Cresud Sociedad Anónima, Comercial, Inmobiliaria, Financiera y Agropecuaria
Unaudited Condensed Interim Consolidated Financial Statements as of December 31, 2023 and for the six and three-month periods ended as of that date, presented comparatively.
Denomination: Cresud Sociedad Anónima, Comercial, Inmobiliaria, Financiera y Agropecuaria | ||
Fiscal year N°: 91, beginning on July 1, 2023 | ||
Legal address: Carlos Della Paolera 261, 9rd floor – Autonomous City of Buenos Aires, Argentina | ||
Company activity: Real estate, agricultural, commercial and financial activities | ||
Date of registration of the by-laws in the Public Registry of Commerce: February 19, 1937 | ||
Date of registration of last amendment of the by-laws in the Public Registry of Commerce: Ordinary and Extraordinary General Assembly of October 28, 2022 registered in the General Inspection of Justice on December 5, 2022 under Number 22602 of Book 110 T- of Stock Companies. | ||
Expiration of Company charter: June 6, 2082 | ||
Registration number with the Supervisory Board of Companies: 26, folio 2, book 45, Stock Companies | ||
Stock: 594,174,957 common shares | ||
Common stock subscribed, issued and paid up nominal value (millions of ARS): 594 | ||
Control Group: Eduardo S. Elsztain directly and through Inversiones Financieras del Sur S.A., Agroinvestment S.A. and Consultores Venture Capital Uruguay S.A. | ||
Legal addresses: Bolívar 108, 1st floor, Autonomous City of Buenos Aires, Argentina (Eduardo S. Elsztain) - Road 8, km 17,500, Zonamérica Building 1, store 106, Montevideo, Uruguay (IFISA) - Cambara 1620, 2nd floor, office 202, Carrasco, 11000 Montevideo, Uruguay (Agroinvesment S.A.) | ||
Parent companies' activity: Investment | ||
Direct and indirect participation of the Control Group over the capital: 228,670,718 shares | ||
Voting stock (direct and indirect equity interest): 38.88% (*) | ||
Type of stock | CAPITAL STATUS | |
Authorized to be offered publicly (Shares) | Subscribed, Issued and Paid-in (millions of ARS) | |
Ordinary certified shares of ARS 1 face value and 1 vote each | 594,174,957 (**) | 594 |
(*) For computation purposes, treasury shares have been subtracted. | ||
(**) Company not included in the Optional Statutory System of Public Offer of Compulsory Acquisition. |
Index
Glossary of terms | 1 |
Unaudited Condensed Interim Consolidated Statements of Financial Position | 2 |
Unaudited Condensed Interim Consolidated Statements of Income and Other Comprehensive Income | 3 |
Unaudited Condensed Interim Consolidated Statements of Changes in Shareholders' Equity | 4 |
Unaudited Condensed Interim Consolidated Statements of Cash Flows | 6 |
Notes to the Unaudited Condensed Interim Consolidated Financial Statements: | |
Note 1 - The Group's business and general information | 7 |
Note 2 - Summary of significant accounting policies | 8 |
Note 3 - Seasonal effects on operations | 9 |
Note 4 - Acquisitions and disposals | 9 |
Note 5 - Financial risk management and fair value estimates | 11 |
Note 6 - Segment information | 11 |
Note 7 - Investments in associates and joint ventures | 16 |
Note 8 - Investment properties | 16 |
Note 9 - Property, plant and equipment | 18 |
Note 10 - Trading properties | 19 |
Note 11 - Intangible assets | 19 |
Note 12 - Right-of-use assets | 19 |
Note 13 - Biological assets | 20 |
Note 14 - Inventories | 21 |
Note 15 - Financial instruments by category | 21 |
Note 16 - Trade and other receivables | 23 |
Note 17 - Cash flow and cash equivalents information | 24 |
Note 18 - Trade and other payables | 25 |
Note 19 - Provisions | 25 |
Note 20 - Borrowings | 26 |
Note 21 - Taxation | 27 |
Note 22 - Revenues | 28 |
Note 23 - Costs | 28 |
Note 24 - Expenses by nature | 28 |
Note 25 - Other operating results, net | 29 |
Note 26 - Financial results, net | 29 |
Note 27 - Related parties transactions | 29 |
Note 28 - CNV General Resolution N° 622 | 31 |
Note 29 - Cost of sales and services provided | 31 |
Note 30 - Foreign currency assets and liabilities | 32 |
Note 31 - Result from discontinued operations | 33 |
Note 32 - Subsequent Events | 37 |
Glossary of terms
The following are not technical definitions but help the reader to understand certain terms used in the wording of the notes to the Group’s Financial Statements.
