20-F 1 agro1231201920-ffinal.htm 20-F Document


 
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
 
þ
ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 FOR THE FISCAL YEAR ENDED ON DECEMBER 31, 2019
 
OR
 
¨
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 
FOR THE TRANSITION PERIOD FROM                     TO ________________
 
 
OR
 
¨
SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 
Date of event requiring this shell company report
 

COMMISSION FILE NUMBER: 001-35052
Adecoagro S.A.
(Exact name of Registrant as specified in its charter)
N/A
(Translation of Registrant’s name into English)
Grand Duchy of Luxembourg
(Jurisdiction of incorporation or organization)
Vertigo Naos Building, 6, Rue Eugène Ruppert,
L - 2453 Luxembourg
Tel: +352.2644.9372
(Address of principal executive offices)
Aurelien Corrion
Vertigo Naos Building, 6, Rue Eugène Ruppert,
L - 2453 Luxembourg
Email: aurelien.corrion@intertrustgroup.com
Tel: +352.26449.167
(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
Common Shares
AGRO
New York Stock Exchange
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
The number of outstanding shares of each of the issuer’s classes of capital stock
as of December 31, 2019:
117,086,050 Common Shares, par value $1.50 per share
Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act
Yes ¨   No þ
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 þ
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 þ   No ¨
Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted 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 and post such files).

Yes þ   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. (Check one):
Large accelerated filer þ
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. ¨ 
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 þ 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 þ
 




TABLE OF CONTENTS
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

i



 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

ii




iii



FORWARD-LOOKING STATEMENTS 
This annual report contains forward-looking statements that are based on our current expectations, assumptions, estimates and projections about us and our industry. These forward-looking statements can be identified by words or phrases such as “anticipate,” “believe,” “continue,” “estimate,” “expect,” “intend,” “is/are likely to,” “may,” “plan,” “should,” “would,” or other similar expressions. The forward-looking statements included in this annual report relate to, among others:
our business prospects and future results of operations;
weather and other natural phenomena;
the length and severity of the recent novel coronavirus (COVID-19) outbreak;
developments in, or changes to, the laws, regulations and governmental policies governing our business, including limitations on ownership of farmland by foreign entities in certain jurisdiction in which we operate, environmental laws and regulations;
the implementation of our business strategy;
our plans relating to acquisitions, joint ventures, strategic alliances or divestitures;
the implementation of our financing strategy and capital expenditure plan;
the maintenance of our relationships with customers;
the competitive nature of the industries in which we operate;
the cost and availability of financing;
future demand for the commodities we produce;
international prices for commodities;
the condition of our land holdings;
the development of the logistics and infrastructure for transportation of our products in the countries where we operate;
the performance of the South American and world economies;
the relative value of the Brazilian Real, the Argentine Peso, and the Uruguayan Peso compared to other currencies; and
the factors discussed under the section entitled “Risk Factors” in this annual report.
These forward-looking statements involve various risks and uncertainties. Although we believe that our expectations expressed in these forward-looking statements are reasonable, our expectations may turn out to be incorrect. Our actual results could be materially different from our expectations. In light of the risks and uncertainties described above, the estimates and forward-looking statements discussed in this annual report might not occur, and our future results and our performance may differ materially from those expressed in these forward-looking statements due to, including, but not limited to, the factors mentioned above. Because of these uncertainties, you should not make any investment decision based on these estimates and forward-looking statements. 
The forward-looking statements made in this annual report relate only to events or information as of the date on which the statements are made. We undertake no obligation to update any forward-looking statements to reflect events or circumstances after the date on which the statements are made or to reflect the occurrence of unanticipated events.

iv



PRESENTATION OF FINANCIAL AND OTHER INFORMATION
Certain Defined Terms
In this annual report, unless otherwise specified or if the context so requires:
References to the terms “Adecoagro S.A.”, “Adecoagro”, “we”, “us”, “our”, “Company”; and “our company” refer to, Adecoagro S.A., a corporation organized under the form of a société anonyme under the laws of the Grand Duchy of Luxembourg, and its subsidiaries.
References to “IFH” and “IFH LP” mean the former International Farmland Holdings, LP, a limited partnership (previously IFH LP and International Farmland Holdings, LLC, or IFH LLC).
References to “Adecoagro LP” mean Adecoagro, LP SCS, a limited partnership organized under the form of a société comandite simple under the laws of the Grand Duchy of Luxembourg (previously Adecoagro LP and Adecoagro, LLC).
References to “$,” “US$,” “U.S. dollars” and “dollars” are to U.S. dollars.
References to “Argentine Pesos,” “Pesos” or “Ps.” are to Argentine Pesos, the official currency of Argentina.
References to “Brazilian Real,” “Real,” “Reais” or “R$” are to the Brazilian Real, the official currency of Brazil.
Unless stated otherwise, references to “sales” are to the consolidated sales of manufactured products and services rendered plus sales of agricultural produce and biological assets.
References to “IFRS” are International Financial Reporting Standards issued by the International Accounting Standards Board (“IASB”) and the interpretations of the International Financial Reporting Interpretations Committee (“IFRIC”), together “IFRS.”
Background
As part of a corporate reorganization (the “Reorganization”), Adecoagro, a Luxembourg corporation under the form of a société anonyme, was formed as a holding company for IFH for the purpose, among others, of facilitating the initial public offering (the “IPO”) of our common shares, completed on January 28, 2011. Before the IPO, Adecoagro had not engaged in any business or other activities except in connection with its formation and the Reorganization. For an additional discussion of the Reorganization, see “Item 4. Information on the Company—A. History and Development of the Company—History.” 
During 2011, we contributed the net proceeds of the IPO to increase our interest in IFH from 98% to 98.64%. During 2012, we issued, in a series of transactions, 1,654,752 shares to certain limited partners of IFH in exchange for their residual interest in IFH, totaling 1.3595%, thereby increasing our interest in IFH to approximately 100%. During 2015 IFH was merged into Adecoagro LP, our wholly-owned subsidiary. For further information please see "Item 4 - A. History and development of the Company - General Information".
The Consolidated Financial Statements as of December 31, 2019 and 2018 and for the years ended December 31, 2019, 2018 and 2017 (hereinafter, the “Consolidated Financial Statements”) included in this annual report have been prepared in accordance with IFRS. All IFRS effective at the time of preparing the Consolidated Financial Statements have been applied.
Description of accounting policies changed during 2019 and 2018

Adoption of IFRS 16 - Leases
For fiscal years beginning on January 1st, 2019 the adoption of IFRS 16 - Leases was mandatory. We disclose in Note 35.1 to our Consolidated Financial Statements the new accounting policies that have been applied from January 1, 2019, where they are different to those applied in prior periods.
The Company has adopted IFRS 16 Leases from January 1, 2019 following the simplified approach, but has not restated comparative figures for previous reporting period as permitted under the specific transition provisions in the Standard. The reclassifications and the adjustments arising from the new lease accounting rules are directly recognized in the opening balance sheet on January 1, 2019. The weighted average incremental borrowing rate applied to lease liabilities recognised in the statement of financial position at the date of the initial application was 7.06%.

