS 77 million in the loss for lawsuits; partially offset by: (ii) a decrease of ARS 20 million in interest and discount generated by operating credits and (iii) an increase of ARS 14 million in donations. Other operating results, net from this segment, as a percentage of the revenues of this segment, increased from 5.5% negative during the fiscal year ended June 30, 2020, to 0.6% negative during the fiscal year ended June 30, 2021.

Hotels. Other operating results, net associated with the Hotels segment increased by 59.2%, from a net loss of ARS 49 million during the fiscal year ended June 30, 2020, to a net loss of ARS 20 million during fiscal year ended June 30, 2021, mainly due to lower charges from lawsuits and others. Other operating results, net from this segment, as a percentage of the revenues from this segment, decreased from 1.0% negative during the fiscal year ended June 30, 2020, to 1.3% negative during the fiscal year ended June 30, 2021.

Others. Other operating results, net associated with the Others segment decreased by 108.4%, from a net profit of ARS 166 million during the fiscal year ended June 30, 2020, to a net loss of ARS 14 million during the fiscal year ended June 30, 2021, mainly due to lack of income of fee charged to La Rural S.A. during the period ended June 30, 2021. Other operating results, net from this segment, as a percentage of the revenues from this segment, decreased from 67.5% positive during the fiscal year ended June 30, 2020, to 2.1% negative during the fiscal year ended June 30, 2021.

Management fees 2021 vs 2020

The company entered into a management agreement with Consultores Asset Management S.A., which provides for payment of fees equivalent to 10% of our profits for advisory services in relation to any matters related to business and investments, such as farming, real estate, finance, hotel, etc. Management fees amounted to ARS 518 million during fiscal year 2020. During fiscal year 2021 no results were recognized on this account.

173

Operating results 2021 vs 2020

Agricultural Business

Agricultural Production. Operating results of the Agricultural Production segment increased by ARS 2,383 million, from a profit of ARS 8,519 million in the fiscal year ended June 30, 2020 to a profit of ARS 10,902 million in the fiscal year ended June 30, 2021.

Land Transformation and Sales. Operating results of the Land Transformation and Sales segment increased by ARS 7,701 million, from a profit of ARS 6,284 million in the fiscal year ended June 30, 2020 to a profit of ARS 13.985 million in the fiscal year ended June 30, 2021.

Corporate. Operating results of this Corporate segment decreased by ARS 303 million from a loss of ARS 417 million in the fiscal year ended June 30, 2020 to a loss of ARS 720 million in the fiscal year ended June 30, 2021.

Others. Operating results of the Others segment increased by ARS 85 million from a ARS 1,773 million in the fiscal year ended June 30, 2020 to ARS 1,858 million in the fiscal year ended June 30, 2021.

Urban Properties and Investment Business

Shopping Malls. Operating results associated with the Shopping Malls segment decreased from a profit of ARS 4,230 million during the fiscal year ended June 30, 2020, to a loss of ARS 29,345 million during the fiscal year ended June 30, 2021.

Offices. Operating results associated with our Offices segment decreased by 79.1%, from a net profit of ARS 59,324 million during the fiscal year ended June 30, 2020, to a net profit of ARS 12,372 million during the fiscal year ended June 30, 2021. Such variation was mainly due to an ARS 45,488 million decrease in the net gain / (loss) from fair value adjustments of investment properties. Operating results associated with the Offices segment, as a percentage of revenues from such segment, decreased from 1,056.3% during the fiscal year ended June 30, 2020, to 281.1% during the fiscal year ended June 30, 2021.

Sales and Developments. Operating results associated with our Sales and Developments segment decreased by 71.1%, from a net profit of ARS 31,546 million during the fiscal year ended June 30, 2020, to a net profit of ARS 9,119 million during the fiscal year ended June 30, 2021. Such decrease is mainly due to the net gain / (loss) from fair value adjustments of investment properties. Operating results associated with the Sales and Developments segment, as a percentage of revenues from this segment, decreased from 1,557.8% during the fiscal year ended June 30, 2020, to 717.5% during the fiscal year ended June 30, 2021.

Hotels. Operating results associated with the Hotels segment decreased by 395.0%, from a net profit of ARS 402 million during the fiscal year ended June 30, 2020, to a net loss of ARS 1,186 million during the fiscal year ended June 30, 2021. Such decrease is mainly due to the fact that revenues were significantly affected by a decline in the activity during the fiscal year 2021, attributable to the COVID-19 pandemic. Operating results associated with the Hotels segment, as a percentage of revenues from such segment, decreased from 8.1% positive during the fiscal year ended June 30, 2020, to 78.5% negative during the fiscal year ended June 30, 2021.

Others. Operating results associated with the Others segment increased from a net loss of ARS 956 million during the fiscal year ended June 30, 2020, to a net loss of ARS 359 million during the fiscal year ended June 30, 2021.

174

Share of profit/ (loss) of associates and joint ventures 2021 vs 2020

Agricultural Business

According to information by segments (taking into account all our joint ventures and inter-segment eliminations), the total share of profit/(loss) of associates and joint ventures decreased by ARS 398 million (131.4%), from a profit of ARS 303 million in the fiscal year ended June 30, 2020 to a loss of ARS 95 million in the fiscal year ended June 30, 2021.

Agricultural Production. The share of profit/(loss) of associates and joint ventures in the Agricultural Production segment decreased by 25.2% from a profit of ARS 131 million in the fiscal year ended June 30, 2020 to a profit of ARS 98 million in the fiscal year ended June 30, 2021.

Others. The operating results in the Others segment decreased by 212.2% from a profit of ARS 172 million in the fiscal year ended June 30, 2020 to a loss of ARS 193 million in the fiscal year ended June 30, 2021.

Urban Properties and Investment Business

According to information by segments (taking into account all our joint ventures and inter-segment eliminations), the total share of profit/(loss) of associates and joint ventures decreased by ARS 23,908 million (137.7%), from ARS 17,367 million profit in the fiscal year ended June 30, 2020 to ARS 6,541 million loss in the fiscal year ended June 30, 2021.

Shopping Malls. In the information by segments, the share of profit / (loss) of the joint venture Nuevo Puerto Santa Fe S.A. is recorded on a consolidated basis, line by line in this segment.

Offices. This segment does not show results from the share of profit / (loss) of associates and joint ventures.

Sales and Developments. The share of profit / (loss) of the joint ventures Quality S.A., Cyrsa S.A. and Puerto Retiro S.A is recorded on a consolidated basis, line by line. The share of profit / (loss) of our associate Manibil S.A., which was recorded in this line until its sale, decreased by ARS 26 million during the fiscal year ended June 30, 2021.

Hotels. This segment does not show results from the share of profit / (loss) of associates and joint ventures.

Other. The share of profit / (loss) of associates from the Others segment decreased by 137.5%, from a net profit of ARS 17,367 million during the fiscal year ended June 30, 2020, to a net loss of ARS 6,541 million during the fiscal year ended June 30, 2021, mainly as a result of the variation from our investments in New Lipstick for ARS 19,187 million negative and in TGLT S.A. in the amount of ARS 3,264 million negative.

Financial results, net 2021 vs 2020

The Group financial results, net recorded a variation of ARS 60,574 million, from a loss of ARS 50,397 million in the fiscal year ended June 30, 2020 to a profit of ARS 10,177 million in the fiscal year ended June 30, 2021. This was mainly due to: (i) Increase in foreign exchange rate, net in the Agricultural Business and Urban Properties and Investment Business of ARS 42,098 million, from a loss of ARS 24,906 million, to a profit of ARS 17,192 million because of the appreciation of the peso against the dollar in real terms, compared to the devaluation in the previous year; and (ii) an increase in gain of ARS 14,196 million in results from the valuation at fair value of financial assets and financial liabilities as a result of the holding of sovereign bonds.

Income Tax 2021 vs 2020

The Company adopts the deferred tax method to calculate the income tax for the reported periods, thus recognizing temporary differences as tax assets and liabilities. The income tax charge for the year went from a loss of ARS 19,593 million during the fiscal year ended June 30, 2020, to a loss of ARS 45,817 million during the fiscal year ended June 30, 2021, out of which a loss of ARS 10,278 million derives from the agricultural business and a loss of ARS 35,539 million derives from the urban properties and investment.

175

Due to the enactment of Law 27,630 published in the Official Gazette on June 16, 2021 and effective for the years beginning on January 1, 2021, the current rates for corporate income tax are modified according to the following scale:

Accumulated net taxable profit
More of		To		Will pay		More %			On the surplus of
	—		5,000,000		—		25	%		—
	5,000,000		50,000,000		1,250,000		30	%		5,000,000
	50,000,000		Onwards		14,750,000		35	%		50,000,000

The amounts provided in the scale will be adjusted annually, as of January 1, 2022, considering the annual variation of the Consumer Price Index (CPI), corresponding to the month of October of the year prior to the adjustment, with respect to the same month from the previous year. The amounts determined by application of the described mechanism will be applicable for the fiscal years that begin after each update.

Net profit/(loss) 2021 vs 2020

As a result of the factors described above, our net profit/(loss) for the year, including the effect of discontinued operations, decreased by ARS 89,444 million from a net profit of ARS 49,265 million in the fiscal year ended on June 30, 2020 to a net loss of ARS 40,179 million in the fiscal year ended June 30, 2021, out of which a profit of ARS 21,944 million derives from the agricultural business, and a loss of ARS 62,123 million derives from the urban properties and investment business.

B. Liquidity and Capital Resources

Liquidity

Our main sources of liquidity have historically been:

· cash generated by operations;

· cash generated by our issuance of common shares and non-convertible notes;

· cash proceeds from borrowings (including cash from bank loans and overdrafts) and financing arrangements (including cash from the exercise of warrants); and

· cash proceeds from sale of investment and trading properties and property, plant and equipment (including cash proceeds from the sale of farmlands).

Our main cash requirements or uses (other than in connection with our operating activities) have historically been:

· acquisition of subsidiaries and non-controlling interest in subsidiaries;

· acquisition of interest in associates and joint ventures;

· capital contributions to associates and joint ventures;

· capital expenditures in property, plant and equipment (including acquisitions of farmlands) and investment and trading properties;

· payments of short-term and long-term debt and payment of the related interest expense; and

· payment of dividends.

176

Our liquidity and capital resources include our cash and cash equivalents, proceeds from operating activities, sales of investment properties, trading properties and farms, obtained bank borrowings, long-term debts incurred and capital funding.

Our material cash requirements from known contractual and other obligations mainly consist of obligations under our borrowings. As of June 30, 2022, we expected to incur a total of ARS 141,431 million under our borrowings, consisting of ARS 95,267 million due within one year, ARS 43,046 million due within one to three years and ARS 3,118 million due within four to five years.

Cash Flows

The table below shows our cash flow for the fiscal years ended June 30, 2022, 2021 and 2020:

	(in million of ARS)
	06.30.22			06.30.21			06.30.20
Net cash generated from operating activities		21,807			14,573			88,014
Net cash generated from investing activities		12,894			119,929			111,462
Net cash used in financing activities		(37,016	)		(87,967	)		(191,052	)
Net (decrease)/ increase in cash and cash equivalents		(2,315	)		46,535			8,424

As of June 30, 2022, we had negative working capital of ARS 34,591 million (calculated as current assets less current liabilities as of such date).

As of June 30, 2022, in our Agricultural Business, we had positive working capital of ARS 11,318 million (calculated as current assets less current liabilities as of such date).

As of June 30, 2022, in our Urban Properties and Investments Business, our Operation Center in Argentina had negative working capital of ARS 45,909 million (calculated as current assets less current liabilities as of such date).

On July 6, 2022, CRESUD completed the exchange of its Series XXIII Notes, for an aggregate principal amount of USD 98,422,999, which represents 86.98% of the outstanding aggregate principal amount of the Series XXIII Notes. For more information see “Recent Developments – Cresud’s Recent Developments – Exchange Offer - Series XXIII Notes”.