Terms | Definitions | |
BHSA | Banco Hipotecario S.A. | |
CAMSA | Consultores Assets Management S.A. | |
CCL | Cash settlement | |
CNV | Securities Exchange Commission (Argentina) | |
Condor | Condor Hospitality Trust Inc. | |
Cresud, “the Company”, ��us” | Cresud S.A.C.I.F. y A. | |
Financial Statements | Unaudited Condensed Interim Consolidated Financial Statements | |
CPF | Collective Promotion Funds | |
GCDI | GCDI S.A. | |
IFISA | Inversiones Financieras del Sur S.A. | |
IPC | Consumer's price index | |
IRSA | IRSA Inversiones y Representaciones S.A. | |
MEP | Electronic Payment Market | |
New Lipstick | New Lipstick LLC | |
IAS | International Accounting Standards | |
IFRS | International Financial Reporting Standards | |
NIS | New Israeli Shekel | |
Quality | Quality Invest S.A. | |
RECPAM | Result from exposure to changes in the purchasing power of the currency |
1
Cresud Sociedad Anónima,
Comercial, Inmobiliaria, Financiera y Agropecuaria
Unaudited Condensed Interim Consolidated Statement of Financial Position
as of December 31, 2023 and June 30, 2023
(All amounts in millions of Argentine pesos, except otherwise indicated)
Free translation from the original prepared in Spanish for publication in Argentina
Note | 12.31.2023 | 06.30.2023 | |
ASSETS | |||
Non-current assets | |||
Investment properties | 8 | 1,338,383 | 1,211,719 |
Property, plant and equipment | 9 | 414,245 | 300,809 |
Trading properties | 10 | 13,415 | 12,472 |
Intangible assets | 11 | 40,618 | 20,599 |
Group of assets held for sale | 2,458 | - | |
Right-of-use assets | 12 | 52,189 | 38,728 |
Biological assets | 13 | 20,248 | 19,230 |
Investment in associates and joint ventures | 7 | 88,152 | 82,006 |
Deferred income tax assets | 21 | 8,869 | 2,951 |
Income tax credit | 24 | 46 | |
Restricted assets | 15 | 3,718 | 2,484 |
Trade and other receivables | 16 | 93,767 | 69,668 |
Investment in financial assets | 15 | 6,662 | 4,267 |
Derivative financial instruments | 15 | 1,258 | 809 |
Total non-current assets | 2,084,006 | 1,765,788 | |
Current assets | |||
Trading properties | 10 | 371 | 298 |
Biological assets | 13 | 73,587 | 38,634 |
Inventories | 14 | 74,871 | 58,313 |
Income tax credit | 932 | 2,364 | |
Trade and other receivables | 16 | 228,050 | 160,829 |
Investment in financial assets | 15 | 121,446 | 90,563 |
Derivative financial instruments | 15 | 8,676 | 12,735 |
Cash and cash equivalents | 15 | 101,794 | 80,468 |
Total current assets | 609,727 | 444,204 | |
TOTAL ASSETS | 2,693,733 | 2,209,992 | |
SHAREHOLDERS’ EQUITY | |||
Shareholders' equity (according to corresponding statement) | 474,903 | 429,922 | |
Non-controlling interest | 667,581 | 562,346 | |
TOTAL SHAREHOLDERS' EQUITY | 1,142,484 | 992,268 | |
LIABILITIES | |||
Non-current liabilities | |||
Trade and other payables | 18 | 30,998 | 25,327 |
Borrowings | 20 | 482,015 | 329,324 |
Deferred income tax liabilities | 21 | 444,373 | 399,819 |
Provisions | 19 | 19,635 | 13,362 |
Payroll and social security liabilities | 707 | 701 | |
Lease liabilities | 57,254 | 36,859 | |
Derivative financial instruments | 15 | 46 | 96 |
Total non-current liabilities | 1,035,028 | 805,488 | |
Current liabilities | |||
Trade and other payables | 18 | 224,509 | 166,124 |
Borrowings | 20 | 258,603 | 212,249 |
Provisions | 19 | 1,622 | 1,789 |
Payroll and social security liabilities | 8,694 | 14,040 | |
Income tax liabilities | 6,681 | 3,414 | |
Lease liabilities | 14,093 | 12,045 | |
Derivative financial instruments | 15 | 2,019 | 2,575 |
Total Current liabilities | 516,221 | 412,236 | |
TOTAL LIABILITIES | 1,551,249 | 1,217,724 | |
TOTAL SHAREHOLDERS' EQUITY AND LIABILITIES | 2,693,733 | 2,209,992 |
The accompanying notes are an integral part of these Financial Statements.
) | ) | |||
Marcelo H. Fuxman Síndico Titular Por Comisión Fiscalizadora | Alejandro G. Elsztain Vice President II |
2
Cresud Sociedad Anónima,
Comercial, Inmobiliaria, Financiera y Agropecuaria
Unaudited Condensed Interim Consolidated Statement of Income and Other Comprehensive Income
for the six and three-month periods ended December 31, 2023 and 2022
(All amounts in millions of Argentine pesos, except otherwise indicated)
Free translation from the original prepared in Spanish for publication in Argentina
Six months | Three months | ||||
Note | 12.31.2023 | 12.31.2022 | 12.31.2023 | 12.31.2022 | |
Revenues | 22 | 204,745 | 210,149 | 101,239 | 101,073 |
Costs | 23 | (116,197) | (123,626) | (51,859) | (53,843) |
Initial recognition and changes in the fair value of biological assets and agricultural products at the point of harvest | (377) | (7,765) | 3,145 | (2,545) | |
Changes in the net realizable value of agricultural products after harvest | 6,924 | 1,423 | 4,466 | 478 | |
Gross profit | 95,095 | 80,181 | 56,991 | 45,163 | |
Net gain/ (loss) from fair value adjustment of investment properties | 8 | 139,697 | (89,946) | (15,026) | (65,804) |
Gain from disposal of farmlands | 4,223 | 1,761 | 4,181 | 1,670 | |
