The Board of Directors of the Ukrainian agricultural holding KSG Agro has sold 700 thousand shares owned by the company to a new partner in accordance with the company’s development strategy and in order to increase the participation of new investors in new projects.
“KSG Agro still owns 800 thousand shares in the company,” the agricultural holding said in a statement on the Warsaw Stock Exchange (WSE).
The name of the new partner was not disclosed.
Taking into account the total number of shares, it means the sale of 4.66% and retention of 5.33% of the company’s shares.
On Thursday, KSG Agro’s share price on the WSE decreased by 0.25% to PLN4.07 per share ($1.05 at the current exchange rate), which corresponds to a capitalization of PLN60.53 million ($15.62 million).
As reported, KSG Agro in February this year announced the purchase of 10% of its own shares from its major shareholder Olbis Investments Ltd, Sergey Kasyanov, to diversify and expand its investment activities in the EU markets. Olbis Investments’ stake is now 47.97%.
In January-September 2024, KSG Agro agricultural holding generated $16.8 million in revenue, up 41% year-on-year. Its EBITDA for the three quarters of last year decreased by 4% to $4.38 million, and its net loss amounted to $0.8 million against a net profit of $1.34 million for the same period in 2023.
This year, KSG Agro will build an energy complex in Dnipro region that will include a solar power plant, an energy storage system, and a gas cogeneration unit, the company’s press service reports.
“It is expected that the project of the energy complex will be implemented according to the zero investment concept proposed by EnergyInvest HUB. This means that KSG Agro will not spend significant equity capital on the construction of a solar station: the main investments will be made by external financial partners,” the agricultural holding said.
According to the company, thanks to this model, the agricultural holding will receive cheaper electricity and heat without the need for capital investment in the project.
According to the report, the capacity of the solar station will be 0.5 MW. A 1 MWh energy storage system will ensure the accumulation of excess solar generation during the day, and a 0.8 MW gas plant will generate the necessary energy in the evening and at night or work as a backup. The combined system will be centrally managed through an EMS (Energy Management System).
The construction of the complex is scheduled to be completed by the end of 2025.
The agricultural holding is convinced that the energy complex built according to this scheme will provide the company with the necessary margin of safety and predictability. Increasing the level of energy autonomy will help prevent the negative consequences associated with power outages.
An important aspect of energy independence is the ability to avoid a significant rise in electricity prices, which significantly affects the growth of agricultural production costs, KSG Agro explains. The economic effect of the construction of the energy complex is expected to allow it to reduce the price of electricity consumed by about 20% of the market price.
“The difficult situation in the Ukrainian energy market leads not only to interruptions in electricity supply but also to its rise in price, which significantly affects the growth of agricultural production costs. That is why financing renewable energy sources, in particular solar energy, is very important for farmers,” explained Sergiy Kasyanov, Chairman of the Board of Directors of the agricultural holding.
He noted that the construction of an energy complex with a solar power plant provides significant benefits in several business dimensions at once: energy autonomy, energy efficiency, increased profitability and greening of agricultural production.
“Add to this the fact that the cost of solar power plants has been decreasing in recent years, and their commissioning leads to minimal interference with the company’s power grid. In addition, such a station allows us to connect more load than the company’s usual load, which actually stabilizes the grid voltage,” Kasyanov said.
KSG Agro started implementing alternative power supply projects in the spring of 2022. So far, about 10 generators with a capacity of 100 to 250 kW each and a total capacity of 1.5 MW have been installed in its farms and headquarters. KSG Agro has also provided the local community with a generator, as its water supply system supplies water to both the community and the agricultural holding’s pig farm.
KSG Agro is a vertically integrated holding company engaged in pig farming, as well as the production, storage, processing and sale of grains and oilseeds. Its land bank in Dnipropetrovska and Khersonska oblasts is about 21 thousand hectares.
According to the agricultural holding, it is one of the top five pork producers in Ukraine. In 2023, it launched a “network-centric” strategy, which will shift from developing a large location to a number of smaller pig farms located in different regions of Ukraine.
In January-September 2023, KSG Agro received $1,336 million in net profit, which is almost 14 times more than in the same period in 2022. Its EBITDA for the three quarters increased by 67% to $4.5 million, and its profit from sales increased by 16% to $11.9 million.
In the first quarter of 2024, it decreased net profit by 37% to $0.96 million on a 2% decrease in revenue to $5.02 million. Its EBITDA decreased by 2% to $1.83 million.
