EX-99.1 2 a19-9851_3ex99d1.htm EX-99.1

EXHBIT 99.1

 

 

BIOCERES CROP SOLUTIONS CORP.

Unaudited interim condensed consolidated financial statements as of March 31, 2019, June 30, 2018 and for the nine-month periods ended March 31, 2019 and 2018.

 


 

INDEX

 

Unaudited interim condensed consolidated financial statements as of March 31, 2019, June 30, 2018 and for the nine-month periods ended March 31, 2019 and 2018.

 

 

 

Unaudited interim condensed consolidated statements of financial position as of March 31, 2019 and June 30, 2018

F-2

 

 

Unaudited interim condensed consolidated statements of comprehensive income for the nine-month and three-month periods ended March 31, 2019 and 2018

F-4

 

 

Unaudited interim condensed consolidated statements of changes in equity for the nine-month periods ended March 31, 2019 and 2018

F-5

 

 

Unaudited interim condensed consolidated statements of cash flows for the nine-month periods ended March 31, 2019 and 2018

F-7

 

 

Notes to the unaudited interim condensed consolidated financial statements

F-9

 

F-1


Table of Contents

 

BIOCERES CROP SOLUTIONS CORP.

 

UNAUDITED INTERIM CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION

As of March 31, 2019 and June 30, 2018

 

(Amounts in US Dollars)

 

 

 

Notes

 

03/31/2019

 

06/30/2018

 

ASSETS

 

 

 

 

 

 

 

CURRENT ASSETS

 

 

 

 

 

 

 

Cash and cash equivalents

 

5.1

 

6,139,337

 

2,215,103

 

Other financial assets

 

5.2

 

5,324,516

 

4,550,847

 

Trade receivables

 

5.3

 

68,408,216

 

52,888,427

 

Other receivables

 

5.4

 

5,213,401

 

4,240,205

 

Income and minimum presumed income taxes recoverable

 

 

 

2,151,617

 

2,082,269

 

Inventories

 

5.5

 

23,240,074

 

19,366,001

 

Total current assets

 

 

 

110,477,161

 

85,342,852

 

 

 

 

 

 

 

 

 

NON-CURRENT ASSETS

 

 

 

 

 

 

 

Other financial assets

 

5.2

 

336,949

 

243,358

 

Other receivables

 

5.4

 

812,919

 

4,979,507

 

Income and minimum presumed income taxes recoverable

 

 

 

84,337

 

126,653

 

Deferred tax assets

 

 

 

934,851

 

5,601,821

 

Investments in joint ventures and associates

 

10

 

25,641,028

 

19,072,055

 

Property, plant and equipment

 

5.6

 

39,955,867

 

40,177,146

 

Intangible assets

 

5.7

 

33,913,458

 

26,657,345

 

Goodwill

 

5.8

 

20,937,480

 

14,438,027

 

Total non-current assets

 

 

 

122,616,889

 

111,295,912

 

Total assets

 

 

 

233,094,050

 

196,638,764

 

 

The accompanying Notes are an integral part of these unaudited interim condensed consolidated financial statements. Related parties’ balances and transactions are disclosed in Note 13.

 

F-2


Table of Contents

 

BIOCERES CROP SOLUTIONS CORP.

 

UNAUDITED INTERIM CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION

As of March 31, 2019 and June 30, 2018

 

(Amounts in US Dollars)

 

LIABILITIES

 

Notes

 

03/31/2019

 

06/30/2018

 

 

 

 

 

 

 

 

 

CURRENT LIABILITIES

 

 

 

 

 

 

 

Trade and other payables

 

5.9

 

39,411,909

 

27,708,830

 

Borrowings

 

5.10

 

95,177,237

 

65,308,928

 

Employee benefits and social security

 

5.11

 

3,492,543

 

4,411,713

 

Deferred revenue and advances from customers

 

5.12

 

897,035

 

1,007,301

 

Income and minimum presumed income taxes payable

 

 

 

 

2,569

 

Government grants

 

 

 

3,100

 

17,695

 

Financed payment - Acquisition of business

 

5.14

 

5,740,746

 

20,223,590

 

Total current liabilities

 

 

 

144,722,570

 

118,680,626

 

 

 

 

 

 

 

 

 

NON-CURRENT LIABILITIES

 

 

 

 

 

 

 

Borrowings

 

5.10

 

16,938,555

 

25,708,205

 

Government grants

 

 

 

7,932

 

15,532

 

Investments in joint ventures and associates

 

10

 

1,995,995

 

2,012,298

 

Deferred tax liabilities

 

 

 

15,336,866

 

13,591,942

 

Provisions

 

5.13

 

436,593

 

845,486

 

Financed payment - Acquisition of business

 

5.14

 

 

2,651,019

 

Private warrants

 

5.15

 

2,925,080

 

 

Total non-current liabilities

 

 

 

37,641,021

 

44,824,482

 

Total liabilities

 

 

 

182,363,591

 

163,505,108

 

 

 

 

 

 

 

 

 

EQUITY

 

 

 

 

 

 

 

Equity attributable to owners of the parent

 

 

 

37,130,349

 

13,713,484

 

Non-controlling interests

 

 

 

13,600,110

 

19,420,172

 

Total equity

 

 

 

50,730,459

 

33,133,656

 

 

 

 

 

 

 

 

 

Total equity and liabilities

 

 

 

233,094,050

 

196,638,764

 

 

The accompanying Notes are an integral part of these unaudited interim condensed consolidated financial statements. Related parties’ balances and transactions are disclosed in Note 13.

 

F-3


Table of Contents

 

BIOCERES CROP SOLUTIONS CORP.

 

UNAUDITED INTERIM CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

For the nine-month and three-month periods ended March 31, 2019 and 2018

 

(Amounts in US Dollars)

 

 

 

 

 

Nine-month
period ended

 

Nine-month
period ended

 

Three-month
period ended

 

Three-month
period ended

 

 

 

Notes

 

03/31/2019

 

03/31/2018

 

03/31/2019

 

03/31/2018

 

Revenue

 

6.1

 

110,741,133

 

101,882,311

 

18,682,627

 

20,903,741

 

Government grants

 

 

 

13,674

 

41,180

 

714

 

12,513

 

Total revenue

 

 

 

110,754,807

 

101,923,491

 

18,683,341

 

20,916,254

 

 

 

 

 

 

 

 

 

 

 

 

 

Cost of sales

 

6.2

 

(58,648,951

)

(60,115,955

)

(10,996,272

)

(12,249,675

)

Research and development expenses

 

6.3

 

(2,089,961

)

(2,850,936

)

(1,147,269

)

(784,138

)

Selling, general and administrative expenses

 

6.4

 

(25,548,400

)

(27,151,613

)

(8,721,883

)

(7,291,737

)

Share of profit or loss of joint ventures and associates

 

10

 

306,386

 

(872,051

)

(506,207

)

(799,813

)

Other income or expenses, net

 

 

 

(25,825

)

299,245

 

272,737

 

12,473

 

Operating profit

 

 

 

24,748,056

 

11,232,181

 

(2,415,553

)

(196,636

)

 

 

 

 

 

 

 

 

 

 

 

 

Finance income

 

6.5

 

45,876,403

 

12,282,231

 

20,086,036

 

6,910,863

 

Finance costs

 

6.6

 

(72,418,345

)

(31,963,413

)

(22,215,869

)

(13,399,250

)

Share based payment cost of listing shares

 

8.3

 

(20,893,789

)

 

(20,893,789

)

 

Net gain of inflation effect on monetary items

 

 

 

11,021,116

 

 

1,155,314

 

 