General and administrative expenses | 24 | (16,204) | (20,671) | (12,671) | (10,726) |
Selling expenses | 24 | (16,298) | (13,471) | (7,556) | (7,085) |
Other operating results, net | 25 | 5,510 | (6,857) | 654 | (11,299) |
Management fees | (5,638) | (3,807) | 1,335 | (2,247) | |
Profit/ (loss) from operations | 206,385 | (52,810) | 27,908 | (50,328) | |
Share of profit/ (loss) of associates and joint ventures | 7 | 19,873 | 2,528 | 16,984 | (507) |
Profit/ (loss) before financial results and income tax | 226,258 | (50,282) | 44,892 | (50,835) | |
Finance income | 26 | 8,662 | 3,419 | 4,774 | 2,012 |
Finance cost | 26 | (18,679) | (36,649) | (8,655) | (23,098) |
Other financial results | 26 | (124,628) | 24,085 | (119,120) | 12,097 |
Inflation adjustment | 26 | 68,277 | 36,540 | 53,721 | 13,349 |
Financial results, net | 26 | (66,368) | 27,395 | (69,280) | 4,360 |
Profit/ (loss) before income tax | 159,890 | (22,887) | (24,388) | (46,475) | |
Income tax | 21 | (37,685) | 82,794 | 25,542 | 87,272 |
Profit for the period | 122,205 | 59,907 | 1,154 | 40,797 | |
Other comprehensive income/ (loss): | |||||
Items that may be reclassified subsequently to profit or loss: | |||||
Currency translation adjustment and other comprehensive results from associates and joint ventures (i) | 137,233 | (9,096) | 148,006 | 8,191 | |
Revaluation surplus/ (deficit) | 1,056 | 974 | 396 | (665) | |
Total other comprehensive income/ (loss) for the period | 138,289 | (8,122) | 148,402 | 7,526 | |
Total comprehensive income for the period | 260,494 | 51,785 | 149,556 | 48,323 | |
Profit/ (loss) for the period attributable to: | |||||
Equity holders of the parent | 48,800 | 32,929 | (13,711) | 20,252 | |
Non-controlling interest | 73,405 | 26,978 | 14,865 | 20,545 | |
Total comprehensive income attributable to: | �� | ||||
Equity holders of the parent | 98,388 | 30,161 | 39,185 | 23,146 | |
Non-controlling interest | 162,106 | 21,624 | 110,371 | 25,177 | |
Profit/ (loss) for the period per share attributable to equity holders of the parent (ii): | |||||
Basic | 82.42 | 55.73 | (23.16) | 34.28 | |
Diluted | 69.91 | 47.67 | (23.16) | 29.32 |
(i)
The components of other comprehensive (loss)/ income do not generate an impact on income tax.
(ii)
See Note 30 to the Annual Consolidated Financial Statements as of June 30, 2023.
The accompanying notes are an integral part of these Financial Statements.
) | ) | |||
Marcelo H. Fuxman Síndico Titular Por Comisión Fiscalizadora | Alejandro G. Elsztain Vice President II |
3
Cresud Sociedad Anónima,
Comercial, Inmobiliaria, Financiera y Agropecuaria
Unaudited Condensed Interim Consolidated Statement of Changes in Shareholders’ Equity
for the six-month period ended December 31, 2023
(All amounts in millions of Argentine pesos, except otherwise indicated)
Free translation from the original prepared in Spanish for publication in Argentina
Attributable to equity holders of the parent | ||||||||||||
Share capital | ||||||||||||
Outstanding shares | Treasury shares | Inflation adjustment of share capital and treasury shares (i) | Warrants (ii) | Share premium | Additional paid-in capital from treasury shares | Legal reserve | Other reserves (iii) | Retained earnings | Subtotal | Non-controlling interest | Total Shareholders' equity | |
Balance as of June 30, 2023 | 586 | 7 | 113,036 | 10,552 | 140,280 | (7,919) | 10,847 | 93,087 | 69,446 | 429,922 | 562,346 | 992,268 |
Profit for the period | - | - | - | - | - | - | - | - | 48,800 | 48,800 | 73,405 | 122,205 |
Other comprehensive income for the period | - | - | - | - | - | - | - | 49,588 | - | 49,588 | 88,701 | 138,289 |
Total comprehensive income for the period | - | - | - | - | - | - | - | 49,588 | 48,800 | 98,388 | 162,106 | 260,494 |
Assignment of results - Shareholders’ meeting | - | - | - | - | - | - | 4,426 | 32,802 | (37,228) | - | - | - |
Repurchase of treasury shares | - | - | - | - | - | - | - | - | - | - | (2,519) | (2,519) |
Reserve for share - based payments | - | - | - | - | - | (187) | - | (43) | - | (230) | (422) | (652) |
Dividends distribution | - | - | - | - | - | - | - | - | (51,298) | (51,298) | (61,399) | (112,697) |
Exercise of warrants (ii) | 1 | - | 5 | (76) | 2,681 | - | - | - | - | 2,611 | 33 | 2,644 |
Issuance of shares | 1 | (1) | - | - | - | (753) | - | 753 | - | - | - | - |
Changes in non-controlling interest | - | - | - | - | - | - | - | (4,490) | - | (4,490) | 7,205 | 2,715 |
Other changes in shareholders' equity | - | - | - | - | - | - | - | 2,488 | (2,488) | - | - | - |
Capitalization of irrevocable contributions | - | - | - | - | - | - | - | - | - | - | 34 | 34 |
Integration of irrevocable contributions | - | - | - | - | - | - | - | - | - | - | 197 | 197 |
Balance as of December 31, 2023 | 588 | 6 | 113,041 | 10,476 | 142,961 | (8,859) | 15,273 | 174,185 | 27,232 | 474,903 | 667,581 | 1,142,484 |
(i) Includes ARS 8 of Inflation adjustment of treasury shares as of December 31, 2023. See Note 19 to the Annual Consolidated Financial Statements as of June 30, 2023.
