Adecoagro : Financial Statements

Adecoagro S.A.

Condensed Consolidated Interim Financial Statements as of September 30, 2018 and for the nine and three-month periods ended September 30, 2018 and 2017

Legal information

Denomination: Adecoagro S.A.

Legal address: Vertigo Naos Building, 6, Rue Eugène Ruppert, L-2453, Luxembourg

Company activity: Agricultural and agro-industrial

Date of registration: June 11, 2010

Expiration of company charter: No term defined Number of register (RCS Luxembourg): B153.681 Issued Capital Stock:: 122,381,815 common shares Outstanding Capital Stock: 116,555,699 common shares Treasury Shares: 5,826,116

F- 2

Adecoagro S.A.

Condensed Consolidated Interim Statements of Income for the nine-month and three-month periods ended September 30, 2018 and 2017 (All amounts in US$ thousands, except shares and per share data and as otherwise indicated)

Nine-months ended September 30,Three-months ended September 30,

Note	2018	2018	2017 (*)
(unaudited)
Sales of goods and services rendered	4	550,230	657,609	178,744	262,988
Cost of goods sold and services rendered	5	(415,449)	(542,199)	(129,954)	(206,890)
Initial recognition and changes in fair value
of biological assets and agricultural produce	14	12,139	24,226	(23,369)	1,524
Changes in net realizable value of
agricultural produce after harvest	9,552	8,036	2,204	4,843
Margin on manufacturing and
agricultural activities before operating
expenses	156,472	147,672	27,625	62,465
General and administrative expenses	6	(39,312)	(44,483)	(9,428)	(15,982)
Selling expenses	6	(61,332)	(64,758)	(21,688)	(27,681)
Other operating income, net	8	107,521	43,034	37,892	5,015
Profit from operations before financing
and taxation	163,349	81,465	34,401	23,817
Finance income	9	6,494	8,742	1,651	3,520
Finance costs	9	(242,342)	(76,679)	(72,653)	(31,269)
Other financial results - Net gain of inflation
effects on the monetary items	9	50,370	-	50,370	-
Financial results, net	9	(185,478)	(67,937)	(20,632)	(27,749)
(Loss)/Profit before income tax	(22,129)	13,528	13,769	(3,932)
Income tax benefit/(expense)	10	3,151	(3,993)	(10,273)	2,288
(Loss)/Profit for the period	(18,978)	9,535	3,496	(1,644)
Attributable to:
Equity holders of the parent	(19,852)	8,409	4,478	(1,696)
Non-controlling interest	874	1,126	(982)	52
(Loss)/Earnings per share attributable to
the equity holders of the parent during
the period:
Basic	(0.17)	0.047	0.038	(0.025)
Diluted	(0.17)	0.046	0.038	(0.025)

2017 (*)

(*) Prior periods have been adjusted to reflect the Company's change in accounting policy for investment properties as described in Note 27.

The accompanying notes are an integral part of these condensed consolidated interim financial statements

F- 3

Adecoagro S.A.

Condensed Consolidated Interim Statements of Comprehensive Income for the nine-month and three-month periods ended September 30, 2018 and 2017 (All amounts in US$ thousands, except shares and per share data and as otherwise indicated)

(Loss)/Profit for the period

Other comprehensive (loss) / income: Items that may be reclassified subsequently to profit or loss:

Exchange differences on translating foreign operations

Cash flow hedge, net of tax (Note 2)

Items that will not be reclassified to profit or loss:

Revaluation surplus net of tax (Note 10)

Other comprehensive (loss) / income for the period

Total comprehensive income / (loss) for the period

Attributable to:

Equity holders of the parent Non-controlling interest

Nine-months ended

September 30,2018

(18,978)

• 9,5353,496(1,644)

(138,733) (52,247)

422,857231,877

212,899

Three-months ended

September 30,2017 (*)

2018

(unaudited)

2017 (*)

4,349 13,202

-17,551

(66,759) 14,144 (27,928)15,710

422,857328,170

27,086

331,666

- 29,854

28,210

198,751 14,148

26,544 542

316,874 14,792

28,420

(210)

(*) Prior periods have been adjusted to reflect the Company's change in accounting policy for investment properties as described in Note 27.

The accompanying notes are an integral part of these condensed consolidated interim financial statements

F- 4

Adecoagro S.A.

Condensed Consolidated Interim Statements of Financial Position as of September 30, 2018 and December 31, 2017

(All amounts in US$ thousands, except shares and per share data and as otherwise indicated)

Other assets

646

535

566

Cash and cash equivalents 18

180,828

269,195

158,568

TOTAL ASSETS

2,154,593

1,645,089

1,496,397

Equity attributable to equity holders of the parent

1,018,606

673,880

700,334

TOTAL SHAREHOLDERS EQUITY

1,062,437

683,019

712,304

Provisions for other liabilities 24

2,971

4,078

3,299

Provisions for other liabilities 24

690

765

590

TOTAL LIABILITIES

1,092,156

962,070

784,093

September 30,	December 31,	December 31,
Note	2018	2017	2016
(unaudited)	(*)	(*)
ASSETS
Non-Current Assets
Property, plant and equipment	11	1,416,269	831,377	814,867
Investment property	12	40,725	42,342	44,581
Intangible assets	13	24,191	17,192	17,252
Biological assets	14	8,890	11,276	8,516
Deferred income tax assets	10	22,541	30,808	25,043
Trade and other receivables	16	22,747	22,107	17,412
Total Non-Current Assets	1,536,009	955,637	928,237
Current Assets
Biological assets	14	73,749	156,718	136,888
Inventories	17	159,712	108,919	111,754
Trade and other receivables	16	198,950	150,107	157,528
Derivative financial instruments	15	5,285	4,483	3,398
Other assets	60	30	24
Total Current Assets	618,584	689,452	568,160
SHAREHOLDERS EQUITY
Capital and reserves attributable to equity holders of the parent
Share capital	19	183,573	183,573	183,573
Share premium	19	900,503	908,934	937,250
Cumulative translation adjustment	(679,854)	(552,604)	(533,120)
Equity-settled compensation	15,391	17,852	17,218
Cash flow hedge	(76,934)	(24,691)	(37,299)
Treasury shares	(8,741)	(6,967)	(1,859)
Revaluation surplus	398,096	-	-
Reserve from the sale of non-controlling interests in subsidiaries	41,574	41,574	41,574
Retained earnings	244,998	106,209	92,997
Non-controlling interest	43,831	9,139	11,970
LIABILITIES
Non-Current Liabilities
Trade and other payables	21	1,991	827	1,427
Borrowings	22	649,761	663,060	430,304
Deferred income tax liabilities	10	158,391	10,457	14,689
Payroll and social security liabilities	23	1,109	1,240	1,235
Derivatives financial instruments	15	-	-	662
Total Non-Current Liabilities	814,223	679,662	451,616
Current Liabilities
Trade and other payables	21	77,143	98,423	92,158
Current income tax liabilities	1,111	503	1,387
Payroll and social security liabilities	23	26,797	27,267	26,844
Borrowings	22	165,372	154,898	205,092
Derivative financial instruments	15	6,820	552	6,406
Total Current Liabilities	277,933	282,408	332,477
TOTAL SHAREHOLDERS EQUITY AND LIABILITIES	2,154,593	1,645,089	1,496,397

(*) Prior periods have been adjusted to reflect the Company's change in accounting policy for Investment properties as described in Note 27.

The accompanying notes are an integral part of these condensed consolidated interim financial statements

F- 5