HISTORICAL RECORDS AND NET INCOME OF R$485.3 MILLION
São Paulo, February 11, 2021 - Biosev, one of the world's largest sugarcane processor, announces its results for the third quarter of the 2020/21 crop year.
9M21 HIGHLIGHTS
✓ Due to the improved operational performance, Net Income totaled R$485.3 million compared to the loss of R$429.2 million in 9M20.
✓ Net Operating Result was an income of R$1.3 billion in 9M21, compared to the Net Operating Result of R$235.5 million in 9M20;
✓ Historical operational records for the period:
✓ Consolidated agricultural yield (TCH) increased by 2.9% to 85.7 ton/ha in 9M21;
✓ Product TRS totaled 142,4 kg TRS/ton, an increase of 9.1% compared to 9M20;
✓ Total Product TRS was 3,680 thousand tons, 8.3% higher than 9M20, mainly due to the 1,879 thousand tons of sugar produced, also a record for the period;
✓ Sugar mix was 53.4% in 9M21, due to its higher profitability in relation to ethanol, and 18 p.p. higher than 9M20. Anhydrous mix was 31.7%,1.6 p.p. higher than 9M20.
✓ Industrial efficiency increased by 2.0% to 1.031 in the period;
✓ Net Revenue ex-HACC/other products of R$5.5 billion, 48.2% higher than in 9M20;
✓ Adjusted EBITDA ex-resale/HACC totaled R$2.0 billion, an increase of 44.2%; EBITDA per unit was R$76.8 per ton, an increase of 44.8%; and EBITDA Margin was 44.7%, 3.0 p.p. higher than 9M20;
✓ EBITDA less CAPEX totaled R$1.1 billion, 87.8% higher than 9M20;
✓ Crushing volume totaled 25.8 million tons in 9M21, stable compared to the same period of 9M20.
B3: BSEV3
Stock price on 02/10/2021: R$7.70 | Number of shares: 1,020,429,426 | Market cap: R$7.9 billion
Conference Call in Portuguese with translation into English: February 12, 2021 12:00 p.m. (Brasília - BRT) | 10:00 a.m. (NY - EST) | 3:00 p.m. (London - GMT)
Portuguese: (11) 3181-8565 | English: +1 (412) 717-9627
Code: Biosev
Investor Relations
E-mail:ri@biosev.com Telephone: (11) 3092-5200http://ri.biosev.com
1. OPERATING PERFORMANCE
The following table presents key indicators for operating efficiency, productivity and production volumes, which are analyzed in this section:
Efficiency and Productivity | 9M21 | 9M20 | % |
Crushing ('000 tons) | 25,785 | 25,902 | -0.5% |
TCH - Agricultural yield (ton/ha) | 85.7 | 83.3 | 2.9% |
Product TRS (kg/ton) | 142.4 | 130.5 | 9.1% |
Industrial Efficiency | 1.031 | 1.011 | 2.0% |
Production | 9M21 | 9M20 | % |
Sugar Mix (%) | 53.4% | 35.4% | 18 p.p. |
Ethanol Mix (%) | 46.6% | 64.6% | -18 p.p. |
Anhydrous Mix (%) | 31.7% | 30.1% | 1.6 p.p. |
Production ('000 tons of Product TRS) ¹ | 3,680 | 3,397 | 8.3% |
Sugar ('000 tons) Ethanol ('000 m³) | 1,879 1,010 | 1,150 1,293 | 63.3% -21.9% |
Cogeneration (GWh) | 800.1 | 781.1 | 2.4% |
¹ Considers the ratios of conversion of sugar and ethanol in the State of São Paulo, as disclosed in the Consecana Manual.
1.1. Crushing
The following table shows crushing volume on a consolidated basis and by cluster:
Efficiency | 9M21 | 9M20 | % |
Crushing ('000 tons) | 25,785 | 25,902 | -0.5% |
Own Third Parties | 15,002 10,782 | 15,768 10,134 | -4.9% 6.4% |
Ribeirão Preto Norte Cluster | 4,895 | 5,012 | -2.3% |
Ribeirão Preto Sul Cluster | 14,631 | 14,533 | 0.7% |
Mato Grosso do Sul Cluster | 6,259 | 6,357 | -1.5% |
The Company reached total crushing volume of approximately 25.8 million tons in 9M21, stable compared to the previous crop, due to the improved operational performance and favorable (drier) weather conditions during the harvest period (April to September) and higher yield measured by TCH (+2.9%) at the Ribeirão Preto Sul and Mato Grosso do Sul Clusters, partially offset by the frost mitigation strategy at the Mato Grosso do Sul Cluster.
At the Ribeirão Preto Norte Cluster, crushing volume was 4.9 million tons, 2.3% lower than 9M20, mainly due to the drier weather conditions during the plantation period.
At the Ribeirão Preto Sul Cluster, crushing volume was 14.6 million tons, 0.7% higher than 9M20, mainly supported by the improved operational performance, climate conditions and 4.3% increase in TCH.