(ii) As of December 31, 2023, the remaining warrants to exercise amount to 87,662,070, equivalent to the same number of shares. See Note 31 to these Financial Statements.
(iii) Group’s other reserves for the period ended December 31, 2023 are comprised as follows:
Cost of treasury shares | Reserve for currency translation adjustment | Reserve for future dividends | Reserve for the acquisition of securities issued by the Company | Special reserve | Other reserves (i) | Total other reserves | |
Balance as of June 30, 2023 | (5,350) | 12,295 | - | 1,091 | 70,742 | 14,309 | 93,087 |
Other comprehensive income for the period | - | 48,792 | - | - | - | 796 | 49,588 |
Total comprehensive income for the period | - | 48,792 | - | - | - | 796 | 49,588 |
Assignment of results - Shareholders’ meeting | - | - | 32,802 | - | - | - | 32,802 |
Issuance of shares | 753 | - | - | - | - | - | 753 |
Changes in non-controlling interest | - | - | - | - | - | (4,490) | (4,490) |
Reserve for share-based payments | 192 | - | - | - | - | (235) | (43) |
Other changes in shareholders' equity | - | - | - | - | 2,488 | - | 2,488 |
Balance as of December 31, 2023 | (4,405) | 61,087 | 32,802 | 1,091 | 73,230 | 10,380 | 174,185 |
(i) Includes revaluation surplus.
The accompanying notes are an integral part of these Financial Statements.
) | ) | |||
Marcelo H. Fuxman Síndico Titular Por Comisión Fiscalizadora | Alejandro G. Elsztain Vice President II |
4
Cresud Sociedad Anónima,
Comercial, Inmobiliaria, Financiera y Agropecuaria
Unaudited Condensed Interim Consolidated Statements of Changes in Shareholders’ Equity
for the six-month period ended December 31, 2022
(All amounts in millions of Argentine pesos, except otherwise indicated)
Free translation from the original prepared in Spanish for publication in Argentina
Attributable to equity holders of the parent | ||||||||||||
Share capital | ||||||||||||
Outstanding shares | Treasury shares | Inflation adjustment of share capital and treasury shares (i) | Warrants | Share premium | Additional paid-in capital from treasury shares | Legal reserve | Other reserves (ii) | Retained earnings | Subtotal | Non-controlling interest | Total Shareholders' equity | |
Balance as of June 30, 2022 | 590 | 2 | 113,028 | 10,702 | 139,093 | 1,013 | 5,118 | 2,867 | 94,269 | 366,682 | 554,626 | 921,308 |
Profit for the period | - | - | - | - | - | - | - | - | 32,929 | 32,929 | 26,978 | 59,907 |
Other comprehensive loss for the period | - | - | - | - | - | - | - | (2,768) | - | (2,768) | (5,354) | (8,122) |
Total comprehensive (loss)/ income for the period | - | - | - | - | - | - | - | (2,768) | 32,929 | 30,161 | 21,624 | 51,785 |
Assignment of results - Shareholders’ meeting | - | - | - | - | - | - | 5,729 | 95,044 | (100,773) | - | - | - |
Repurchase of treasury shares | (9) | 9 | - | - | - | - | - | (5,138) | - | (5,138) | (1,105) | (6,243) |
Reserve for share-based payments | - | - | - | - | - | - | - | 170 | - | 170 | 262 | 432 |
Exercise of warrants | - | - | 1 | (9) | 77 | - | - | - | - | 69 | 6 | 75 |
Changes in non-controlling interest | - | - | - | - | - | - | - | 10,320 | - | 10,320 | (15,088) | (4,768) |
Dividends distribution | - | - | - | - | - | - | - | - | (13,811) | (13,811) | (22,325) | (36,136) |
Other changes in shareholders' equity | - | - | - | - | - | - | - | (759) | - | (759) | (592) | (1,351) |
Incorporation by business combination | - | - | - | - | - | - | - | - | - | - | 59 | 59 |
Balance as of December 31, 2022 | 581 | 11 | 113,029 | 10,693 | 139,170 | 1,013 | 10,847 | 99,736 | 12,614 | 387,694 | 537,467 | 925,161 |
(i) Includes ARS 3 of Inflation adjustment of treasury shares as of December 31, 2022. See Note 19 to the Annual Consolidated Financial Statements as of June 30, 2022.
(ii) Group’s other reserves for the period ended December 31, 2022 are comprised as follows:
Cost of treasury shares | Reserve for currency translation adjustment | Reserve for the acquisition of securities issued by the Company | Special reserve | Other reserves (i) | Total other reserves | |
Balance as of June 30, 2022 | (1,625) | 5,512 | 1,091 | - | (2,111) | 2,867 |
Other comprehensive (loss)/ income for the period | - | (3,793) | - | - | 1,025 | (2,768) |
Total comprehensive (loss)/ income for the period | - | (3,793) | - | - | 1,025 | (2,768) |
Assignment of results - Shareholders’ meeting | - | - | - | 95,044 | - | 95,044 |
Repurchase of treasury shares | (5,138) | - | - | - | - | (5,138) |
Reserve for share-based payments | - | - | - | - | 170 | 170 |
Changes in non-controlling interest | - | - | - | - | 10,320 | 10,320 |
Other changes in shareholders' equity | - | (508) | - | - | (251) | (759) |
Balance as of December 31, 2022 | (6,763) | 1,211 | 1,091 | 95,044 | 9,153 | 99,736 |
(i) Includes revaluation surplus.
The accompanying notes are an integral part of these Financial Statements.