Profit / (loss) before income tax

 

 

 

(11,666,559

)

(8,449,001

)

(24,283,861

)

(6,685,023

)

 

 

 

 

 

 

 

 

 

 

 

 

Income tax

 

 

 

(3,445,656

)

7,378,351

 

1,605,093

 

1,522,299

 

Loss for the period

 

 

 

(15,112,215

)

(1,070,650

)

(22,678,768

)

(5,162,724

)

 

 

 

 

 

 

 

 

 

 

 

 

Other comprehensive loss

 

 

 

(5,587,090

)

(19,124,269

)

(3,075,367

)

(7,473,158

)

 

 

 

 

 

 

 

 

 

 

 

 

Items that may be subsequently reclassified to profit and loss

 

 

 

(5,093,375

)

(19,124,269

)

(2,101,011

)

(7,251,745

)

Exchange differences on translation of foreign operations from joint ventures

 

 

 

(2,728,261

)

(6,462,115

)

(792,750

)

(2,133,379

)

Exchange differences on translation of foreign operations

 

 

 

(2,365,114

)

(12,662,154

)

(1,308,261

)

(5,118,366

)

 

 

 

 

 

 

 

 

 

 

 

 

Items that will not be subsequently reclassified to loss and profit

 

 

 

(493,715

)

 

(974,356

)

(221,413

)

Revaluation of property, plant and equipment, net of tax, of JV and associates

 

 

 

155,246

 

 

(145,989

)

 

Revaluation of property, plant and equipment, net of tax

 

 

 

(648,961

)

 

(828,367

)

 

Tax rate change over revaluation of property, plant and equipment

 

 

 

 

 

 

(221,413

)

Total comprehensive loss

 

 

 

(20,699,305

)

(20,194,919

)

(25,754,135

)

(12,635,882

)

 

 

 

 

 

 

 

 

 

 

 

 

Profit / (loss) for the period attributable to:

 

 

 

 

 

 

 

 

 

 

 

Equity holders of the parent

 

 

 

(17,245,703

)

(2,072,622

)

(21,474,709

)

(3,200,167

)

Non-controlling interests

 

 

 

2,133,488

 

1,001,972

 

(1,204,059

)

(1,962,557

)

 

 

 

 

(15,112,215

)

(1,070,650

)

(22,678,768

)

(5,162,724

)

Total comprehensive income / (loss) attributable to:

 

 

 

 

 

 

 

 

 

 

 

Equity holders of the parent

 

 

 

(21,384,923

)

(14,694,875

)

(23,643,501

)

(8,510,432

)

Non-controlling interests

 

 

 

685,618

 

(5,500,044

)

(2,110,634

)

(4,125,450

)

 

 

 

 

(20,699,305

)

(20,194,919

)

(25,754,135

)

(12,635,882

)

Loss per share

 

 

 

 

 

 

 

 

 

 

 

Basic and diluted loss attributable to ordinary equity holders of the parent

 

7

 

(0.60

)

(0.07

)

(0.72

)

(0.11

)

Weighted average number of shares

 

 

 

 

 

 

 

 

 

 

 

Basic and diluted

 

7

 

28,597,680

 

28,098,117

 

29,630,486

 

28,098,117

 

 

 

The accompanying Notes are an integral part of these unaudited interim condensed consolidated financial statements. Related party balances and transactions are disclosed in Note 13.

 

F-4


Table of Contents

 

BIOCERES CROP SOLUTIONS CORP.

 

UNAUDITED INTERIM CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

For the nine-month periods ended March 31, 2019 and 2018

(Amounts in US Dollars)

 

 

 

Attributable to the equity holders of the parent

 

 

 

 

 

Description

 

Issued capital

 

Share
premium

 

Stock options

 

Retained
results

 

Foreign
currency
translation

 

Revaluation of
PP&E

 

Equity
(deficit)
attributable to
owners of the
parent

 

Non-
controlling
Interests

 

Total equity

 

06/30/2017

 

2,810

 

56,254,519

 

72,822

 

(15,110,050

)

(6,598,080

)

1,219,600

 

35,841,621

 

41,397,445

 

77,239,066

 

Parent company investment

 

 

(4,087,231

)

 

 

 

 

(4,087,231

)

 

(4,087,231

)

Stock options

 

 

 

34,219

 

 

 

 

34,219

 

 

34,219

 

Profit or loss of the period

 

 

 

 

(2,072,622

)

 

 

(2,072,622

)

1,001,972

 

(1,070,650

)

Other comprehensive loss

 

 

 

 

 

(12,622,253

)

 

(12,622,253

)

(6,502,016

)

(19,124,269

)

03/31/2018

 

2,810

 

52,167,288

 

107,041

 

(17,182,672

)

(19,220,333

)

1,219,600

 

17,093,734

 

35,897,401

 

52,991,135

 

 

The accompanying Notes are an integral part of these unaudited interim condensed consolidated financial statements. Related parties’ balances and transactions are disclosed in Note 13.

 

F-5


Table of Contents

 

BIOCERES CROP SOLUTIONS CORP.

 

UNAUDITED INTERIM CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

For the nine-month periods ended March 31, 2019 and 2018

(Amounts in US Dollars)

 

 

 

Attributable to the equity holders of the parent

 

 

 

 

 

Description

 

Issued capital

 

Share
premium

 

Stock options

 

Retained
results

 

Foreign
currency
translation

 

Revaluation of
PP&E

 

Equity
(deficit)
attributable to
owners of the
parent

 

Non-
controlling
Interests

 

Total equity

 

06/30/2018

 

2,810

 

68,023,449

 

102,827

 

(26,149,583

)

(36,612,070

)

8,346,051

 

13,713,484

 

19,420,172

 

33,133,656

 

Adjustment of opening balance for the application of IAS 29

 

 

 

 

22,546,341

 

 

(2,986,317

)

19,560,024

 

7,797,295

 

27,357,319

 

Parent company investment (Note 8.1)

 

 

(14,558,347

)

 

 

 

 

(14,558,347

)

 

(14,558,347

)

Stock options

 

 

 

71,231

 

 

 

 

71,231

 

 

71,231

 

Reverse recapitalization (Note 8.3)

 

329

 

21,721,148

 

 

 

 

 

21,721,477

 

 

21,721,477

 

Private warrants (Note 5.15)

 

 

(3,432,723

)

 

 

 

 

(3,432,723

)

 

(3,432,723

)

Shares issued - Rizobacter call option (Note 8.4)

 

474

 

21,439,652

 

 

 

 

 

21,440,126

 

(14,302,975

)

7,137,151

 

Profit or loss of the period

 

 

 

 

(17,245,703

)

 

 

(17,245,703

)

2,133,488

 

(15,112,215

)

Other comprehensive loss

 

 

 

 

 

(3,725,468

)

(413,752

)

(4,139,220

)

(1,447,870

)

(5,587,090

)

03/31/2019

 

3,613

 

93,193,179

 

174,058

 

(20,848,945

)

(40,337,538

)

4,945,982

 

37,130,349

 

13,600,110

 

50,730,459

 

 

The accompanying Notes are an integral part of these unaudited interim condensed consolidated financial statements. Related parties’ balances and transactions are disclosed in Note 13.

 

F-6


Table of Contents

 

BIOCERES CROP SOLUTIONS CORP.