At the Mato Grosso do Sul Cluster, crushing volume was 6.3 million tons, 1.5% lower than 9M20, reflecting the Company's strategy to mitigate the effects from the frost that affected the region in the previous and current crops (accelerating harvest and crushing operations as from the second quarter ofthe previous crop to mitigate impacts on sucrose quality and accumulation).
1.2. Tons of Cane per Hectare (TCH)
The following table shows the evolution in TCH on a consolidated basis and by cluster:
Productivity | 9M21 | 9M20 | % |
TCH - Agricultural yield (ton/ha) | 85.7 | 83.3 | 2.9% |
Ribeirão Preto Norte Cluster | 81.3 | 84.4 | -3.7% |
Ribeirão Preto Sul Cluster | 89.5 | 85.9 | 4.3% |
Mato Grosso do Sul Cluster | 81.3 | 77.5 | 4.9% |
Cane yield measured by consolidated TCH reached 85.7 ton/ha in 9M21, historical record for the period, 2.9% higher than the same period of the previous crop, which is basically explained by the application of best agronomic practices in crop regeneration to the sugar plantations, in addition to the favorable weather conditions (rainy season) during the field development period (January to March).
The 3.7% decrease in TCH at the Ribeirão Preto Norte Cluster resulted from the drier weather conditions during the plantation period in the previous crop.
1.3. Product Total Recoverable Sugar (TRS)
The following table shows the evolution of Product TRS and by cluster:
Productivity | 9M21 | 9M20 | % |
Product TRS (Kg TRS/ton) | 142.4 | 130.5 | 9.1% |
Ribeirão Preto Norte Cluster | 147.6 | 139.2 | 6.1% |
Ribeirão Preto Sul Cluster | 143.9 | 132.3 | 8.7% |
Mato Grosso do Sul Cluster | 134.8 | 119.7 | 12.7% |
Product TRS content was 142.4 kg TRS/ton in 9M21, historical record for the period, an increase of 9.1% compared to 9M20, which reflects the continuous impacts of the evolution of the phytosanitary quality of the sugarcane crop, the quality of the harvesting processes, the intensive use of ripening agents and organic fertilization, among others, an improved operational performance and favorable (drier) weather conditions during the harvest, which favors concentration of sugar content.
Industrial efficiency reached 1.031 in 9M21, an increase of 2.0% compared to 9M20, historical record for the period. The results demonstrate the higher efficiency in converting cane into the final products of sugar and ethanol, as well as the lower losses in production processes. Industrial efficiency is calculated based on the volume of TRS produced by the mills.
Total production in tons of Product TRS was 3,680 thousand tons, historical record for the period, an increase of 8.3% compared to 9M20, mainly due to the evolution of the sugarcane crop and industrial efficiency gains.
Sugar mix was 53.4%, historical record for the period, due to the higher allocation of TRS to sugar production, given the product's higher profitability in the period compared to ethanol, an increase of 18.0
p.p. compared to the same period of the previous crop, which was more focused on ethanol.
Ethanol mix was 46.6%, as a result of company's strategy to optimize sales by prioritizing products thatcapture higher value added, 18.0 p.p. lower than the same period of last crop. The anhydrous mix (over the total ethanol produced) was 31.7% in 9M21, 1.6 p.p. higher than 9M20.
1.4. Cogeneration
The following table presents productivity and cogeneration volume for sale:
Production | 9M21 | 9M20 | % |
Total Cogen (GWh) | 800.1 | 781.1 | 2.4% |
Cogen for Sale (GWh) | 800.1 | 781.1 | 2.4% |
Ribeirão Preto Norte Cluster | 107.6 | 101.9 | 5.6% |
Ribeirão Preto Sul Cluster | 375.9 | 380.0 | -1.1% |
Mato Grosso do Sul Cluster | 316.6 | 299.2 | 5.8% |
Cogen for Sale/Crushing (kWh/ton) | 34.2 | 33.3 | 2.7% |
Ribeirão Preto Norte Cluster | 43.3 | 39.9 | 8.6% |
Ribeirão Preto Sul Cluster | 25.7 | 26.2 | -1.7% |
Mato Grosso do Sul Cluster | 50.6 | 47.1 | 7.5% |
The Company has cogeneration power plants at all its eight industrial sites and is energy self-sufficient during the harvesting period. Out of these units, seven produce surplus electricity for sale.
Total cogeneration for sale in 9M21 increased by 2.4% compared to 9M20 and reached a volume of 800.1 GWh.
The productivity of cogeneration units measured in kWh of power sold per ton of cane crushed stood at 34.2 kWh/ton in 9M21, an increase of 2.7% compared to 9M20. These results reflect the higher total crushing volume and the Company's strategy to optimize sales by prioritizing products and periods that generate higher added value.
2. ECONOMIC AND FINANCIAL PERFORMANCE
2.1. Net Revenue
Net revenue excluding the non-cash effects from the hedge accounting of foreign currency-denominated debt (HACC) amounted to R$8.6 billion, an increase of 74.6% compared to 9M20. The result is primarily explained by the growth in export volumes and average prices, the higher industrial efficiency in sugarcane conversion and the revenues from export performance contracts associated with the rollover of foreign currency-denominated debt obligations, with these factors partially offset by the decrease in ethanol import volumes and by the fact that previous crop included revenue from the Nordeste Cluster. Note that, excluding the revenue from the Nordeste Cluster in the previous crop to improve the comparison with the current crop, net revenue would be 74.8% higher than in 9M20.