) | ) | |||
Marcelo H. Fuxman Síndico Titular Por Comisión Fiscalizadora | Alejandro G. Elsztain Vice President II |
5
Cresud Sociedad Anónima,
Comercial, Inmobiliaria, Financiera y Agropecuaria
Unaudited Condensed Interim Consolidated Statement of Cash Flows
for the six-month periods ended December 31, 2023 and 2022
(All amounts in millions of Argentine pesos, except otherwise indicated)
Free translation from the original prepared in Spanish for publication in Argentina
Note | 12.31.2023 | 12.31.2022 | |
Operating activities: | |||
Net cash generated from operating activities before income tax paid | 17 | 51,746 | 1,436 |
Income tax paid | (2,979) | (2,591) | |
Net cash generated from/ (used in) operating activities | 48,767 | (1,155) | |
Investing activities: | |||
Proceeds from the sale of participation in joint ventures | 13,015 | - | |
Capital contributions to associates and joint ventures | - | (50) | |
Acquisition and improvement of investment properties | (3,269) | (4,120) | |
Proceeds from sales of investment properties | 19,748 | 6,627 | |
Acquisitions and improvements of property, plant and equipment | (8,228) | (22,297) | |
Payment of acquisitions of property, plant and equipment | (21,981) | - | |
Acquisition of intangible assets | (572) | (255) | |
Proceeds from sales of property, plant and equipment | 26,915 | 17,560 | |
Dividends collected from associates and joint ventures | 245 | 1,149 | |
Proceeds from loans granted | 523 | 1,134 | |
Acquisitions of investments in financial assets | (140,742) | (41,557) | |
Proceeds from disposal of investments in financial assets | 162,757 | 59,289 | |
Interest received from financial assets | 5,789 | 174 | |
Payments of derivative financial instruments | 87 | (523) | |
Net cash generated from investing activities | 54,287 | 17,131 | |
Financing activities: | |||
Borrowings, issuance and new placement of non-convertible notes | 60,593 | 85,116 | |
Payment of borrowings and non-convertible notes | (68,658) | (106,582) | |
Obtaining/ (payments) of short term loans, net | 29,943 | (8,065) | |
Interest paid | (41,098) | (37,163) | |
Capital contributions from non-controlling interest in subsidiaries | 231 | - | |
Lease liabilities paid | (72) | (308) | |
Repurchase of treasury shares | (2,519) | (6,243) | |
Dividends paid | (93,559) | (29,743) | |
Exercise of warrants | 2,644 | 75 | |
Net cash used in financing activities | (112,495) | (102,913) | |
Net decrease in cash and cash equivalents | (9,441) | (86,937) | |
Cash and cash equivalents at the beginning of the period | 15 | 80,468 | 155,539 |
Foreign exchange gain on cash and unrealized fair value result for cash equivalents | 26,036 | 4,874 | |
Inflation adjustment | 4,731 | (6,617) | |
Cash and cash equivalents at the end of the period | 15 | 101,794 | 66,859 |
The accompanying notes are an integral part of these Financial Statements.
) | ) | |||
Marcelo H. Fuxman Síndico Titular Por Comisión Fiscalizadora | Alejandro G. Elsztain Vice President II |
6
Cresud Sociedad Anónima,
Comercial, Inmobiliaria, Financiera y Agropecuaria
Notes to the Unaudited Condensed Interim Consolidated Financial Statements
(All amounts in millions of Argentine pesos, except otherwise indicated)
1.
The Group’s business and general information
Cresud was founded in 1936 as a subsidiary of Credit Foncier, a Belgian company primarily engaged in providing rural and urban loans in Argentina and administering real estate holdings foreclosed by Credit Foncier. Credit Foncier was liquidated in 1959, and as part of such liquidation, the shares of Cresud were distributed to Credit Foncier’s shareholders. From the 1960s through the end of the 1970s, the business of Cresud shifted exclusively to agricultural activities.
In 2002, Cresud acquired a 19.85% interest in IRSA, a real estate company related to certain shareholders of Cresud. In 2009, Cresud increased its ownership percentage in IRSA to 55.64% and IRSA became Cresud’s direct principal subsidiary.
Cresud and its subsidiaries are collectively referred to hereinafter as the Group.
Main shareholders´ of the Company are jointly Inversiones Financieras del Sur S.A., Agroinvestment S.A and Consultores Venture Capital Uruguay S.A. This entities are companies incorporated in Uruguay and belong to the same controlling group and the ultimate beneficiary is Eduardo S. Elsztain.
Economic context in which the Group operated
The Group operated in an economic context whose main variables have shown strong volatility. The main ones are detailed below:
●
The country ended the year 2023 with a 1.4% decrease in activity, according to preliminary data from INDEC.
●
Accumulated inflation between January 1st and December 31, 2023 reached 211% (CPI).
●
Between these dates, the Argentine peso depreciated nominally against the US dollar, from ARS 180 to ARS 805 per dollar at the end of the period.
●
The monetary authority maintained exchange restrictions established in previous years throughout 2023 to contain the demand for dollars. These restrictions did not prevent meeting all the company's financial and contractual maturities.
On December 10, 2023 a new government took office in Argentina with plans to carry out extensive reforms of laws and regulations.
Among its first measures, the new government issued a Decree of Necessity and Urgency (DNU, by its Spanish acronym) modifying several laws, introducing reforms in the labor market, customs code, and the status of public companies, among others. Although the DNU must be discussed and ratified by at least one chamber of the National Congress, its provisions have been partially in force since December 29, 2023, considering a series of judicial actions that have granted the suspension of certain modifications.
