In January-March 2024, IMC Agro Holding posted a net loss of $3.81 million compared to $4.10 million in the same period of 2023, while its EBITDA increased 3.2 times to $4.43 million, according to the company’s report on the Warsaw Stock Exchange.
“The increase in normalized EBITDA in the first quarter of 2024, as well as the decrease in net loss for the period, was due to an increase in sales,” the company said.
According to the report, the holding’s revenue increased by 41% to $59.20 mln, while the share of exports decreased to 71.7% from 83.5% a year earlier.
The share of corn in the revenue decreased to 42.8% from 83.3%, while the share of wheat increased to 34.4% from 15.9%, and sunflower seeds to 22.3% from 0.3%.
IMC’s gross profit increased by 48% to $12.75 mln, and its operating loss decreased to $0.17 mln from $2.85 mln in the first quarter of 2023.
At the same time, due to the devaluation of the hryvnia in the first quarter of this year compared to its fixed exchange rate for the year, the company incurred a foreign exchange loss of $4.10 million, which resulted in the total loss of IMC for the reporting year increasing to $7.86 million from $4.08 million a year earlier.
Overall, the agroholding’s assets increased by 0.6% to $314.14 mln in the first quarter of 2024.
At the same time, the company increased its investments in the reporting period to $4.9 mln, while in the first quarter of last year there were practically none ($0.02 mln), while the outflow from financing activities decreased to $0.9 mln from $6.4 mln, and the inflow from operating activities amounted to $16.4 mln against an outflow of $1.9 mln in the same period last year.
As a result, free cash flows at the end of March increased to $26.0 million from $16.20 million at the beginning of the year, while bank debt remained virtually unchanged at $45.9 million.
“IMC is an integrated group of companies operating in Sumy, Poltava and Chernihiv regions (north and center of Ukraine) in the crop production, elevators and warehouses segments. The land bank is about 120 thousand hectares, storage capacity is 554 thousand tons with a harvest of 1.002 million tons in 2023.
In 2023, IMC posted a net loss of $21.03 million compared to $1.12 million a year earlier, and its EBITDA decreased 11.3 times to $3.22 million. The holding’s revenue increased by 22.3% to $139.45 million, while the share of exports decreased to 68% from 73% a year earlier.
In 2024, IMC Agro Holding intends to expand corn crops and return to pre-war agricultural technology, and is also studying two projects to develop processing, the decision on which will be made in May-June, said Alex Lissitsa, SEO of the agricultural holding, at the Forbes Agrifood conference.
“During the two years of war, we have come a long way. We had 120 thousand hectares and 6 elevators. 100 thousand hectares and 5 elevators were under occupation. As a result of the de-occupation, we managed to enter our territory. However, some facilities were destroyed,” he said.
According to him, the new large dairy farm of the agricultural holding, located on the border with Belarus, had to be closed due to the poor condition of the cows after the occupation, as well as the almost completely destroyed logistics infrastructure around Chernihiv, where all bridges were destroyed.
In the first year, 30 thousand hectares of the agricultural holding’s land were in the war zone and were partially mined. The second year of the war was a stage of rethinking for IMC, and in the third year they managed to reach more or less the planned indicators, explained the SEO of the agricultural holding.
According to him, in 2022, IMC was unable to sow its land and grew mainly wheat. In 2024, the agroholding will return to traditional technological maps and expand the area under corn, as in 2023 it managed to get a record harvest of 20 tons per hectare. IMC was able to achieve such results thanks to favorable weather conditions that offset the problem of fertilizer and pesticide shortages. In addition, the agroholding has the necessary capacity to store corn.
Mr. Lissitsa also noted that IMC refused to cooperate with international traders who behaved incorrectly towards most Ukrainian customers. Currently, IMC prefers to cooperate with the domestic grain trader Nibulon, through which it sells about 70% of its products. IMC has also found new suppliers of sunflower seeds – Ukrainian regional companies in Chernihiv region.
“We used to build relationships with large foreign traders, and now we are establishing partnerships with those we have not communicated with before. We were beautiful, fashionable, and it was not very fun to work with them. And now we realized that we are basically still beautiful, but not so fashionable. And we need to work with local businesses. They offered us a helping hand and we started working again. Now we are really rethinking. Many contracts with international traders are still in court. I don’t know when they will end. Huge amounts of money are stuck there. It is really easier for us to drive up to our neighbors, negotiate and shake hands,” stated the IMC SEO.
Lissitsa also said that most agricultural holdings have not invested in machinery over the past two years, but have been living off the purchase of spare parts, and thus most of the agricultural machinery has been produced.