 

UNAUDITED INTERIM CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

For the nine-month periods ended March 31, 2019 and 2018

(Amounts in US Dollars)

 

 

 

Notes

 

03/31/2019

 

03/31/2018

 

OPERATING ACTIVITIES

 

 

 

 

 

 

 

Loss for the period

 

 

 

(15,112,215

)

(1,070,650

)

 

 

 

 

 

 

 

 

Adjustments to reconcile loss to net cash flows

 

 

 

 

 

 

 

Income tax

 

 

 

3,445,656

 

(7,378,351

)

Finance results

 

 

 

26,034,300

 

19,681,182

 

Results of inflation effects on the monetary items

 

 

 

(11,021,116

)

 

Share based payment cost of listing shares

 

8.3

 

20,893,789

 

 

Depreciation of property, plant and equipment

 

5.6

 

1,782,683

 

1,614,784

 

Amortization of intangible assets

 

5.7

 

1,495,522

 

1,677,543

 

Inventory purchase price allocation charge

 

 

 

 

2,257,378

 

Stock options

 

 

 

71,231

 

34,219

 

Reverse recapitalization expenses

 

 

 

4,479,913

 

 

Share of profit or loss of joint ventures and associates

 

10

 

(306,386

)

872,051

 

Loss of control of subsidiaries

 

 

 

(10,591

)

 

Allowance for impairment of trade debtors

 

6.4

 

147,766

 

1,042,730

 

Allowance for obsolescence

 

6.4

 

269,979

 

428,094

 

Puttable instruments interest

 

 

 

 

438,082

 

Gain or loss on sale of equipment and intangible assets

 

 

 

(185,398

)

2,956

 

 

 

 

 

 

 

 

 

Working capital adjustments

 

 

 

 

 

 

 

Trade receivables

 

 

 

23,886,582

 

(6,349,748

)

Other receivables

 

 

 

3,332,761

 

1,392,732

 

Income and minimum presumed income taxes

 

 

 

(27,408

)

(2,369,625

)

Inventories

 

 

 

(3,837,079

)

1,601,278

 

Trade and other payables

 

 

 

(23,933,570

)

(11,503,325

)

Employee benefits and social security

 

 

 

(851,082

)

(1,699,538

)

Deferred revenue and advances from customers

 

 

 

(102,098

)

(283,104

)

Income and minimum presumed income taxes payable

 

 

 

 

2,138,139

 

Government grants

 

 

 

(22,195

)

(58,389

)

Inflation effects on working capital adjustments

 

 

 

(11,668,074

)

 

Net cash flows generated by operating activities

 

 

 

18,762,970

 

2,468,438

 

 

The accompanying Notes are an integral part of these unaudited interim condensed consolidated financial statements. Related parties’ balances and transactions are disclosed in Note 13.

 

F-7


Table of Contents

 

BIOCERES CROP SOLUTIONS CORP.

 

UNAUDITED INTERIM CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

For the nine-month periods ended March 31, 2019 and 2018

(Amounts in US Dollars)

 

 

 

Notes

 

03/31/2019

 

03/31/2018

 

INVESTMENT ACTIVITIES

 

 

 

 

 

 

 

Proceeds from sale of property, plant and equipment

 

 

 

257,606

 

106,661

 

Investment in joint ventures and associates and associates

 

10

 

(124,124

)

(763,744

)

Net loans granted to shareholders and other related parties

 

 

 

206,388

 

 

Purchase of property, plant and equipment

 

5.6

 

(1,800,540

)

(2,182,964

)

Net loans granted to joint ventures

 

 

 

 

(3,200,139

)

Capitalized development expenditures

 

5.7

 

(53,407

)

(360,694

)

Purchase of intangible assets

 

5.7

 

(126,391

)

(457,233

)

Net cash flows used in investing activities

 

 

 

(1,640,468

)

(6,858,113

)

 

 

 

 

 

 

 

 

FINANCING ACTIVITIES

 

 

 

 

 

 

 

Proceeds from borrowings

 

 

 

13,269,451

 

22,616,963

 

Repayment of borrowings and interest payments

 

 

 

(33,005,813

)

(26,958,977

)

Increase bank overdraft and other short-term borrowings

 

 

 

6,878,784

 

11,528,866

 

Other financial proceeds or payments, net

 

 

 

(828,372

)

180,528

 

Reverse recapitalization

 

 

 

1,083,928

 

 

Net cash flows (used in) provided by financing activities

 

 

 

(12,602,022

)

7,367,380

 

 

 

 

 

 

 

 

 

Net increase in cash and cash equivalents

 

 

 

4,520,480

 

2,977,705

 

Cash and cash equivalents as of beginning of the period

 

5.1

 

2,215,103

 

1,679,478

 

Effect of exchange rate changes and inflation effects on cash and cash equivalents

 

 

 

(596,246

)

 

Cash and cash equivalents as of the end of the period

 

5.1

 

6,139,337

 

4,657,183

 

 

The accompanying Notes are an integral part of these unaudited interim condensed consolidated financial statements. Related parties’ balances and transactions are disclosed in Note 13.

 

F-8


Table of Contents

 

BIOCERES CROP SOLUTIONS CORP.

 

NOTES TO THE UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Amounts in US Dollars, except otherwise indicated)

 

Index

 

1.  General information

 

2.  Accounting standards and basis of preparation

 

2.1.  Statement of compliance with IFRS as issued by IASB

 

2.2.  Authorization for the issue of the Unaudited interim condensed consolidated financial Statements

 

2.3.  Basis of measurement

 

2.4.  Functional currency and presentation currency

 

2.5.  Changes in accounting policies

 

2.6.  Changes in accounting estimates and judgements

 

2.7.  Changes in subsidiaries

 

3.  New standards, amendments and interpretations issued by the IASB

 

4.  Seasonality

 

5.  Information about components of Unaudited interim condensed consolidated statements of financial position

 

5.1.  Cash and cash equivalents

 

5.2. Other financial assets

 

5.3.  Trade receivables

 

5.4.  Other receivables

 

5.5. Inventories

 

5.6. Property, plant and equipment

 

5.7.  Intangible assets

 

5.8.  Goodwill

 

5.9.  Trade and other payables

 

5.10. Borrowings

 

5.11.  Employee benefits and social security

 

5.12.  Deferred revenue and advances from customers

 

5.13.  Provisions

 

5.14.  Financed payment - Acquisition of business

 

5.15.  Private warrants

 

6.  Information about components of consolidated statement of comprehensive income

 

6.1. Revenue

 

6.2. Cost of sales

 

6.3.  R&D classified by nature

 

6.4. Expenses classified by nature and function

 

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BIOCERES CROP SOLUTIONS CORP.

 

NOTES TO THE UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Amounts in US Dollars, except otherwise indicated)

 

6.5.  Finance income

 

6.6.  Finance costs

 

7.  Loss per share

 

8. Information about consolidated components of equity

 

8.1.  Parent company investment

 

8.2.  Share capital

 

8.3. Reverse recapitalization

 

8.4.  Shares issued — Rizobacter call option

 

8.5.  Shares summary

 

8.6.  Non-controlling interest

 

9.  Cash flow information

 

10.  Joint ventures and associates

 

11.  Segment information

 

12.  Financial instruments- risk management

 

13.  Shareholders and other related parties’ balances and transactions

 

14.  Key management personnel compensation

 

15.  Contingencies, commitments and restrictions on the distribution of profits

 

16.  Events occurring after the reporting period

 

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Table of Contents

 

BIOCERES CROP SOLUTIONS CORP.

 

NOTES TO THE UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Amounts in US Dollars, except otherwise indicated)

 

1.         GENERAL INFORMATION

 

On March 14, 2019, Union Acquisition Corp. (“Union” or “UAC”), whose name changed to Bioceres Crop Solutions Corp. (“Bioceres”), consummated the previously announced merger pursuant to a share exchange agreement, dated as of November 8, 2018 (as amended, the “Exchange Agreement”), by and among UAC and Bioceres, Inc., a company incorporated under the laws of Delaware, which converted into Bioceres LLC pursuant to the Reorganization (as defined below) on February 28, 2019.