On July 6, 2022, IRSA completed the exchange of its Series II Notes, for an aggregate principal amount of USD 238,985,000, which represents 66.38% of the outstanding aggregate principal amount of the Series II Notes. For more information see “Recent Developments – IRSA’s Recent Developments – Exchange Offer - Series II Notes, originally issued by IRSA CP, for Series XIV”.

Also, on August 17, 2022, IRSA sold and transferred one floor of the tower “200 Della Paolera” located in the Catalinas district of the Autonomous City of Buenos Aires for a total leasable area of approximately 1,184 sqm and 8 parking lots located in the building. The transaction price was approximately USD 12.6 million (USD/sqm 10,600), which had already been paid. For more information see “Recent Developments – IRSA’s Recent Developments – 200 Della Paolera tower floor sale”.

At the same date, our Urban Properties and Investments Business had cash and cash equivalents of ARS 12,776 million.

As stated in Note 1 to the consolidated financial statements as of June 30, 2020, on September 25, 2020 the Court decreed the insolvency and liquidation of IDBD and appointed a trustee for its shares along with a custodian over DIC and Clal shares. After this decision, the Board of Directors of IDBD was removed, therefore, we lost control on that date. For comparability purposes and as required by IFRS 5, the results of the Israel Operations Center have been reclassified to discontinued operations for the fiscal years ended June 30, 2021 and 2020.

177

As stated in Note 4 to the consolidated financial statements as of June 30, 2021, due to the sale of Carnes Pampeanas S.A. on February 24, 2021, the results of this subsidiary have been reclassified to discontinued operations for the fiscal years ended June 30, 2021 and 2020.

Operating activities

Fiscal year ended June 30, 2022

Our operating activities for the fiscal year ended June 30, 2022 generated net cash inflows of ARS 23,034 million, originated from continuing operations, mainly due to (i) an operating income for ARS 7.053 million, (ii) a decrease in biological assets for ARS 19,726 million, (iii) a decrease in trade and other receivables for ARS 4,578 million partially offset by (iv) decrease in trade and other payables for ARS 6,623 million and (v) a decrease in lease liabilities for ARS 1,905 million.

Fiscal year ended June 30, 2021

Our operating activities for the fiscal year ended June 30, 2021 generated net cash inflows of ARS 15,050 million, of which ARS 5,395 million are originated in discontinued operations and ARS 9,655 million are from continuing operations, mainly due to (i) a decrease in biological assets for ARS 14,780 million, (ii) a decrease in trades and other receivables for ARS 6,861 million, and (iii) an operating income for ARS 1,414 million partially offset by (iv) an increase in inventory for ARS 7,607 million, (v) a decrease in lease liabilities for ARS 2,681 million and (vi) a net variation in derivative financial instruments for ARS 3,273 million.

Fiscal year ended June 30, 2020

Our operating activities for the fiscal year ended June 30, 2020 generated net cash inflows of ARS 89,616 million, of which ARS 59,595 million are originated in discontinued operations and ARS 30,021 million are from continuing operations, mainly due to (i) an operating income for ARS 18,210 million, (ii) a decrease in trades and other receivables for ARS 13,206 million and (iii) a decrease in biological assets for ARS 12,331 million partially offset by (iv) an increase in trade and other payables for ARS 7,182 million and (v) an increase of right to use assets for ARS 2,593 million.

Investment activities

Fiscal year ended June 30, 2022

Our investing activities resulted in net cash inflows of ARS 12,894 million, originated from continuing operations for the fiscal year ended June 30, 2022, mainly due to (i) ARS 25,977 million derived from proceeds from sales of investment properties, (ii) ARS 18,089 million proceeds from disposal of investments in financial assets partially offset by (iii) ARS 27,186 million used in the acquisition of investments in financial assets, (iv) ARS 4,022 million used in the acquisition and improvement in property, plant and equipment and (v) acquisitions and improvement of investment properties for ARS 6,134 million.

Fiscal year ended June 30, 2021

Our investing activities resulted in net cash inflows of ARS 119,929 million, of which ARS 72,320 million are originated in discontinued operations and ARS 47,609 are from continuing operations for the fiscal year ended June 30, 2021, mainly due to (i) ARS 30,394 million derived from proceeds from sales of investment properties, (ii) ARS 52,348 million proceeds from disposal of investments in financial assets partially offset by (iii) ARS 27,482 million used in the acquisition of investments in financial assets, (iv) ARS 3,316 million used in the acquisition and improvement in property, plant and equipment and (v) ARS 1,638 million used in the acquisition and improvement of investment properties.

178

Fiscal year ended June 30, 2020

Our investing activities resulted in net cash inflows of ARS 111,462 million, of which ARS 100,213 million are originated in discontinued operations and an inflow of funds from continued activities of ARS 11,249 million for the fiscal year ended June 30, 2020, mainly due to (i) ARS 45,874 million proceeds from disposal of investments in financial assets partially offset by, (ii) ARS 34,308 million used in the acquisition of investments in financial assets (iii) ARS 3,453 million used in the acquisition and improvement in property, plant and equipment and (iv) ARS 9,057 million used in the acquisition and improvements of investment properties.

Financing activities

Fiscal year ended June 30, 2022

Our financing activities for the fiscal year ended June 30, 2022 resulted in net cash outflows of ARS 37,016 million, corresponding to continued activities, mainly due to (i) the payment of borrowing and non-convertible notes for ARS 41,660 million and (ii) the payment of interest on short-term, long-term debt of ARS 16,211 million and (iii) dividends paid to non-controlling interest in subsidiaries for ARS 7,780 million partially offset by (iv) borrowings and issuance of non-convertible notes for ARS 26,522 million, and (v) sales of non-convertible notes in portfolio for ARS 4,320 million.

Fiscal year ended June 30, 2021

Our financing activities for the fiscal year ended June 30, 2021 resulted in net cash outflows of ARS 87,967 million, corresponding ARS 29,679 million to discontinued activities, and ARS 58,288 million to continued activities, mainly due to (i) the payment of borrowing and non-convertible notes for ARS 153,450 million and (ii) the payment of interest on short-term and long-term debt of ARS 33,680 million partially offset by (iii) borrowings and issuance of non-convertible notes for ARS 93,608 million, (iv) charge for issuance of shares and other equity instruments for ARS 20,719 million and (v) sales of non-convertible notes in portfolio for ARS 11,574 million.

Fiscal year ended June 30, 2020

Our financing activities for the fiscal year ended June 30, 2020 resulted in net cash outflows of ARS 191,052 million, corresponding ARS 172,654 million to discontinued activities, and ARS 18,398 million to continued activities, mainly due to (i) the payment of borrowing and non-convertible notes of ARS 75,909 million, (ii) the payment of interest on short-term and long-term debt of ARS 20,065 million, (iii) ARS 7,315 million corresponding to the net cancellation of short-term loans (iv) ARS 6,413 million due to repurchase of non-convertible notes, partially offset by (v) borrowings and issuance of non-convertible notes for ARS 95,884 million and (vi) proceeds from derivative financial instruments for ARS 12,177 million.

Capital Expenditures

Our capital expenditures were ARS 13,435 million, ARS 7,357 and ARS 30,447 million for the fiscal years ended June 30, 2022, 2021 and 2020, respectively, including other goods and equipment acquired in business combinations.

Our capital expenditures consisted of the purchase of real estate and farms, acquisition and improvement of productive agricultural assets, communication networks, completion of the construction of a shopping center, construction of real estate and acquisition of land reserves.

179

Fiscal year ended June 30, 2022

During the fiscal year ended June 30, 2022, in our Urban Properties and Investments Business we invested ARS 9,751 million, as follows: (a) acquisitions and improvements of property, plant and equipment of ARS 335 million, primarily i) ARS 11 million in buildings and facilities, ii) ARS 53 million in machinery and equipment and others, iii) improvements in our hotels Sheraton Libertador, Llao Llao and Intercontinental (ARS 11 million, ARS 253 million and ARS 7 million, respectively); (b) improvements in our rental properties for ARS 2,731 million; (c) the development of properties for ARS 6,625 million.

During the fiscal year ended June 30, 2022, we invested in the Agricultural Business ARS 3,684 million mainly due (a) acquisition and development of owner occupied farmland for ARS 2,115 million (ARS 2,027 million of subsidiary BrasilAgro); (b) ARS 617 million in bearer plant; (c) ARS 406 million in other building and facilities; (d) ARS 405 million machinery and equipment; (e) ARS 124 million in vehicles, and (f) ARS 17 million in furniture and supplies

Fiscal year ended June 30, 2021

During the fiscal year ended June 30, 2021, we invested ARS 4,414 million, as follows: (a) acquisitions and improvements of property, plant and equipment of ARS 2,715 million, primarily i) ARS 259 million in buildings and facilities, ii) ARS 953 million in communication networks, iii) ARS 1,341 million in machinery and equipment and others, iv) improvements in our hotels Sheraton Libertador, Llao Llao and Intercontinental (ARS 13 million, ARS 33 million and ARS 26 million, respectively) and v) ARS 90 million in agricultural establishments; (b) improvements in our rental properties for ARS 1,699 million, out of which ARS 1,609 million derive from our Operations Center in Argentina and ARS 90 million derive from the Operations Center in Israel.

During the fiscal year ended June 30, 2021, we invested in the Agricultural Business ARS 2,943 million mainly due (a) acquisition and development of owner occupied farmland for ARS 2,100 million (ARS 1,735 million of subsidiary BrasilAgro); (b) ARS 248 million in bearer plant; (c) ARS 123 million in other building and facilities; (d) ARS 275 million machinery and equipment; (e) ARS 64 million in vehicles; (f) ARS 21 million in furniture and supplies; and (g) ARS 112 million destined to suppliers advances for proprieties acquisitions.

Fiscal year ended June 30, 2020

During the fiscal year ended June 30, 2020, we invested ARS 27,415 million, as follows: (a) acquisitions and improvements of property, plant and equipment of ARS 13,968 million, primarily i) ARS 817 million in buildings and facilities, ii) ARS 8,416 million in communication networks, iii) ARS 4,354 million in machinery and equipment and others iv) improvements in our hotels Sheraton Libertador, Llao Llao and Intercontinental (ARS 34 million, ARS 151 million and ARS 108 million, respectively) and v) ARS 89 million in agricultural establishments; (b) improvements in our rental properties of ARS 6,651 million, out of which ARS 4,695 million derive from our Operations Center in Argentina and ARS 1,956 million derive from the Operations Center in Israel; (c) the development of properties for ARS 6,795 million.

During the fiscal year ended June 30, 2020, we invested ARS 3,032 million mainly due (a) acquisition and development of owner occupied farmland for ARS 1,786 million (ARS 1,407 million of subsidiary BrasilAgro); (b) ARS 769 million in bearer plant; (c) ARS 138 million in other building and facilities; (d) ARS 143 million machinery and equipment; (e) ARS 67 million in vehicles; (f) ARS 13 million in furniture and supplies; and (g) ARS 116 million destined to suppliers advances for proprieties acquisitions.