At the same time, the IMC is considering two processing projects in parallel – one with the EBRD and the other with the IFC.
“I can’t tell you yet, but we are looking at these projects very, very closely and will make a decision in May-June this year,” Lissitsa said.
The agroholding’s SEO emphasized that IMC has no problems with financing and has established partnerships with a number of banking institutions.
“Last year, we were probably one of the first in the agricultural sector to receive a new loan from the EBRD during the war. Raiffeisen financed us for the purchase of machinery. Credit Agricole is now adding more,” Lissitsa summarized and advised farmers to establish transparent relations with banks and be ready to provide them with all the information to get financing for new projects.
IMC Agro Holding has completed the harvesting of corn in 2023 and achieved a record yield of 12.4 tons/ha, which is 1.3 tons/ha higher than the previous record set in 2018, said Alex Lissitsa, SEO of the agricultural holding.
“A total of 574 thousand tons were harvested from an area of 46.3 thousand hectares, with an average corn yield of 12.4 tons/ha, a record for all years of the company’s operations, which is 1.3 tons/ha higher than the previous record set in 2018,” he wrote on Facebook.
IMC is an integrated group of companies operating in Sumy, Poltava and Chernihiv regions (north and center of Ukraine). It controls 120.3 thousand hectares (120.0 thousand hectares under cultivation). As of September 30, 2023, the group operated in two segments: crop production and elevators and warehouses.
The agroholding’s net loss in 2022 amounted to $1.1 million against a net profit of $78.7 million a year earlier, with a 37.3% decrease in revenue to $114 million. EBITDA decreased threefold to $36.2 mln.
For the 2024 harvest, IMC sowed winter wheat on 20.3 thou hectares.
In the first nine months of 2023, IMC posted a net loss of $2.25 million, compared to $4.67 million in net profit for the same period in 2022. The agroholding’s revenue increased by 59.8% to $98.78 million, including exports, which increased by 24.4% to $70.23 million. A significant increase in production costs – by 55.6% to $92.4 million – led to a decrease in gross profit by 33.3% to $29.89 million. EBITDA in the first nine months of 2023 amounted to $13.85 million, which is 2.7 times less than in the first nine months of 2022. The report notes that the reason for the decline was the decline in harvest prices in 2023.
CORN, HARVESTING, IMC, RECORD
In early October, IMC Agro Holding completed sowing of winter wheat for the 2024 harvest on 20.3 thou hectares, the company’s press service reported on Facebook.
According to the report, the warm and dry weather in September allowed IMC to sow all the planned areas with winter wheat, and the precipitation in the second decade of October helped to get friendly winter shoots.
In addition, at the end of the second decade of October, the agroholding completed threshing sunflower on an area of 32.1 thou hectares, harvesting 92.7 thou tons with an average yield of 2.9 tons/ha.
At the same time, the yield on the land in the north of Chernihiv region, which was not cultivated last year due to the occupation and the subsequent need to inspect for explosive devices, amounted to 2.2 tons/ha. On the rest of the IMC areas in Chernihiv, Sumy and Poltava regions, the sunflower yield amounted to 3.3 tons/ha.
“As for the sunflower harvest, its average yield is not a record for IMC, given the above-mentioned objective reasons, but nevertheless, the total yield and quality of sunflower give hope for its successful sale for processing,” said Oleksandr Verzhykhovsky, Chief Operating Officer of IMC.
As reported, in the 2023 season, IMC obtained a record average winter wheat yield of 7.1 tons/ha, which was the highest result in the 25 years of the agricultural holding’s operation. The company allocated 33.3 thou hectares for the crop, from which it harvested 236 thou tons of grain.
“IMC specializes in growing grains, oilseeds and milk production in Ukraine. It cultivates about 123.3 thousand hectares of land in Poltava, Chernihiv and Sumy regions. It has storage capacities of 554 thousand tons of grains and oilseeds.
In January-March 2023, IMC Agro Holding posted a net loss of $4.10 million, down 2.6 times year-on-year, largely due to higher logistics and distribution costs. The holding’s revenue increased by 11% to $41.96 million, of which exports accounted for $35.03 million. IMC’s gross profit grew 3.9 times to $8.60 million due to lower costs. Due to a twofold increase in logistics and distribution costs (up to $9.40 million), the company recorded an operating loss of $2.85 million, which is twice as good as in the first quarter of 2022.
Based on the results of work in the first half of 2022, IMC Agricultural Holding received $11.34 million in net profit, which is 6.8 times less than in the same period last year, according to the company’s report on the Warsaw Stock Exchange on Thursday.