 

The merger was reflected as a reverse recapitalization (capital transaction) equivalent to the issuance of shares by the private company (Bioceres) for the net monetary assets of the public shell company (Union).

 

See previous details of the merger in the combined financial statements as of June 30, 2018, June 30, 2017, December 31, 2016, for the year ended June 30, 2018, for the nine-month transition period ended June 30, 2017 and for the years ended December 31, 2016 and 2015 (“Combined financial statements as of June 30, 2018”).

 

Prior to the consummation of the merger on March 14, 2019, the following steps took place among Bioceres, Inc. and certain of its affiliates (collectively the “Reorganization”).

 

On February 13, 2019, Bioceres, Inc. formed a new subsidiary, BCS Holding Inc. (“BCS Holding”), and contributed its crop business net assets (consisting of certain assets and liabilities, the “Bioceres Inc Crop Business”) to BCS Holding in exchange for 100% equity interest in BCS Holding. On February 28, 2019, Bioceres, Inc. converted into Bioceres LLC, and on March 1, 2019, Bioceres S.A., a company organized under the laws of Argentina and our ultimate parent company (“Parent”), contributed all its equity interest in Bioceres Semillas (its direct majority owned subsidiary) to Bioceres LLC in exchange for additional equity interests in Bioceres LLC.

 

On October 22, 2018, Parent, RASA Holding LLC, a Delaware limited liability company and a wholly owned subsidiary of Bioceres, Inc., now a wholly-owned subsidiary of BCS Holding (“RASA Holding”), and Pedro Enrique Mac Mullen, María Marta Mac Mullen and International Property Services Corp., as sellers (collectively, the “Grantors”) entered into an amended and restated option agreement (as may be amended from time to time, the “Rizobacter Call Option Agreement”), pursuant to which the Parent, RASA Holding or any of their nominated affiliates would have the option (the “Rizobacter Call Option”) to purchase from the Grantors all of their 11,916,000 shares of common stock of Rizobacter Argentina S.A., an Argentine corporation and a subsidiary of RASA Holding (“Rizobacter”), representing 29.99% of all outstanding common stock of Rizobacter. Immediately following the consummation of the merger on March 14, 2019, the Rizobacter Call Option (as defined below) was exercised, pursuant to which the total indirect ownership of BCS Holding in Rizobacter increased to 80.00% of all outstanding stock of Rizobacter. Consideration for the Rizobacter Call Option (net of prepayments) was in the form of Union shares. Union shares constituting the in-kind consideration were issued in reliance on an applicable exemption from the registration requirements of the Securities Act.

 

As additional consideration payable to Bioceres LLC in the merger, the original founders of Union have agreed to transfer to Bioceres LLC in the aggregate 862,500 unregistered ordinary shares.

 

As a result of the merger and the other transactions contemplated by the Exchange Agreement, as well as the Reorganization and exercise of the Rizobacter Call Option, Union became the holding company of BCS Holding, its subsidiaries and Bioceres Semillas. Upon the consummation of the merger, Union changed its name to Bioceres Crop Solutions Corp and its fiscal year to June 30.

 

The Group is a fully-integrated agricultural biotechnology business with a leadership position in the South America region. It operates multiple technology platforms to develop and commercialize products that enhance crop productivity and expand feedstock applications in order to provide value to its customers around the world.

 

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BIOCERES CROP SOLUTIONS CORP.

 

NOTES TO THE UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Amounts in US Dollars, except otherwise indicated)

 

Financial and economic situation

 

On April 4, 2019 Rizobacter issued corporate bonds for a total amount of $16 million, maturing in half-yearly instalments as from the sixth month from the date of issuance. Those corporate bonds were secured by a mortgage on real estate assets owned by the Company.

 

On May 2, 2019 Rizobacter also executed the restructuring of $4.5 million of its short-term borrowings into a 3-year maturity loan.

 

Finally, on May 7, 2019 Bioceres Crop Solutions Corp., Bioceres LLC and Bioceres SA entered into an agreement for the restructuring of $15 million of the outstanding intercompany loans into a facility with a 5-year maturity.

 

To meet short-term debts, the Group could, if necessary, issue new corporate bonds up to US$40 million. This program is already authorized by the regulatory authorities of Argentina and could be allocated to the Group’s needs. In addition, the Group has revolving credit facilities up to an amount of approx. $30 million with financial institutions that jointly with the generation of resources from the business operations, allows the Group to meet its current financial obligations.

 

2.         ACCOUNTING STANDARDS AND BASIS OF PREPARATION

 

2.1.         Statement of compliance with IFRS as issued by IASB

 

These unaudited interim condensed consolidated financial statements for the nine-month period ended March 31, 2019 has been prepared in accordance with Accounting Standard IAS 34 Interim Financial Reporting.

 

These unaudited interim condensed consolidated financial statements do not include all the notes of the type normally included in an annual financial statement. Accordingly, these unaudited interim condensed consolidated financial statements are to be read in conjunction with the Combined financial statements as of June 30, 2018.

 

2.2.         Authorization for the issue of the unaudited interim condensed consolidated financial statements

 

These unaudited interim condensed consolidated financial statements of the Group as of March 31, 2019, June 30, 2018 and for the nine-month period ended March 31, 2019 and 2018 have been authorized by the Board of Directors of Bioceres Crop Solution Corp. at their meetings held on July 3, 2019.

 

2.3.         Basis of measurement

 

The unaudited interim condensed consolidated financial statements of the Group have been prepared using:

 

·             Going Concern Basis of Accounting, considering the conclusion of the assessment made by the Group’s Management about the ability of the Group and its subsidiaries to continue as a going concern, in accordance with the requirements of paragraph 25 of IAS 1, “Presentation of Financial Statements”.

 

·             Accrual Basis of Accounting (except for cash flows information). Under this basis of accounting, the effects of transactions and other events are recognized as they occur, even when there are no cash flows.

 

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BIOCERES CROP SOLUTIONS CORP.

 

NOTES TO THE UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Amounts in US Dollars, except otherwise indicated)

 

2.4.         Functional currency and presentation currency

 

a)        Functional currency

 

Items included in the financial statements of each of the Group’s entities are measured using the currency of the primary economic market in which the entity operates (i.e., “the functional currency”).

 

IAS 29 “Financial reporting in hyperinflationary economies” requires that the financial statements of an entity whose functional currency is the currency of a hyperinflationary economy with high inflation, whether they are based on the historical cost method or the current cost method, be stated in terms of the measuring unit current at the closing date of the reporting period. For such purpose, the inflation produced from the acquisition date or the revaluation date, as applicable, must be computed in non-monetary items. The standard details a series of factors to be considered for concluding whether an economy is a hyperinflationary economy, including, but not limited to, a cumulative inflation rate over a three-year period that approaches or exceeds 100%. Inflation accumulated in three years, as of June 30, 2018, is over 100%. It is for this reason that, in accordance with IAS 29, the Argentine economy should be considered as high inflation since July 1, 2018. Consequently, the Group has applied IAS 29 to these financial statements.

 

In an inflationary period, any entity that maintains an excess of monetary assets over monetary liabilities, will lose purchasing power, and any entity that maintains an excess of monetary liabilities on monetary assets, will gain purchasing power, provided that such items are not subject to an adjustment mechanism.

