Adecoagro (AGRO) Q3 2024 earnings summary

Executive summary

• $96.3 million distributed to shareholders year to date via dividends and share repurchases, exceeding policy minimum by $26 million.

• Record results in rice operations, with continued efficiency gains and product expansion in dairy.

• Sugar, Ethanol & Energy segment achieved a 55% sugar mix in Q3 and higher year-to-date production.

• ESG initiatives include plans to increase biomethane production fivefold by 2027, with FINEP financing secured.

• Gross sales increased 17.7% in Q3 and 6.3% in 9M24 year-over-year, driven by higher volumes despite lower commodity prices.

Financial highlights

• Gross sales reached $457 million in Q3 and $1.108 billion year to date, with SE&E contributing the largest share.

• Q3 Adjusted EBITDA was $110.9 million, down 28.6% year-over-year; 9M24 Adjusted EBITDA was $341 million, down 10.5%.

• Net sales for sugar, ethanol, and energy business were $227 million in Q3 and $502 million year to date.

• Adjusted EBITDA for sugar, ethanol, and energy: $100.1 million in Q3, $258.9 million year to date.

• Net debt at $632 million to $646 million, down 8.6%-9% year-over-year; net leverage ratio at 1.1x-1.5x.

Outlook and guidance

• Expecting a slight year-over-year increase in annual crushing and a new record in sugar production, assuming normal weather.

• 14% of 2024 sugar production remains unhedged; 2025 production is mostly open.

• Ethanol inventories held to capitalize on expected price increases during the intercrop period.

• Rice and dairy segments expect improved yields and productivity, with favorable water availability and attractive prices.

• Energy spot price recovery anticipated due to dry weather.