v



On adoption of IFRS 16, the Company recognized lease liabilities in relation to leases which had previously been classified as ‘operating leases’ under the principles of IAS 17 Leases. In the previous years, the Company only recognized lease liabilities in relation to leases that were classified as "Finance leases" under IAS 17 Leases. For the initial recognition, these liabilities were measured at the present value of the remaining lease payments, discounted using the lessee’s incremental borrowing rate as of January 1, 2019.
In order to evaluate the effect of adoption IFRS 16 as at January 1, 2019, please see "Note 35.1 to our consolidated financial statements."
The new accounting policy for leases under IFRS 16 is as follows:
Leases are recognized as a right-of-use asset and a corresponding liability at the date of which the leased asset is available for use. Each lease payment is allocated between the liability and finance cost. The finance cost is charged to profit or loss over the lease period so as to produce a constant periodic rate of interest on the remaining balance of the liability for each period. The right-of-use asset is depreciated over the shorter of the asset's useful life and the lease term on a straight-line basis.
In determining the lease term, the Company considers all facts and circumstances that create an economic incentive to exercise an extension option, or not exercise a termination option. Extension options (or periods after termination options) are only included in the lease term if the lease is reasonably certain to be extended (or not terminated).
Short term leases are recognized on a straight line basis as an expense in the income statement. Please see "Note 35.1 to our Consolidated Financial Statements."
Accounting for Farmland Valuation
During 2018, we have adopted the revaluation model for our farmlands that are recognized under property, plant and equipment. Farmlands are valued at Fair value. Previously, we valued all of these assets using the cost model. These amendments have resulted in an increase of property, plant and equipment of US$ 545 million as of December 31, 2018. This higher valuation resulted in an increase of the deferred tax liability of US$ 139 million. This change in accordance with IAS 16, is applied prospectively. The higher valuation, net of its tax effects, is reflected in the Shareholders' equity under the line item "Revaluation surplus".
Also we adopted the revaluation model for our investment property. The higher valuation resulted in an increase in retained earnings of US$ 45 million; an increase in investment property of US$ 40 million as of December 31, 2017, and an increase in deferred tax liability of US$ 12 million. This change was applied retrospectively, in accordance with IAS 8. Consequently, prior year figures have been restated.
Financial reporting in a hyperinflation economy
IAS 29 “Financial Reporting in Hyperinflationary Economies” ("IAS 29") requires that the financial statements of entities whose functional currency is that of a hyperinflationary economy to be adjusted for the effects of changes in the general price index and to be expressed in terms of the current unit of measurement at the closing date of the reporting period. Accordingly, the inflation produced from the date of acquisition or from the revaluation date, as applicable, must be computed in the non-monetary items.
In order to determine whether an economy is categorized as hyperinflationary under the terms of IAS 29, the accounting standard details a series of factors to be considered, including the existence of a cumulative inflation rate in three years that approximates or exceeds 100 %.
During 2018 Argentina experienced a significant increase in inflation, which exceeded the 100% three-year cumulative inflation rate. Also, the remaining indicators support the conclusion that Argentina should be considered a hyperinflationary economy for accounting purposes. Accordingly, commencing July 1, 2018, we started applying IAS 29 in the financial reporting of our subsidiaries and associates using Argentine peso as the functional currency. We will to continue to apply IAS 29 until such time as the cumulative three-year inflation rate is equal to or less than 70%. During 2019, the threshold of less than 70% was not achieved, and as a result we continue applying inflation accounting. See "Item 5. Operating and Financial Review and Prospects -Trends and Factors Affecting Our Results of Operations - Description of recent changes to our accounting policies."

vi



Financial statements of a foreign entity with a functional currency of a country that has a highly inflationary economy, are restated to reflect changes in the general price level or index in that country before translation into U.S. Dollars. In adjusting for hyperinflation, a general price index is applied to all non-monetary items in the financial statements (including equity) and the resulting gain or loss, which is the gain or loss on the entity's net monetary position, is recognized in the income statement. Monetary items in the closing statement of financial position are not adjusted. The Company treated all Argentine subsidiaries as being subject to a hyperinflationary economy as all of them have Argentine peso as functional currency. The results and financial position of all foreign entities with a functional currency of a country that has a highly inflationary economy are translated at closing rates after the restatement for changes in the general purchasing power Argentine peso.
The inflation adjustment on the initial balances was calculated by means of conversion factor derived from the Argentine price indexes published by the National Institute of Statistics, with a year-over-year change in the index of 1.538.
The main procedures for the above-mentioned adjustment are as follows:

Monetary assets and liabilities which are carried at current amounts at the balance sheet date are not restated because they are already expressed in terms of the monetary unit current at the balance sheet date.
Non-monetary assets and liabilities which are not carried at current amounts at the balance sheet date, and components of shareholders' equity are adjusted by applying the applicable price index.
All items in the income statement are restated by applying the applicable price index.
The effect of inflation on the Company’s net monetary position is included in the income statement, in "Other financial results" .
The ongoing application of the re-translation of comparative amounts to closing exchanges rates under IAS 21 and the hyperinflation adjustments required by IAS 29 will lead to an additional difference on top of the difference arising out of the adoption of hyperinflation accounting.
The comparative figures in the Consolidated Financial Statements presented in a stable currency are not adjusted for subsequent changes in the price level or exchange rates. Accordingly, there is an initial difference, arising on the adoption of hyperinflation accounting, between the closing equity of the previous year and the opening equity of the current year. The Company recognized this initial difference directly in equity.
Segment reporting information.
The measurement principles for the Company’s segment reporting structure are based on the IFRS principles adopted in the interim financial statements through June 30, 2018. Since the adoption of IAS 29 on July 1, 2018, the measurement principles for the Company’s segment reporting structure are based on the IFRS principles adopted in these financial statements, with the exceptions disclose below.
Total segment assets and liabilities are measured in a manner consistent with that of the Consolidated Financial Statements. These assets and liabilities are allocated based on the operations of the segment and the physical location of the asset.
Effective July 1, 2018, we applied IAS 29. (See "Financial reporting in a hyperinflation economy").
According to IAS 29, all Argentine peso-denominated non-monetary items in the statement of financial position are adjusted by applying a general price index from the date they were initially recognized to the end of the reporting period. Likewise, all Argentine peso-denominated items in the statement of income are expressed in terms of the measuring unit current at the end of the reporting period. Consequently, income statement items are adjusted by applying a general price index on a monthly basis from the dates they were initially recognized in the financial statements through the end of the reporting period. This process is called “re-measurement”.
Once the re-measurement process is completed, all Argentine peso denominated accounts are translated into U.S. Dollars, applying the guidelines in IAS 21 “The Effects of Changes in Foreign Exchange Rates”(“IAS 21”). IAS 21 requires that amounts be translated at the closing rate at the date of the most recent statement of financial position. Accordingly, monthly results of operations in Argentine pesos, after adjustment for inflation pursuant to IAS 29, must then be converted into U.S. dollars at the closing exchange rate for such monthly reporting period. This process is called “translation.”
The re-measurement and translation processes are applied on a monthly basis until year-end. Due to this process, the re-measured and translated results of operations for a given month are subject to change until year-end, affecting comparison and analysis.