Excluding the effects from resale operations (of finished products, such as (i) sugar, ethanol and energy; and (ii) other commodities, which are required to comply with export performance contracts associated with obligations denominated in foreign currency), the Company's net revenue was R$4.4 billion, an increase of 34.2% compared to 9M20, mainly due to the growth in export volumes and average prices, as well as the higher industrial efficiency in sugarcane conversion, partially offset by the decrease in ethanol import volumes and by the fact that previous crop included revenue from the Nordeste Cluster. Note that, excluding the revenue from the Nordeste Cluster in the previous crop to improve the comparison with the current crop, net revenue would be 34.4% higher than in 9M20.
The following table presents a breakdown of net revenue ex-HACC:
Net Revenue ex-HACC (R$ Thousand) | 9M21 | 9M20 | % |
Sugar | 3,127,905 | 1,428,000 | 119.0% |
Domestic Market | 217,567 | 111,819 | 94.6% |
Export Market | 2,910,338 | 1,316,181 | 121.1% |
Ethanol | 1,877,986 | 1,983,008 | -5.3% |
Domestic Market | 765,051 | 1,695,371 | -54.9% |
Export Market | 1,112,935 | 287,637 | 286.9% |
Energy | 448,550 | 270,343 | 65.9% |
Total | 5,454,441 | 3,681,351 | 48.2% |
Other Products | 3,147,623 | 1,245,219 | 152.8% |
Bagasse, services and others | 43,591 | 36,194 | 20.4% |
Export performance contracts | 3,104,032 | 1,209,025 | 156.7% |
Total | 8,602,064 | 4,926,570 | 74.6% |
¹ 9M20 includes amounts from the Nordeste Cluster.
Revenue from resale operations is detailed in the following table:
Resale operations (R$ Thousand) | 9M21 | 9M20 | % |
Sugar, ethanol and energy ¹ | 1,074,173 | 421,667 | 154.7% |
Export performance contracts | 3,104,032 | 1,209,025 | 156.7% |
Total | 4,178,205 | 1,630,692 | 156.2% |
¹ Revenue from resales of sugar, ethanol and energy is accounted for in the lines corresponding to the respective products in the table of Net Revenue ex-HACC.
The following charts present a breakdown of net revenue ex-HACC, excluding the effects from hedge accounting and revenue from export performance contracts, by product and by market in the respective periods:
Net Revenue ex-HACC/export performance by product (%)
Net Revenue ex-HACC/export performance by market (%)
The following table presents the sugar and ethanol inventory balance variation in the respective periods:
Inventories - Variation | 9M21 | 9M20 | % |
Sugar ('000 tons) | 71 | 102 | -30% |
Ethanol ('000 m3) | 245 | 307 | -20% |
2.1.1. Sugar
Net revenue from sugar sales excluding the non-cash effects from the hedge accounting of foreign currency-denominated debt (HACC) amounted to R$3.1 billion, an increase of 119.0% compared to
9M20. This variation reflects the production mix, which prioritized sugar, given the product's higher profitability in the period compared to ethanol, increase in exports, improved operational performance, which translates into higher efficiency in sugarcane conversion, and average prices of the product compared to the previous crop.
The following chart presents a comparison of sugar volumes and average prices, excluding the non-cash effects from the hedge accounting of foreign currency-denominated debt (HACC):
Volume (thousand tons) and Average Price (R$/ton)
The following chart presents a breakdown by type of sugar, excluding the non-cash effects from the hedge accounting of foreign currency-denominated debt (HACC):
Net Revenue ex-HACC by Sugar Type (%)
2.1.2. Ethanol
Net revenue from ethanol sales excluding the non-cash effects from the hedge accounting of foreign currency-denominated debt (HACC) amounted to R$1.9 billion, a decrease of 5.3% compared to 9M20, when the sales volume in the period decreased 17.2% due to a shift in the sugar mix and higher carry out in the period.
The price increased 14.4% when compared to 9M20. The Company's strategy to optimize sales by prioritizing products and periods that capture higher value added reflected the ethanol competitiveness in the foreign market, improved by the depreciation in the Brazilian real against the U.S. dollar. Note that, excluding the revenue from the Nordeste Cluster in the previous crop to improve the comparison with the current crop, net revenue would be 5.0% lower than in 9M20.
The following chart presents a comparison of ethanol sales volumes and average prices, excluding the non-cash effects from the hedge accounting of foreign currency-denominated debt (HACC):
Volume (thousand m³) and Average Price (R$/m³)
The following chart presents a breakdown of revenue by type of ethanol, excluding the non-cash effects from the hedge accounting of foreign currency-denominated debt (HACC):
Net Revenue ex-HACC by Ethanol Type (%)
2.1.3. Energy
Net revenue from energy was R$448.6 million, an increase of 65.9% compared to 9M20. This variation is mainly due to the higher sales volume and average sales prices in the period.
