管理層發言
Good morning, ladies and gentlemen. And thank you for waiting. At this time, we would like to welcome everyone to Adecoagro's 2026 Second Quarter Results Conference Call. Today with us, we have Mr. Mariano Bosch, CEO; Mr. Emilio Federico Gnecco, CFO; Mr. Renato Junqueira-Santos Pereira, Vice President, Sugar, Ethanol and Energy; and Mrs. Victoria Cabello, Investor Relations Officer. We would like to inform you that this event is being recorded and all participants will be in listen-only mode during the company's presentation. After the company's remarks are completed, there will be a question-and-answer section. At this time, further instructions will be given. Before proceeding, let me mention that forward-looking statements are based on the beliefs and assumptions of Adecoagro's management and on information currently available to the company. They involve risks, uncertainties and assumptions because they relate to future events and therefore depend on circumstances that may or may not occur in the future. Investors should understand that general economic conditions, industry conditions and other operating factors could also affect Adecoagro's results and could cause results to differ materially from those expressed in such forward-looking statements. Now, I will turn the conference over to Mr. Mariano Bosch, CEO. Mr. Bosch, you may begin your conference.
Good morning and thank you for joining Adecoagro's first half 2026 results conference. Consolidated adjusted EBITDA marked new records, reaching $258 million year to date and $173 million during the second quarter, reflecting the earnings potential and scale that our well-diversified industrial platform now has. In fertilizers, stronger operational performance during the quarter resulted in higher production volumes, while higher prices and cost efficiencies supported further margin expansion. Given higher-than-expected prices during the first half, we expect the annual performance from this segment to be above our initial projections. In Brazil, the sugarcane plantation is in excellent condition. The investments and work done over the years to improve cane productivity are paying off as weather conditions have normalized. Sugarcane availability is now driving the crushing volume growth, and this is also one of the reasons why we view the acquisition of Carapo Mill as highly accretive. We believe this asset will enable us to organically expand our sugar and ethanol operations by milling the surplus cane that our cluster currently has, while further strengthening our presence in the region. As we capture the operational synergies, we see potential to unlock value by increasing the crushing and consequently reinforcing our position among the lowest-cost producers in the industry. Given its earnings potential, this expansion does not alter our deleveraging progress nor our target net debt to EBITDA for the full year. In Food and Agriculture, stronger productivity enabled higher cost dilution. Raw milk production has improved, supporting higher processed volume in our industries. As a new crop is being commercialized, margins should improve supported by a more efficient cost structure. To conclude, I would like to express my gratitude to all the teams in Adecoagro. It is because of their commitment that we continue to achieve new milestones despite the different commodity cycles which we navigate. Thanks to our shareholders for their continued support. And now I will let Emilio walk you through the numbers of the period.
Thank you, Mariano. Good morning, everyone. Please now turn to Page 4 with a summary of our consolidated financial results. As a reminder, we are presenting our numbers on a pro forma basis assuming our fertilizers business had been part of Adecoagro since the beginning of 2025. We believe this provides a more meaningful year-over-year comparison. Gross sales totaled $535 million during the second quarter, while on an accumulated basis they reached $928 million. Despite higher revenues in our fertilizer segment, overall revenues remain in line across both periods, reflecting mixed prices and volume dynamics across our product portfolio. Adjusted EBITDA set new high records. The main driver was the strong performance of our fertilizers business, which benefited from higher production, stronger pricing, and operational efficiencies. Such performance more than compensated for the softer results in the sugar, ethanol and energy and food and agriculture businesses, which I will discuss in a moment. Let's move to slide 6 and review the financial and operational performance of the sugar, ethanol and energy segment. Despite experiencing above-average rainfall, particularly in May, we crushed 3.5 million tons of cane during the quarter, up 3% compared to the same period of last year. This continues the positive trend we have seen since the start of the year. Cane yields have recovered thanks to the better moisture conditions. Although TRS levels remain below last year's, they have been improving steadily throughout the year. In terms of product mix, we continue to maximize ethanol production given its attractive premium over sugar. As a result, we reached a 78% ethanol mix year to date. By comparison, during the first half of 2022, we maximized sugar production. This shift highlights one of the key advantages of our industrial assets: the flexibility to quickly change production toward the product offering the highest marginal contribution. On the cost side, production costs were negatively impacted by the appreciation of the Brazilian real. Excluding the FX effect, our year-to-date production cost in local currency remains in line with the previous year. Turning to sales, the decline we saw this quarter was mainly driven by lower sugar prices and lower sugar volumes sold, reflecting the change in our production mix. For ethanol, lower sales volumes were actually part of our commercial strategy. Following the sharp decline in domestic