180

Indebtedness

As of June 30, 2022, we had total loans in the amount of ARS 141,431 million. The following table sets forth the scheduled maturities of our outstanding debt:

Capital	Agricultural Business		Urban properties and investments		Total
	(million of ARS)
Less than 1 year		31,878		60,208		92,086
More than 1 and up to 2 years		14,348		10,469		24,817
More than 2 and up to 3 years		14,445		2,087		16,532
More than 3 and up to 4 years		1,519		106		1,625
More than 4 and up to 5 years		1,422		253		1,675
More than 5 years		1,379		—		1,379
		64,991		73,123		138,114
Interest
Less than 1 year		1,706		1,475		3,181
More than 1 and up to 3 years		—		63		63
More than 3 and up to 4 years		—		9		9
More than 4 and up to 5 years		—		64		64
		1,706		1,611		3,317
		66,697		74,734		141,431

	Agricultural Business		Urban properties and investments		Total
	(million of ARS)
Non-convertible Notes		47,614		66,216		113,830
Bank loans and others		10,986		1,012		11,998
Bank overdrafts		8,097		5,871		13,968
Others		—		1,014		1,014
AABE debt		—		405		405
Loans with non-controlling interests		—		216		216
		66,697		74,734		141,431

The composition and fair value of the loans as of June 30, 2022 and June 30, 2021 are as follows:

	Book value				Fair value
	06.30.2022		06.30.2021		06.30.2022		06.30.2021
	(million of ARS)
NCN		113,830		146,397		98,198		140,402
Bank loans		11,998		29,896		11,998		29,896
Bank overdrafts		13,968		15,270		13,968		15,270
Other borrowings		1,635		3,031		1,635		3,031
Total borrowings		141,431		194,594		125,799		188,599
Non-current		46,164		120,089
Current		95,267		74,505
Total		141,431		194,594

181

The following tables describe our total debt as of June 30, 2022:

Agricultural business	Currency	Annual Average Interest Rate			Face Value		Book value
					(in million of the corresponding currency of the debt)		(in million ARS)
Cresud’s Series XXIII Notes (1)	USD		6.50	%		113		11,858
Cresud’s Series XXX Notes	USD		2.00	%		25		3,129
Cresud’s Series XXXI Notes	USD		9.00	%		31		125
Cresud’s Series XXXII Notes	USD		9.00	%		34		4,333
Cresud’s Series XXXIII Notes	USD		6.99	%		19		2,422
Cresud’s Series XXXIV Notes	USD		6.99	%		36		2,980
Cresud’s Series XXXV Notes	USD		3.50	%		42		5,268
Cresud’s Series XXXVI Notes	USD		2.00	%		41		5,090
Cresud’s Series XXXVII Notes	USD		5.50	%		24		3,024
Bank loans	USD		2.00	%		2		271
Bank loans	ARS		38.00	%		1,650		1,670
Bank loans	ARS		42.00	%		1,220		1,523
Bank overdrafts	ARS		34.00% to 42.50%			—		8,097
BrasilAgro’s Notes	BRL		106.50% to 110.00% e Pré 5.37 + TLP 100%			330		7,843
Bank loans	BRL		3.24% to 6.34% + CDI a 100%			20		468
Bank loans	BRL		3.50	%		10		230
Bank loans	BRL		6.34% to 7.64%			11		255
Bank loans	BRL		3.76% to 6.76%			34		807
Bank loans	USD		7.00% to 9.50%			9		1,176
FyO’s Notes	USD		0.00	%		12		1,542
Bank overdrafts	ARS		From 34.00% to 80.00%			—		246
Bank loans	USD		5.75	%		35		4,340
								66,697

(5) On July 6, 2022, we completed the exchange of our Series XXIII Notes, in an aggregate principal amount of USD 113,158,632, maturing on February 16, 2023. On July 6, 2022, the expiration of the exchange offer was announced, USD 98,422,999 of Series XXIII Notes were validly tendered and accepted, representing 86.98% of acceptance. On July 8, the exchange offer was settled, the Series XXXVIII Notes were issued, for an amount of USD 70.6 million, and Series XXIII Notes were partially canceled, consequently the outstanding amount is USD 14,735,633.

Urban Properties and Investments Business	Currency	Annual Average Interest Rate			Face Value		Book value  (in million ARS)
		(in million of the corresponding currency of the debt)			(in million of ARS)
IRSA’s 2023 Notes – Series I	USD		10.00	%		3		389
IRSA’s 2023 Notes – Series II (1)	USD		8.75	%		351		44,863
IRSA’s 2023 Notes – Series VIII	USD		10.00	%		18		2,364
IRSA’s 2023 Notes – Series IX	USD		10.00	%		56		7,339
IRSA’s 2024 Notes – Series XI	USD		5.00	%		13		1,583
IRSA’s 2024 Notes – Series XII (2)	ARS		4.00	%		44		5,935
IRSA’s 2024 Notes – Series XIII	USD		3.90	%		30		3,743
Loans with non-controlling interests	USD		5.00	%		1		215
Bank loans	USD		Libor + 1.90%			8		1,012
AABE Debt	ARS		Libor			373		405
Others	USD/ARS		NA			—		1,015
Bank overdrafts	ARS		From 34.00% to 80.00%			—		5,871
								74,734

(1)

Originally issued by IRSA Propiedades Comerciales S.A. On May 16, 2022, we announced the exchange offer of Notes Series II for Notes Series XIV (for more information see “Issue of Notes Series XIV (Exchange offer of Notes Series II))", with the purpose to carry out the refinancing of Notes Series II. On July 6, 2022, the exchange was completed, in which USD 238,985,000 of Notes Series II were presented and accepted, which represents 66.38% of acceptance. On July 8, the settlement of the exchange proceeded, where the new Notes Series XIV were issued and the partial cancellation of the Notes Series II was carried out, leaving an outstanding amount of USD 121,015,000.

(2)

Series XII denominated in UVA and payable in ARS. Nominal value UVA 44 million

182

Agricultural Business Series XXIII Notes

On February 16, 2018, we issued the Series XXIII Notes, for USD 113.2, bearing a fixed interest rate of 6.5% payable semiannually, denominated and payable in dollars, which matures on February 16, 2023. The issue price was 100%.

As a consequence of the regulations established by the Central Bank, and once the corresponding authorizations were obtained, on June 16, 2022, we announced the exchange offer of Series XXIII Notes for Series XXXVIII Notes (for more information see “Series XXXVIII Notes (Exchange of Series XXIII Notes)”), in order to carry out the refinancing of Series XXIII Notes.

On July 6, 2022, we announced the expiration of the exchange offer, a total of USD 98,422,999 of Series XXIII Notes were validly tendered and accepted, representing an acceptance of 86.98%. On July 8, the exchange offer was settled, new Series XXXVIII Notes were issued and Series XXIII Notes were partially canceled, the outstanding amount is USD 14,735,633.

Series XXX Notes

On August 31, 2020, we issued the Series XXX Notes, denominated in dollars and payable in Pesos at the applicable exchange rate, as defined in the issuance documents, with a nominal value of USD 25.0 million at a fixed rate of 2.0%, maturing 36 months from the date of issuance with quarterly interest payments and principal expiring at maturity. The issue price was 100%.

Series XXXI y XXXII Notes (Exchange of Series XXIV Notes)

On November 12, 2020, the company carried out an exchange offer of its Series XXIV Notes, for a face value of USD 73.6 million A total amount of USD 65.1 million of Series XXIV Notes were tendered and accepted for the Exchange (for both Series) which represents 88.41% acceptance, through the participation of 1,098 orders.

As a result of the exchange, Series XXXI and XXXII Notes were issued, which are described below:

· Series XXXI: denominated and payable in U.S. dollars for USD 1.3 million at a fixed rate of 9.0%, with quarterly interest payments. The principal payment will be made in three installments, as follows: 33% on November 12, 2021, 33% on November 12, 2022, and 34% on November 12, 2023. The issue price was 100.0%.

· Series XXXII: denominated and payable in U.S. dollars for USD 34.3 million at a fixed rate of 9.0%, with quarterly interest payments. The principal payment will be in one installment on November 12, 2022. The issue price was 100.0%.

Exchange Offer Series XXV Notes

As consequence of the regulations established by the Central Bank, the issuance of the Series XXXIII and XXXIV Notes were carried out, in order to refinance the Series XXV Notes for a face value of USD 59,561,897. In this regard, the maturity and cancelation of the XXV Notes took place on July 12, 2021.

As a result of the exchange, Series XXXIV Notes were issued, which are described below:

· Series XXXIV: denominated and payable in U.S. dollars for USD 35.7 million at a fixed rate of 6.99%, with semi-annual interest payments. The principal payment will be made in three semi-annual installments, payable as follows: 33% on June 30, 2022, 33% on June 30, 2023, and 34% on June 30, 2024. The issue price was 100%.

On July 5, 2021, we completed the exchange operation of the Series XXV Notes with a nominal value of USD 59.6 million. The nominal value of Existing Notes presented and accepted on the Exchange was approximately USD 18.8 million. The main characteristics of the issuance are detailed below:

· Series XXXIII Notes: denominated and payable in U.S. dollars for USD 18.8 million at a fixed rate of 6.99%, with semi-annual interest payments. The principal payment will be made in semi-annual installments, as follows: 33% on July 6, 2022, 33% on July 6, 2023, and 34% on July 6, 2024. The issue price was 100%

183

Series XXXV Notes

On September 13, 2021, we issued in the local market a total amount of USD 41.9 million through the following Notes:

· Series XXXV: denominated in U.S. dollars and payable in Pesos at the applicable exchange rate for USD 41.9 million at a fixed rate of 3.5%, with semi-annual interest payments. The principal payment will be made in three installments, counted from the date of issuance: the first for 25% of the nominal value on September 13, 2023; the second for 25% on March 13, 2024, and the third for 50% of the nominal value on September 13, 2024. The price of issuance was 100.0% of the nominal value.

Series XXXVI Notes

On February 18, 2022, we issued in the local market a total amount of USD 40.6 million through the following Notes:

Series XXXVI Notes: denominated in U.S. dollars and payable in Pesos at the applicable exchange rate for USD 40.6 million at a fixed rate of 2.0%, with semi-annual interest payments. The principal payment will be in one installment, on February 18, 2025. The price of issuance was 100.0% of the nominal value.

The proceeds have been used to refinance short-term liabilities.

Series XXXVII Notes

On June 15, 2022, we issued in the local market a total amount of USD 24.4 million through the following Notes:

Series XXXVII Notes: denominated and payable in U.S. dollars for USD 24.4 million at a fixed rate of 5.5%, with semi-annual interest payments (except for the last installment, which will be due three months after the previous interest period). The principal payment will be in one installment, on March 15, 2025. The price of issuance was 100.0% of the nominal value.

The proceeds have been used to refinance short-term liabilities and/or working capital.

Series XXXVIII Notes (Exchange of Series XXIII Notes)

As a consequence of the regulations established by the Central Bank, on July 6, 2022, we completed the exchange of our Series XXIII Notes, in an aggregate principal amount of USD 113,158,632, maturing on February 16, 2023. On July 6, 2022, the expiration of the exchange offer was announced, USD 98,422,999 of Series XXIII Notes were validly tendered and accepted, representing 86.98% of acceptance. On July 8, the exchange offer was settled, the Series XXXVIII Notes were issued, for an amount of USD 70.6 million, and Series XXIII Notes were partially canceled, consequently the outstanding amount is USD 14,735,633.

The exchange offer provided two alternatives:

- Option A: Cash payment for up to 30% of the total amount of participation in the exchange, and the difference to complete the exchanged face value, in Series XXXVIII Notes. For every USD 1 offered, the holder received USD 0.6913 plus the remaining amount to complete USD 1 for each USD 1 of Series XXIII Notes presented for the exchange, in Series XXXVIII Notes. Under Option A, 43.40% of the notes were accepted.

- Option B: For each USD 1 of Series XXIII Notes tendered and accepted the bondholder received in exchange USD 1,03 Series XXXVIII Notes. Under Option B, 56.60% of the notes were accepted.

In both options, the interest accrued as of settlement date was paid.

184

Series XXXVIII Notes will mature on March 3, 2026 and will accrue interest at a fixed rate of 8.00%, with interest payable semi-annually on January 3 and July 3 from 2023 to 2026, and at maturity. Amortization of principal will be in one installment on March 3, 2026. The issue price was 100%.

Series XXXIX Notes

Subsequently, on August 23, 2022, we issued in the local market a total amount of ARS 5.122,5 million (equivalent at the time of issuance to approximately USD 37.7 million) through the following Notes:

Series XXXIX Notes: denominated and payable in Pesos for ARS 5.122,5 million at a variable rate (private Badlar + 1.0%), with quarterly payments. The principal payment will be in one installment at maturity, on February 23, 2024. The price of issuance was 100.0% of the nominal value.