 

Briefly, the restatement mechanism of IAS 29 establishes that monetary assets and liabilities will not be restated because they are already expressed in a current unit of measurement at the end of the reporting period. Assets and liabilities subject to adjustments based on specific agreements, will be adjusted according to that agreements. Non-monetary items measured at their current values at the end of the reporting period, such as the net realizable value or others, do not need to be restated. The remaining non-monetary assets and liabilities will be restated for a general price index. The loss or gain for the net monetary position will be included in the net result of the reporting period, revealing this information in a separate line item.

 

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. The index as of March 31, 2019 and June 30, 2018 were 205.9571 and 144.8053, respectively.

 

The comparative figures in these unaudited interim condensed consolidated financial statements presented in a stable currency are not adjusted for subsequent changes in the price level or exchange rates. This resulted in 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

 

b)        Presentation currency

 

The unaudited interim condensed consolidated financial statements of the Group are presented in US Dollars, which is the presentation currency.

 

c)         Foreign currency

 

Transactions entered into by Group entities in a currency other than their functional currency are recorded at the relevant exchange rates as of the date upon which such transactions occur. Foreign currency monetary assets and liabilities are translated at the prevailing exchanges rates as of the final day of each reporting period. Exchange differences arising on the retranslation of unsettled monetary assets and liabilities are recognized immediately in profit or loss, except for foreign currency borrowings qualifying as a hedge of a net investment in a foreign operation for which exchange differences are recognized in other comprehensive income and accumulated in the foreign exchange reserve along with the exchange differences arising on the retranslation of the foreign operation. Upon the disposal of a foreign operation, the cumulative exchange differences recognized in the foreign exchange reserve relating to such

 

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BIOCERES CROP SOLUTIONS CORP.

 

NOTES TO THE UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Amounts in US Dollars, except otherwise indicated)

 

operation up to the date of disposal are transferred to the consolidated statement of profit or loss and other comprehensive income as part of the profit or loss taking place upon such disposal.

 

2.5.         Changes in accounting policies

 

The accounting policies adopted in the preparation of this unaudited interim condensed consolidated financial statements are consistent with those adopted for the preparation of the Combined financial statements as of June 30, 2018, except for what is described below:

 

a)             Retrospectively considerations

 

As the merger took place on March 14, 2019, the 27,116,174 shares issued to Bioceres LLC in exchange of its Bioceres Inc Crop Business and its equity interest in Bioceres Semillas, together with the 119,443 shares issued to exercise the Bioceres Semillas’ tag-along and the 862,500 shares received by Bioceres LLC from the original founders of Union, were considered retrospectively in issued capital and in EPS calculation based on the assumption of those events have occurred at the beginning of the earliest period presented. See Note 7 and 8.2.

 

b)             Warrants

 

As part of the merger, we incorporated 11,500,000 public warrants (“Public warrants”), 5,200,000 private warrants (“Founder warrants”) and 7,500,000 private warrants (“Bioceres warrants”) that Union issued to Bioceres LLC in exchange of its Bioceres Inc Crop Business and its equity interest in Bioceres Semillas

 

The warrants are an equity instrument only if (a) the instrument includes no contractual obligation to deliver cash or another financial asset to another entity and (b) if the instrument will or may be settled in the issuer’s own equity instruments, it is either a non-derivative that includes no contractual obligation for the issuer to deliver a variable number of its own equity instruments; or a derivative that will be settled only by the issuer exchanging a fixed amount of cash or another financial asset for a fixed number of its own equity instruments (“fixed-for-fixed’ condition”).

 

Public warrants were classified as equity instrument as they comply with the fixed-for-fixed’ condition (see Note 8). Founder warrants and Bioceres warrants (as a group, the “Private warrants”) instead were classified as financial liabilities (see Note 5.15).

 

Estimates

 

The estimate of the fair value of Private warrants requires a determination to be made with an option pricing model. This estimate requires a determination of those factors most appropriate to the pricing model, including the expected life of the option and the expected volatility of the share price upon the basis of which hypotheses are made. The Group measures the fair value of these instruments applying a simulation model of the share price trajectory under the hypothesis of Brownian Motion. The hypotheses used for the estimate of the fair value of these instruments are disclosed in Note 5.15.

 

2.6.         Changes in accounting estimates and judgments

 

There were no significant changes in accounting estimates and judgments with respect to the Combined financial statements as of June 30, 2018, except for what was described above for warrants.

 

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BIOCERES CROP SOLUTIONS CORP.

 

NOTES TO THE UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Amounts in US Dollars, except otherwise indicated)

 

2.7.         Changes in subsidiaries

 

As of March 31, 2019, the participation of Rizobacter S.A. in Indrasa Biotecnología S.A. decreased from 52.50% to 35%, therefore the Group loss the control over this subsidiary.

 

On March 14, 2019, immediately following the closing of the merger, the Rizobacter Call Option was exercised, pursuant to which the total indirect ownership of BCS Holding in Rizobacter increased to 80.00% of all outstanding stock of Rizobacter (Note 5.14).

 

3.         NEW STANDARDS, AMENDMENTS AND INTERPRETATIONS ISSUED BY THE IASB

 

The following new standards became applicable for the current reporting period and the Group had to change its accounting policies as a result of adopting the following standards:

 

IFRS 15 - Revenue from contracts with customers

 

The main changes are the following:

 

The standard introduces a new five-step model for recognizing revenue from contracts with customers:

 

1) Identifying the contract with the customer.

 

2) Identifying separate performance obligations in the contract.

 

3) Determining the transaction price.

 

4) Allocating the transaction price to separate performance obligations.

 

5) Recognizing revenue when the performance obligations are satisfied.

 

The Group has chosen a modified retrospective application of IFRS 15.

 

The impact of adopting IFRS 15 was not significant and therefore no cumulative effect upon adoption was recorded.

 

The standard and interpretations issued, but not yet in force at the date of issuance of these Unaudited Interim condensed consolidated financial statements, which are or may be applicable to the Group, are:

 

IFRS 16 — Leases.

 

IFRIC 23: Uncertainty over income tax treatments

 

The Group intends to adopt these standards and interpretations when they enter into force, except that the opposite is indicated.

 

IFRS 16 - Leases

 

IFRS 16 was issued in January 2016. It will result in almost all leases being recognized on the balance sheet, as the distinction between operating and finance leases will be removed. Under the new standard, an asset (the right to use the leased item) and a financial liability to pay rentals are recognized. The only exceptions are short-term and low-value leases.

 

The new standard will be effective for financial years commencing on or after January 1, 2019. At this stage, the Group does not intend to adopt the standard before its effective date.

 

These amendments do not have a material impact on the Group.

 

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BIOCERES CROP SOLUTIONS CORP.

 

NOTES TO THE UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Amounts in US Dollars, except otherwise indicated)

 

IFRIC 23: Uncertainty over income tax treatments

 

On 7 June 2017, the IFRS Interpretations Committee (IFRS IC) issued IFRIC 23, which clarifies how the recognition and measurement requirements of IAS 12 Income taxes are applied where there is uncertainty over income tax treatments.

 

The interpretation specifically addresses: i) whether an entity considers uncertain tax treatments separately, ii) the assumptions an entity makes about the examination of tax treatments by taxation authorities, iii) how an entity determines taxable profit (tax loss), tax bases, unused tax losses, unused tax credits and tax rates and iv) how an entity considers changes in facts and circumstances

 

IFRIC 23 is effective for annual periods beginning on or after 1 January 2019. At this stage, the Group does not intend to adopt the standard before its effective date. The Group does not expect impacts due to the application of this interpretation.