The following chart presents a comparison of energy own sales volume and average own sales price:
Sales Volume (GWh) and Average Sales Price (R$/MWh) - Own
2.1.4. Other products
The line item "Other products" records revenue from sales of raw bagasse, services and other items, in addition to revenue from the sale of commodities in the spot market to fulfill export contracts with the aim of settling debt obligations in foreign currency.
Revenue from the sale of other products totaled R$3.2 billion, an increase of 152.8% compared to 9M20, mainly due to the growth in the above-referred export performance contracts associated with the rollover of foreign currency-denominated debt obligations.
2.2. Cost of Goods Sold (COGS)
The Company has continued to consistently deliver cost reductions, while consolidating initiatives to adjust structures and become more resilient in an environment of still highly challenging pricing.
In nominal terms, cash COGS ex-resale totaled R$1.9 billion, an increase of 19.7% compared to 9M20, due to higher sales volumes and increase of 15.7% in the CONSECANA price index in the period, partially offset by the reductions in operating costs under the ongoing process to streamline costs and structures.
COGS per unit was R$612 per ton, an increase of 5.0% compared to 9M20, mainly impacted by the increase of 15.7% in the CONSECANA price index in the period.
The following tables present a breakdown of total COGS and cash COGS:
COGS and Cash COGS (R$ Thousand) ³ | 9M21 | 9M20 | % |
Total COGS | (6,538,121) | (4,050,231) | 61.4% |
Non-cash items | (337,982) | (795,075) | -57.5% |
Depreciation and Amortization Gains (losses) to sell Biological Assets ¹ | (1,265,425) 927,443 | (1,042,380) 247,305 | 21.4% 275.0% |
Cash COGS | (6,200,139) | (3,255,156) | 90.5% |
Personnel Raw Materials ² Inputs Resale goods Sugar, ethanol and energy Export performance contracts | (400,104) (1,442,754) (93,426) (4,263,855) (1,141,396) (3,122,459) | (357,314) (1,174,794) (85,451) (1,637,597) (421,027) (1,216,570) | 12.0% 22.8% 9.3% 160.4% 171.1% 156.7% |
Cash COGS ex-resale | (1,936,284) | (1,617,559) | 19.7% |
¹ Gains (losses) from the fair value adjustment less estimated cost of sales of biological assets. ² Sugarcane, lease and HLT. ³ Excluding the effect from IFRS16.
Cash COGS ex-resale (R$ Thousand) ¹ | 9M21 | 9M20 | % |
Agricultural | (1,696,672) | (1,405,188) | 20.7% |
HLT (own + 3rd party cane) | (479,175) | (484,709) | -1.1% |
Land lease | (424,974) | (307,024) | 38.4% |
3rd party cane | (792,523) | (613,455) | 29.2% |
Industrial | (216,727) | (184,369) | 17.6% |
Others | (22,884) | (28,002) | -18.3% |
Cash COGS ex-resale | (1,936,283) | (1,617,559) | 19.7% |
TRS Product sold ex-resale ('000 tons) | 3,165 | 2,776 | 14.0% |
Cash COGS ex-resale (R$/ Ton) | (612) | (583) | 5.0% |
¹ Excluding the effect from IFRS16.
2.3. Selling, General and Administrative (SG&A) Expenses
SG&A expenses totaled R$491.3 million, an increase of 31.8% compared to 9M20.
Selling expenses totaled R$299.4 million, an increase of 94.2% compared to 9M20, due to the difference in the composition of the sales mix in the period, focused on the sugar mix and the increase in exports, which increased the demurrage and port storage expenses.
General and administrative expenses totaled R$191.8 million, a decrease of 12.3% compared to 9M20, mainly due to the effects from the ongoing process to streamline operating and organizational structures, partially offset against the increase in consulting expenses in the period.
Depreciation expenses recognized under SG&A expenses totaled R$14.6 million in 9M21, compared to R$16.2 million in 9M20.
The following table presents a comparison of cash SG&A expenses between periods:
SG&A Cash (R$ Thousand) ¹ | 9M21 | 9M20 | % |
Selling | (299,430) | (154,186) | 94.2% |
Freight Shipping Charges Commissions, wharfage and other | (221,419) (67,492) (10,519) | (115,217) (29,944) (9,025) | 92.2% 125.4% 16.6% |
G&A | (191,847) | (218,670) | -12.3% |
Personnel Services Other | (93,401) (84,175) (14,271) | (106,337) (88,825) (23,508) | -12.2% -5.2% -39.3% |
SG&A Cash | (491,277) | (372,856) | 31.8% |
¹ Excluding the effect from IFRS16.