The proceeds have been used to refinance short-term liabilities and/or working capital. For more information see “Recent Development – Local Bond Issuance – Series XXXIX Notes”.

Helmir bank loan

On May 11, 2021, our subsidiary Helmir subscribed a loan with Itaú Unibanco S.A. for USD 35 million with an annual fixed rate of 5.75% and semiannual interest payments. The maturity will be on May 11, 2024. The loan has as collateral 18,548,770 BrasilAgro ADRs shares and the proceeds were used to excercise BrasilAgro’s warrants.

Issuance of BrasilAgro Non-Convertible Notes

On May 5, 2021, BrasilAgro issued Non-convertible Notes, unique series, for a nominal value of BRL 240 million (equivalent to ARS 4,632 million). They will accrue interest at a variable rate made up for IPCA (Consumer Price Index) plus 5.3658% nominal per year, payable annually and will amortize their capital in two payments on April 13, 2027 and April 12, 2028.

Series I Notes (issued by FYO)

On October 22, 2021, FYO issued its first bond in the local market for an amount of USD 12.3 million. The note is dollar denominated and payable in Pesos at the applicable exchange rate, with an annual fixed rate of 0.0%, and maturity on October 22, 2023. The issue price was 100.0% of the nominal value.

Series II Notes (issued by FYO)

On July 25, 2022, FYO issued its second bond in the local market for an amount of USD 15.0 million. The note is dollar denominated and payable in Pesos at the applicable exchange rate, with an annual fixed rate of 0.0%, and maturity on July 25, 2025. The issue price was 100.0% of the nominal value.

The proceeds have been used mainly to attend working capital needs.

Urban Properties and Investments Business

Series II Notes (originally issued by IRSA Propiedades Comerciales S.A.)

On March 23, 2016, Series II Notes were issued in an aggregate principal amount of USD 360 million, under New York Law. Series II Notes accrue interest semi-annually, at an annual fixed rate of 8.75% and mature on March 23, 2023. The issuance price was 98.722% of the nominal value.

Likewise, as a result of the merger between IRSA and IRSA CP, on May 16, 2022, IRSA signed an amendment of the indenture for Series II, where IRSA expressly assumes the obligations under the Series II.

185

As a consequence of the regulations established by the Central Bank, and once the corresponding authorizations were obtained, on May 16, 2022, IRSA announced the exchange offer of Series II Notes for Series XIV Notes (for more information see “Series XIV Notes (Exchange of Series II Notes)”), in order to carry out the refinancing of Series II Notes.

On July 6, 2022, the expiration of the exchange was announced, USD 238,985,000 of Series II Notes were validly tendered and accepted, representing an acceptance of 66.38%. On July 8, the exchange offer was settled, the new Series XIV Notes were issued and the Series II Notes were partially canceled, with the outstanding principal amount being USD 121,015,000.

Series II Notes due 2023 are subject to certain covenants, events of default and limitations, such as the limitation on incurrence of additional indebtedness, limitation on restricted payments, limitation on transactions with affiliates, and limitation on merger, consolidation and sale of all or substantially all assets.

To incur additional indebtedness, IRSA is required to meet a minimum 2.00 to 1.00 Consolidated Interest Coverage Ratio. The Consolidated Interest Coverage Ratio is defined as Consolidated EBITDA divided by consolidated net interest expense. Consolidated EBITDA is defined as operating income plus depreciation and amortization and other consolidated non-cash charges.

The Series II Notes contain financial covenants limiting IRSA’s ability to declare or pay dividends in cash or in kind, unless the following conditions are met at the time of payment:

(a)	no Event of Default shall have occurred and be continuing;
(b)	IRSA may incur at least USD 1.00 worth of additional debt pursuant to the “Restriction on Additional Indebtedness”;
I and the aggregate amount of such dividend exceeds the sum of:

(i)	100% of cumulative EBITDA for the period (treated as one accounting period) from July 1, 2015 through the last day of the last fiscal quarter ended prior to the date of such Restricted Payment minus an amount equal to 150% of consolidated interest expense for such period; and
(ii)	any reductions of Indebtedness of IRSA on a consolidated basis after the Issue Date any reductions of Indebtedness of after the Issue Date exchanged for to Capital Stock of the IRSA or its Subsidiaries.

Series I Notes

On May 15, 2019, IRSA issued the Note Series I under Argentine law for an amount of USD 96.3 million due on November 15, 2020, at a fixed rate of 10%. The proceeds were mainly used to repay preexisting debt. On August 6, 2019, IRSA reopened the Note Series I under Argentine law for an amount of USD 85.2 million, at a price of 103.77%, which resulted in an internal annual rate of return of 8.75% nominal.

As a consequence of the restrictions on access to the Foreign Exchange Market, on October 22, 2020, IRSA launched an exchange offer on its Series I Notes due on November 15, 2020.

The exchange offer ended on November 10, 2020 with an acceptance of 98.31%, so the percentage to change essential conditions of Series I was reached. On November 12, 2020, IRSA canceled Nominal Value of USD 178,458,188 of Series I Notes, after the cancellation the outstanding principal amount is USD 3,060,519, as was mentioned, expiration date was changed, among others modifications, until March 1, 2023 (for more information see “Series VIII and IX”).

186

Series VIII and IX Notes

On November 12, 2020, IRSA carried out an exchange offer of its Series I Notes, for a face value of USD 181.5 million.

Face Value of Series I Notes presented and accepted for the Exchange (for both Series): approximately USD 178.5 which represents 98.31% acceptance, through the participation of 6,571 orders.

As a result of the exchange, Series VIII and IX Notes were issued, which are described below:

· Series VIII: denominated and payable in U.S. Dollars for USD 31.7 million at a fixed rate of 10.0%, with quarterly payments. The principal payment will be in three installments of the capital: 33% on November 12, 2021, 33% on November 12, 2022, and 34% on November 12, 2023. The issuance price was 100.0% of the face value.

· Series IX: denominated and payable in U.S. Dollars for USD 80.7 million (includes USD 6,505,560 that were subscribed in cash) at a fixed rate of 10.0%, with quarterly payments. The principal payment will be in one installment on March 1, 2023. The issuance price was 100.0% of the face value.

Also, considering that consent has been obtained for an amount greater than 90% of the capital of the Series I Notes, the Company has modified and replaced the following essential and non-essential terms and conditions of the Series I Note.

By virtue of the implementation of the Proposed Non-Essential Modifications, the entire section of “Certain Commitments” and “Events of Default” is eliminated from the terms and conditions set forth in the prospectus supplements dated May 2, 2019 and dated July 25, 2019 corresponding to the existing notes. Additionally, pursuant to the implementation of the Proposed Essential Modifications, the following terms and conditions of the Existing Notes are modified and replaced: (i) Expiration Date: It will be March 1, 2023, and (ii) Interest Payment Dates: will be the same dates reported for Series IX in the Notice of Results.

Series X, XI and XII Notes

On March 31, 2021, IRSA issued in the local market a total amount of USD 65.5 million through the following Notes:

· Series X: denominated and payable in pesos for ARS 701.6 million (equivalent at the time of issuance to USD 7.6 million) at a variable rate (private BADLAR + 5.0%) with quarterly payments. Price of issuance was 100.0% of the nominal value. The principal was paid on March 31, 2022.

· Series XI: denominated in USD and payable in ARS at the applicable exchange rate for USD 15.8 million at a fixed rate of 5.0%, with semiannual payments plus, if applicable, the Premium Factor in the first year (as defined in the corresponding prospectus supplement) and principal expiring on March 31, 2024. Price of issuance was 98.39% of the face value (IRR 5.6%).

· Series XII: denominated in UVA and payable in ARS at the applicable UVA value for UVA 53.8 million (equivalent at the time of issuance to ARS 3,868.2 million and USD 42.1 million) at a fixed rate of 4.0%, with semiannual payments and principal expiring on March 31, 2024. Price of issuance was 100.0% of the nominal value.

The proceeds have been used to refinance short-term liabilities and working capital.

On March 31, 2022, Series X denominated in pesos was fully canceled.

187

Series XIII

On August 26, 2021, IRSA issued in the local market a total amount of USD 58.1 million through the following Notes:

· Series XIII: denominated in U.S. Dollars and payable in pesos at the applicable exchange rate for USD 58.1 million at a fixed rate of 3.9%, with semi-annual payments. The principal payment will be in three installments, counted from the date of issuance: the first for 25% of the nominal value on August 26, 2023; the second for 25% on February 26, 2024; and the third for 50% of the nominal value on August 26, 2024. Price of issuance was 100.0% of the nominal value.

The proceeds will be used to refinance short-term liabilities.

Series XIV Notes (Exchange of Series II Notes)

As consequence of the regulations established by the Central Bank, on July 6, 2022, IRSA completed the exchange of its Series II Notes, originally issued by IRSA Propiedades Comerciales S.A., in an aggregate principal amount of USD 360 million, maturing on March 23, 2023. On July 6, 2022, the expiration of the exchange was announced, USD 238,985,000 of Series II Notes were validly tendered and accepted, representing an acceptance of 66.38%. On July 8, the exchange offer was settled, the new Series XIV Notes were issued for an amount of USD 171.2 million and the Series II Notes were partially canceled, the outstanding principal amount is USD 121,015,000.

The exchange offered two alternatives:

· Option A: Cash payment for up to 30% of the total amount of participation in the exchange, and the difference to complete the exchanged face value, in Series XIV Notes with a premium of 1,015 times. For each USD 1,000 tendered, the bondholder received USD 493.18 in cash and USD 514.42 in Series XIV Notes. Under Option A, 60.83% of the notes were accepted.

· Option B: For each USD 1,000 of Series II Notes the bondholder received 1,030 of Series XIV Notes. Under Option B, 39.17% of the notes were accepted.

In both options, the interest accrued as of settlement date was paid.

Series XIV Notes were issued under New York Law, will mature on June 22, 2028 and will accrue interest at a fixed rate of 8.75%, with interest payable semi-annually on June 22 and December 22 of each year, until expiration. Amortization will be in annual installments payable on June 22 of each year, each for 17.5% from 2024 to 2027 and the remaining 30% on June 22, 2028. The issue price was 100%.

Series XIV Notes due 2028 are subject to certain covenants, events of default and limitations, such as the limitation on incurrence of additional indebtedness, limitation on restricted payments, limitation on transactions with affiliates, and limitation on merger, consolidation and sale of all or substantially all assets.

To incur additional indebtedness, IRSA is required to meet a minimum 2.00 to 1.00 Consolidated Interest Coverage Ratio. The Consolidated Interest Coverage Ratio is defined as Consolidated EBITDA divided by consolidated net interest expense. Consolidated EBITDA is defined as operating income plus depreciation and amortization and other consolidated non-cash charges.

The Series XIV Notes contain financial covenants limiting IRSA’s ability to declare or pay dividends in cash or in kind, unless the following conditions are met at the time of payment:

(a)	no Event of Default shall have occurred and be continuing;
(b)	IRSA may incur at least USD 1.00 worth of additional debt pursuant to the “Restriction on Additional Indebtedness”;

188

(c) and the aggregate amount of such dividend exceeds the sum of:

(i)	100% of cumulative EBITDA for the period (treated as one accounting period) from July 1, 2020 through the last day of the last fiscal quarter ended prior to the date of such Restricted Payment minus an amount equal to 150% of consolidated interest expense for such period; and
(ii)	any reductions of Indebtedness of IRSA on a consolidated basis after the Issue Date any reductions of Indebtedness of after the Issue Date exchanged for to Capital Stock of the IRSA or its Subsidiaries.

For more information related to exchange controls see “Item 10. Additional Information—D. Exchange Controls”.

C. Research and Developments, Patents and Licenses

Investments in technology, in our agricultural business, amounted to ARS 27 million, ARS 33 million and ARS 37 million for fiscal years 2022, 2021 and 2020 respectively. Our total technology investments aimed to increase the productivity of purchased land have amounted to ARS 5,563 million since fiscal year 1995.