ethanol prices caused by higher market supply, we decided to start building inventories rather than selling at current market prices. As a result, we finished the quarter with about 41% of our year-to-date ethanol production stored in inventory, positioning us to capture stronger margins once prices recover. This follows the strategy we implemented during the first quarter: we sold inventories and current production while prices were at their peak ahead of the new harvest. Overall, adjusted EBITDA reached $53 million during the quarter and $94 million year to date. The decline compared to last year reflects lower sales as well as lower Consecana prices in the mark-to-market valuation of our biological assets, particularly harvested cane. Looking ahead, crushing is progressing as planned and we are still on track to achieve our full year target. We continue to expect low double-digit growth in crushing volumes this year supported by greater cane availability. Now let's turn to slide 8 to discuss our fertilizers operations. Urea production increased 22% year over year driven by higher plant utilization and, importantly, zero downtime during the quarter. As a result, year to date urea production reached 617 thousand tons, remaining well above last year's level which was impacted by 31 days of downtime due to adverse weather conditions that disrupted gas supply as discussed on previous calls. On the commercial side, results benefited from a significant increase in international urea prices. Following the escalation of the conflict in the Middle East, a region responsible for roughly 30% of global urea trade, prices reached nearly $800 per ton during the quarter. As we executed sales throughout the period we were able to progressively capture the surge in prices. Accordingly, adjusted EBITDA more than doubled both in the quarter and on a year-to-date basis. In addition, higher production volumes together with operational efficiencies drove a meaningful expansion in margins. Although urea prices have moderated from the peaks reached in April and May, we still expect full-year EBITDA from this segment to be above our original projections. This outlook is supported by higher prices captured in the first half of the year while most of our cost structure remained fixed. Please move to page 10 where we describe the performance of our food and agriculture segment. So at the end of July, we harvested 92% of the planted area, achieving yields above the prior campaign and producing more than 1.1 million tons of crops. We expect to complete the harvest season this month and have already begun planting activities of our winter crops for the next season. In dairy, processing volumes increased compared to last year, driven by higher raw milk production at our free-stall facilities due to better cow productivity. Looking at financial performance, year-to-date results still reflect lower commodity prices across much of our portfolio, along with higher costs in U.S. dollar terms. That said, if we focus on the quarter itself, both revenues and adjusted EBITDA improved year over year supported by higher production volumes and a gradual recovery in margins as we begin sales of the new harvest. We expect margins to continue improving over the next few quarters as the benefits of our cost reduction initiatives become more visible. In dairy, we also expect to continue growing processed milk volumes supported by the launch of new products under our consumer brands. Let's move to Slide 12 and review our capital allocation strategy. Starting with expansion CapEx, year to date our largest capital deployment was the final payment of approximately $400 million related to the acquisition of Profertil, which was completed during the previous quarter. At the same time, we continued investing in a number of attractive organic growth opportunities across our businesses. These investments include the expansion of our sugarcane plantations and biomethane operations in Brazil, as well as additional agricultural machinery and a new cheese packaging line at our Morteros dairy facility. Before moving on, I would like to highlight that these figures do not include the acquisition of Carapo Mill, which remains subject to customary closing conditions. We expect the transaction to close in the coming weeks, with the purchase price paid in cash at closing. Given the estimated earnings contribution from the asset, we do not expect the acquisition to affect our deleveraging targets for year end. Now let's move to page 13 where we present our debt profile. As we typically experience at this point of the year, net debt tends to peak due to the seasonal working capital requirements associated with our agricultural operations. If we exclude that seasonal effect as well as the $58 million increase in readily marketable inventories during the quarter, net debt would already be below 2022 year-end levels. On a pro forma basis, net leverage stood at 3x which remains consistent with our deleveraging path and reflects the stronger earnings generation we are seeing across the operations. Despite the seasonality in cash needs, and our commercial strategy to hold inventories for some of our products in anticipation of better pricing opportunities, we continue to expect leverage to decline as EBITDA generation increases. On the liquidity side, our ratio improved to 1.9x compared to 1.2x in the previous quarter, demonstrating our ability to comfortably meet short-term obligations. Please note that most of our debt remains long term, and that its currency composition is closely aligned with our revenue profile, helping reduce foreign exchange risk. Finally, regarding shareholder returns, the first installment of our annual cash dividend totaling $17.5 million was paid on May 19, equivalent to $0.12 per share. The second installment in the same amount will be paid in November resulting in a total annual cash dividend of $35 million. Thank you very much for your time.
