A/S Trigon Agri: Continued improvement in year-on-year 1Q results

Key highlights

The first quarter of the year is usually the quietest quarter in cereals production, sales and storage segments of the Group as most of the Group’s fields are still covered under snow, elevators slow down their activities to prepare the facilities for the upcoming harvest in June and most of the trading volumes drop as contracts of last year’s harvest are typically coming to closure. The milk production operations do not have such seasonal dynamics as milk output is more stable from quarter to quarter. As most of the Group’s 2010 cereals produce was sold already in 2010, the Total revenue, other income and fair value adjustments in 1Q 2011 was less compared to the same period in previous year amounting to EUR 6,625 thousand (EUR 12,813 thousand in 1Q 2010). Also the cereals sales revenue from third party crops decreased due to lower volumes sold because of the export restrictions in force in Ukraine and Russia.

Total revenue, other income and fair value adjustments in 1Q 2011 consisted of Total revenue for the reporting period of EUR 3,976 thousand (EUR 11,269 thousand in 1Q 2010); Other income of EUR 484 thousand (EUR 448 thousand in 1Q 2010) and Gains arising from changes in fair value less estimated point-of-sale costs of biological assets of EUR 2,165 thousand (EUR 1,096 thousand in 1Q 2010).

In 1Q 2011 the total operating expenses amounted to EUR 8,618 thousand (EUR 15,340 thousand in 1Q 2010). The 44% decrease in operating expenses is primarily related to the lower cost of purchased goods due to lower cereals sales trading volumes but also to the significant decrease in other expenses and employee benefits expense. The latter is explained by the continued cost reduction and efficiency improvements carried out by the Group.

EBITDA in 1Q 2011 amounted to a loss of EUR 800 thousand (loss of EUR 2,166 thousand in 1Q 2010) whereas the EBITDA in Group’s cereals production clusters improved from a negative EBITDA loss of a EUR 2,562 thousand in 1Q 2010 to a loss of only a EUR 1,300 thousand in 1Q 2011. The improvement was also seen in the milk production segments where EBITDA improved from EUR 161 thousand in 1Q 2010 to EUR 401 thousand in 1Q 2011. The improvement in the agricultural production clusters is explained by the efficiency improvements and higher milk and cereals prices received compared to the same period in last year. EBITDA in cereals sales and trading and storage clusters decreased from EUR 235 thousand in 1Q 2010 to EUR 99 thousand in 1Q 2011 due to lower volumes.

The net profit of the Group amounted to a loss of EUR 2,963 thousand in 1Q 2011 (loss of EUR 3,448 thousand in 1Q 2010).

The consolidated assets of the Group as of March 31, 2011 amounted to EUR 144,103 thousand (EUR148,121 thousand at December 31, 2010). The net debt of the Group as of March 31, 2011 amounted to EUR 3,380 thousand (EUR -2,073 thousand at December 31, 2010, negative net debt means that cash and liquid securities in books are larger than outstanding borrowings).

 

Interim Report 1Q 2011

 

Investor enquiries:
Mr. Ülo Adamson, President of Trigon Agri A/S
Tel: +372 66 79200
E-mail: mail@trigonagri.com

 

About Trigon Agri
Trigon Agri is a leading integrated soft commodities production, storage and trading company with operations in Ukraine, Russia and Estonia. Trigon Agri’s shares are traded on the main market of NASDAQ OMX Stockholm. Trigon Agri is managed under a management agreement by Trigon Capital, a leading Central and Eastern European operational management firm with around USD 1 billion of assets under management.

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