 

IAS 28 - Equity accounting

 

In October 2017, the IASB published an amendment to IAS 28 on ‘Long-term interests in associates and joint ventures’. This clarifies that an entity should apply IFRS 9 to long-term interests in an associate or joint venture to which it does not apply the equity method. It is effective for annual periods beginning on or after 1 January 2019. The IASB has also published an illustrative example on applying the requirements in IFRS 9 and IAS 28 to long-term interests in an associate or joint venture.

 

This amendment will be effective for financial years commencing on or after January 1, 2019. At this stage, the Group does not intend to adopt the standard before its effective date. Management is working on determining the impact these amendments will have on the Group.

 

4.         SEASONALITY

 

The Group revenues fluctuate depending on the timing of orders from our distributors and customers and on prevailing seed market prices, which influence the purchase decisions of growers, the end users of seed and integrated products, crop protection products and crop nutrition products. Given the cyclicality of crop planting and harvesting and South America’s planting and growing seasons, which vary from year to year, our business is highly seasonal. This results in substantial fluctuations in quarterly sales and profitability. Generally, the Group sales are concentrated in the third and fourth quarters of each calendar year, when demand for seed and integrated products, crop protection products and crop nutrition products increases as growers begin planting their fields. With seed and integrated products business, the Group contract with growers and seed suppliers based upon our anticipated market demand. Generally, in seed and integrated products business we stock the seed during the harvest season and ship from inventory throughout the year, with the objective of selling most of the inventory from the current year’s harvest before the next year’s, with crop protection and crop nutrition business following a similar cycle to the seed cycle. The impact of seasonality and the resulting fluctuations in quarterly results may be moderated as we achieve our international expansion plans for seed business in geographies with contrasting seasons and climates.

 

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BIOCERES CROP SOLUTIONS CORP.

 

NOTES TO THE UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Amounts in US Dollars, except otherwise indicated)

 

5.         INFORMATION ABOUT COMPONENTS OF UNAUDITED INTERIM CONDENSED CONSOLIDATED STATEMENTS OF FINANCIAL POSITION

 

5.1.        Cash and cash equivalents

 

 

 

03/31/2019

 

06/30/2018

 

 

 

 

 

 

 

Cash and banks

 

6,139,337

 

2,215,103

 

 

 

6,139,337

 

2,215,103

 

 

5.2.        Other financial assets

 

 

 

03/31/2019

 

06/30/2018

 

Current

 

 

 

 

 

Restricted short-term deposit

 

4,322,572

 

4,538,321

 

Other investments

 

993,603

 

 

Other marketable securities

 

8,341

 

12,526

 

 

 

5,324,516

 

4,550,847

 

 

 

 

03/31/2019

 

06/30/2018

 

Non-current

 

 

 

 

 

Shares of Bioceres S.A.

 

335,256

 

240,920

 

Other marketable securities

 

1,693

 

2,438

 

 

 

336,949

 

243,358

 

 

5.3.        Trade receivables

 

 

 

03/31/2019

 

06/30/2018

 

 

 

 

 

 

 

Trade debtors

 

43,002,044

 

44,641,053

 

Allowance for impairment of trade debtors

 

(2,723,626

)

(3,212,170

)

Shareholders and other related parties (Note 13)

 

386,331

 

571,216

 

Allowance for impairment of related parties (Note 13)

 

(46,006

)

(23,126

)

Allowance for return of goods

 

(896,921

)

(1,517,361

)

Trade debtors - Parent company (Note 13)

 

510,327

 

361,606

 

Trade debtors - Joint ventures and associates (Note 13)

 

818,375

 

209,039

 

Discounted and deferred checks

 

27,357,692

 

11,858,170

 

 

 

68,408,216

 

52,888,427

 

 

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BIOCERES CROP SOLUTIONS CORP.

 

NOTES TO THE UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Amounts in US Dollars, except otherwise indicated)

 

5.4.        Other receivables

 

 

 

03/31/2019

 

06/30/2018

 

Current

 

 

 

 

 

Taxes

 

719,951

 

664,926

 

Other receivables - Shareholders and other related parties (Note 13)

 

3,478

 

119,677

 

Other receivables - Parent Company (Note 13)

 

 

103,251

 

Other receivables - Joint ventures and associates (Note 13)

 

295,347

 

1,962,459

 

Prepayments to suppliers

 

2,573,851

 

516,742

 

Reimbursements over exports

 

362,606

 

362,815

 

Prepaid expenses and other receivables

 

86,606

 

 

Loans receivable

 

 

1,360

 

Miscellaneous

 

1,171,562

 

508,975

 

 

 

5,213,401

 

4,240,205

 

Non-Current

 

 

 

 

 

Taxes

 

127,147

 

295,924

 

Reimbursements over exports

 

555,601

 

346,575

 

Other receivables - Joint ventures and associates (Note 13)

 

 

4,337,008

 

Miscellaneous

 

130,171

 

 

 

 

812,919

 

4,979,507

 

 

5.5.        Inventories

 

 

 

03/31/2019

 

06/30/2018

 

 

 

 

 

 

 

Agrochemicals

 

15,139

 

94,486

 

Seeds and grains

 

635,263

 

514,000

 

Microbiological resale products

 

9,138,572

 

8,389,191

 

Microbiological products produced

 

8,801,738

 

6,383,263

 

Goods in transit

 

771,708

 

776,869

 

Supplies

 

4,706,627

 

3,978,934

 

Allowance for obsolescence

 

(828,973

)

(770,742

)

 

 

23,240,074

 

19,366,001

 

 

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Table of Contents

 

BIOCERES CROP SOLUTIONS CORP.

 

NOTES TO THE UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Amounts in US Dollars, except otherwise indicated)

 

5.6.        Property, plant and equipment

 

Property, plant and equipment as of March 31, 2019 and June 30, 2018 included the following:

 

 

 

03/31/2019

 

06/30/2018

 

 

 

 

 

 

 

Gross carrying amount

 

51,454,239

 

44,764,394

 

Accumulated depreciation

 

(11,498,372

)

(4,587,248

)

Net carrying amount

 

39,955,867

 

40,177,146

 

 

1.      Net carrying amount for each class of assets is as follows:

 

Class

 

Net carrying
amount
03/31/2019

 

Net carrying
amount
06/30/2018

 

Office equipment

 

199,207

 

194,819

 

Vehicles

 

1,908,031

 

1,099,603

 

Equipment and computer software

 

92,213

 

212,236

 

Fixtures and fittings

 

4,097,801

 

3,508,083

 

Machinery and equipment

 

5,809,723

 

4,466,293

 

Land and buildings

 

27,290,833

 

30,513,273

 

Buildings in progress

 

558,059

 

182,839

 

Total

 

39,955,867

 

40,177,146

 

 

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BIOCERES CROP SOLUTIONS CORP.

