Page 160 - RusRPTSept21

18% in 2Q20 and 22.4% in 1Q21. The main positive surprise was the $0.89 per GDR dividend announced for 1H21 (the highest ever for 1H).
Agriculture. Revenues grew 66% y/y due to a six-fold increase y/y in wheat sales volumes (sales were postponed from 2020) and higher selling prices for most crops. This underpinned profitability, and EBITDA more than tripled y/y to R2.8bn in 2Q21, for a 48% margin.
Sugar. Sales volumes dropped 46% y/y in 2Q21, though this was partly offset by a 57% higher average sugar price. With the higher sugar beet prices, EBITDA came in at R1.9bn in 2Q21, down from R2.5bn in 2Q20, for a 26% margin.
Meat. Revenues grew 32% y/y in 2Q21 thanks to a 6% increase in sales volumes (new pig farms in Tambov Region reached full capacity) and higher prices (up 26% y/y). The EBITDA margin fell 4 pp y/y to 14% on EBITDA of R1.3bn amid higher costs for feed and animal health protection.
Oil and fats. Segment revenues rose 73% thanks to higher global prices. The division's EBITDA margin rose from 12% to 13%, an all-time high.
The BoD recommended a dividend for 1H21 of $119.7mn (R8.8bn at USD/RUB73.6), almost four times the average 1H interim dividend. This translates into $4.45 per share ($0.89 per GDR) and represents a 50% payout. The dividend record date is September 10, and the payment date is October 21 or earlier.
The results were strong, suggesting upside to our forecasts even though we had expected a better performance from the meat segment. We were also pleased by the dividend announcement. Rusagro continued to benefit from higher soft commodity prices (for crops, oils and fats) in 2Q21, though margins could narrow on an expected drop in grain and pork prices and 20% higher COGS. Meanwhile, a better pork sales mix and improved productivity should partly offset the impact of higher feed costs on the meat segment. During the earnings call, the management guided capex of R18-20bn in 2021 and R15-18bn in 2022. The company thinks it could post record financial figures in 2021.
160 RUSSIA Country Report September 2021 www.intellinews.com