vii



Following the adoption of IAS 29 with respect to our Argentine operations, management revised the information reviewed by the chief operating decision maker ("CODM"). Accordingly, from July 1, 2018 the information provided to the CODM departs from the application of IAS 29 and IAS 21 re-measurement and translation processes by adjusting for inflation the segment results operations for each reporting period and translating them into the Company’s reporting currency using the reporting period average exchange rate. The translated amounts were not subsequently re-measured and translated in accordance with the IAS 29 and IAS 21 procedures outlined above. From January 1, 2018 through June 30, 2018, the Company’s segment results were still based on the IFRS measurement principles adopted until June 30, 2018.
In order to evaluate the economic performance of businesses on a monthly basis, results of operations in Argentina are based on monthly data that have been adjusted for inflation and converted into the average exchange rate of the U.S. Dollar each month. These figures are not subsequently readjusted and reconverted as described above under IAS 29 and IAS 21. It should be noted that this translation methodology for evaluating segment information is the same method as the one used by the Company to translate results of operation from its other subsidiaries from other countries that have not been designated hyperinflationary economies because it allows for a more accurate analysis of the economic performance of its business as a whole.
The Company's CODM believes that the exclusion of the re-measurement and translation processes from the segment reporting structure allows for a more useful presentation and facilitates period-to-period comparison and performance analysis.
IFRS 8 requires that segment information be reported on the basis of the internal reports that are regularly reviewed by the entity's CODM to evaluate the company’s operating results. The Company’s CODM does not evaluate monthly results of operation according to the presentation obtained from the application of IAS 29 and IAS 21 as described above because it is considered more useful and accurate that monthly results remain unchanged once translated.
Therefore, the measurement of reported figures in the segment presentation differ from the measurement of the figures reported in the statement of income in the manner described above.
Below is a reconciliation of Segment Information to the Statement of Income that clarifies the difference between the application of IAS 29 and IAS 21 in the Statement of Income and in the reported Segment Information for the years ended 2019 and 2018:
 
2019
 
Crops
 
Rice
 
Dairy
 
Total segment reporting
 
Adjustment
 
Total as per statement of income
 
Total segment reporting
 
Adjustment
 
Total as per statement of income
 
Total segment reporting
 
Adjustment
 
Total as per statement of income
Sales of goods sold and services rendered
168,938

 
(2,492
)
 
166,446

 
102,162

 
(1,006
)
 
101,156

 
84,767

 
(945
)
 
83,822

Cost of goods and services rendered
(159,197
)
 
2,687

 
(156,510
)
 
(74,480
)
 
529

 
(73,951
)
 
(77,532
)
 
838

 
(76,694
)
Initial recognition and changes in fair value of biological assets and agricultural produce
30,290

 
(549
)
 
29,741

 
13,194

 
(979
)
 
12,215

 
13,741

 
(231
)
 
13,510

Gain from changes in net realizable value of agricultural produce after harvest
1,542

 
283

 
1,825

 

 

 

 

 

 

Margin on Manufacturing and Agricultural Activities Before Operating Expenses
41,573

 
(71
)
 
41,502

 
40,876

 
(1,456
)
 
39,420

 
20,976

 
(338
)
 
20,638

General and administrative expenses
(5,446
)
 
(87
)
 
(5,533
)
 
(6,752
)
 
147

 
(6,605
)
 
(4,188
)
 
90

 
(4,098
)
Selling expenses
(12,852
)
 
128

 
(12,724
)
 
(21,072
)
 
498

 
(20,574
)
 
(6,252
)
 
18

 
(6,234
)
Other operating income, net
(1,133
)
 
(225
)
 
(1,358
)
 
282

 
(15
)
 
267

 
(635
)
 
(68
)
 
(703
)
Profit from Operations Before Financing and Taxation
22,142

 
(255
)
 
21,887

 
13,334

 
(826
)
 
12,508

 
9,901

 
(298
)
 
9,603

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Depreciation and amortization
(4,662
)
 
(137
)
 
(4,799
)
 
(6,994
)
 
171

 
(6,823
)
 
(5,064
)
 
98

 
(4,966
)
Net (loss) / gain from Fair value adjustment of investment property

 

 

 

 

 

 

 

 


viii



 
2019
 
All other segments
 
Corporate
 
Total
 
Total segment reporting
 
Adjustment
 
Total as per statement of income
 
Total segment reporting
 
Adjustment
 
Total as per statement of income
 
Total segment reporting
 
Adjustment
 
Total as per statement of income
Sales of goods sold and services rendered
3,904

 
27

 
3,931

 

 

 

 
891,554

 
(4,416
)
 
887,138

Cost of goods and services rendered
(3,412
)
 
(40
)
 
(3,452
)
 

 

 

 
(675,187
)
 
4,014

 
(671,173
)
Initial recognition and changes in fair value of biological assets and agricultural produce
(40
)
 
53

 
13

 

 

 

 
70,295

 
(1,706
)
 
68,589

Gain from changes in net realizable value of agricultural produce after harvest

 

 

 

 

 

 
1,542

 
283

 
1,825

Margin on Manufacturing and Agricultural Activities Before Operating Expenses
452

 
40

 
492

 

 

 

 
288,204

 
(1,825
)
 
286,379

General and administrative expenses
(167
)
 
17

 
(150
)
 
(19,319
)
 
428

 
(18,891
)
 
(57,797
)
 
595

 
(57,202
)
Selling expenses
(171
)
 
(11
)
 
(182
)
 
(165
)
 
23

 
(142
)
 
(107,628
)
 
656

 
(106,972
)
Other operating income, net
(956
)
 
602

 
(354
)
 
(175
)
 
21

 
(154
)
 
(1,137
)
 
315

 
(822
)
Profit from Operations Before Financing and Taxation
(842
)
 
648

 
(194
)
 
(19,659
)
 
472

 
(19,187
)
 
121,642

 
(259
)
 
121,383

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Depreciation and amortization
(181
)
 
4

 
(177
)
 
(20
)
 
3

 
(17
)
 
(174,578
)
 
139

 
(174,439
)
Net (loss) / gain from Fair value adjustment of investment property
(927
)
 