 

NOTES TO THE UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Amounts in US Dollars, except otherwise indicated)

 

2.Gross carrying amount as of March 31, 2019 is as follows:

 

Class

 

Gross carrying amount

 

 

As of the

beginning
of period

 

Adjustment
of opening
net book
amount for
application
of IAS 29

 

Additions

 

Transfers

 

Disposals

 

Foreign
currency

translation

 

Revaluation

 

As of the
end of

period

 

Office equipment

 

243,948

 

334,496

 

19,803

 

 

(7,597

)

(27,731

)

 

562,919

 

Vehicles

 

1,660,294

 

1,052,861

 

929,332

 

 

(218,390

)

175,546

 

 

3,599,643

 

Equipment and computer software

 

419,638

 

417,173

 

17,153

 

 

(10,518

)

(33,302

)

 

810,144

 

Fixtures and fittings

 

3,826,665

 

1,913,979

 

1,260

 

192,118

 

 

(409,237

)

 

5,524,785

 

Machinery and equipment

 

5,404,029

 

3,982,367

 

81,282

 

7,011

 

(37,257

)

(298,076

)

 

9,139,356

 

Land and buildings

 

33,026,981

 

1,475,392

 

236,020

 

6,255

 

 

(1,797,522

)

(1,687,793

)

31,259,333

 

Buildings in progress

 

182,839

 

78,751

 

515,690

 

(205,384

)

 

(13,837

)

 

558,059

 

Total

 

44,764,394

 

9,255,019

 

1,800,540

 

 

(273,762

)

(2,404,159

)

(1,687,793

)

51,454,239

 

 

3.      Accumulated depreciation as of March 31, 2019 is as follows:

 

Class

 

Depreciation

 

 

Accumulated
as of the
beginning of
period

 

Adjustment
of opening
net book
amount for
application
of IAS 29

 

Disposals

 

Of the
period

 

Foreign

currency
translation

 

Revaluation

 

Accumulated
as of the end
of period

 

Office equipment

 

49,129

 

309,342

 

(3,584

)

23,990

 

(15,165

)

 

363,712

 

Vehicles

 

560,691

 

765,972

 

(175,596

)

572,529

 

(31,984

)

 

1,691,612

 

Equipment and computer software

 

207,402

 

491,761

 

(753

)

46,494

 

(26,973

)

 

717,931

 

Fixtures and fittings

 

318,582

 

912,661

 

 

255,836

 

(60,095

)

 

1,426,984

 

Machinery and equipment

 

937,736

 

2,115,831

 

(21,621

)

454,827

 

(157,140

)

 

3,329,633

 

Land and buildings

 

2,513,708

 

1,377,613

 

 

429,007

 

(204,338

)

(147,490

)

3,968,500

 

Total

 

4,587,248

 

5,973,180

 

(201,554

)

1,782,683

 

(495,695

)

(147,490

)

11,498,372

 

 

F-20


Table of Contents

 

BIOCERES CROP SOLUTIONS CORP.

 

NOTES TO THE UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Amounts in US Dollars, except otherwise indicated)

 

4.      Gross carrying amount as of March 31, 2018 is as follows:

 

Class

 

Gross carrying amount

 

 

As of the
beginning
of period

 

Additions

 

Transfers

 

Disposals

 

Foreign
currency
translation

 

Revaluation

 

As of the
end of
period

 

Office equipment

 

252,220

 

98,897

 

 

 

(44,600

)

 

306,517

 

Vehicles

 

2,223,102

 

321,938

 

 

(139,665

)

(309,503

)

 

2,095,872

 

Equipment and computer software

 

426,530

 

137,066

 

7,564

 

(6,012

)

(76,807

)

 

488,341

 

Fixtures and fittings

 

4,665,074

 

2,873

 

348,290

 

 

(842,821

)

 

4,173,416

 

Machinery and equipment

 

9,177,077

 

207,516

 

 

(24,718

)

(1,635,435

)

 

7,724,440

 

Land and buildings

 

30,931,226

 

4,569

 

225,192

 

 

(5,353,875

)

 

25,807,112

 

Buildings in progress

 

870,469

 

1,410,105

 

(581,046

)

 

(218,978

)

 

1,480,550

 

Total

 

48,545,698

 

2,182,964

 

 

(170,395

)

(8,482,019

)

 

42,076,248

 

 

5.      Accumulated depreciation as of March 31, 2018 is as follows:

 

Class

 

Depreciation

 

 

Accumulated
as of the
beginning of
period

 

Disposals

 

Of the
period

 

Foreign
currency
translation

 

Revaluation

 

Accumulated
as of the end
of period

 

Office equipment

 

31,522

 

 

30,953

 

(7,270

)

 

55,205

 

Vehicles

 

373,216

 

(55,501

)

322,816

 

(60,259

)

 

580,272

 

Equipment and computer software

 

118,169

 

(5,277

)

128,022

 

(24,978

)

 

215,936

 

Fixtures and fittings

 

204,171

 

 

175,256

 

(51,168

)

 

328,259

 

Machinery and equipment

 

771,636

 

 

553,458

 

(205,658

)

 

1,119,436

 

Land and buildings

 

828,109

 

 

404,279

 

(181,428

)

 

1,050,960

 

Total

 

2,326,823

 

(60,778

)

1,614,784

 

(530,761

)

 

3,350,068

 

 

The depreciation charge is included in Notes 6.3 and 6.4.

 

F-21


Table of Contents

 

BIOCERES CROP SOLUTIONS CORP.

 

NOTES TO THE UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Amounts in US Dollars, except otherwise indicated)

 

Revaluation of property, plant and equipment

 

At a minimum, the Group updates their assessment of the fair value of its land and buildings at the end of each reporting year (after the revaluation policy was adopted), taking into account the most recent independent valuations and market data. As of March 31, 2019 we reviewed the valuations in order to determine the variations between the fair values and their book value taking into consideration the valuations made in September 2018. Management determined the property, plant and equipment’s value within a range of reasonable fair value estimates.

 

All resulting fair value estimates for land and buildings are classified as level 3 and are consistencies with the methodology disclosed in the annual financial statements.

 

F-22


Table of Contents

 

BIOCERES CROP SOLUTIONS CORP.

 

NOTES TO THE UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Amounts in US Dollars, except otherwise indicated)

 

5.7.        Intangible assets

 

Intangible assets as of March 31, 2019 and June 30, 2018 included the following:

 

 

 

03/31/2019

 

06/30/2018

 

 

 

 

 

 

 

Gross carrying amount

 

38,875,578

 

29,155,315

 

Accumulated amortization

 

(4,962,120

)

(2,497,970

)

Net carrying amount

 

33,913,458

 

26,657,345

 

 

1.                   Net carrying amount of each class of intangible assets is as follows:

 

Class

 

Net carrying
amount
03/31/2019

 

Net carrying
amount
06/30/2018

 

Seed and integrated products

 

 

 

 

 

Soybean HB4

 

5,437,806

 

4,927,853

 

Crop nutrition

 

 

 

 

 

Microbiology products

 

2,439,213

 

2,122,484

 

Other intangible assets

 

 

 

 

 

Trademarks and patents

 

7,357,290

 

5,574,682

 

Software

 

958,186

 

949,310

 

Customer loyalty

 

17,720,963

 

13,083,016

 

Total

 

33,913,458

 

26,657,345

 

 

F-23


Table of Contents

 

BIOCERES CROP SOLUTIONS CORP.

 

NOTES TO THE UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Amounts in US Dollars, except otherwise indicated)

 

2.                   Gross carrying amount as of March 31, 2019 is as follows:

 

 

 

Gross carrying amount

 

Class

 

As of the
beginning
of period

 

Adjustment
of opening
net book

amount for

application
of IAS 29

 

Additions

 

Disposals

 

Foreign
currency
translation

 

As of the
end of
period

 

Seed and integrated products

 

 

 

 

 

 

 

 

 

 

 

 

 

Soybean HB4

 

4,927,853

 

 

509,953

 

 

 

5,437,806

 

Crop nutrition

 

 

 

 

 

 

 

 

 

 

 

 

 

Microbiology products

 

2,505,864

 

841,714

 

53,407

 

 

(177,065

)

3,223,920

 

Other intangible assets

 

 

 

 

 

 

 

 

 

 

 

 

 

Trademarks and patents

 

6,278,706

 

2,986,739

 

 

 

(490,084

)

8,775,361

 

Software

 

1,444,603

 

438,726

 

126,391

 

(36,144

)

(99,630

)

1,873,946

 

Customer loyalty

 

13,998,289

 

6,658,894

 

 

 

(1,092,638

)

19,564,545

 

Total

 

29,155,315

 

10,926,073

 

689,751

 

(36,144

)

(1,859,417

)

38,875,578

 

 

F-24


 

Table of Contents

 

BIOCERES CROP SOLUTIONS CORP.