Additionally, the National Congress was called to extraordinary sessions to consider a series of legislative initiatives, including an “Omnibus Law”.
The regulatory and legislative situation as of December 31, 2023, does not substantially differ from that established by the previous government. The company's financial statements should be read considering these circumstances.
The Board of Directors has approved these Financial Statements for issuance on February 8, 2024.
As of December 31, 2023, the Group operates in two major business lines: (i) agricultural business and (ii) urban property and investment business.
7
Cresud Sociedad Anónima,
Comercial, Inmobiliaria, Financiera y Agropecuaria
2.
Summary of significant accounting policies
2.1.
Basis of preparation
These financial statements have been prepared in accordance with IAS 34 “Interim financial reporting” and should therefore be read in conjunction with the Group's annual Consolidated Financial Statements as of June 30, 2023 prepared in accordance with IFRS Accounting Standards. Also, these financial statements include additional information required by Law No. 19,550 and / or regulations of the CNV. Such information is included in the notes to these financial statements, as accepted by IFRS Accounting Standards.
These financial statements for the interim periods of six months ended December 31, 2023 and 2022 have not been audited. Management considers that they include all the necessary adjustments to fairly present the results of each period. Intermediate period results do not necessarily reflect the proportion of the Group's results for the entire fiscal years.
IAS 29 "Financial Reporting in Hyperinflationary Economies" requires that the financial statements of an entity whose functional currency is one of a hyperinflationary economy be expressed in terms of the current unit of measurement at the closing date of the reporting period, regardless of whether they are based on the historical cost method or the current cost method. To do so, in general terms, the inflation produced from the date of acquisition or from the revaluation date, as applicable, must be calculated by non-monetary items. This requirement also includes the comparative information of the financial statements.
In order to conclude on whether an economy is categorized as highly inflationary in the terms of IAS 29, the standard details a series of factors to be considered, including the existence of an accumulated inflation rate in three years that approximates or exceeds 100%. Accumulated inflation in Argentina in three years is over 100%. For that reason, in accordance with IAS 29, Argentina must be considered a country with a highly inflationary economy starting July 1, 2018.
In relation to the inflation index to be used and in accordance with Argentine Federation of Professional Councils in Economic Sciences (FACPCE) Resolution No. 539/18, it is determined based on the Wholesale Price Index (IPIM) until 2016, considering the average variation of the Consumer Price Index (CPI) of the Autonomous City of Buenos Aires for the months of November and December 2015, because during those two months there were no national IPIM measurements. Then, from January 2017, the National Consumer Price Index (National CPI) is considered.
The table below presents the index for the period between the last fiscal year and as of December 31, 2023, and for the twelve month period ending on the same date, according to official statistics (INDEC) and following the guidelines described in Resolution 539/18.
As of December 31, 2023 (six months) | As of December 31, 2023 (twelve months) | |
Price variation | 107% | 211% |
As a consequence of the aforementioned, these financial statements as of December 31, 2023 were restated in accordance with IAS 29.
2.2
Accounting policies
The accounting policies applied in the presentation of these Financial Statements are consistent with those applied in the preparation of the Annual Financial Statements, as described in Note 2 to those Financial Statements.
2.3
Comparability of information
Balance items as of June 30, 2023 and December 31, 2022 presented in these Financial Statements for comparative purposes arise from the financial statements as of and for such period, restated in accordance with IAS 29 (See Note 2.1). Certain items from prior periods have been reclassified for consistency purposes.
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Cresud Sociedad Anónima,
Comercial, Inmobiliaria, Financiera y Agropecuaria
2.4
Use of estimates
The preparation of Financial Statements at a certain date requires Management to make estimations and evaluations affecting the amount of assets and liabilities recorded and contingent assets and liabilities disclosed at such date, as well as income and expenses recorded during the period. Actual results might differ from the estimates and evaluations made at the date of preparation of these financial statements. In the preparation of these financial statements, the significant judgments made by Management in applying the Group’s accounting policies and the main sources of uncertainty were the same as the ones applied by the Group in the preparation of the Annual Financial Statements described in Note 3 to those Financial Statements.
3.
Seasonal effects on operations
Agricultural business
Some of the Group’s businesses are more affected by seasonal effects than others. The operations of the Group’s agricultural business are subject to seasonal effects. The harvests and sale of grains in Argentina generally take place each year since June in the case of corn and soybean since March, since October in the case of wheat, and since December in the case of sunflower. In Brazil, the harvest and sale of soybean take place since February, and in the case of corn weather conditions make it possible to have two seasons, therefore the harvest take place between March and July. In Bolivia, weather conditions also make it possible to have two soybean, corn and sorghum seasons and, therefore, these crops are harvested in July and May, whereas wheat is harvested in August and September, respectively. In the case of sugarcane, harvest and sale take place between April and November of each year. Other segments of the agricultural business, such as beef cattle production tend to be more stable. However, beef cattle production is generally larger during the second quarter, when conditions are more favorable. As a result, there may be material fluctuations in the agricultural business results across quarters.
Urban properties and investments business
The operations of the Group’s shopping malls are subject to seasonal effects, which affect the level of sales recorded by lessees. During summertime in Argentina (January and February), the lessees of shopping malls experience the lowest sales levels in comparison with the winter holidays (July) and Christmas and year-end holidays celebrated in December, when they tend to record peaks of sales. Apparel stores generally change their collections during the spring and the fall, which impacts positively on shopping malls sales. Sale discounts at the end of each season also affect the business. As a consequence, for shopping mall operations, a higher level of business activity is expected in the period ranging between July and December, compared to the period between January and June.
