LUXEMBOURG, May 12, 2016 /PRNewswire/ -- Adecoagro S.A. (NYSE: AGRO, Bloomberg: AGRO US, Reuters: AGRO.K), one of the leading agricultural companies in South America, announced today its results for the first quarter of 2016.

Main highlights for the period:


    --  Adecoagro recorded Adjusted EBITDA((1)) of $43.2 million in 1Q16,
        representing a 113.0% increase compared to 1Q15.
    --  Adjusted EBITDA margin( (1)) during 1Q16 reached 36.9% in 1Q16, compared
        to 18.5% in 1Q15.
    --  Net income for 1Q16 stands at $2.8 million, $8.3 million higher than
        1Q15.

Financial & Operational Highlights by Business:


    --  Adjusted EBITDA in our Farming and Land Transformation businesses' in
        1Q16 was $26.2 million, 13.5% higher than 1Q15. This increase is
        primarily explained by: (i) a $9.9 million increase in margins from our
        Crops segment as a result of higher corn prices in the local market.
        Local prices were driven by the elimination of export taxes and export
        quotas, coupled with lower costs in dollars resulting from the
        devaluation of the Argentine peso and lower input prices for seeds,
        fertilizers and agrochemicals; (ii) a 44.5% increase in margins in the
        Rice segment as a result of higher rice yields and lower costs in dollar
        terms due to operational efficiencies and peso devaluation. Results were
        partially offset by: (iii) lower soybean, white rice and dairy prices;
        and (iv) a $9.9 million lower unrealized gain from our commodity hedge
        position.


    --  In our Sugar, Ethanol & Energy business, Adjusted EBITDA in 1Q16 reached
        $22.1 million, $19.7 million higher than 1Q15. Adjusted EBITDA margin
        grew from 4.7% in 1Q15 to 31.9% in the current quarter. Results were
        driven by strong operational and financial performance, including: (i)
        the implementation and execution of a "continuous harvest" production
        system which has allowed the company to harvest and crush sugarcane
        year-round (see Strategy Execution below). As a result, during 1Q16 we
        crushed 1.5 million tons, 226.9% higher year-over-year, and produced
        166.4 thousand tons of sugar and ethanol measured in TRS equivalent,
        223.2% higher than 1Q15; (ii) strong production and sales volumes
        coupled with higher ethanol prices in both BRL and USD have resulted in
        a 36.7%  growth in net sales; and (iii) a 15.7% reduction in unit costs
        as a result of fixed cost dilution due to volume growth, coupled with
        the devaluation of the Brazilian Real. These positive effects were
        partially offset by an $11.5 million decrease in hedging results (a $0.5
        million gain in 1Q16 compared to a $12.2 million gain in 1Q15).


    --  Net Income in 1Q16 was $2.8 million, $8.3 million higher than in 1Q15.
        Net income during the quarter was enhanced by Adjusted EBITDA in both
        the Farming and Sugar, Ethanol & Energy businesses; and was partially
        offset by a $7.2 million increase in depreciation expenses resulting
        from the capital expenditures deployed during 2015 for the to
        completione of the construction of the Ivinhema mill.

Strategy Execution:






    --  Implementation of a "Continuous Harvest" in our Sugar, Ethanol & Energy
        businessSince the beginning of the 2016/17 harvest year we implemented a
        "non-stop" or "continuous harvest". This means that we will harvest and
        crush sugarcane year-round, without stopping during the traditional
        off-season. This new strategy will allow us to increase annual sugarcane
        milling and sugar, ethanol and energy production by approximately 10%.
        Another benefit of the system is that we will be producing ethanol in
        the off-season, when market prices usually have a high premium to prices
        at harvest. In addition, cogeneration efficiency is related to harvested
        volumes and unrelated to TRS, enabling us to utilize our cogeneration
        potential during the whole year. Considering that approximately 85% of
        total costs are fixed, this model will result not only in higher
        revenues but also in the dilution of our fixed costs.The investments
        required for implementing the "continuous harvest" only include
        sugarcane planting and  land leasing expenses for expanding our
        plantation. These costs in Mato Grosso do Sul are highly competitive due
        to low competition for land from other mills. No investments in
        industrial assets or machinery were required.Maintenance of our
        industrial equipment and agricultural machinery will be performed
        throughout the year during rainy days, when milling is forced to stop
        due to unfeasibility of harvesting. The "continuous harvest" is part of
        our strategy of increasing our overall productivity and enhancing our
        return on invested capital. We believe this model will allow us to
        remain one of the lowest-cost producers of sugar, ethanol and energy in
        Brazil. The implementation and execution of this model was only possible
        after reaching high operating efficiency standards and strong
        coordination between our agricultural and industrial teams.

((1)) Adjusted EBITDA is defined as consolidated profit from operations before financing and taxation, depreciation, amortization plus the gains or losses from disposals of non-controlling interests in subsidiaries. Adjusted EBIT is defined as consolidated profit from operations before financing and taxation, plus the gains or losses from disposals of non-controlling interests in subsidiaries. Adjusted EBITDA margin and Adjusted EBIT margin are calculated as a percentage of net sales.

To read the full 1Q16 earnings release, please access ir.adecoagro.com. A conference call to discuss 1Q16 results will be held on May 13, 2016 with a live webcast through the internet:

English Conference Call

May 13, 2016
9 a.m. (US EST)
10 p.m. Buenos Aires
10 p.m. Sao Paulo
3 p.m. Luxembourg

Tel: +1 (844) 836-8746
Participants calling from the US
Tel: +1 (412) 317-2501
Participants calling from other countries
Access Code: Adecoagro

Investor Relations Department
 Charlie Boero Hughes
CFO

Hernan Walker
IR Manager
Email: ir@adecoagro.com
Tel: +54 (11) 4836-8651

About Adecoagro:

Adecoagro is a leading agricultural company in South America. Adecoagro owns over 257 thousand hectares of farmland and several industrial facilities spread across the most productive regions of Argentina, Brazil and Uruguay, where it produces over 1.7 million tons of agricultural products including corn, wheat, soybeans, rice, dairy products, sugar, ethanol and electricity among others.

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SOURCE Adecoagro S.A.