602

 
(325
)
 

 

 

 
(927
)
 
602

 
(325
)

 
2018
 
Crops
 
Rice
 
Dairy
 
Total segment reporting
 
Adjustment
 
Total as per statement of income
 
Total segment reporting
 
Adjustment
 
Total as per statement of income
 
Total segment reporting
 
Adjustment
 
Total as per statement of income
Sales of goods sold and services rendered
164,538

 
(9,120
)
 
155,418

 
100,013

 
(4,610
)
 
95,403

 
33,201

 
(3,491
)
 
29,710

Cost of goods and services rendered
(165,988
)
 
9,052

 
(156,936
)
 
(75,739
)
 
766

 
(74,973
)
 
(31,488
)
 
3,361

 
(28,127
)
Initial recognition and changes in fair value of biological assets and agricultural produce
36,422

 
(7,755
)
 
28,667

 
8,967

 
(4,842
)
 
4,125

 
7,295

 
(1,840
)
 
5,455

Gain from changes in net realizable value of agricultural produce after harvest
2,704

 
(3,613
)
 
(909
)
 

 

 

 

 

 

Margin on Manufacturing and Agricultural Activities Before Operating Expenses
37,676

 
(11,436
)
 
26,240

 
33,241

 
(8,686
)
 
24,555

 
9,008

 
(1,970
)
 
7,038

General and administrative expenses
(4,239
)
 
37

 
(4,202
)
 
(5,070
)
 
(869
)
 
(5,939
)
 
(2,034
)
 
(246
)
 
(2,280
)
Selling expenses
(5,921
)
 
474

 
(5,447
)
 
(15,465
)
 
1,375

 
(14,090
)
 
(983
)
 
41

 
(942
)
Other operating income, net
5,422

 
1,741

 
7,163

 
275

 
(58
)
 
217

 
(1,055
)
 
58

 
(997
)
Profit from Operations Before Financing and Taxation
32,938

 
(9,184
)
 
23,754

 
12,981

 
(8,238
)
 
4,743

 
4,936

 
(2,117
)
 
2,819

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Depreciation and amortization
(1,697
)
 
(329
)
 
(2,026
)
 
(5,846
)
 
5,840

 
(6
)
 
(2,253
)
 
(280
)
 
(2,533
)
Net gain from Fair value adjustment of investment property

 

 

 

 

 

 

 

 


ix



 
2018
 
All other segments
 
Corporate
 
Total
 
Total segment reporting
 
Adjustment
 
Total as per statement of income
 
Total segment reporting
 
Adjustment
 
Total as per statement of income
 
Total segment reporting
 
Adjustment
 
Total as per statement of income
Sales of goods sold and services rendered
1,919

 
(149
)
 
1,770

 

 

 

 
810,609

 
(17,370
)
 
793,239

Cost of goods and services rendered
(1,412
)
 
99

 
(1,313
)
 

 

 

 
(623,243
)
 
13,278

 
(609,965
)
Initial recognition and changes in fair value of biological assets and agricultural produce
(806
)
 
(393
)
 
(1,199
)
 

 

 

 
31,025

 
(14,830
)
 
16,195

Gain from changes in net realizable value of agricultural produce after harvest

 

 

 

 

 

 
2,704

 
(3,613
)
 
(909
)
Margin on Manufacturing and Agricultural Activities Before Operating Expenses
(299
)
 
(443
)
 
(742
)
 

 

 

 
221,095

 
(22,535
)
 
198,560

General and administrative expenses
(155
)
 
(9
)
 
(164
)
 
(19,626
)
 
1,433

 
(18,193
)
 
(56,426
)
 
346

 
(56,080
)
Selling expenses
(165
)
 
16

 
(149
)
 
(178
)
 
33

 
(145
)
 
(92,154
)
 
1,939

 
(90,215
)
Other operating income, net
10,668

 
2,728

 
13,396

 
(167
)
 
36

 
(131
)
 
99,727

 
4,505

 
104,232

Profit from Operations Before Financing and Taxation
10,049

 
2,292

 
12,341

 
(19,971
)
 
1,502

 
(18,469
)
 
172,242

 
(15,745
)
 
156,497

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Depreciation and amortization
(171
)
 
(6
)
 
(177
)
 

 

 

 
(153,169
)
 
(1,085
)
 
(154,254
)
Net gain from Fair value adjustment of investment property
10,680

 
2,729

 
13,409

 

 

 

 
10,680

 
2,729

 
13,409


Sugar, Ethanol and Energy, and Land Transformation segments have not been reconciliated due to the lack of differences.


x



Financial Statements
Non-IFRS Financial Measures
To supplement our Consolidated Financial Statements, which are prepared and presented in accordance with IFRS, we use the following non-IFRS financial measures in this annual report, which are based on the information that arose from segment information (Note 3 of our Consolidated Financial Statements, the statement of financial position and the statement of cash flow).
Adjusted Consolidated EBITDA
Adjusted Segment EBITDA
Adjusted Consolidated EBIT
Adjusted Segment EBIT
Adjusted Free Cash Flow
Adjusted Free Cash Flow from Operations
Net Debt
Net Debt to Adjusted Consolidated EBITDA
In this section, we provide an explanation and a reconciliation of each of our non-IFRS financial measures to the most directly comparable IFRS measures. The presentation of these financial measures is not intended to be considered in isolation or as a substitute for, or superior to, financial information prepared and presented in accordance with IFRS. 
We use non-IFRS measures to internally evaluate and analyze financial results. We believe these non-IFRS financial measures provide investors with useful supplemental information about the liquidity and financial performance of our business, enable comparison of financial results between periods where certain items may vary independent of business performance, and enable comparison of our financial results with other public companies, many of which present similar non-IFRS financial measures. 
There are limitations associated with the use of non-IFRS financial measures as an analytical tool. In particular, many of the adjustments to our IFRS financial measures reflect the exclusion of items, such as depreciation of property, plant and equipment and amortization of intangible assets, changes in fair value and the related income tax effects of the aforementioned exclusions, that are recurring and will be reflected in our financial results for the foreseeable future. In addition, these measures may be different from non-IFRS financial measures used by other companies, limiting their usefulness for comparison purposes.
Adjusted Consolidated EBITDA, Adjusted Segment EBITDA, Adjusted Consolidated EBIT and Adjusted Segment EBIT 
We present Adjusted Consolidated EBITDA, Adjusted Segment EBITDA, Adjusted Consolidated EBIT and Adjusted Segment EBIT in this annual report as supplemental measures of performance of our company and of each operating segment, respectively, that are not required by, or presented in accordance with IFRS.
Adjusted Consolidated EBITDA equals the sum of our Adjusted Segment EBITDA for each of our operating segments. We define “Adjusted Consolidated EBITDA” as (i) consolidated net profit (loss) for the year, as applicable, before interest expense, income taxes, depreciation of property, plant and equipment and amortization of intangible assets, net gain from fair value adjustments of investment property land foreign exchange gains or losses, other net financial results; and (ii) adjusted by profit or loss from discontinued operations; (iii) adjusted by those items, that do not impact profit and loss, but are recorded directly in shareholders' equity, including (a) the gains or losses from disposals of non-controlling interests in subsidiaries whose main underlying asset is farmland, reflected under the line item: "Reserve from the sale of non-controlling interests in subsidiaries” and (b) the net increase in value of sold farmland, which has been recognized in either revaluation surplus of retained earnings; and (iv) net of the combined effect of the application of IAS 29 and IAS 21 from the Argentine operations included in profit from operations. (See "Item 5. Operating and Financial Review and Prospects A. Operating Results - Critical Accounting Policies and Estimates.")
We define “Adjusted Segment EBITDA” for each of our operating segments as (i) the segment’s share of consolidated profit (loss) from operations before financing and taxation per segment information for the year, as applicable, before depreciation of property, plant and equipment and amortization of intangible assets; and (ii) adjusted by profit or loss from discontinued operations; (iii) adjusted by those items, that do not impact profit and loss, but are recorded directly in shareholders' equity, including (a) the gains or losses from disposals of non-controlling interests in subsidiaries whose main underlying asset is farmland, reflected under the line item: "Reserve from the sale of non-controlling interests in subsidiaries” and (b) the net increase in value of sold farmland, which has been recognized in either revaluation surplus of retained earnings.