According to him, the loss from exchange rate differences for the agrarian group in the first half of this year amounted to $2.55 million, while in January-June last year it received $2.11 million from changes in the exchange rate.
At the same time, the company’s EBITDA fell 3.2 times, to $28.98 million, with a 47% reduction in revenue, to $44.53 million. , up to $18 million.
According to the report, the total volume of IMC assets as of June 30, 2022 decreased by 9.1% compared to December 31, 2021 – to $214, short-term debt increased by 5.9%, to $66.8 million, while long-term debt increased by 2.8%, to $155.2 million.
The report also clarifies that 97.5% of all sales in the first half of this year came from corn, compared with 98.2% in the first half of last year, and the price of its sale rose marginally to $208 per ton from $205 per ton last year. year
In total, during the specified period, IMC sold 213 thousand tons of crops for a total of $43.83 million, including 208.8 thousand tons of corn for $43.35 thousand tons of corn (-48% compared to the first half of 2021 ), 645 tons of wheat for $201 thousand (an increase of 2 times), and 93 tons of sunflower for $40 thousand (-66%). In addition, the proceeds from the sale of milk and cattle meat brought the agricultural holding a total of $572,000.
The agricultural holding indicated that until August the Black Sea ports in Ukraine remained blocked for export activities. Although the IMC has developed alternative logistics chains for exporting grain through the seaports of other neighboring countries, such logistics are very complex, have numerous bottlenecks and are associated with high capital costs to create an efficient logistics infrastructure on new export routes, which explains the low volumes of grain exports since 24 February.
At the same time, the IMC noted that none of its critically important facilities received significant damage as a result of the war, all inventories are in good condition and in safe custody, and today all the group’s assets are located in de-occupied territories.
In addition, the IMC declares that there is no shortage of labor and the preservation of its personnel, including key and top managers, although 86 employees defend Ukraine in the ranks of the Armed Forces of Ukraine.
The agricultural holding specified that this year 73% of the company’s land bank was sown: 19.2 thousand hectares of sunflower, 50.2 thousand hectares of corn and 18.4 thousand hectares of winter wheat. Land in the Chernihiv region, where active hostilities were fought, is scheduled to return to production this fall.
As of August 21, IMC completed harvesting winter wheat, harvesting from 18.3 thousand hectares with an average yield of 6.7 t/ha, which is a record result for all the years of the company’s economic activity, and 18% higher than in 2021 year.
IMC specializes in the cultivation of cereals, oilseeds and milk production in Ukraine. It processes about 123.3 thousand hectares of land in the Poltava, Chernihiv and Sumy regions. It owns storage facilities for 554 thousand tons of grain and oilseeds.
At the end of 2021, IMC increased its net profit by 2.5 times compared to 2020 – up to $78.71 million, EBITDA – by 53%, up to $110.35 million, revenue – by 12.6%, up to $181.69 million
In 2021, IMC sold 536.10 thousand tons of corn (-12.2% compared to 2020), wheat – 117.97 thousand tons (-0.1%), sunflower – 85.82 thousand tons ( -1.2%).
The chairman of the board of directors of IMC agricultural holding, Oleksandr Petrov, for the period on December 27-30 bought 99,742 shares of the company at a price of PLN32.28 per share for a total of PLN3.22 million ($793,020 at the rate of the National Bank of Poland), thereby increasing his share in the charter capital of the agricultural holding to 81.21%, according to the website of the Warsaw Stock Exchange.
According to the group of companies, Petrov personally, as well as through his companies Richmarket Investments Ltd and Agrovalley Limited, owns shares in IMC in the amount of 26,945,415.
The IMC share price did not change over the week, remaining at the level of PLN32.3, and since the beginning of the year it has increased 1.7 times.
As reported, in 2020, the agricultural holding increased its net profit 4.3 times compared to 2019 – to $31.71 million, EBITDA – 1.8 times, to $71.84 million, revenue decreased by 5% – to $161.39 million.
IMC in 2020 sold 610,930 tonnes of corn (less by 14% compared to 2019), wheat – 118,060 tonnes (more by 54%), sunflower – 86,830 tonnes (more by 7.1%), soybeans – 1,310 tonnes (reduction by 25 times).
In May 2021, the company decided to pay 3.4 times more dividends for 2020 than in 2019 – EUR20.57 million, or EUR0.62 per share.
The agricultural holding specializes in the cultivation of grains, oilseeds and milk production in Ukraine. It processes about 123,300 hectares of land in Poltava, Chernihiv and Sumy regions. It owns capacities for storing 554,000 tonnes of grain and oilseeds.