2.4. EBITDA
The following table presents a breakdown of Adjusted EBITDA ex-resale/HACC:
EBITDA Composition (R$ Thousand) ⁴ | 9M21 | 9M20 | % |
Net Revenue | 8,522,891 | 4,660,369 | 82.9% |
Cash COGS | (6,200,139) | (3,255,156) | 90.5% |
Gross Profit (Cash) | 2,322,752 | 1,405,213 | 65.3% |
SG&A (Cash) | (491,277) | (372,856) | 31.8% |
TEAG Profit/(Loss) ¹ | (425) | (3,755) | -88.7% |
Other Operating Revenue/Expenses | (149,412) | 24,439 | -711.4% |
Non-recurring items | 132,877 | 46,720 | 184.4% |
Adjusted EBITDA | 1,814,515 | 1,099,761 | 65.0% |
Adjusted EBITDA Margin | 21.3% | 23.6% | -2.3 p.p. |
Resale effect ² | 85,650 | 6,905 | 1140.5% |
HACC effect ³ | 79,173 | 266,201 | -70.3% |
EBITDA ex-resale/HACC | 1,979,339 | 1,372,867 | 44.2% |
EBITDA Margin ex-resale/HACC | 44.7% | 41.7% | 3 p.p. |
Crushing ('000 tons) | 25,785 | 25,902 | -0.5% |
Adjusted EBITDA per unit (R$/ton) | 70.4 | 42.5 | 65.7% |
EBITDA per unit ex-resale/HACC (R$/ton) | 76.8 | 53.0 | 44.8% |
¹ Equivalent to the share of 50% held in the Guarujá Sugar Terminal (TEAG). ² Reverses the impacts of resale of sugar, ethanol, energy and export performance operations. ³ Reverses the non-cash effects from the hedge accounting of foreign currency-denominated debt. ⁴ Excluding the effect from IFRS16.
Adjusted EBITDA ex-resale/HACC totaled R$2.0 billion, with EBITDA per unit of R$76.8 per ton, both historical records for the period. EBITDA margin was 44.7%. These variations were mainly due to the operational improvement, increase in net revenue by virtue of the increase in exports and average prices, partially offset by the increase in COGS and SG&A expenses, reflecting the impact of 15.7% in the CONSECANA price index in the period and the changes in the sales mix composition.
The following table presents a reconciliation of Adjusted EBITDA with the profit or loss for the periods:
EBITDA Reconciliation (R$ Thousand) | 9M21 | 9M20 | % |
NET INCOME (LOSS) | 453,900 | (470,372) | -196.5% |
Income Tax and Social Contribution | 434,496 | 19,708 | 2104.7% |
Financial result | 507,783 | 740,749 | -31.5% |
Depreciation and Amortization | 1,654,121 | 1,419,049 | 16.6% |
EBITDA CVM 527 | 3,050,300 | 1,709,134 | 78.5% |
Losses (gains) from selling Biological Assets ¹ | (927,443) | (247,305) | 275.0% |
Amortization of Concession - TEAG | 6,299 | 6,299 | 0.0% |
Non-recurring items | 132,877 | 46,720 | 184.4% |
IFRS16 impacts | (447,517) | (415,087) | 7.8% |
Adjusted EBITDA | 1,814,515 | 1,099,761 | 65.0% |
Adjusted EBITDA Margin | 21.3% | 23.6% | -2.3 p.p. |
¹ Losses (gains) from the fair value adjustment less estimated cost of sales of biological assets.
2.5. Hedge
The following table shows the aggregate position of our hedged sugar volumes and prices (via commodity and foreign exchange derivative contracts) as at December 31, 2020:
Hedge on 12/31/2020 | 20/21 Crop | 21/22 Crop |
Sugar (#NY11) | ||
Volume ('000 tons) Average Price (cUS$/lb) | 1,291 12.93 | 946 13.18 |
FX (US$) | ||
Amount (US$ million) Average Price (R$/US$) | 355 4.637 | 272 4.957 |
Hedged Price (cR$/lb) w/o Pol. | 59.95 | 65.32 |
Hedged Price (cR$/lb) w/ Pol. | 62.14 | 67.43 |
Exposure Hedged (%) - Net Consecana | 100.0% | 85.1% |
2.6. Financial Results
Excluding the effects from FX variation, the net financial result was an expense of R$353.2 million, compared to an expense of R$417.6 million in 9M20. The variation is mainly explained by the decrease in interest expenses, partially offset by the lower interest income from short-term investments in the period.
Including FX variation, the net financial result was an expense of R$386.9 million in 9M21, a 38.0% decrease compared to 9M20.
PTAX in the period | 9M21 | 9M20 | % |
Initial - on March 31 | 5.1987 | 3.8967 | 33.4% |
Final - on December 31 | 5.1967 | 4.0307 | 28.9% |
Variation % | 0.0% | 3.4% | -3.4 p.p. |
The following table shows the changes in the financial income (expenses) between the periods:
Financial Result (R$ Thousand) ¹ | 9M21 | 9M20 | % |
Financial Result, net | (386,878) | (623,763) | -38.0% |
FX Variation | (33,699) | (206,126) | -83.7% |
Financial Result before FX | (353,179) | (417,637) | -15.4% |
Interest Expenses Income from Short-term Investments Derivative transactions Other Revenues/(Expenses) | (321,633) 3,238 (37,393) 2,609 | (389,472) 9,635 (47,420) 9,620 | -17.4% -66.4% -21.1% -72.9% |
¹ Excluding the effect from IFRS16.