xi



 We believe that Adjusted Consolidated EBITDA and Adjusted Segment EBITDA are important measures of operating performance for our company and each operating segment, respectively, because they allow investors to evaluate and compare our consolidated operating results and to evaluate and compare the operating performance of our segments, respectively, including our return on capital and operating efficiencies, from period to period by removing the impact of our capital structure (interest expense from our outstanding debt), asset base (depreciation and amortization), tax consequences (income taxes), foreign exchange gains or losses and other financial results. In addition, by including the gains or losses from disposals of non-controlling interests in subsidiaries whose main underlying asset is farmland, investors can also evaluate and compare the full value and returns generated by our land transformation activities. Other companies may calculate Adjusted Consolidated EBITDA and Adjusted Segment EBITDA differently, and therefore our Adjusted Consolidated EBITDA and Adjusted Segment EBITDA may not be comparable to similarly titled measures used by other companies. Adjusted Consolidated EBITDA and Adjusted Segment EBITDA are not measures of financial performance under IFRS, and should not be considered in isolation or as an alternative to consolidated net profit (loss), cash flows from operating activities, segment’s profit from operations before financing and taxation and other measures determined in accordance with IFRS. Items excluded from Adjusted Consolidated EBITDA and Adjusted Segment EBITDA are significant and necessary components to the operations of our business, and, therefore, Adjusted Consolidated EBITDA and Adjusted Segment EBITDA should only be used as a supplemental measure of our company’s operating performance, and of each of our operating segments, respectively. We also believe Adjusted Consolidated EBITDA and Adjusted Segment EBITDA are useful for securities analysts, investors and others to evaluate and compare the financial performance of our company and other companies in the agricultural industry. These non-IFRS measures should be considered in addition to, but not as a substitute for or superior to, the information contained in either our statements of income or segment information.
Our Adjusted Consolidated EBIT equals the sum of our Adjusted Segment EBITs for each of our operating segments. We define “Adjusted Consolidated EBIT” as (i) consolidated net profit (loss) for the year, as applicable, before interest expense, income taxes, foreign exchange gains or losses and other net financial results; and (ii) adjusted by profit or loss from discontinued operations ; (iii) adjusted by gains or losses from disposals of non controlling interests in subsidiaries whose main underlying asset farmland ; and (iv) net of the combined effect of the application of IAS 29 and IAS 21 from the Argentine operations included in profit from operations. We define “Adjusted Segment EBIT” for each of our operating segments as the segment’s share of (i) consolidated profit (loss) from operations before financing and taxation as per segment information for the year, as applicable; and (ii) adjusted by profit or loss from discontinued operations; and (iii) adjusted by those items, that do not impact profit and loss, but are recorded directly in shareholders' equity, including (a) the gains or losses from disposals of non-controlling interests in subsidiaries whose main underlying asset is farmland, reflected under the line item: "Reserve from the sale of non-controlling interests in subsidiaries”; (b) the net increase in value of sold farmland, which has been recognized in either revaluation surplus of retained earnings.
We believe that Adjusted Consolidated EBIT and Adjusted Segment EBIT are important measures of operating performance, for our company and each operating segment, respectively, because they allow investors to evaluate and compare our consolidated operating results and to evaluate and compare the operating performance of our segments, from period to period by including the impact of depreciable fixed assets and removing the impact of our capital structure (interest expense from our outstanding debt), tax consequences (income taxes), foreign exchange gains or losses and other financial results. In addition, by including the gains or losses from disposals of non-controlling interests in subsidiaries whose main underlying asset is farmland and also the sale of farmlands, investors can evaluate the full value and returns generated by our land transformation activities. Other companies may calculate Adjusted Consolidated EBIT and Adjusted Segment EBIT differently, and therefore our Adjusted Consolidated EBIT and Adjusted Segment EBIT may not be comparable to similarly titled measures used by other companies. Adjusted Consolidated EBIT and Adjusted Segment EBIT are not measures of financial performance under IFRS, and should not be considered in isolation or as an alternative to consolidated net profit (loss), cash flows from operating activities, segment’s profit from operations before financing and taxation and other measures determined in accordance with IFRS. Items excluded from Adjusted Consolidated EBIT and Adjusted Segment EBIT are significant and necessary components to the operations of our business, and, therefore, Adjusted Consolidated EBIT and Adjusted Segment EBIT should only be used as a supplemental measure of the operating performance of our company, and of each of our operating segments, respectively.
Adjusted Free Cash Flow and Adjusted Free Cash Flow from Operations
We believe that the measures of Adjusted Free Cash Flow and Adjusted Free Cash Flow from Operations are important measures of liquidity that enable investors to draw important comparisons year to year of the amount of cash generated by the Company’s principal business and financing activities, which includes the cash generated from our land transformation activities, after paying for recurrent items, including interest, taxes and maintenance capital expenditures.