4.
Acquisitions and disposals
Significant acquisitions and disposals for the six-month period ended December 31, 2023 are detailed below. Significant acquisitions and disposals for the fiscal year ended June 30, 2023, are detailed in Note 4 to the Annual Financial Statements.
Agricultural business
Sale of fraction of “Los Pozos” farm
On October 5, 2023, Cresud signed a transfer deed of ownership for the sale of a fraction of field land known as Registration 5,421 of the establishment called “Los Pozos” located in the province of Salta, with a total area of 4,262 hectares. The total price was USD 2.3 million, of which USD 1.4 remains to be received, which will be paid in two installments, the last of which is dated September 23, 2025, with a mortgage guarantee for said balance.
Sale of fraction of “El Tigre” farm
On December 14, 2023, Cresud signed a transfer deed of ownership for the sale of a fraction of 500 hectares of agricultural activity from its “El Tigre” farm, located in the department of Trenel, province of La Pampa, Argentina. The total price was USD 3.8 million, of which USD 0.9 remains to be received, which will be paid in two installments, the last of which is dated December 12, 2025, with a mortgage guarantee for said balance. After this transaction, the Company keeps the ownership of approximately 7,860 hectares of “El Tigre” farm.
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Cresud Sociedad Anónima,
Comercial, Inmobiliaria, Financiera y Agropecuaria
Urban property business and investments
“Maple Building" sale
On July 24, 2023, IRSA signed the deed for the sale of all the functional and complementary units of the “Maple Building” located at 664 Suipacha Street in the Autonomous City of Buenos Aires. The price of the operation was USD 6.75 million, of which USD 3 million has been collected in cash, USD 750,000 through the delivery of 3 functional units in a building owned by the buyer at Avenida Córdoba 637 in the Autonomous City of Buenos Aires, with a bailment agreement for 30 months and the remaining balance of USD 3 million will be paid as follows:
- USD 2.5 million in 10 semiannual, equal and consecutive installments of USD 250,000, the first due 24 months from the signing of the deed, with an annual interest of 5%;
- USD 0.5 million through the provision of services by the buyer, which were valued at the CCL exchange rate according to the conditions agreed in the contract.
“261 Della Paolera” floor sale
On August 9, 2023, IRSA signed the deed for the sale of the 9th floor of the "261 Della Paolera" tower located in the Catalinas neighborhood of the Autonomous City of Buenos Aires with a total of 1,184 square meters, 10 parking spaces, and 2 complementary units of the same building. The transaction price was approximate USD (MEP) 6.3 million, which had already been paid in ARS.
On October 5, 2023, the transfer deed was signed for the sale of the 25th and 26th floors of the “261 Della Paolera” tower located in the Catalinas neighborhood of the Autonomous City of Buenos Aires for a total of 2,395 square meters, 18 units of garages and 6 complementary units of the same building. The transaction price was approximately USD (MEP) 14.9 million, all of which were paid in full in ARS.
After this transaction, IRSA keeps the property of 4 floors of the building with an approximate leasable area of 4,937 sqm, in addition to parking spaces and other complementary spaces.
Vista al Muelle – Boating Trust transaction
On October 31, 2023, Vista al Muelle S.A. (VAM), a subsidiary of Liveck S.A., sold two of its plots in the department of Canelones (Uruguay) to the Boating Trust for USD 6 million. In the same transaction, the trust sold units in Tower II to VAM for USD 5 million, which VAM used to fully settle its debt with the Chamyan family. The operation resulted in a profit of USD 1 million.
Sale of Quality Investment S.A.
On August 31, 2023, IRSA sold and transferred 100% of its participation in Quality Invest S.A. representing 50% of the share capital. The amount of the transaction amounted to USD 22.9 million, of which USD 21.5 million has been collected together with the transfer of the shares and the balance of USD 1.4 million will be collected after 3 years, accruing an interest of 7% per year.
Ezpeleta land plot Barter Agreement
On December 7, 2023, IRSA has signed a barter agreement transferring the “Ezpeleta land plot” of 46 hectares, located in the district of Quilmes, Buenos Aires province.
The real estate project to be developed on the property consists of a gated community with 330 single-family lots and 6 macro lots for medium-density developments.
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Cresud Sociedad Anónima,
Comercial, Inmobiliaria, Financiera y Agropecuaria
The transaction price was set at USD 16.4 million and will be paid to IRSA through the delivery of 125 single-family lots of the project and also 40% of the buildable square meters of the multifamily lots of said project.
Additionally, IRSA received the sum of ARS 62.3 million in cash as part of the consideration.
Sale of GCDI common-shares
During the months of November and December 2023, IRSA sold 1,583,560 common-shares of GCDI, equivalent to 0.17% of the capital share, for a total of ARS 25.5 million.
Del Plata Building Trust
On November 10, 2023, IRSA executed a Trust Administration Contract at cost for a project development and construction of a residential building, stores (gastronomic use), and complementary parking spaces, which is subject to fulfillment of certain suspensive conditions detailed below, and in which the Company will have the character of money trustor. Likewise, and as beneficiary of the trust, IRSA will receive approximately 5,128 salable square meters and 32 parking spaces. TMF Trust Company (Argentina) S.A., a company with a fiduciary purpose that is not a related party, will act as trustee.
The aforementioned trust contract involves the contribution of a building owned by Banco Hipotecario S.A. (“BHSA”), an entity in which the Company holds a significant interest. The building is located in the block embraced by the streets Carlos Pellegrini, Presidente Perón, Sarmiento and Pasaje Carabelas, in the City of Buenos Aires. The contribution was made on December 28, 2023.