2.7. Profit or Loss for the Period
Profit for the period totaled R$485.3 million, compared to the loss of R$429.2 million in 9M20. Based on the abovementioned factors, the variation resulted mainly from the increase in net operating result, in view of the improved operational performance, net revenue and higher gains from the settlement and mark-to-market adjustment of derivative positions, partially offset by the FX variation.
3. INVESTMENTS
The Company invested R$828.0 million, an increase of 9.0% compared to 9M20, due to the increase in non-recurring disbursements associated with the strategy of making the agro industrial operation more productive and profitable.
The investments were focused on the agricultural sector and are mainly non-recurring investments performed on an annual basis, relating to the increased plantation volume and cultivated area in the period compared to the past crop, impacted by the FX variation in the input costs and the non-recurring investments in industrial improvement in connection with the Company's strategy to optimize sales by prioritizing products that capture higher value added.
Capex (R$ Thousand) | 9M21 | 9M20 | % |
Expansion | 14,789 | 7,262 | 103.7% |
Operations | 639,091 | 574,646 | 11.2% |
Industrial Agriculture Planting Treatment Other | 58,084 1,624 222,220 346,853 10,310 | 29,765 22,632 193,805 315,692 12,753 | 95.1% -92.8% 14.7% 9.9% -19.2% |
Intercrop deferred costs | 174,106 | 177,773 | -2.1% |
Total CAPEX | 827,986 | 759,681 | 9.0% |
¹ 9M20: Ex-NE cluster for comparison purposes.
4. EBITDA LESS CAPEX
EBITDA less CAPEX is presented in the table below:
(R$ Thousand) ¹ | 9M21 | 9M20 | % |
EBITDA ex-resale/HACC CAPEX | 1,979,339 827,986 | 1,372,867 759,681 | 44.2% 9.0% |
EBITDA ex-resale/HACC minus CAPEX | 1,151,353 | 613,186 | 87.8% |
¹ Excluding the effect from IFRS16.
5. DEBT
The Company's gross debt totaled R$6.9 billion as at December 31, 2020, an increase of 17.1% compared to December 31, 2019, mainly due to the effect from the 28.9% depreciation of the Brazilian real against the U.S. dollar on the dollar-denominated portion of its debt.
The balance of cash and short-term investments totaled R$612 million, out of which 55.1% was denominated in U.S. dollar. This variation reflects the Company's strategy to optimize sales by prioritizing products and periods that capture higher value added.
In view of the aforementioned factors, net debt totaled R$6.3 billion, an increase of 11.8% compared to the position as at December 31, 2019.
The following table presents a breakdown of the debt position:
Debt (R$ Million) | 12/31/2020 | 12/31/2019 | Var. % |
Gross Debt | (6,915) | (5,906) | 17.1% |
Short Term Long Term | (3,058) (3,856) | (483) (5,423) | 533.5% -28.9% |
Cash and Short-term Investments Net Debt Adjusted EBITDA LTM | 612 (6,302) 2,845 | 269 (5,637) 1,849 | 127.2% 11.8% 53.9% |
Net Debt/Adjusted EBITDA LTM | 2.22x | 3.05x | -27.4% |
¹ LTM: last twelve months
The following charts present a breakdown of debt by index and instrument as at December 31, 2020, as well as the cash position and short-term investments by currency:
The hedged position related to foreign currency indebtedness as at December 31, 2020 was USD264.9 million.
The following chart shows the cash position and debt amortization schedule:
6. CAPITAL MARKETS
At the closing of 3Q21, the Company's market capitalization totaled R$5.5 billion. Its stock performance in the last 12 months compared to Ibovespa is shown below:
Performance BSEV3 versus IBOV
Source: Bloomberg, December 31, 2020
7. APPENDICES
7.1. IFRS16
The IFRS 16/CPC 06 (R2) Leases standard, adopted as of April 1, 2019, changed accounting for lease agreements and agricultural partnerships, which are now treated similarly to financing transactions related to the acquisition of right of use of assets, and payments for which, previously recorded as operating costs and expenses, are now recognized as depreciation or amortization and financial expenses.