分析師問答
We will now open the call to questions. Thank you. The floor is now open for questions. If you have a question, please write it down in the Q&A section or click on raise hand for audio questions. Please remember that your company's name should be visible for your questions to be taken. We ask that when you pose your question that you pick up your headset to provide optimum sound quality. Please hold while we pull for questions. Our first question comes from Gustavo Troyano with Itau BBA. Sir, your microphone is open.
Hello, everybody. Thanks for taking my question. It is actually on Profertil, and more specifically on the mismatch between production figures in the quarter and sales volumes that you reported for this quarter as well. I wanted to hear from you what could be attributed to the usual seasonality of sales volumes and what could relate to maybe a one-off in the quarter potentially driven by the urea price spike or something like that. And still on this point, maybe after the first half, should we expect that the clogged urea sales volumes for the full year will reach the 1.3 million tons for the full year, concentrating volumes in the second half, or could there be some downward adjustments to sales volumes after what happened throughout the first half of the year? Thank you very much.
Hi, Gustavo. Thank you very much for your question. I think this helps clarify how we sell the urea. We produce 1.3 million tons per year, so we are going to sell 1.3 million tons in the whole year. Argentina consumes 2.5 million tons, so there is no way that we will not sell the 1.3 million tons. So 1.3 is for sure something we will always be selling. We could be selling all that we produce every month, and that is easy to do. But we have a strategy where usually, and in general over the years, September, October and November are the months of maximum consumption of urea by producers. So in general that is where the higher prices in the domestic market of Argentina are found. We try to concentrate more sales in that specific period. That is for general years. This year in particular has, as you mentioned, a peak because of the war during March and April. So in April we tried to maximize the peak, that is why we sold more than what we originally projected in the first half. What you can see there is the first half we sold more or less the average that has been sold in previous years, but in this specific year we were pushing to sell more. In June, however, the price of urea went down lower than the previous year and lower than July and August. So in June we decided not to push the sales we had been pushing in April and May on what we had produced. That is specifically why this particular month or this particular quarter shows that you are not selling all the production being produced. We are happy with that decision because in June the price was lower than today's prices in July and August, so we have more inventory today to be sold at a higher price. Of course, we would have sold 100% in April if that had been better. But in April we pushed as much as possible. This is a spot market that every week changes and that is how urea is commercialized in general. So that is important to make that specific clarification, and thank you for the question.
That is clear. Thank you very much.
Our next question comes from Matheus Enfeldt with UBS.
Hi. Morning, everyone. Thank you for the time. My first question on sugar and ethanol: you had previous calls mentioning the expectation of a drop in cash cost of 10% to 15%, if I am not wrong. Could you provide any updates around that level of cost efficiency or cost improvements for this crop? Do you still think that number is reasonable when looking at the entire crop? That is my first question. And then the second one on the acquisition of the Carapo Mill: I understand there are potential synergies to capture higher crushing. My question is, what is the excess capacity or excess sugarcane that you currently have? How do you anticipate that cost will move with a higher or a larger radius for sourcing once you end that plant? And if you could help us get a sense around that, and then finally on what is a reasonable outlook for crushing for that mill for 2027 — is it already possible for you to reach 4.0–4.5 million tons above the 3.5 that the mill crushed last season? Those are my questions. Thank you.