 

NOTES TO THE UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Amounts in US Dollars, except otherwise indicated)

 

3.                   Accumulated amortization as of March 31, 2019 is as follows:

 

 

 

Amortization

 

Class

 

Accumulated
as of
beginning of
period

 

Adjustment
of opening
net book
amount for
application
of IAS 29

 

Disposals

 

Of the period

 

Foreign
currency
translation

 

Accumulated
as of the end
of period

 

Crop nutrition

 

 

 

 

 

 

 

 

 

 

 

 

 

Microbiology products

 

383,380

 

202,791

 

 

229,538

 

(31,002

)

784,707

 

Other intangible assets

 

 

 

 

 

 

 

 

 

 

 

 

 

Trademarks and patents

 

704,024

 

334,919

 

 

434,103

 

(54,975

)

1,418,071

 

Software

 

495,293

 

227,264

 

(36,144

)

267,519

 

(38,172

)

915,760

 

Customer loyalty

 

915,273

 

435,389

 

 

564,362

 

(71,442

)

1,843,582

 

Total

 

2,497,970

 

1,200,363

 

(36,144

)

1,495,522

 

(195,591

)

4,962,120

 

 

4.                   Gross carrying amount as of March 31, 2018 is as follows:

 

 

 

Gross carrying amount

 

Class

 

As of the
beginning of
period

 

Additions

 

Disposals

 

Foreign
currency
translation

 

As of the
end of
period

 

Seed and integrated products

 

 

 

 

 

 

 

 

 

 

 

Soybean HB4

 

3,111,253

 

1,313,809

 

 

 

4,425,062

 

Crop nutrition

 

 

 

 

 

 

 

 

 

 

 

Microbiology products

 

3,782,238

 

360,694

 

 

(696,327

)

3,446,605

 

Other intangible assets

 

 

 

 

 

 

 

 

 

 

 

Trademarks and patents

 

10,906,317

 

 

 

(1,909,515

)

8,996,802

 

Software

 

1,787,925

 

457,233

 

 

(356,289

)

1,888,869

 

Customer loyalty

 

24,315,484

 

 

 

(4,257,237

)

20,058,247

 

Total

 

43,903,217

 

2,131,736

 

 

(7,219,368

)

38,815,585

 

 

F-25


Table of Contents

 

BIOCERES CROP SOLUTIONS CORP.

 

NOTES TO THE UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Amounts in US Dollars, except otherwise indicated)

 

5.                   Accumulated amortization as of March 31, 2018 is as follows:

 

 

 

Amortization

 

Class

 

Accumulated
as of
beginning of
period

 

Disposals

 

Of the period

 

Foreign
currency
translation

 

Accumulated
as of the end
of period

 

Crop nutrition

 

 

 

 

 

 

 

 

 

 

 

Microbiology products

 

290,969

 

 

256,234

 

(75,182

)

472,021

 

Other intangible assets

 

 

 

 

 

 

 

 

 

 

 

Trademarks and patents

 

503,553

 

 

491,558

 

(134,666

)

860,445

 

Software

 

395,156

 

 

290,728

 

(96,687

)

589,197

 

Customer loyalty

 

654,648

 

 

639,023

 

(175,069

)

1,118,602

 

Total

 

1,844,326

 

 

1,677,543

 

(481,604

)

3,040,265

 

 

The amortization charge is included in Notes 6.3 and 6.4.

 

5.8.        Goodwill

 

The variations in goodwill occurred during the period corresponds as the result of inflation adjustment and conversion to presentation currency. There have been no goodwill impairment indicators.

 

Carrying amount of goodwill as of March 31, 2019 and June 30, 2018 is as follows:

 

 

 

03/31/2019

 

06/30/2018

 

 

 

 

 

 

 

Rizobacter

 

20,937,480

 

14,438,027

 

Total

 

20,937,480

 

14,438,027

 

 

5.9.        Trade and other payables

 

 

 

03/31/2019

 

06/30/2018

 

 

 

 

 

 

 

Trade creditors

 

34,059,472

 

22,222,872

 

Shareholders and other related parties (Note 13)

 

532,455

 

365,994

 

Trade creditors - Joint ventures and associates (Note 13)

 

2,805,556

 

3,493,113

 

Taxes

 

1,637,007

 

35,391

 

Miscellaneous

 

377,419

 

1,591,460

 

 

 

39,411,909

 

27,708,830

 

 

F-26


Table of Contents

 

BIOCERES CROP SOLUTIONS CORP.

 

NOTES TO THE UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Amounts in US Dollars, except otherwise indicated)

 

5.10.           Borrowings

 

 

 

03/31/2019

 

06/30/2018

 

Current

 

 

 

 

 

Bank overdraft

 

578,265

 

532,912

 

Bank borrowings

 

50,308,317

 

44,061,555

 

Corporate bonds

 

 

3,262,924

 

BAF Loans

 

 

5,112,222

 

Discount checks

 

17,076,635

 

10,243,204

 

Loans payables-Parent company (Note 13)

 

26,880,091

 

1,816,084

 

Finance lease

 

333,929

 

280,027

 

 

 

95,177,237

 

65,308,928

 

Non-current

 

 

 

 

 

Bank borrowings

 

16,490,721

 

25,253,940

 

Finance lease

 

447,834

 

454,265

 

 

 

16,938,555

 

25,708,205

 

 

BAF Loans has converted into Loans payables-Parent company. Both are debts taken by the Group in connection with the Rizobacter acquisition. On May 7, 2019, Bioceres Crop Solutions Corp., Bioceres LLC and Bioceres SA entered into an agreement for the restructuring of $15 million of the outstanding intercompany loans into a facility with a 5-year maturity and an annual fixed rate of approximately 10%.

 

On August 31, 2018, we paid the last capital and interest service of Corporate bonds. After these payments there are no more outstanding Corporate bonds corresponding to the regime of public offering.

 

The Group has met the capital and interest installments whose maturity was effective in the nine-month period ended March 31, 2019.

 

Covenant compliance is required to be measured annually.

 

The carrying value of some borrowings as of March 31, 2019 measured at amortized cost differ from their fair value.  The following fair values measured are based on discounted cash flows (Level 3) due to the use of unobservable inputs, including own credit risk.

 

 

 

03/31/2019

 

 

 

 

 

Amortized
cost

 

Fair value

 

Current

 

 

 

 

 

Bank borrowings

 

50,308,317

 

49,613,643

 

Discount checks

 

17,076,635

 

15,807,243

 

Non-current

 

 

 

 

 

Bank borrowings

 

16,490,721

 

14,701,679

 

 

F-27


Table of Contents

 

BIOCERES CROP SOLUTIONS CORP.

 

NOTES TO THE UNAUDITED INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Amounts in US Dollars, except otherwise indicated)

 

5.11. Employee benefits and social security

 

 

 

03/31/2019

 

06/30/2018

 

 

 

 

 

 

 

Salaries and social security

 

2,843,152

 

3,146,583

 

Staff incentives and vacations

 

649,391

 

1,265,130

 

 

 

3,492,543

 

4,411,713

 

 

5.12.           Deferred revenue and advances from customers

 

 

 

03/31/2019

 

06/30/2018

 

 

 

 

 

 

 

Advances from customers

 

897,035