xii



We define Adjusted Free Cash Flow as (i) net cash generated from operating activities net of the combined effect of the application of IAS 29 and IAS 21 to the Argentine operations, less (ii) net cash used in investing activities net of the combined effect of the application of IAS 29 and IAS 21, less (iii) interest paid, plus (iv) proceeds from the sale of non-controlling interest in farming subsidiaries; less (v) lease payments. We define Adjusted Free Cash Flow from Operations as (i) net cash generated from operating activities net of the combined effect of the application of IAS 29 and IAS 21 less (ii) net cash used in investing activities net of the combined effect of the application of IAS 29 and IAS 21 , less (iii) interest paid, plus (iv) proceeds from the sale of non-controlling interest in subsidiaries; less (v) lease payments; plus (vi) expansion capital expenditures. (See "Item 3. Key InformationA Selected Financial Data." and "Item 5. Operating and Financial Review and Prospects A. Operating Results -- Critical Accounting Policies and Estimates"
Expansion capital expenditures is defined as the required investment to expand current production capacity including organic growth, joint ventures and acquisitions. We define maintenance capital expenditures as the necessary investments in order to maintain the current level of productivity both at an agricultural and industrial level. Proceeds from the sale of non-controlling interest in farming subsidiaries is a measure of the cash generated from our land transformation business that is included under cash from financing activities pursuant to IFRS.
We believe Adjusted Free Cash Flow is an important liquidity measure for the Company because it allows investors and others to evaluate and compare the amount of cash generated by the Company business and financing activities to undertake growth investments, to fund acquisitions, to reduce outstanding financial debt, and to provide a return to shareholders in the form of dividends and/or share repurchases, among other things.
We believe Adjusted Free Cash Flow from Operations is an additional important liquidity metric for the Company because it allows investors and others to evaluate and compare the total amount of cash generated by the Company’s business and financing activities after paying for recurrent items including interests, taxes and maintenance capital expenses. We believe this metric is relevant in evaluating the overall performance of our business.
Other companies may calculate Adjusted Free Cash Flow and Adjusted Free Cash Flow from Operations differently, and therefore our formulation may not be comparable to similarly titled measures used by other companies. Adjusted Free Cash Flow and Adjusted Free Cash Flow from Operations are not measures of liquidity under IFRS, and should not be considered in isolation or as an alternative to consolidated, cash flows from operating activities, net increase, (decrease) in cash and cash equivalents and other measures determined in accordance with IFRS.
Net Debt and Net Debt to Adjusted Consolidated EBITDA
Net debt is defined as the sum of non-current and current borrowings less cash and cash equivalents. This measure is widely used by management.
Management is consistently tracking our leverage position and our ability to repay and service our debt obligations over time. We have therefore set a leverage ratio target that is measured by net debt divided by Adjusted Consolidated EBITDA.
We believe that the ratio net debt to Adjusted Consolidated EBITDA provides useful information to investors because management uses it to manage our debt-equity ratio in order to promote access to capital markets and our ability to meet scheduled debt service obligations.
Fiscal Year and Harvest Year
Our fiscal year begins on January 1 and ends on December 31 of each year. However, our production is based on the harvest year for each of our crops and rice. A harvest year varies according to the crop or rice and to the climate in which it is grown. Due to the geographic diversity of our farms, the planting period for a given crop or rice may start earlier on one farm than on another, causing differences in their respective harvesting periods. The presentation of production volume (tons) and product area (hectares) in this annual report, in respect of the harvest years for each of our crops and rice, starts with the first day of the planting period at the first farm to start planting on that harvest year and continues to the last day of the harvesting period of the respective crop or rice on the last farm to finish harvesting that harvest year, as shown in the table below.

xiii



capturaa43.jpg
Product area for cattle is presented on a harvest year basis given that land utilized for cattle operations is linked to our farming operations and use of farmland during a harvest year. Production volumes for dairy and cattle operations are presented on a fiscal year basis. On the other hand, production volumes and product area in our sugar, ethanol and energy business are presented on a fiscal year basis.
The financial results for all of our products are presented on a fiscal year basis.

xiv



Certain Weight Units and Measures in the Agricultural Business
Weight units and measures used in agriculture vary according to the crop and producing country. In order to permit comparability of our operating data with operating data from the international markets, the following table sets forth key weight units and measures used in the agriculture industry:
 
Agricultural weight units and measures
 
 
1 metric ton
1,000 kg
1.102 U.S. (short) tons
1 cubic meter
1,000 liters
 
1 kilogram (kg)
2.20462 pounds
 
1 pound
0.45359 kg
 
1 acre
0.40469 hectares
 
1 hectare (ha)
2.47105 acres
 
Soybean and Wheat
 
 
1 bushel of soybean
60 pounds
27.2155 kg
1 bag of soybean
60 kg
2.20462 bushels
1 bushel/acre
67.25 kg/ha
 
1.00 U.S. dollar/bushel
2.2046 U.S. dollar/bag
 
Corn
 
 
1 bushel of corn
56 pounds
25.4012 kg
1 bag of corn
60 kg
2.36210 bushels
1 bushel/acre
62.77 kg/ha
 
1.00 U.S. dollar/bushel
2.3621 U.S. dollar/bag
 
Dairy
 
 
1 liter
0.264 gallons
2.273 pounds
1 gallon
3.785 liters
8.604 pounds
1 lbs
0.440 liters
0.116 gallons
1.00 U.S. dollar/liter
43.995 U.S. dollar/cwt
3.785 U.S. dollar/gallon
1.00 U.S. dollar/cwt
0.023 U.S. dollar/liter
0.086 U.S. dollar/gallon
1.00 U.S. dollar/gallon
0.264 U.S. dollar/liter
11.622 U.S. dollar/cwt
Sugar & Ethanol
 
 
1 kg of TRS equivalent
0.95 kg of VHP Sugar
0.59 liters of Hydrated Ethanol
1.00 US$ cents/pound
22.04 U.S. dollar/ton
 
Presentation of Information — Market Data and Forecasts
This annual report includes information provided by us and by third-party sources that we believe are reliable, including data related to the economic conditions in the markets in which we operate. Unless otherwise indicated, information in this annual report concerning economic conditions is based on publicly available information from third-party sources which we believe to be reasonable. The economic conditions in the markets in which we operate may deteriorate, and those economies may not grow at the rates projected by market data, or at all. The deterioration of the economic conditions in the markets in which we operate may have a material adverse effect on our business, results of operations and financial condition and the market price of our common shares.
Rounding 
We have made rounding adjustments to reach some of the figures included in this annual report. Accordingly, numerical figures shown as totals in some tables may not be an arithmetic aggregation of the figures that preceded them.