Income Statement (R$ Thousand)Before IFRS16
IFRS16 effects 9M21
After IFRS16
Before IFRS16
IFRS16 effects 9M20
After IFRS16
Gross Revenue
Taxes and Sales Deductions Net Revenue
8,726,021 (203,130) 8,522,891
COGS
Depreciation and Amortization Raw Materials
(6,538,121) (1,265,425) (1,442,754)
- - - 73,169 (372,544)
8,726,021 (203,130) 8,522,891
5,018,736 (358,367) 4,660,369
(6,464,952) (1,637,969)
Inputs
(93,426)
443,754 1,959
(999,000) (91,467)
(4,050,231) (1,042,380) (1,174,794)
- - - 54,425 (358,911)
5,018,736 (358,367) 4,660,369
(3,995,806) (1,401,291)
(85,451)
409,199 4,137
GROSS PROFIT
OPERATING INCOME (EXPENSES)
1,984,770 (661,964)
SG&A
(505,828)
Depreciation and Amortization
(16,152)
73,169 204 204 1,601
2,057,939 (661,760)
610,138 (374,663)
(505,624)
(389,048)
(14,551)
(16,192)
54,425 185 185 (1,566)
(765,595) (81,314) 664,563
(374,478)
(388,863)
(17,758)
Others
(14,271)
(1,805)
(16,076)
(23,508)
1,751
(21,757)
Equity income/(loss) in subsidiaries
-
Other operating income (expenses)
PROFIT (LOSS) BEFORE FINANCIAL RESULT Financial Result, net
(6,724) (149,412) 1,322,806
(6,724)
(10,054)
-
(10,054)
(386,878)
- 73,373 (120,905)
(149,412) 1,396,179
24,439 235,475
(507,783)
(623,763)
- 54,610 (116,986)
24,439 290,085
(740,749)
Financial Revenue Financial Expenses Interest Expenses Derivatives
18,181
(333,967)
(321,633)
- (120,905) (120,905)
18,181
32,000
(454,872)
(402,217)
(442,538)
(389,472)
- (116,986) (116,986)
32,000
(519,203)
(506,458)
(37,393)
FX Variation
PROFIT (LOSS) BEFORE TAXES ON INCOME Income Tax and Social Contribution
(33,699) 935,928 (450,656)
- -
(37,393)
(47,420)
(47,532)
NET INCOME (LOSS)
485,272
16,160 (31,372)
(33,699) 888,396 (434,496)
(206,126)
- -
(47,420)
(206,126)
(388,288)
(62,376)
(450,664)
(40,916)
453,900
(429,204)
21,208 (41,168)
(19,708)
(470,372)
7.2. Statement of Profit and Loss for the Period
Income Statement (R$ Thousand) | 9M21 | 9M20 | % |
Gross Revenue | 8,726,021 | 5,018,736 | 73.9% |
Taxes and Sales Deductions | (203,130) | (358,367) | -43.3% |
Net Revenue | 8,522,891 | 4,660,369 | 82.9% |
COGS | (6,464,952) | (3,995,806) | 61.8% |
GROSS PROFIT | 2,057,939 | 664,563 | 209.7% |
OPERATING INCOME (EXPENSES) | (661,760) | (374,478) | 76.7% |
G&A | (206,194) | (234,677) | -12.1% |
Selling | (299,430) | (154,186) | 94.2% |
Equity income/(loss) in subsidiaries | (6,724) | (10,054) | -33.1% |
Other operating income (expenses) | (149,412) | 24,439 | -711.4% |
PROFIT (LOSS) BEFORE FINANCIAL RESULT | 1,396,179 | 290,085 | 381.3% |
Financial Result, net | (507,783) | (740,749) | -31.5% |
Financial Revenue | 18,181 | 32,000 | -43.2% |
Financial Expenses | (454,872) | (519,203) | -12.4% |
Derivative | (37,393) | (47,420) | -21.1% |
FX Variation | (33,699) | (206,126) | -83.7% |
PROFIT (LOSS) BEFORE TAXES ON INCOME | 888,396 | (450,664) | -297.1% |
Income Tax and Social Contribution | (434,496) | (19,708) | 2104.7% |
NET INCOME (LOSS) | 453,900 | (470,372) | -196.5% |
7.3. Balance Sheet - Assets
ASSETS (R$ Thousand) | 31/12/2020 | 03/31/2020 | % |
CURRENT ASSETS | |||
Cash and cash equivalents | 484,178 | 1,174,943 | -58.8% |
Short-term investments | 119,732 | 52,245 | 129.2% |
Derivative financial instruments | 105,423 | 225,787 | -53.3% |
Accounts receivables | 265,477 | 202,050 | 31.4% |
Inventories | 864,170 | 2,948,633 | -70.7% |
Biological Assets | 1,275,757 | 663,908 | 92.2% |
Recoverable taxes | 144,704 | 158,777 | -8.9% |
Other receivables | 95,235 | 88,170 | 8.0% |
Assets held for sale | 26,674 | 45,165 | -40.9% |
Total current assets | 3,381,350 | 5,559,678 | -39.2% |
NON CURRENT ASSETS | |||
Long-term investments | 8,217 | - | 100.0% |
Advances to suppliers | 65,055 | 56,602 | 14.9% |
Escrow deposits | 284,956 | 385,413 | -26.1% |
Recoverable taxes | 80,409 | 57,529 | 39.8% |
Deferred income tax and social contribution | 389,423 | 872,971 | -55.4% |
Other receivables | 305,606 | 320,012 | -4.5% |
Right to use leasehold assets | 1,983,844 | 1,577,379 | 25.8% |
Investments | 154,547 | 160,393 | -3.6% |
Property, plant and equipment | 3,142,165 | 3,477,391 | -9.6% |
Intangible assets | 917,460 | 921,964 | -0.5% |
Total non-current assets | 7,331,682 | 7,885,539 | -7.0% |