We reach our objectives within this area through the implementation of domestic and international technological development projects focusing mainly on:

· Quality and productivity improvement.

· Increase in appreciation value of land through the development of marginal areas.

· Increase in the quality of food in order to achieve global food safety standards. We aim to implement and perform according to official and private quality protocols that allow us to comply with the requirements of our present and future clients. Regarding official regulations, in 2003 we implemented the Servicio Nacional de Sanidad y Calidad Agroalimentaria law on animal identification for livestock in six farms. Simultaneously, in 2004 we implemented Global GAP Protocols (formerly EurepGap) with the objective of complying with European Union food safety standards and as a mean for continuous improvement of the internal management and system production of our farms. Our challenge is to achieve global quality standards.

· Certification of suitable quality standards, since in recent years worldwide agriculture has evolved towards more efficient and sustainable schemes in terms of environmental and financial standpoints, where the innocuousness and quality of the production systems is becoming increasingly important. In this context, Good Agricultural Practices (GAP) have emerged, as a set of practices seeking to ensure the innocuousness of agricultural products, the protection of the environment, the workers’ safety and well-being, and agricultural health, with a view to improving conventional production methods. Certification of such standards allows to demonstrate the application of Good Agricultural Practices to production systems and ensures product traceability, allowing to impose stricter controls to verify the enforcement of the applicable laws.

· The implementation of a system of control and assessment of agricultural tasks for analyzing and improving efficiency in the use of agricultural machinery hired. For each of the tasks, a minimum standard to be fulfilled by contractors was set, which has led to do an improvement in the plant stand upon sowing, a better use of supplies and lower harvesting losses.

We have several trademarks registered with the Instituto Nacional de la Propiedad Industrial, the Argentine institute for industrial property. We do not own any patents nor benefit from licenses from third parties.

189

D. Trend Information

International Macroeconomic Outlook

As reported in the IMF’s “World Economic Outlook,” world GDP is expected to grow 3.2% in 2022. As with the July 2022 WEO projections, there is a higher-than-usual degree of uncertainty around this forecast. Several shocks have hit a world economy already weakened by the pandemic: higher-than-expected inflation worldwide––especially in the United States and major European economies––triggering tighter financial conditions; a worse-than-anticipated slowdown in China, reflecting COVID- 19 outbreaks and lockdowns; and further negative spillovers from the war in Ukraine. Nevertheless, the baseline forecast assumed; a reduction in household purchasing power, due to a slower growth than expected, and tighter monetary policy drove a downward in the United States. In China, further lockdowns and the deepening real estate crisis have led growth to be revised down, with major global spillovers. And in Europe, significant downgrades reflect spillovers from the war in Ukraine and tighter monetary policy. Global inflation has been revised up due to food and energy prices as well as lingering supply-demand imbalances and is anticipated to reach 6.6 percent in advanced economies and 9.5 percent in emerging market and developing economies this year. In 2023, disinflationary monetary policy is expected to bite, with global output growing by just 2.9 percent.

The dollar’s appreciation in 2022—by about 5 percent in nominal effective terms as of June compared with December 2021 ––is also likely to have slowed world trade growth, considering the dollar’s dominant role in trade invoicing as well as negative financial balance sheet effects on demand and imports in countries with dollar-denominated liabilities.

On the other hand, Tighter financial conditions trigger debt distress in emerging market and developing economies. As advanced economy central banks raise interest rates to fight inflation, financial conditions worldwide will continue to tighten. The resulting increase in borrowing costs will, without correspondingly tighter domestic monetary policies, put pressure on international reserves and cause depreciation versus the dollar, inducing balance sheet valuation losses among economies with dollar-denominated net liabilities. Such challenges will come at a time when government financial positions in many countries are already stretched, implying less room for fiscal policy support, with 60 percent of low income countries in or at high risk of government debt distress (debt restructuring or accumulation of arrears)––up from about one-fifth a decade ago. Widespread capital flight from emerging market and developing economies could amplify this risk.

Argentine macroeconomic context

Shopping malls sales reached a total ARS 57,994.6 million in June 2022, which represents a 266.9% increase as compared to June 2021. Accumulated sales for the first six months, represent a 185.7% in current terms and 70.9% increase in real terms as compared to the same period of 2021.

The INDEC reported that, for the eight months ended August 30, 2022, industrial activity in Argentina increased by 6.1% compared to the same period in 2021. The textile industry accumulated a 18.2% growth during the first eight months of 2022 as compared to the same period last year. Moreover, the monthly estimation of economic activity (“EMAE”) as of July 31, 2021, increased by 5.6% compared to the same month in 2021.

Regarding the balance of payments, in the second quarter of 2022 the current account deficit reached USD 894 million, with USD 1,446 million allocated to the goods and services trade balance, and USD 2,904 million to the net primary deficit, and a surplus of USD 563 million to net secondary income.

During the second quarter of 2022, the financial account showed net outflow of USD 2,119 million, explained by the net acquisition of financial assets for USD 2,791 million, and net issuance of liabilities of USD 4,910 million. The sectors that have explained these outflows have been Central Bank for USD 1,283 million, offset by the net income of the Deposit-taking companies or USD 1,304 million, Government for USD 397 million and Other sectors for USD 1,701 million. The international reserves increased by USD 1,283 million during the second quarter of 2022.

190

In local financial markets, the Private Badlar rate in Pesos ranged from 34.13% to 50.63% in the period from July 2021 to June 2022, averaging 38.06% in June 2022 compared to 32.56% in June 2021. As of June 30, 2022, the seller exchange rate quoted by Banco de la Nación Argentina was ARS 125.2300 Pesos per USD 1.00. As of June 30, 2022, Argentina’s country risk increased by 832 basis points in year-on-year terms. The debt premium paid by Argentina was 2,428 basis points in June 2022, compared to 357 basis points paid by Brazil and 473 basis points paid by Mexico.

As of October 25, 2022, the Private Badlar rate in Pesos peaked at 68.25%. As of October 26, 2022, the seller exchange rate quoted by Banco de la Nación Argentina was of ARS 155.39 pesos per USD 1.00. As of October 25, 2022, Argentina’s country risk increased by 834 basis points in year-on-year terms. The debt premium paid by Argentina was at 2,501 basis points as of October 25, 2022, compared to 266 basis points paid by Brazil and 426 basis points paid by Mexico as of that same date.

Likewise, in the national and international framework described above, the Company periodically analyzes alternatives to appreciate its shares value. In that sense, the Board of Directors of the Company will continue focusing on the evaluation of financial, economic and / or corporate tools that allow the Company to improve its position in the market in which it operates and have the necessary liquidity to meet its obligations. Within the framework of this analysis, the indicated tools may be linked to corporate reorganization processes (merger, spin-off or a combination of both), disposal of assets in public and / or private form that may include real estate as well as negotiable securities owned by the Company, incorporation of shareholders through capital increases through the public offering of shares to attract new capital, repurchase of shares and instruments similar to those described that are useful to the proposed objectives.

Agriculture and Cattle Raising Sector in Argentina

Agriculture

Argentina has positioned itself over the years as one of the world’s leading food producers and exporters. It is the second largest country in South America after Brazil and has particularly favorable natural conditions for diversified agricultural production: vast extensions of fertile land and varied soil and weather patterns.

During the decade of the nineties, the Argentine agriculture and cattle raising industry experienced sweeping changes, such as a significant increase in production and yield (thanks to a sustained agricultural modernization process), relocation of production (crops vs. livestock) and a significant restructuring process within the industry, as well as increased land concentration. Taking advantage of a favorable international context, the agriculture and cattle raising sector has been one of the major drivers of the Argentine recovery after the economic and financial crisis of 2002.

According to the World Agricultural Supply and Demand Estimates Repro published by the United States Department of Agriculture on October 12, 2022, world soybean production for the season 2022/2023 is expected to be about 390.99 million tons, an increase of 10.7% as compared to the season 2021/2022. Argentina, is one of the major exporters of Soybean together with Brazil, Paraguay and Uruguay. Argentina’s soybean production and soybean exports for the season 2022/2023 are expected to be about 51.00 million tons and 7.00 million tons, respectively. This means a 15.9% increase in Argentina’s soybean production, and a 150.0% increase on its soybean exports; compared with the season 2021/2022.

World corn production is expected to be about 1,168.74 million tons for season 2022/2023, 3.99% less than in the previous season. Argentina is the world’s second largest corn exporter after Brazil, and followed by Ukraine, Russia and South Africa. For the season 2022/2023 Argentina’s corn production and exports are expected to be about 55.0 million tons and 41.0 million tons, respectively. That means a 3.8% increase in Argentinia’s corn production, and a 5.1% increase on its corn exports; compared with the season 2021/2022.

The policies implemented by the new government ever since taking office have led to better projections for the agricultural industry. Mainly, the strong devaluation of the Peso, tax reductions on exports and special exchange rate for soybean products have improved the situation of agricultural growers.

191

World wheat production is expected to be about 781.70 million tons for season 2022/2023, an increase of 0.2% as compared to the season 2021/2022. Argentina’s wheat production and wheat exports for the season 2022/2023 are expected to be about 17.50 million tons and 12.00 million tons, respectively. This means a 22.2% decrease in Argentina’s wheat production, and a 26.2% decrease on its wheat exports; compared with the season 2021/2022.

Among the factors that contributed to a greater calm, highlights the acceleration of exports from Ukraine, after the reopening of the Black Sea ports through the Agreement of Istanbul. However, during October 2022, new sources of uncertainty, such as the heightened geopolitical tension between China and Taiwan and drought in the northern hemisphere, which could resume a period of higher volatility.

Cattle

According to the Institute for the Promotion of Beef (“IPCVA”), cattle slaughter during the second quarter of 2022 was slightly above 3.34 million heads, a moderately higher amount representing an increase of 6.3%, as compared to the values corresponding to the first quarter of 2022, when approximately 3.14 million bovines had been slaughtered. Compared to the second quarter of 2021, when about 3.17 million heads had been slaughtered, cattle slaughter showed moderate increases of 5.5%.

During the first half of 2022, bovine slaughter has resulted in approximately 6.48 million head, 2.2% above the values corresponding to the firsst six months of 2021, in which about 6.35 million bovines had been slaughtered. The moderate increase observed in bovine slaughter is greater than 136 thousand heads, which is explained by a rise in the slaughter of cows, of about 172 thousand heads, and of bulls, by about 11 thousand, which was offset by a lower slaughter of heifers, less by about 43 thousand heads than in the first half of the previous year, and also due to fewer steers and young bulls, about 3 thousand.

Beef production in the second quarter of 2022 showed a significant increases in terms of its aggregate volume of production in relation to the first quarter of 2022, going from 720 thousand tons of bone-in beef to 775 thousand tons.

Urban Properties and Investment Business

Evolution of Shopping Malls in Argentina

In August 2022, the Consumer Confidence Index (CCI) showed a 6.6% increase compared to July 2022, and a 6.8% decrease compared to August 2021. Shopping mall sales increased 266.9% in the fiscal 2022 compared to fiscal 2021. Accumulated sales for the first six months, represent a 185.7% in current terms and 70.9% increase in real terms as compared to the same period of 2021.

Evolution of Office Properties in Argentina

The corporate activity carried out remotely or virtual work that characterized this stage of confinement by COVID19 brought with it a combination of lower demand, increased vacancies, and a slight decrease in the rental prices of category A + and A office buildings in Buenos Aires.

According to Colliers, the second quarter of 2022 closes with a vacancy in the order of 18.8% regarding the premium market of the City of Buenos Aires, slightly decreasing when compared to the previous quarter. Rental prices did not undergo major changes during the second quarter of the year 2022. Category A+ properties have an average price of 24.4 USD/sqm and class A properties of 19.3 USD/sqm. Regarding the average price per submarket, Catalinas and Norte CABA reflect the highest with records of 27.9 USD/sqm and 26.6 USD/sqm respectively.