xv



PART I
Item 1.    Identity of Directors, Senior Management and Advisers
 
Not applicable. 
Item 2.    Offer Statistics and Expected Timetable

Not applicable.
Item 3.    Key Information 
A.    SELECTED FINANCIAL DATA 
The following selected statement of financial position data as of December 31, 2019 and 2018 and selected statement of income data and cash flow data for each of the three years in the period ended December 31, 2019 have been derived from our Consolidated Financial Statements appearing elsewhere in this annual report on Form 20-F. The selected statement of financial position data as of December 31, 2017, 2016 and 2015 and for the years ended December 31, 2016 and 2015 has been derived from our annual consolidated financial statements, which have been retroactively recast to give effect to the change of measurement basis for our investment properties during 2018. These financial statements are not included in this annual report.
The Consolidated Financial Statements are prepared in accordance with IFRS. All IFRS effective at the time of preparing the Consolidated Financial Statements have been applied.
You should read the information contained in the following tables in conjunction with “Item 5. Operating and Financial Review and Prospects”, “Item 8. Financial Information”, “Item 18. Financial Statements” and the Consolidated Financial Statements and the accompanying notes included elsewhere in this annual report.
Financial reporting in a hyperinflation economy
During 2018, Argentina experienced a significant increase in inflation, which exceeded the 100% three-year cumulative inflation rate. Also the remaining indicators do not contradict the conclusion that Argentina should be considered a hyperinflationary economy for accounting purposes. As a results, it is agreed that there is sufficient evidence to conclude that Argentina is a hyperinflationary economy under the terms of IAS 29. Therefore, from July 1, 2018, we started applying IAS 29 in the financial reporting of its subsidiaries and associates with the Argentine peso as functional currency. (See "Presentation of Financial and Other Information - Financial reporting in a hyperinflation economy").


1



 
For the years ended December 31,
 
2019
 
2018
 
2017
 
2016
 
2015
 
(In thousands of $)
Statements of Income Data:
 

 
 

 
 

 
 

 
 

Sale of goods and services rendered
887,138

 
793,239

 
933,178

 
869,235

 
674,314

Cost of goods sold and services rendered
(671,173
)
 
(609,965
)
 
(766,727
)
 
(678,581
)
 
(557,786
)
Initial recognition and changes in fair value of biological assets and agricultural produce
68,589

 
16,195

 
63,220

 
125,456

 
54,528

Changes in net realizable value of agricultural produce after harvest
1,825

 
(909
)
 
8,852

 
(5,841
)
 
14,691

Margin on manufacturing and agricultural activities before operating expenses
286,379

 
198,560

 
238,523

 
310,269

 
185,747

General and administrative expenses
(57,202
)
 
(56,080
)
 
(57,299
)
 
(50,750
)
 
(48,425
)
Selling expenses
(106,972
)
 
(90,215
)
 
(95,399
)
 
(80,673
)
 
(70,268
)
Other operating income, net
(822
)
 
104,232

 
43,763

 
5,752

 
52,964

Share of loss of joint ventures

 

 

 

 
(2,685
)
Profit from operations before financing and taxation
121,383

 
156,497

 
129,588

 
184,598

 
117,333

Finance income
9,908

 
8,581

 
11,744

 
7,957

 
9,150

Finance costs
(202,566
)
 
(271,263
)
 
(131,349
)
 
(165,380
)
 
(116,890
)
Other financial results - Net gain of inflation effects on the monetary items
92,437

 
81,928

 

 

 

Financial results, net
(100,221
)
 
(180,754
)
 
(119,605
)
 
(157,423
)
 
(107,740
)
Profit / (Loss) before income tax
21,162

 
(24,257
)
 
9,983

 
27,175

 
9,593

Income tax (expense) / benefit
(20,820
)
 
1,024

 
4,992

 
(12,899
)
 
2,479

Profit / (Loss) for the year
342

 
(23,233
)
 
14,975

 
14,276

 
12,072

 
 
 
 
 
 
 
 
 
 
Attributable to:
 
 
 

 
 

 
 

 
 

Equity holders of the parent
(772
)
 
(24,622
)
 
13,198

 
11,568

 
10,830

Non-controlling interest
1,114

 
1,389

 
1,777

 
2,708

 
1,242

 
 
 
 

 
 

 
 

 
 

(Loss) / earnings per share from operations attributable to the equity holders of the parent during the year:
 
 
 

 
 

 
 

 
 

Basic (loss) / earnings per share
(0.007
)
 
(0.211
)
 
0.109

 
0.095

 
0.090

Diluted (loss) / earnings per share
(0.007
)
 
(0.211
)
 
0.108

 
0.094

 
0.089




2



 
For the Year Ended December 31,
 
2019
 
2018
 
2017
 
2016
 
2015
Cash Flow Data:
 

 
 

 
 

 
 

 
 

Net cash generated from operating activities (a)
322,110

 
218,513

 
237,105

 
255,401

 
145,186

Net cash used in investing activities (b)
(248,710
)
 
(174,922
)
 
(188,335
)
 
(122,014
)
 
(125,051
)
Net cash generated from financing activities (c)
(37,863
)
 
(20,854
)
 
70,194

 
(181,682
)
 
92,413

(a) Includes 23,550 and 7,598 of the combined effect of IAS 29 and IAS 21 of the Argentine subsidiaries for 2019 and 2018, respectively. 
(b) Includes 3,851 and 4,122 of the combined effect of IAS 29 and IAS 21 of the Argentine subsidiaries for 2019 and 2018, respectively. 
(c) Includes (14,340) and (8,231) of the combined effect of IAS 29 and IAS 21 of the Argentine subsidiaries for 2019 and 2018, respectively. 
Other Financial Data:
 
 
 

 
 

 
 

 
 

Adjusted Segment EBITDA (unaudited) (1)
 
 
 

 
 

 
 

 
 

Crops
26,804

 
34,635

 
25,678

 
27,462

 
33,211

Rice
20,328

 
18,827

 
12,179

 
11,698

 
6,274

Dairy
14,965

 
7,189

 
12,243

 
5,717

 
6,356

All Other segments
266

 
(460
)
 
556

 
9,085

 
677

Farming subtotal
62,363

 
60,191

 
50,656

 
53,962

 
46,518

Ethanol, sugar and energy
253,069

 
238,284

 
247,301

 
265,044

 
167,180

Land transformation
9,376

 
36,227

 

 

 
23,980

Corporate
(19,639
)
 
(19,971
)
 
(21,664
)
 
(20,957
)
 
(21,776
)
Adjusted Consolidated EBITDA (unaudited) (1)
305,169

 
314,731

 
276,293

 
298,049

 
215,902

________________________________________________________________________________________________  
(1)
See “Presentation of Financial and Other Information” for the definitions of Adjusted Segment EBITDA and Adjusted Consolidated EBITDA and the reconciliation in the table below.
 