TOTAL ASSETS | 10,713,032 | 13,445,217 | -20.3% |
7.4. Balance Sheet - Liabilities and Equity
LIABILITIES AND SHAREHOLDERS' EQUITY (R$ Thousand) | 31/12/2020 | 03/31/2020 | % |
CURRENT LIABILITIES | |||
Borrowings and financing | 3,058,308 | 7,225,234 | -57.7% |
Liabilities from leasing operations | 561,217 | 498,932 | 12.5% |
Advance from domestic customers | 21,311 | 28,128 | -24.2% |
Advance from foreign customers | 462,881 | 2,585,641 | -82.1% |
Accounts payables | 663,105 | 798,903 | -17.0% |
Accrued payroll and related taxes | 93,903 | 90,483 | 3.8% |
Taxes payable | 57,000 | 75,152 | -24.2% |
Derivative financial instruments | 231,324 | 586,843 | -60.6% |
Other payables | 94,961 | 118,051 | -19.6% |
Total current liabilities | 5,244,010 | 12,007,367 | -56.3% |
NON CURRENT LIABILITIES | |||
Borrowings and financing | 3,856,252 | 96,191 | 3909.0% |
Liabilities from leasing operations | 1,574,048 | 1,182,337 | 33.1% |
Advance from foreign customers | - | 626,116 | -100.0% |
Accounts payables | 4,529 | 5,965 | -24.1% |
Deferred income tax and social contribution | 35,384 | 36,883 | -4.1% |
Derivative financial instruments | 10,594 | 16,596 | -36.2% |
Provision for tax, labor, civil and environmental contingencies | 290,927 | 294,668 | -1.3% |
Taxes payable | 18,324 | 18,501 | -1.0% |
Other payables | 149,070 | 167,247 | -10.9% |
Total non-current liabilities | 5,939,128 | 2,444,504 | 143.0% |
SHAREHOLDERS' EQUITY | |||
Paid-in Capital | 6,077,674 | 6,077,674 | 0.0% |
Capital reserve | 1,353,937 | 1,353,937 | 0.0% |
Accumulated losses | (8,167,310) | (8,167,310) | 0.0% |
Retained Earnings | 453,998 | - | 100.0% |
Other comprehensive income (loss) | (194,510) | (277,132) | -29.8% |
Total equity attributable to shareholders | (476,211) | (1,012,831) | -53.0% |
Non-controlling interest | 6,105 | 6,177 | -1.2% |
Total equity | (470,106) | (1,006,654) | -53.3% |
TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY | 10,713,032 | 13,445,217 | -20.3% |
7.5. Statement of Cash Flows
Cash Flow (R$ Thousand) | 31/12/2020 | 12/31/2019 |
CASH FLOW FROM OPERATING ACTIVITIES | ||
NET INCOME (LOSS) | 453,900 | (470,372) |
Non-cash transactions | 1,734,367 | 2,236,940 |
Depreciation and amortization | 1,654,121 | 1,419,049 |
Exchange, interest rate and commodities risk management | (29,660) | 144,629 |
Losses (gains) from selling Biological Assets ¹ | (927,443) | (247,305) |
Interest, exchange rate changes and inflation adjustments, net | 392,396 | 573,361 |
Losses/(gains) on hedge operations | 123,920 | 251,531 |
Deferred Income tax and social contribution | 439,916 | 20,291 |
Other non-cash transactions | 81,117 | 75,384 |
Decrease/(Increase) in assets | 2,507,214 | (1,241,099) |
Increase/(Decrease) in liabilities | (3,331,936) | 143,244 |
Interest paid on borrowings and financing | (230,924) | (293,838) |
Net cash provided by/(used in) operating activities | 1,132,621 | 374,875 |
CASH FLOWS FROM INVESTING ACTIVITIES | ||
Decrease (increase) in short- and long-term investments | (75,146) | 74,458 |
Additions to right of use assets | (791,394) | (1,814,492) |
Increase in property, plant and equipment | (436,119) | (348,736) |
Additions to biological assets | (412,222) | (376,651) |
Increase in intangible assets | (929) | (9,836) |
Net cash provided by/(used in) investing activities | (1,716,688) | (2,474,688) |
CASH FLOW FROM FINANCING ACTIVITIES | ||
Additions to lease liabilities | 792,379 | 1,815,411 |
Payment of lease liabilities | (436,432) | (394,816) |
Borrowings and financing | 1,227,667 | 2,176,427 |
Payment of borrowings and financing | (1,690,312) | (2,483,462) |
Net cash provided by/(used in) financing activities | (106,698) | 1,113,560 |
INCREASE/(DECREASE) IN CASH AND CASH EQUIVALENTS | (690,765) | (986,253) |
Cash and cash equivalents at the beginning of the period | 1,174,943 | 1,189,112 |
Cash and cash equivalents at the end of the period | 484,178 | 202,859 |
¹ Losses (gains) from the fair value adjustment less estimated cost of sales of biological assets.
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Biosev SA published this content on 11 February 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 11 February 2021 22:31:06 UTC.