192

Evolution of the Hotel industry in Argentina

According to the Hotel Vacancy Survey (EOH) prepared by INDEC, in June 2022, overnight stays at hotel and parahotel establishments were estimated at 2.87 million, 355.8% more than the same month the previous year. Overnight stays by resident and nonresident travelers increased by 295.4% and 3,135.9%, respectively. Total travelers who stayed at hotels during June 2022 were 1.28 million, a 346.7% increase compared to the same month the previous year. The number of resident and nonresident travelers increased by 293.3% and 3,121.5%, respectively. The Room Occupancy Rate in June 2022 was 40.7%, compared to a 15.7% of the same month the previous year. Moreover, the Bed Occupancy Rate for the same period was 31.0%, compared to a 10.8% of the same month the previous year.

E.    Critical Accounting Estimates

                Not all of these significant accounting policies require management to make subjective or complex judgments or estimates. The following is intended to provide an understanding of the policies that management considers critical because of the level of complexity, judgment or estimations involved in their application and their impact on the Consolidated Financial Statements. These judgments involve assumptions or estimates in respect of future events. Actual results may differ from these estimates.

Estimation	Main assumptions	Potential implications	Main references
Business combination - Allocation of acquisition prices	Assumptions regarding timing, amount of future revenues and expenses, revenue growth, expected rate of return, economic conditions, and discount rate, among other.	Should the assumptions made be inaccurate, the recognized combination may not be correct.	Note 4 – Acquisitions and dispositions
Recoverable amounts of cash-generating units (even those including goodwill), associates and assets.	The discount rate and the expected growth rate before taxes in connection with cash-generating units. The discount rate and the expected growth rate after taxes in connection with associates. Cash flows are determined based on past experiences with the asset or with similar assets and in accordance with the Company’s best factual assumption relative to the economic conditions expected to prevail. Business continuity of cash-generating units. Appraisals made by external appraisers and valuators with relation to the assets’ fair value, net of realization costs (including real estate assets).	Should any of the assumptions made be inaccurate; this could lead to differences in the recoverable values of cash-generating units.	Note 8 - Investments in associates and joint ventures Note 10 – Property, plant and equipment Note 12 – Intangible assets
Control, joint control or significant influence	Judgment relative to the determination that the Company holds an interest in the shares of investees (considering the existence and influence of significant potential voting rights), its right to designate members in the executive management of such companies (usually the Board of directors) based on the investees’ bylaws; the composition and the rights of other shareholders of such investees and their capacity to establish operating and financial policies for investees or to take part in the establishment thereof.	Accounting treatment of investments as subsidiaries (consolidation) or associates (equity method)	Note 2.3 – Scope of consolidation; “de facto control”
Estimated useful life of intangible assets and property, plant and equipment	Estimated useful life of assets based on their conditions.	Recognition of accelerated or decelerated depreciation by comparison against final actual earnings (losses).	Note 10 – Property, plant and equipment Note 12 – Intangible assets
Fair value valuation of investment properties	Fair value valuation made by external appraisers and valuators. See Note 9.	Incorrect valuation of investment property values	Note 9 – Investment properties
Income tax	The Company estimates the income tax amount payable for transactions where the Treasury’s Claim cannot be clearly determined. Additionally, the Company evaluates the recoverability of assets due to deferred taxes considering whether some or all of the assets will not be recoverable.	Upon the improper determination of the provision for income tax, the Company will be bound to pay additional taxes, including fines and compensatory and punitive interest.	Note 23 – Taxes
Allowance for doubtful accounts	A periodic review is conducted of receivables risks in the Company’s clients’ portfolios. Bad debts based on the expiration of account receivables and account receivables’ specific conditions.	Improper recognition of charges / reimbursements of the allowance for bad debt.	Note 17 – Trade and other receivables

Level 2 and 3 financial instruments	Main assumptions used by the Company are:		Incorrect recognition of a charge to income / (loss).	Note 16 – Financial instruments by category
	·	Discounted projected income by interest rate
	·	Values determined in accordance with the shares in equity funds on the basis of its Financial Statements, based on fair value or investment assessments.
	·	Comparable market multiple (EV/GMV ratio).
	·	Underlying asset price (Market price); share price volatility (historical) and market interest rate (Libor rate curve).

Probability estimate of contingent liabilities.	Whether more economic resources may be spent in relation to litigation against the Company, such estimate is based on legal advisors’ opinions.	Charge / reversal of provision in relation to a claim.	Note 21 – Provisions
Qualitative considerations for determining whether or not the replacement of the debt instrument involves significantly different terms	The entire set of characteristics of the exchanged debt instruments, and the economic parameters represented therein: Average lifetime of the exchanged liabilities; Extent of effects of the debt terms (linkage to index; foreign currency; variable interest) on the cash flows from the instruments.	Classification of a debt instrument in a manner whereby it will not reflect the change in the debt terms, which will affect the method of accounting recording.	Note 16 – Financial instruments by category (Financial liabilities)
Biological assets	Main assumptions used in valuation are yields, production costs, selling expenses, forwards of sales prices, discount rates.	Wrong recognition/valuation of biological assets. See sensitivities modeled on these parameters in Note 13.	Note 14 – Biological assets

193

Item 6. Directors, Senior Management and Employees

A. Directors and Senior Management

Board of Directors

We are managed by a board of directors. Our bylaws provide that our Board of Directors shall consist of a minimum of three and a maximum of fifteen regular directors and the same or less numbers of alternate directors. Currently, our board is composed by ten regular directors and seven alternate directors. Each director and alternate director is elected by our shareholders at an annual ordinary meeting of shareholders usually for a three-year term, provided, however, that of the board of directors is elected each year. The directors and alternate directors may be re-elected indefinitely.

Alternate directors will be summoned to exercise their functions in case of absence, vacancy or death of a regular director or until a new director is appointed.

The table below shows information about our regular directors and alternate (For information see, “Recent Developments- General Ordinary Shareholders’ Meeting”):

Directors (1)	Date of Birth	Position in Cresud	Term Expires (2)	Date appointed to the current office	Current position held since
Eduardo S. Elsztain	01/26/1960	Chairman	06/30/23	10/26/20	1994
Saúl Zang	12/30/1945	First Vice-Chairman	06/30/23	10/26/20	1994
Alejandro G. Elsztain	03/31/1966	Second Vice-Chairman and CEO	06/30/22	10/30/19	1994
Jorge O. Fernández	01/08/1939	Regular Director	06/30/24	10/26/21	2003
Fernando A. Elsztain	01/04/1961	Regular Director	06/30/22	10/30/19	2004
Mariana Renata Carmona	02/11/1961	Regular Director	06/30/23	10/26/20	2020
Alejandro G. Casaretto	10/15/1952	Regular Director	06/30/23	10/26/20	2008
Liliana Glikin	03/29/1953	Regular Director	06/30/22	10/30/19	2019
Alejandro Bartolome	12/09/1954	Regular Director	06/30/22	10/30/19	2019
Gabriela Macagni	01/13/1964	Regular Director	06/30/22	03/11/20	2020
Gastón A. Lernoud	06/04/1968	Alternate Director	06/30/23	10/26/20	1999
Enrique Antonini	03/16/1950	Alternate Director	06/30/22	10/31/19	2007
Eduardo Kalpakian	03/03/1964	Alternate Director	06/30/22	10/31/19	2007
Ilan Elsztain	08/01/1992	Alternate Director	06/30/22	03/11/20	2020
Iair Elsztain	03/05/1995	Alternate Director	06/30/22	03/11/20	2020
Gabriel A.G. Reznik	11/18/1958	Alternate Director	06/30/24	10/26/21	2021
Pedro D. Labaqui Palacio	02/22/1943	Alternate Director	06/30/24	10/26/21	2021

_________________

(1)	The business address of our management is Carlos Della Paolera 261, 9th Floor, (C1001ADA) Buenos Aires, Argentina.
(2)	Term expires at the annual ordinary shareholders’ meeting.

Liliana Glikin, Alejandro Bartolome, Graciela Macagni, Enrique Antonini and Eduardo Kalpakian, qualify as independent, in accordance with the CNV Rules.

Our Chairman Eduardo S. Elsztain is the husband of our regular director Mariana R. Carmona, and they are both parents to alternate directors Ilan and Iair Elsztain. Eduardo S. Elsztain is also the brother of Second Vice-Chairman and CEO Alejandro G. Elsztain and cousin of the regular director Fernando A. Elsztain.

The following is a brief biographical description of each member of our board of directors:

Eduardo S. Elsztain. Mr. Eduardo S. Elsztain has been engaged in the real estate business for more than thirty years. He is the Chairman of the Board of Directors of IRSA Inversiones y Representaciones S.A., Banco Hipotecario S.A., BrasilAgro Companhia Brasileira de Propriedades Agrícolas Ltda., Austral Gold Ltd. and Consultores Assets Management S.A., among other companies. He also Chairs Fundación IRSA, is a member of the World Economic Forum, the Council of the Americas, the Group of Fifty and the Argentine Business Association (AEA), among others. He is co-founder of Endeavor Argentina and serves as Vice President of the World Jewish Congress.

Saúl Zang. Mr. Zang holds a law degree from the Universidad de Buenos Aires. He is a member of the International Bar Association and of the Interamerican Federation of Lawyers. He is a founding partner of Zang, Bergel & Viñes Law Firm. Mr. Zang is Vice-Chairman I of IRSA Inversiones y Representaciones S.A., Consultores Assets Management S.A. and other companies such as Fibesa S.A. and Chairman at Puerto Retiro S.A. He is also director of Banco Hipotecario S.A., BrasilAgro Companhia Brasileira de Propriedades Agrícolas Ltda., BACS Banco de Crédito & Securitización S.A., Nuevas Fronteras S.A., and Palermo Invest S.A., among other companies.

Alejandro Gustavo Elsztain. Mr. Alejandro Gustavo Elsztain holds an agricultural engineer degree from the Universidad de Buenos Aires. He completed the Advanced Management Program at Harvard Business School. He is currently serving as Vice-President II of IRSA Inversiones y Representaciones S.A., and Vice President of Fibesa S.A., Nuevas Fronteras S.A. and Hoteles Argentinos S.A.U. He is also director of BrasilAgro, a Brazilian agricultural company, FYO and Agrofy. He is also the president of Fundación Hillel Argentina.

194

Jorge Oscar Fernández. Mr. Fernández obtained a degree in Economic Sciences from Universidad de Buenos Aires. He has performed professional activities at several banks, financial corporations, insurance firms and other companies related to financial services. He is also involved in many industrial and commercial institutions and associations.

Fernando Adrián Elsztain. Mr. Fernando Adrián Elsztain holds an architecture degree from Universidad de Buenos Aires. He has been engaged in the real estate business as a consultant and as managing officer of a real estate company. He is Chairman of the Board of Directors of Palermo Invest S.A. and Nuevas Fronteras S.A. He is also a director of IRSA Inversiones y Representaciones S.A., Hoteles Argentinos S.A.U. and Llao Llao Resorts S.A., and an alternate director of Puerto Retiro S.A.

Mariana R. Carmona. Ms. Carmona has a degree on Psychology from the Universidad de Buenos Aires. She is a founder and director of the Fundación Museo de los Niños and member of IWF Argentina. She is also the Vice President I of Consultores Assets Management S.A.

Alejandro Gustavo Casaretto. Mr. Casaretto obtained a degree in agricultural engineering from Universidad de Buenos Aires. He has served as our technical manager, farm manager, and technical coordinator since 1975. He joined as a member of the board of directors from 2008.

Liliana Irene Glikin. Ms. Glikin has obtained a law degree from the Universidad de Buenos Aires and a journalist degree from the Journalism School of the “Circulo de la Prensa”. She is also law professor at the Universidad de Buenos Aires. She is partner and legal advisor in “Stolkiner y Asociados” firm.

Alejandro Mario Bartolome. Mr. Bartolomé has a degree in agronomy from the Universidad de Buenos Aires and also has a Master of Science from the Reading University, England. He is an entrepreneur and wine producer. He is co-founder and ex director of GDM, former Don Mario, a leader company focus on genetics in the world. He has worked as production manager and CEO of the Company.