Hi, Matheus. Thank you for the question. On the projection of the yield and the milling for Carapo in 2027, we do not give that guidance yet; we want to close first and then we will explain more details on Carapo. On the rest of the questions, including some of the synergies from Carapo, Renato can take the cost and how the cost can be impacted with Carapo and what the synergies are. Renato?
Hi, Matheus. Thank you for your question. As it was mentioned, we see Carapo as an extension of our cluster in Mato Grosso do Sul, so we are going to adopt the same operational model there and you have the same competitive advantage. Our plan for the future is to do continuous harvest. We are going to take advantage of the high production flexibility that Carapo also has, high cogeneration potential and the ICMES tax rebate; it is exactly the same as our mills in Mato Grosso do Sul. We think Carapo has potential to increase effective crushing a lot, almost doubling the crushing. This is because the capacity of Carapo is very similar to the capacity of our other mills — if you consider the milling capacity, sugar production capacity and ethanol capacity, it is very similar to the Angelica and Ivinhema mills. We also think that we have a lot of opportunities to improve some KPIs and to reach the same level as we have in Mato Grosso do Sul. For example, industrial efficiency we think can be 2% higher than Carapo's current level. The use of time is also more than 2% higher; cogen exports, kilowatts of energy per ton of cane crushed, we think we can improve. Also some improvements in agriculture both in yields and TRS. To finalize the synergies, we think that we have a lot of synergies related to G&A, so we are going to keep the same structure that we currently have and also use this for Carapo. We are also going to benefit from logistics and assets; we will take advantage of the tanks that Carapo has and warehouses. I think there are a lot of synergies that we are going to get in the next years. Of course, part of the sugarcane from the cluster will be sent to be crushed in Carapo. Regarding the cost, I think it is important to say that quarterly cost has some temporary distortion caused by cost allocation and industrial seasonality, so it is better to analyze costs based on the year cost. But even with this consideration, we think it is still possible to reach a 10% reduction in cost compared to last year. I think this is explained first by cost dilution: we plan to crush approximately 10% more than we crushed last year. We still have time to do it. Of course it depends on the weather, but at this point it is still possible. So this gives extra cost dilution. The leasing cost is much lower because of the Consecana price. Headcount has been reduced due to efficiencies obtained especially because of use of new technologies such as through-row harvesting machines and drones. We have decreased the number of harvesting fronts, reducing the number of people working on those fronts, and this is more than enough to offset some diesel and fertilizer increases in cost. So we still think it is possible to have this 10% reduction.
That is helpful. Thank you.
Our next question comes from Pedro Gama with Citi.
Hi, Mariano and Adecoagro team. Good morning. Thank you for the opportunity to ask questions. I have two questions in the fertilizer segment. In the past, management highlighted that the likely expansion of the Profertil plant is a key growth avenue. However, during the previous weeks and months a major Argentine in the gas sector announced investment in a new greenfield urea plant in the same region as Profertil. Building on that, I would like to ask two things. First, how does Profertil's current cash cost structure compare to this peer that is vertically integrated in gas production? Is the unit cost difference significant, and how does this affect Adecoagro's long-term competitive position in the Argentine arena? Second, given that the likely Profertil expansion is a brownfield project, should this be faster to implement, and what would be the key triggers or market conditions required for you to make a final investment decision? Is there a strategic urgency to bring this new capacity online before your competitor, thereby capturing a first-mover advantage in the domestic market which usually has higher margin than exports to Brazil, for example, or could this expansion be postponed in light of the company's focus to deleverage? These are the main points. Thank you.
Thank you, Pedro, for your question.