As of December 31,
 
2019
 
2018
 
2017
 
2016
 
2015
 
(In thousands of $)
Statement of Financial Position Data:
 

 
 

 
 

 
 

 
 

Biological assets
130,436

 
105,387

 
167,994

 
145,404

 
111,818

Inventories
112,790

 
128,102

 
108,919

 
111,754

 
85,286

Property, plant and equipment, net
1,493,220

 
1,480,439

 
831,377

 
814,867

 
696,889

Right of use assets
238,053

 

 

 

 

Total assets
2,521,307

 
2,277,372

 
1,645,089

 
1,496,397

 
1,392,124

Non-current lease liabilities
174,570

 

 

 

 

Total lease liabilities
216,384

 

 

 

 

Non-current borrowings
780,202

 
718,484

 
663,060

 
430,304

 
483,651

Total borrowings
968,280

 
862,116

 
817,958

 
635,396

 
723,339

Share Capital
183,573

 
183,573

 
183,573

 
183,573

 
183,573

Equity attributable to equity holders of the parent
988,269

 
1,063,636

 
673,880

 
700,334

 
556,814

Non-controlling interest
40,614

 
44,509

 
9,139

 
11,970

 
7,335

Number of shares (including treasury shares)
122,382

 
122,382

 
122,382

 
122,382

 
122,382

 



3



The following tables show a reconciliation of Adjusted Segment EBITDA to our segments’ profit / (loss) from operations before financing and taxation, the most directly comparable IFRS financial measure, and a reconciliation of Adjusted Consolidated EBITDA to our net profit (loss) for the year, the most directly comparable IFRS financial measure.
 
For the year ended December 31, 2019
 
Crops
 
Rice
 
Dairy
 
All other
segments
 
Farming
Subtotal
 
Sugar,
Ethanol
and
Energy
 
Land
Trans-
formation
 
Corporate
 
Total
 
(In thousands of $)
Adjusted Segment EBITDA
(unaudited)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Profit/(Loss) from
Operations Before Financing and Taxation as per Segment Information
22,142

 
13,334

 
9,901

 
(842
)
 
44,535

 
95,412

 
1,354

 
(19,659
)
 
121,642

Net loss from Fair value adjustment of investment property as per Segment Information

 

 

 
927

 
927

 

 

 

 
927

Reverse of revaluation surplus derived from the disposals of assets before taxes

 

 

 

 

 

 
8,022

 

 
8,022

Adjusted Segment EBIT (unaudited)(1)
22,142

 
13,334

 
9,901

 
85

 
45,462


95,412

 
9,376

 
(19,659
)
 
130,591

Depreciation of Property, plant and equipment and amortization of Intangible Assets as per Segment Information
4,662

 
6,994

 
5,064

 
181

 
16,901

 
157,657

 

 
20

 
174,578

Adjusted Segment EBITDA (unaudited)(1)
26,804

 
20,328

 
14,965

 
266

 
62,363

 
253,069

 
9,376

 
(19,639
)
 
305,169

Reconciliation to Profit
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 
Profit for the year
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
342

Income tax expense
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
20,820

Interest expense, net
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
52,815

Foreign exchange, net
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
108,458

Other financial results - Net gain of inflation effects on the monetary items
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(92,437
)
Other financial results, net
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
31,385

Combined effects of IAS 29 and IAS 21 of the Argentine subsidiaries of Profit from operations
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
259

Net loss from Fair value adjustment of investment property as per Segment Information
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
927

Adjusted Consolidated EBIT (unaudited) (1)
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
122,569

Depreciation of Property, Plant and Equipment and amortization of Intangible Assets as per Segment Information
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
174,578

Reverse of revaluation surplus derived from the disposals of assets before taxes
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
8,022

Adjusted Consolidated EBITDA (unaudited)(1)
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
305,169

 
(1)
See “Presentation of Financial and Other Information” for the definitions of Adjusted Segment EBIT, Adjusted Consolidated EBIT, Adjusted Segment EBITDA and Adjusted Consolidated EBITDA.

4



 
For the year ended December 31, 2018
 
Crops
 
Rice
 
Dairy
 
All other
segments
 
Farming
Subtotal
 
Sugar,
Ethanol
and
Energy
 
Land
Trans-
formation
 
Corporate
 
Total
 
(In thousands of $)
Adjusted Segment EBITDA
(unaudited)
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

Profit/(Loss) from
Operations Before Financing and Taxation
32,938

 
12,981

 
4,936

 
10,049

 
60,904

 
95,082

 
36,227

 
(19,971
)
 
172,242

Net gain from Fair value adjustment of investment property

 

 

 
(10,680
)
 
(10,680
)
 

 

 

 
(10,680
)
Adjusted Segment EBIT (unaudited)(1)
32,938

 
12,981

 
4,936

 
(631
)
 
50,224

 
95,082

 
36,227

 
(19,971
)
 
161,562

Depreciation and amortization
1,697

 
5,846

 
2,253

 
171

 
9,967

 
143,202

 

 

 
153,169

Adjusted Segment EBITDA (unaudited)(1)
34,635

 
18,827

 
7,189

 
(460
)
 
60,191

 
238,284

 
36,227

 
(19,971
)
 
314,731

Reconciliation to Profit
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 
Profit for the year
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
(23,233
)
Income tax expense
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
(1,024
)
Interest expense, net
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
43,662

Foreign exchange, net
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
183,195

Other financial results - Net gain of inflation effects on the monetary items
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(81,928
)
Other financial results, net
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
35,825

Combined effects of IAS 29 and IAS 21 of the Argentine subsidiaries of Profit from operations
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
15,745

Net gain from Fair value adjustment of investment property
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(10,680
)
Adjusted Consolidated EBIT (unaudited)(1)
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
161,562

Depreciation and amortization
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
153,169

Adjusted Consolidated EBITDA (unaudited)(1)
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
314,731

(1)
See “Presentation of Financial and Other Information” for the definitions of Adjusted Segment EBIT, Adjusted Consolidated EBIT, Adjusted Segment EBITDA and Adjusted Consolidated EBITDA.

5



 
For the year ended December 31, 2017
 
Crops
 
Rice
 
Dairy
 
All other
segments
 
Farming
Subtotal
 
Sugar,
Ethanol
and
Energy
 
Land
Trans-
formation
 
Corporate
 
Total
 
(In thousands of $)
Adjusted Segment EBITDA
(unaudited)
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

Profit/(Loss) from
Operations Before Financing and Taxation
24,167

 
8,328

 
11,206

 
4,699

 
48,400

 
102,852

 

 
(21,664
)
 
129,588

Net gain from fair value adjustment of investment property

 

 

 
(4,302
)
 
(4,302
)
 

 

 

 
(4,302
)
Adjusted Segment EBIT (unaudited)(1)
24,167

 
8,328

 
11,206

 
397

 
44,098

 
102,852

 


(21,664
)
 
125,286

Depreciation and amortization
1,511

 
3,851

 
1,037

 
159

 
6,558

 
144,449

 

 

 
151,007

Adjusted Segment EBITDA (unaudited)(1)
25,678

 
12,179

 
12,243

 
556

 
50,656

 
247,301

 

 
(21,664
)
 
276,293

Reconciliation to Profit
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 
Profit for the year
 

 
 

 
 

 
 

 
 

 
 

 
 

 
 

 
14,975

Income tax expense