Gabriela Macagni. Ms. Macagni has a degree in chemical engineering from the Technological Institute of Buenos Aires (ITBA) and postgraduate degrees in business from the Harvard Business School and the Stanford Business School. She started her career in 1987 as a consultant at Accenture. She worked at Citibank since 1990, developing in the investment banking area, where he was responsible for structuring operations for more than USD 2,000 million, in the local and international capital markets. As a senior manager in commercial banking, she led the Media and Telecommunications unit. After the 2002 crisis, she was responsible for the Corporate Restructuring area and in 2005 she was appointed member of the executive board, in charge of Strategic Planning. In 2001 she was appointed as executive manager of Endeavor. From 2015 to 2019, she served as an independent director of Grupo Supervielle (NYSE: SUPV) where she was a member of the Audit, Human Resources, Compliance and Corporate Governance Committees. She is currently a member of the board of Sofital S.A., a subsidiary of Grupo Supervielle, and the Superville Corporate Venture Fund. Likewise, she is a member of the ITBA board of directors and a trustee of the San Andrés Educational Civil Association.

Gastón Armando Lernoud. Mr. Lernoud obtained a law degree in Universidad El Salvador in 1992. He obtained a Master in Corporate Law in Universidad de Palermo in 1996. He has been senior associate in Zang, Bergel & Viñes Law Firm until June 2002, when he was joined Cresud as legal counsel until August 2022.

Enrique Antonini. Mr. Antonini holds a degree in law from the School of Law of Universidad de Buenos Aires. He has been director of Banco Mariva S.A. since 1992 until today, and alternate director of Mariva Bursátil S.A. since 2015. He is a member of the Argentine Banking Lawyers Committee and the International Bar Association. He is also currently Alternate Director of IRSA Inversiones y Representaciones S.A.

195

Eduardo Kalpakian. Mr. Kalpakian holds a degree in business from the Universidad de Belgrano. He has also an MBA from Universidad del CEMA. He has been director for 25 years of Kalpakian Hnos. S.A.C.I., a leading carpet manufacturer and flooring distributor in Argentina. Currently he is vice-chairman of such company’s board and CEO. He is also vice-chairman of the board of La Dormida S.A.A.C.E I.

Ilan Elsztain. Mr. Elsztain holds a degree in economics from the University of Buenos Aires. He has previously worked in various of our group companies: Avenida, Fibesa and IRSA Propiedades Comerciales. He is currently alternate director of CAMSA, where he conducts research.

Iair Elsztain. Mr. Elsztain is currently studying for a degree in industrial engineering at the UADE Faculty of Engineering. He previously served as general manager at Iaacob House Hostel, he is currently working on the Israel Startup Experience (ISE) Entrepreneurship Project, which offers travel for young people with experience in Israel. He has also interned at Olive Tree Venture Capital (Tel Aviv), an investment fund dedicated to companies in the technology and healthcare industry. He is also alternate director of the board of IRSA Inversiones y Representaciones S.A.

Gabriel A. G. Reznik. Mr. Reznik obtained a degree in Civil Engineering from Universidad de Buenos Aires. He worked for IRSA since 1992 until May 2005 at which time he resigned. He had formerly worked for an independent construction company in Argentina. He is alternate director of IRSA Inversiones y Representaciones S.A. and regular director of Banco Hipotecario S.A.

Pedro Damaso Labaqui Palacio. Mr. Labaqui obtained a law degree from Universidad de Buenos Aires. He is also director of Bapro Medios de Pago S.A., permanent statutory auditor of Bayfe S.A. Fondos Comunes de Inversión, director and member of the Supervisory Committee of J. Minetti S.A., and Director of REM Sociedad de Bolsa S.A.

Employment contracts with certain members of our board of directors

We do not have written contracts with our directors. However, Eduardo S. Elsztain, Saul Zang, Alejandro G. Elsztain, Fernando A. Elsztain and Alejandro G. Casaretto are employed by us under the Labor Contract Law No. 20,744.

Law No. 20,744 governs certain conditions of the labor relationship, including remuneration, protection of wages, hours of work, holidays, paid leave, maternity protection, minimum age requirements, protection of young workers and suspension and termination of the contract.

Senior Management

Senior management performs its duties in accordance with the instructions of our board of directors. There are no arrangements by which a person is selected as a member of our senior management.

The following table shows information about our current senior management of the Operations Center in Argentina (designated by the board of directors meeting):

Name	Date of Birth	Position	Current Position Held Since
Alejandro G. Elsztain	03/31/1966	CEO	1994
Matías I. Gaivironsky	02/23/1976	Chief Financial and Administrative Officer	2011
Alejandro Casaretto	10/15/1952	Chief Regional Agricultural Officer	2008
Diego Chillado Biaus	09/15/1978	Commercial Manager (1)	2019

____________  

(1) Position designated as Senior Management on October 27, 2022.

The following is a biographical description of each of our senior managers who are not directors:

Matías Iván Gaivironsky. Mr. Gaivironsky holds a degree in business administration from Universidad de Buenos Aires and a master’s degree in finance from Universidad del CEMA. Since 1997 he has served in various positions at Tarshop, IRSA and the Company, and was appointed Chief Financial Officer in December 2011 and in early 2016 he was appointed as Chief Financial and Administrative Officer.

Diego Chillado Biaus. Mr. Diego Chillado Biaus obtained a degree in Administration and Agricultural Economics from Universidad de Buenos Aires. He has a master’s degree in Agribusiness from Universidad Austral. He is currently the Commercial Manager of Cresud, where he has served in several positions since 2005. He is also a member of the Board of Directors of FyO. Previously, he worked as Commercial Director of BrasilAgro and General Manager of Kumagro.

196

Executive Committee

Pursuant to our by-laws, our day-to-day business is managed by an executive committee consisting of a minimum of four and a maximum of seven directors and one alternate member, among which there should be the chairman, first vice-chairman and second vice-chairman of the board of directors. The current members of the Executive Committee are Messrs. Eduardo S. Elsztain, Saúl Zang, Alejandro Elsztain and Fernando A. Elsztain.

The executive committee is responsible for the management of the day-to-day business pursuant to authority delegated by our board of directors in accordance with applicable law and our by-laws. Our by-laws authorize the executive committee to:

· designate the managers and establish the duties and compensation of such managers;

· grant and revoke powers of attorney to attorneys-at-law on behalf of us;

· hire, discipline and fire personnel and determine wages, salaries and compensation of personnel;

· enter into contracts related to our business;

· manage our assets;

· enter into loan agreements for our business and set up liens to secure our obligations; and

· perform any other acts necessary to manage our day-to-day business.

Supervisory Committee

The Argentine General Corporation Law and the Argentine Capital Market Law require any corporation that has made a public offering in Argentina, such as us, to have a supervisory committee (comisión fiscalizadora). Pursuant to the Argentine General Corporation Law, only lawyers and accountants admitted to practice in Argentina or civil partnerships composed of such persons may serve as statutory auditors in an Argentine sociedad anónima.

The primary responsibilities of the supervisory committee are to monitor the management’s compliance with the Argentine General Corporation Law, the applicable bylaws, regulations, if any, and the shareholders’ resolutions, and to perform other functions, including, but not limited to: (i) supervise and inspect the corporate books and records whenever necessary, but at least quarterly; (ii) attend meetings of the directors, executive committee, audit committee and shareholders; (iii) prepare an annual report concerning our financial condition and submit it to our shareholders at the ordinary annual meeting; (iv) provide certain information regarding the company, in response to the request of shareholders representing at least 2% of the capital stock; (v) call an extraordinary shareholders’ meeting when necessary, on its own initiative or at the request of the shareholders, or an ordinary one when our boards of directors fails to do so; (vi) supervise and monitor compliance with laws and regulations, the applicable bylaws and the shareholders’ resolutions; and (vii) investigate written complaints made by shareholders representing at least 2% of the capital stock.

In performing these functions, our supervisory committees do not control our operations or assess the merits of the decisions made by the directors. The duties and responsibilities of an alternate statutory auditor, when acting in the place of a statutory auditor on a temporary or permanent basis, are the same as those discussed above for statutory auditors. They have no other duties or responsibilities as alternate statutory auditors.

Our supervisory committee (comisión fiscalizadora) is responsible for reviewing and supervising our administration and affairs and verifying compliance with our bylaws and resolutions adopted at the shareholders’ meetings. The members of our supervisory committee are appointed at our annual general ordinary shareholders’ meeting for a one-fiscal year term. Our supervisory committee is composed of three regular members and three alternate members and pursuant to Section 294 of the Argentine General Corporation Law must meet at least every three months.

197

The following table shows information about the members of our Supervisory Committee, who were elected in the annual general ordinary shareholders’ meeting which was held on October 21, 2021:

Member	Date of Birth	Position
José Daniel Abelovich	07/20/1956	Member
Marcelo Héctor Fuxman	11/30/1955	Member
Noemí Ivonne Cohn	05/20/1959	Member
Roberto Daniel Murmis	04/07/1959	Alternate Member
Cynthia Deokmelian	06/08/1976	Alternate Member
Paula Sotelo	08/10/1971	Alternate Member

All members of the supervisory committee qualify as independent, in accordance with CNV Resolution No. 400/2002 Rules.

Set forth below is a brief biographical description of each member of our Supervisory Committee:

José Daniel Abelovich. Mr. Abelovich holds an accounting degree from the Universidad de Buenos Aires. He is a founding member and partner of Abelovich, Polano & Asociados S.R.L., a member firm of Nexia International. Formerly, he was manager of Harteneck, López y Cía/Coopers & Lybrand and has served as a senior advisor in Argentina for the United Nations and the World Bank. He is a member of the Supervisory Committees of IRSA Inversiones y Representaciones S.A., Pampa Energía SA, Hoteles Argentinos S.A.U. and Banco Hipotecario S.A., among other companies.

Marcelo Héctor Fuxman. Mr. Fuxman holds an accounting degree from the Universidad de Buenos Aires. He is a partner of Abelovich, Polano & Asociados S.R.L., a member firm of Nexia International. He is also a member of the Supervisory Committees of IRSA Inversiones y Representaciones S.A., Inversora Bolívar and Banco Hipotecario, among other companies.

Noemí Ivonne Cohn. Ms. Cohn holds an accounting degree from the Universidad de Buenos Aires. She is a partner at Abelovich, Polano & Asociados S.R.L., a member firm of Nexia International, where she works in the auditor’s department. Ms. Cohn worked in the audit area of Harteneck, Lopez y Cía., Coopers & Lybrand in Argentina and Los Angeles, California. She is also a member of the Supervisory Committees of IRSA Inversiones y Representaciones S.A., Futuros y Opciones.com S.A. and Pan American Mall S.A., among other companies.

Roberto Daniel Murmis. Mr. Murmis holds accounting and law degrees from the Universidad de Buenos Aires. He is a partner at Abelovich, Polano & Asociados S.R.L., a member firm of Nexia International. He is a member of the Tax Affairs Commission and of the General Council of the Argentine Chamber of Commerce. He formerly served as an advisor to the Secretariat of Public Revenue (Secretaría de Ingresos Públicos) of the Argentine Ministry of Economy. Mr. Murmis also is a member of the supervisory committees of IRSA Inversiones y Representaciones S.A., among other companies.

Cynthia Deokmelian. Mrs Deokmellian obtained a degree in accounting from Universidad de Buenos Aires. She is a Director of the Audit department of Abelovich, Polano y Asociados S.R.L. – NEXIA, an accounting firm in Argentina that is a member of Nexia International, a global network of accounting and consulting firms. Mrs. Deokmellian worked in the Audit department of KPMG in Argentina. Furthermore, she is a member of the Supervisory Committee of Futuros y Opciones.Com, FyO Acopio S.A., among other companies.