Very important. Number one: South America consumes 10 million tons of urea, and imports around 10 million tons. We produce 1.3 million tons. The announcement you mentioned is to produce 2.1 million tons, so there is still a lot of need for urea in the whole region. That announced project is to produce in four or five years from now, so there is still a lot to go. When you ask to compare the cost of production from one system to the other, it is important to understand the other project's cost structure; we know exactly what our costs are, but there are a lot of costs on the other side that still need to be understood. In terms of gas and the cost of gas, gas is a very transparent market and we have to renew our contracts, as we said before, and we expect those contracts to be better in terms of prices than they are today. We are receiving offers of gas way cheaper than today. There is still a lot of gas available in the region. So we do not see any disadvantage in buying gas in the region compared to competitors. Argentina, as we have been explaining many times, will be a huge exporter of gas, so we are always going to be a buyer of gas at export parity cost as we have been saying. That is going to be very competitive. So we still believe that we will continue to be one of the lower-cost producers. Regarding selling in the domestic market or exporting, with the logistics and the port that we have in Bahía Blanca, we are very competitive to go to Brazil as we are to go to Puerto San Martin in northern Argentina. So the difference between domestic and export markets when we go to the Brazilian market is not going to be very relevant. That is to understand the impact of a new plant on the whole 10 million tons the region consumes. As for our own brownfield project, we continue to analyze in depth, do the engineering work, and evaluate synergies. We have many benefits from a brownfield project because we know exactly where the plant location would be — behind the existing one — and there are many synergies with our existing assets. So we remain very keen on that project. We are very interested in continuing to analyze and to understand the real cost of building the plant and how best to build it to continue to be a low-cost producer. That is where we are focusing and how efficient we can be in building this new plant, which of course would be a relevant development.
Very clear. Thank you.
Our next question comes from Lucas Ferreira with JPMorgan. Your microphone is open.
Hi, guys. Thanks for the time. I have two questions. The first one on the commercialization strategy for sugar and ethanol: Renato, can you talk about, in your view, what are the reasons for ethanol prices being extremely low at this point, and how the company is reacting to that? Looking at your numbers, you are carrying a large amount of inventories to be sold later in the crop. How much capacity do you have to carry if that is still the strategy for the second half of the year? And then on sugar prices, if this recent rally drives you to accelerate selling, are these already levels that you think are good enough to do a major acceleration of selling in the market? And then a second question on the Argentina farming side: a bit of your outlook considering that we have El Niño coming in. The business has been more and more challenging the last few years. How much of a recovery to a normal level do you expect? What do you think is a baseline for crop yields and potential yields? How much of that gap closure should we see assuming El Niño will mostly support rainfall in the country? Thank you very much.
Thank you, Lucas, for your question.
I will ask Renato to answer the commercialization question on sugar and ethanol and our strategy with sugar now. Renato?
Hi, Lucas. Starting with ethanol, I think supply of ethanol was high due to the progress of the sugarcane harvest and corn ethanol production, which is why prices decreased a lot, especially in June and July. With this price, the parity rate at the pump decreased as well — the parity rate was lower than 70%. Since early August we have started to see some signs that demand is picking up, so more liquidity, and we have already seen an increase in price compared to July of about 5%. What we are doing, and I think most producers in Brazil are doing too, is switch the mix to sugar. This will decrease the supply of ethanol, and we think that the combination of lower supply and higher demand makes the situation for Q4 and Q1 better. That is why our strategy is to carry as much ethanol as possible to be sold later. We have capacity to carry our production, especially because we have also switched the mix to maximize sugar, and in a few weeks we will have all the tanks of Carapo that we can use to store our production. Regarding sugar, we think the market is shifting from a roughly 3 million-ton surplus to a deficit of about 2 million tons for different reasons in the most important production countries: India, Thailand, the European Union and Brazil. If you take into account lower stocks worldwide and the usual ratio being very low, we think the price of sugar has reacted because of this situation. We are taking the opportunity that the market is giving us in these rallies to increase our hedging for both 2026 and 2027. Today we are currently about 70% hedged for 2026 at $0.157 per pound and about 16% hedged for 2027 at $0.174 per pound. This is not counting Carapo production.
Thank you, Renato and Lucas. Finally, on El Niño that you were asking about regarding the impact in Argentina, we expect normalization of yields or improvement of yields, which is welcome and includes benefits for the cost structure in our food and agriculture business. Even more important, because of El Niño we are also seeing a rise in the price of rice, and rice is an important product that we produce in Argentina and Uruguay, so that will have an additional positive impact. In general, El Niño for us is a positive scenario. On top of that, the need for urea is typically higher for the whole agriculture sector in Argentina because of more rains, so usually consumption of urea in the whole country is higher under an El Niño scenario. Thank you very much.
Our next question comes from Isabella Simonato with Bank of America.