Agroholding KSG Agro has bought back 10% of its shares from its major shareholder Olbis Investments Ltd, the company’s press service reports.
“The purpose of this step is to increase the holding’s liquidity, which will allow KSG Agro to diversify and expand its investment activities in the EU markets,” the agricultural holding explained.
KSG Agro noted that they want to place special emphasis on investments in biofertilizers. As part of the company’s long-term strategy to strengthen its financial stability, it is also considering real estate investments.
The first step in implementing this strategy is to strengthen the company’s financial position and liquidity by acquiring 1.5 million shares from its major shareholder, Olbis Investments Ltd. Previously, Olbis Investments Ltd S.A. owned 64.62% of the holding’s share capital, and 35.17% were in free float.
KSG Agro, a vertically integrated holding company, is engaged in pig breeding, as well as production, storage, processing and sale of grains and oilseeds. Its land bank in Dnipropetrovska and Khersonska oblasts is about 21 thousand hectares.
According to the agricultural holding, it is one of the top 5 pork producers in Ukraine. In 2023, it launched a “network-centric” strategy, which will move from developing a large location to a number of smaller pig farms located in different regions of Ukraine.
In January-September 2023, KSG Agro received $1,336 million in net profit, which is almost 14 times more than in the same period in 2022. Its EBITDA for the three quarters of this year increased by 67% to $4.5 million, and its profit from sales increased by 16% to $11.9 million.
In January-March 2024, KSG Agro agricultural holding reduced its net profit by 37% to $0.96 million, while revenue decreased by 2% to $5.02 million. Its EBITDA decreased by 2% to $1.83 million.
In 2025, KSG Agro will renew the pig population at its pig farm in Dnipro region by more than 3.5 thousand sows, with total investments in pig rejuvenation exceeding EUR1 million, the company’s press service reports.
“Rejuvenation of the pig population by replenishing sows is very important for us, as it allows us to significantly improve the quality characteristics of the herd. As a result, we will get better piglet health and improved taste characteristics of pork. In general, we expect to increase the efficiency of pig production by 15%,” explained Sergiy Kasyanov, Chairman of the Board of Directors of KSG Agro.
The process of reviewing proposals from international producers of various purebred pig genetics is currently underway, from which the most optimal parameters for the holding’s herd will be selected.
KSG Agro added that the total number of pigs in the holding is currently more than 60 thousand.
The vertically integrated KSG Agro holding is engaged in pig production, as well as the production, storage, processing, and sale of grains and oilseeds. Its land bank in Dnipropetrovska and Khersonska oblasts is about 21 thousand hectares.
According to the agricultural holding, it is one of the top 5 pork producers in Ukraine. In 2023, it launched a “network-centric” strategy, which will move from developing a large location to a number of smaller pig farms located in different regions of Ukraine.
In January-September 2023, KSG Agro received $1,336 million in net profit, which is almost 14 times more than in the same period in 2022. Its EBITDA for the three quarters of this year increased by 67% to $4.5 million, and its profit from sales increased by 16% to $11.9 million.
In January-March 2024, KSG Agro agricultural holding reduced its net profit by 37% to $0.96 million, while revenue decreased by 2% to $5.02 million. Its EBITDA decreased by 2% to $1.83 million.
In the first quarter of 2024, KSG Agro agricultural holding reduced its net profit by 37% to $0.96 million, while revenue decreased by 2% to $5.02 million, according to the company’s report on the Warsaw Stock Exchange.
“As in the previous year, the Group used more of its own grain for feed production rather than purchasing it (to reduce dependence on external suppliers of feed components in wartime). In 2024, the Group continues to export grain,” the document says.
According to it, due to a 10-fold increase in the benefits of biological transformation this year (up to $1.06 million), gross profit increased by 10% to $2.26 million, operating profit by 5% to $1.61 million, while EBITDA decreased by 2% to $1.83 million.
It is specified that the higher profit last year was due to the sale of a subsidiary for $0.76 million.
According to the report, KSG Agro managed to slightly reduce its net debt in the first quarter of this year to $15.06 million from $15.63 million due to a reduction in bank loans to $15.17 million from $15.84 million. The agricultural holding’s free cash flows at the end of March amounted to $0.11 million compared to $0.21 million at the beginning of the year.