Paula Sotelo. Ms. Sotelo holds an accounting degree from Universidad de Buenos Aires. She is Director of the audit department of Abelovich, Polano y Asociados S.R.L. – NEXIA, an accounting firm from Argentina that is a member of Nexia International, a global network of accounting and consulting firms. Previously, she was Senior Manager in the audit area of KPMG Argentina and KPMG New York. She is a member of the Supervisory Committees of IRSA Inversiones y Representaciones S.A., Futuros y Opciones.Com S.A., FyO Acopio S.A., among others.

198

KEY EMPLOYEES

There are no key employees.

B. Compensation

Compensation of directors

Under the Argentine General Corporation Law, if the compensation of the members of the Board of Directors is not established in the by-laws of the Company, it should be determined by the shareholders’ meeting. The maximum amount of total compensation to the members of the Board of Directors, including compensation for technical or administrative permanent activities, cannot exceed 25% of the earnings of the Company. That amount should be limited to 5% when there is no distribution of dividends to shareholders and will be increased proportionally to the distribution, in accordance with the formulas and scales set forth under the CNV Rules. When one or more directors perform special commissions or technical or administrative activities, and there are no earnings to distribute or they are reduced, the shareholding meeting shall approve compensation in excess of the above mentioned limits.

The compensation of our directors for each fiscal year is determined pursuant to Argentine law and taking into consideration whether the directors performed technical or administrative activities and our fiscal years results.

Once the amount is determined, it is considered at the shareholders ‘meeting.

At our shareholders’ meeting held on October 21, 2021, a compensation for an aggregate amount of ARS 93.1 million was approved for all of our directors for the fiscal year ended June 30, 2021. On June 30, 2022 there was not a new shareholders’ meeting held.

This compensation approved by the annual ordinary shareholders’ meeting pertains to Cresud individual board and does not consider inflation adjustment. For accounting purposes, the consolidated compensation for the Boards of Directors accrued during the fiscal year ended June 30, 2021 and 2022 was ARS 2,074 million and ARS 1,822 million, respectively.

Compensation of Supervisory Committee

Our shareholders’ meeting held on October 21, 2021 further approved by majority vote a compensation for an aggregate amount of ARS 2.4 million to our Supervisory Committee for the fiscal year ended June 30, 2021. At June 30, 2022 there was not a new shareholders’ meeting held.

Compensation of Senior Management

Our senior management is paid a fixed amount established by taking into consideration their background, capacity and experience and an annual bonus which varies according to their individual performance and our results.

The total and aggregate compensation paid to our senior management of the urban properties and investment business and the Agricultural Business for the fiscal year ended June 30, 2022, was ARS 106 million.

Compensation of the Audit Committee

The members of our Audit Committee do not receive any additional compensation other than that received for their services as members of our board of directors.

Compensation Plan for Executive Management

We have a defined contribution plan covering the members of our management team. The Plan became effective on January 1, 2006. Employees may begin participation voluntarily on monthly enrollment dates. Participants may make pre-tax contributions to the Plan of up to 2.5% of their monthly salary, or the “Base Contributions”, and pretax contributions of up to 15% of their annual bonuses, or “Extraordinary Contributions”. Under the Plan, we match employee contributions to the plan at a rate of 200% for Base Contributions and 300% for Extraordinary Contributions.

199

Contribution expense was ARS 1,316 million and ARS 72 million for the fiscal years ended June 30, 2022 and 2021, respectively. Employee contributions are held in a mutual fund. Contributions we make on behalf of our employees are held temporarily in a company account until the trust is set up. Individual participants may direct the trustee to invest their accounts in authorized investment alternatives. Participants or their assignees, as the case may be, may have access to 100% of our contributions under the following circumstances:

1.	ordinary retirement in accordance with applicable labor regulations;
2.	total or permanent incapacity or disability; or
3.	death.

In case of resignation or unjustified termination, the beneficiary may redeem the amounts contributed by us only if he or she has participated in the Plan for at least five years.

Long Term Incentive Program

The Shareholders’ Meetings held on October 31, 2011, October 31, 2012, and October 31, 2013, ratified the resolutions approved thereat as regards the incentive plan for the Company’s executive officers, up to 1% of its shareholders’ equity by allocating the same number of own treasury stock (the “Executive Plan”), and delegated on the Board of Directors the broadest powers to fix the price, term, form, modality, opportunity and other conditions to implement such Executive Plan.

In this sense and in accordance with the new Capital Markets Law, the Company has made the relevant filing with the CNV and pursuant to the comments received from such entity, it has made the relevant amendments to the Executive Plan which, after the CNV had stated to have no further comments, were explained and approved at the Shareholders’ Meeting held on November 14, 2014, where the broadest powers were also delegated to the Board of Directors to implement such Executive Plan.

The Company has developed a medium and long term incentive and retention stock program for its management team and key employees under which share-based contributions (after tax and social contributions) were calculated based on the annual bonus for the years 2011, 2012, 2013 and 2014.

The beneficiaries under the Executive Plan were invited to participate by the Board of Directors and their decision to access the Executive Plan is voluntary.

In the future, the Executive Participants or their successors in interest will have access to 100% of the benefit (Cresud’s shares contributed by the Company) in the following cases:

· if an employee resigns or is dismissed for no cause, he or she will be entitled to the benefit only if 5 years have elapsed from the moment of each contribution.

· retirement.

· total or permanent disability.

· death.

While Executive Participants are part of the program and until the conditions mentioned above are met to receive the shares corresponding to the contributions based on the 2011 to 2013 bonus, Executive Participants will receive the economic rights corresponding to the shares assigned to them. In case that the conditions are not met, the contributed funds remain at the participant’s disposal.

The shares allocated to the Executive Plan by the Company are shares purchased in 2009, which the Shareholders’ Meeting held on October 31, 2011, has specifically decided to allocate to the Executive Plan.

200

On October 30, 2019, the shareholders’ meeting approved the implementation of a new incentive plan for directors, management and employees based on the granting of shares for the long term remuneration of its executives, directors and employees, which accomplish certain requirements in terms of seniority and internal category. In that sense, the shareholders approved a capital increase for up to 1% of the capital stock at the time of the execution of the plan. As of the date of this Annual Report, the incentive plan was not executed and thus, no shares were issued or allocated to it.

Long Term Incentive Plan based on Shares of BrasilAgro

On October 2, 2017, the General Shareholders’ Meeting of BrasilAgro approved the creation of the Long-Term Share-Based Incentive Plan (“ILPA Plan”), a compensation program in which participants are entitled to receive a number of issued shares by the company if the objectives defined in the agreement are achieved. The ILPA Plan was divided into 3 programs and requires beneficiaries to remain with the Company for a specified period (consolidation period), in addition to having cumulative key performance indicators (“KPls”) that can define, increase or decrease the number of actions, classifying the result according to the 3 categories that make up the plan. The first compensation program (“ILPA 1”) was approved by the Board of Directors on June 18, 2018 and ended during the year June 30, 2020. On June 30, 2020, the charges of the ILPA Plan amounted ARS 81 million and accumulated expenses with the plan amounted to ARS 116 million.

On May 6, 2021, the Board of Directors approved the terms of the second share-based compensation program (“ILPA 2”), giving continuity to the ILPA Plan, establishing the characteristics and general rules of the new plan, such as a maximum number of shares and the list of eligible employees, appointed by a designated committee and approved by the Board. The structure of the 2nd program is maintained in accordance with the basic guidelines of the ILPA Plan, which basically include the permanence of employees during the accrual period and the achievement of key performance indicators (“KPIs”) accumulated between 1 July 2020 and June 30, 2023 (consolidation period).

 As of the date of these financial statements, ILPA 2 expenses totaled ARS 131 million.

C. Board Practices

For information about the date of expiration of the current term of office and the period during which each director has served in such office see “Item 6. Directors, Senior Management and employees – A. Directors and Senior Management.”

Benefits upon Termination of Employment

There are no contracts providing for benefits to directors upon termination of employment, other than those described under the following sections: (i) Item 6 “Directors, Senior Management and Employees – B. Compensation – Capitalization Plan and (ii) Item 6 “Directors, Senior Management and Employees – B. Compensation – Long Term Incentive Program.

201

Internal Control

Management uses the Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (the “COSO Report”) to assess effectiveness of internal control over financial reporting.

The COSO Report sets forth that internal control is a process, effected by an entity’s board of directors, management and other personnel, designed to provide reasonable assurance regarding the achievement of the entity’s objectives in the following categories:

· Effectiveness and efficiency of operations

· Reliability of financial reporting

· Compliance with applicable laws and regulations Based on the above, the Company’s internal control system involves all levels of the company actively involved in exercising control:

· the board of directors, by establishing the objectives, principles and values, setting the tone at the top and making the overall assessment of results;

· the management of each area is responsible for internal control in relation to objectives and activities of the relevant area, i.e. the implementation of policies and procedures to achieve the results of the area and, therefore, those of the entity as a whole;

· the other personnel plays a role in exercising control, by generating information used in the control system or taking action to ensure control.

Audit Committee

In accordance with the Capital Markets Law No. 26.831 and the CNV Rules, our board of directors has established an audit committee which focus on assisting the board in exercising its duty of care, compliance with disclosure requirements, supervise the operation of the internal control systems and the administrative-accounting system, supervise the application of the policies regarding information on the company’s risk management, ethical conduct of our businesses, monitoring the sufficiency of our financial statements, our compliance with the laws, independence and capacity of independent auditors and performance of audit duties both by our internal audit and our external auditors and issue a well-founded opinion regarding transactions with related parties in the cases established by this law. These responsibilities are meant to comply with the duties assigned by Law 26.831, the Technical CNV Rules, and other applicable laws.

On March 11, 2020 our board of directors appointed Liliana Glikin, María Gabriela Macagni and Alejandro Mario Bartolome, all of them independent members, as members of the audit committee. The board of directors named María Gabriela Macagni as the financial expert in accordance with the relevant SEC rules. We have a fully independent audit committee as per the standards provided in Rule 10(A)-3(b)(1).

D. Employees

As of June 30, 2022, we had 2,750 employees.

As of such date, we had 600 employees in our Agricultural Business in Argentina, including Cresud employees and FyO but not those of Agro-Uranga S.A. Approximately 30% are under collective labor agreements.

We employ 453 people in our International Agricultural businesses, composed of 386 employees of BrasilAgro, 29 employees in the companies located in Paraguay, 38 employees in the companies located in Bolivia.

202

Our Shopping Malls, Offices, Sales and Developments and Other businesses had 651 employees with 260 represented by the Union of Commerce Employees (Sindicato de Empleados de Comercio). Our Hotels segment had 750 employees with 638 represented by the Tourism, Hotels and Gastronomy Union from the Argentine Republic (Unión de Trabajadores del Turismo, Hoteleros y Gastronómicos de la República Argentina) (UTHGRA).

The following table shows the number of employees in the Company’s various businesses as of the dates mentioned below:

			Urban Business
	Agricultural Business(1)(2)		Shopping Malls, Offices, Sales and Developments and Other Business(3)		Hotels(4)		Shared Service Center		Corporate Areas		Total
June 30, 2020		1,397		807		701		188		104		3,197
June 30, 2021		964		629		652		209		90		2,544
June 30, 2022		1,053		651		750		212		84		2,750

_________ 

(1)	Agricultural Business includes CRESUD, FyO, BrasilAgro, Acres and Palmeiras.
(2)	In February 2021, SACPSA was sold.
(3)	Includes We are Appa S.A.
(4)	Includes Hotel Intercontinental, Libertador Hotel and Llao Llao.

E. Share Ownership

The following table sets forth the amount and percentage of our shares beneficially owned by our directors, Supervisory Committee and senior management as of June 30, 2022:

		Share ownership
Name	Position	Number of Shares (2)		Percentage			Number of Warrants (3)		Percentage Fully Diluted
Directors
Eduardo Sergio Elsztain (1)	Chairman		216,884,083		36.63	%		35,138,100		36.97	%
Saúl Zang	First vice-chairman		6,992,377		1.18	%		1,105,194	</