Hi, Mariano, Emilio. Good morning. Thank you for the call. I have two questions. First, in the food and agriculture business this year you reduced planted area significantly given the economics, but now we are moving into a more favorable scenario: prices have picked up a little and yields as well. Can you give us a sense of how to think about planted area for the 2027 campaign? I think this will be very helpful. Second, on sugar and ethanol discussion, we've been seeing inventories decline over the past few seasons but that has not necessarily translated into prices similar to what we've seen in the past with similar inventory levels. Part of that I believe is China running with lower inventories or trade flows balanced with Brazil producing above 40 million tons. In your view, what would need to happen globally for sugar prices to go back to $0.18, $0.19, $0.20 per pound? Thank you.
Thank you, Isabella, for your question.
Regarding Food and Agriculture and planted area, you should not expect significant differences from this year. We are maximizing returns and are focused on leasing and planting only the areas where we continue to see the returns we are looking for, so I do not see that changing in any significant way, at least I do not see the area growing significantly. Regarding sugar and ethanol and what would need to happen for sugar to reach $0.19 per pound, Renato can add to what he has already said.
I think it will depend a lot on the El Niño impact on key countries; the impact can be higher or lower. This switch from a roughly 3 million-ton surplus to a 2 million-ton deficit could be larger depending on what happens in those key countries. For example, in India stocks are very low, and they are announcing measures to avoid importing sugar, but of course it will depend on the monsoon. In Thailand, the same applies. Even in Brazil, despite higher cane availability, there have been interruptions in crushing and TRS content, especially in June, was lower than expected. The mix has been less sugar-oriented than many thought at the beginning of the season. I think all those variables will impact the size of the deficit and the price of sugar in the coming months. The world may be learning to deal with lower stocks because of higher interest rates and improvements in logistics, but at some point fundamentals have to prevail and price has to increase.
Very helpful. Thank you.
Our next question comes from Thiago Duarte with BTG Pactual.
Hello, everybody. My question goes back to the Carapo transaction and to Renato. Two things: one, when we look at M&A deals in the industry, one of the historically most challenging aspects is the quality of the sugarcane that comes along with the mill. Do you have a view on the quality of the cane that will be harvested with the Carapo mill in terms of cultural treatments, especially longer cut cane like fifth or sixth cut? Do you already have a view on that? Second, when you talk about optimism about raising the crushing volumes or almost doubling the crushing volumes as you said, what would be the necessary CapEx to expand planted area or similar investments that will need to be done, or do you think you will have the additional 2.5–3.0 million tons of cane available from your existing plantations? Thank you.
Thank you, Thiago, for your question.
Thank you, Thiago. Renato?
Thiago, we think the region is very similar to our region and the potential to produce sugarcane is exactly the same as Ivinhema. The potential to have tons per hectare and kilograms of TRS per ton of cane is exactly the same. Of course we will adjust some treatments because we have a different methodology to treat sugarcane than they are using today, but we think that is something very quickly fixed and that the cane quality will probably be better in the near future. Regarding excess cane in the cluster, I think we already have something close to between 500 thousand tons and 1 million tons that could be diverted to be crushed in Carapo for the next two to three years.
But of course, in order to achieve 6 to 7 million tons, which is very possible considering the industry we are acquiring, we will have to plant more. The only important additional CapEx we need to achieve those levels is to plant sugarcane. The mill infrastructure is almost done.
Oh, that is perfect. We visited the plantations and they are in good shape today, which is not something that has to be changed. Just a follow-up: you also mentioned the possibility to improve cogeneration yields in the mill. Is there CapEx associated with improving megawatt per ton generated?
Yes, there are some CapEx items, but they are small. We are thinking about things like isolating the main equipment to improve energy consumption in the mill. If you consume less energy in the mill, we have more energy to export. Those investments are not large, like acquiring a new boiler; we are not thinking about those types of investments, just adjustments based on things we have already seen in our visits to the mill.
That is perfect. Thank you.
This concludes the questions and answers section. At this time, I would like to turn the floor back to Mr. Bosch for any closing remarks.
Thank you all for participating today, and we hope to see you in our next calls. Thank you.
This concludes today's presentation. You may disconnect at this time, and have a nice day.