During January-March 2024, the key operating subsidiary KSG Dnipro issued $5 million of C and D series bonds with a coupon rate of 7% per annum and maturity in August and October 2025, respectively, of which it placed $1.35 million of C series bonds.
As noted, the sowing campaign is proceeding according to plan, without significant interruptions due to military operations. As of the date of the report, the group sowed sunflower on an area of 7.7 thousand hectares, wheat on 2.2 thousand hectares and rapeseed on 1.43 thousand hectares.
According to the report, KSG Agro, a vertically integrated holding company, is one of the top 5 pork producers in Ukraine. It is also engaged in the production, storage, processing, and sale of grains and oilseeds. Its land bank is about 21 thousand hectares in the Dnipro and Kherson regions.
In 2023, KSG Agro reduced its net loss by 30.9% to $1.16 million, while revenue increased by 13.8% to $18.79 million.
In 2023, KSG Agro agricultural holding reduced its net loss by 30.9% to $1.16 million, while revenue increased by 13.8% to $18.79 million.
This data is presented in the company’s annual report on the Warsaw Stock Exchange.
“The increase in revenues in 2023 is largely due to the resumption of grain exports, which were limited in 2022 due to the beginning of Russia’s invasion of Ukraine. In addition, in 2022, the Group used more of its own grain for feed production rather than purchasing it, seeking to reduce dependence on external suppliers of feed ingredients due to wartime logistical reasons,” the document says.
It is specified that the total revenue from crop production last year amounted to $12.6 million compared to $4.5 million in 2022, but the net change in the fair value of crops was less than a year earlier – $1.6 million versus $4.6 million.
It is noted that as an alternative source of income to hedge against unpredictable weather conditions, KSG Agro used its agricultural equipment and expertise to provide tillage and similar land preparation services to other crop producers for a total of $2.5 million compared to $1.3 million in 2022.
Due to lower prices for agricultural products and higher sales costs, the gross profit of the agricultural holding fell 6.6 times last year to $0.48 million, and also recorded an operating loss of $1.62 million and negative EBITDA of $0.40 million, while a year earlier these indicators were positive – $0.44 million and $1.79 million, respectively.
It is also indicated that due to lower exchange rate losses, the total loss in 2023 decreased even more significantly – to $1.21 million from $4.31 million a year earlier.
According to the report, KSG Agro managed to almost halve its net debt last year to $15.63 million from $27.46 million due to a reduction in bank loans to $15.84 million from $27.74 million. The agricultural holding’s free cash flow at the end of 2023 was $0.21 million compared to $0.27 million a year earlier.
During the first quarter of 2024, the group repaid a total of $4.28 million of its existing loans from TAScombank and received new tranches totaling $2.30 million, as well as issued series C and D bonds of its key operating subsidiary KSG Dnipro for approximately $5 million, of which it placed series C bonds for $1.4 million.
The number of permanent employees of the agricultural holding decreased in 2023 to 234 from 274 a year earlier.
It is noted that the group expects the winter crop harvest in 2024 to be at least average.
As for pig farming, it is indicated that during 2023 KSG Agro gradually reduced the massive number of pigs at the farm in Niva Trudova. The main reasons were concerns about the general safety and biosecurity of the herd, as well as changes in the group’s strategy and general market conditions: less herd, more farms – to reduce the risk of losing the entire pig population in the event of a missile or drone strike, the agricultural holding began to distribute the herd to several locations.
The group’s management is currently negotiating ways to expand the number of farms under its management, either through a partnership program with other pig farmers or by leasing or buying additional farms, the report says.
It also indicates that, based on the results of the trials, most of the low-productivity sows were gradually removed from the main herd and sold during the year, and to replace them, KSG Agro is purchasing new sows of Canadian genetics, in particular, it plans to purchase another batch later in 2024. The fresh Canadian genetics are expected to enable the group to produce high-quality piglets that will be sold as piglets rather than being raised further on the group’s farms. It should also shorten the group’s production cycle, further reducing overall safety and biosecurity risks.
KSG Agro, a vertically integrated holding company, is, according to him, one of the top 5 pork producers in Ukraine. It is also engaged in the production, storage, processing and sale of grains and oilseeds. Its land bank is about 21 thousand hectares in Dnipropetrovska and Kherson regions.
KSG Agro earned $1.34 million in net profit in January-September 2023, up almost 14 times compared to the same period in 2022. Its EBITDA for the three quarters of 2023 increased by 67% to $4.54 million, and revenue increased by 16% to $11.9 million.