Finally, it is informed that the trust underlying project has pre-approval for the Microcentro district reconversion regime issued by the Government of the City of Buenos Aires (Law 6508).
5.
Financial risk management and fair value estimates
These Financial Statements do not include all the information and disclosures on financial risk management; therefore, they should be read along with Note 5 to the Annual Financial Statements. There have been no changes in risk management or risk management policies applied by the Group since year-end.
Since June 30, 2023 and up to the date of issuance of these Financial Statements, there have been no significant changes in business or economic circumstances affecting the fair value of the Group's assets or liabilities, (either measured at fair value or amortized cost).
6.
Segment information
As explained in Note 6 to the Annual Consolidated Financial Statements, segment information is reported from the perspective of products and services: (i) agricultural business and (ii) urban properties and investment business.
Below is a summary of the Group’s business units and a reconciliation between the operating income according to segment information and the operating income of the Statement of Income and Other Comprehensive Income of the Group for the periods ended December 31, 2023 and 2022:
11
Cresud Sociedad Anónima,
Comercial, Inmobiliaria, Financiera y Agropecuaria
Below is a summarized analysis of the lines of business of the Group for the period ended December 31, 2023:
12.31.2023 | |||||||
Agricultural business (I) | Urban Properties and Investment business (II) | Total segment information | Joint ventures (i) | Adjustments (ii) | Elimination of inter-segment transactions and non-reportable assets / liabilities (iii) | Total Statement of Income and Other Comprehensive Income/ Financial Position | |
Revenues | 103,563 | 84,304 | 187,867 | (457) | 17,610 | (275) | 204,745 |
Costs | (83,400) | (14,866) | (98,266) | 56 | (17,987) | - | (116,197) |
Initial recognition and changes in the fair value of biological assets and agricultural products at the point of harvest | (642) | - | (642) | - | - | 265 | (377) |
Changes in the net realizable value of agricultural products after harvest | 6,924 | - | 6,924 | - | - | - | 6,924 |
Gross profit/ (loss) | 26,445 | 69,438 | 95,883 | (401) | (377) | (10) | 95,095 |
Net gain from fair value adjustment of investment properties | 955 | 139,883 | 140,838 | (1,141) | - | - | 139,697 |
Gain from disposal of farmlands | 4,223 | - | 4,223 | - | - | - | 4,223 |
General and administrative expenses | (9,350) | (7,042) | (16,392) | 54 | - | 134 | (16,204) |
Selling expenses | (10,519) | (5,763) | (16,282) | 41 | - | (57) | (16,298) |
Other operating results, net | 7,281 | (1,842) | 5,439 | (7) | 147 | (69) | 5,510 |
Management fees | - | - | - | - | (5,638) | - | (5,638) |
Profit/ (loss) from operations | 19,035 | 194,674 | 213,709 | (1,454) | (5,868) | (2) | 206,385 |
Share of (loss)/ profit of associates and joint ventures | (55) | 18,970 | 18,915 | 958 | - | - | 19,873 |
Segment profit/ (loss) | 18,980 | 213,644 | 232,624 | (496) | (5,868) | (2) | 226,258 |
Reportable assets | 625,464 | 1,426,850 | 2,052,314 | 3,693 | - | 637,726 | 2,693,733 |
Reportable liabilities (*) | - | - | - | - | - | (1,551,249) | (1,551,249) |
Net reportable assets | 625,464 | 1,426,850 | 2,052,314 | 3,693 | - | (913,523) | 1,142,484 |
12
Cresud Sociedad Anónima,
Comercial, Inmobiliaria, Financiera y Agropecuaria
Below is a summarized analysis of the lines of business of the Group for the period ended December 31, 2022:
12.31.2022 | |||||||
Agricultural business (I) | Urban Properties and Investment business (II) | Total segment information | Joint ventures (i) | Adjustments (ii) | Elimination of inter-segment transactions and non-reportable assets / liabilities (iii) | Total Statement of Income and Other Comprehensive Income/ Financial Position | |
Revenues | 114,924 | 77,591 | 192,515 | (430) | 19,032 | (968) | 210,149 |
Costs | (90,951) | (13,479) | (104,430) | 196 | (19,392) | - | (123,626) |
Initial recognition and changes in the fair value of biological assets and agricultural products at the point of harvest | (8,012) | - | (8,012) | - | - | 247 | (7,765) |
Changes in the net realizable value of agricultural products after harvest | 1,423 | - | 1,423 | - | - | - | 1,423 |
Gross profit/ (loss) | 17,384 | 64,112 | 81,496 | (234) | (360) | (721) | 80,181 |
Net gain/ (loss) from fair value adjustment of investment properties | 279 | (92,383) | (92,104) | 2,158 | - | - | (89,946) |
Gain from disposal of farmlands | 1,761 | - | 1,761 | - | - | - | 1,761 |
General and administrative expenses | (8,390) | (12,517) | (20,907) | 63 | - | 173 | (20,671) |
Selling expenses | (10,030) | (4,057) | (14,087) | 27 | - | 589 | (13,471) |
Other operating results, net | 2,656 | (9,610) | (6,954) | (44) | 172 | (31) | (6,857) |
Management fees | - | - | - | - | (3,807) | - | (3,807) |
Profit/ (loss) from operations | 3,660 | (54,455) | (50,795) | 1,970 | (3,995) | 10 | (52,810) |
Share of (loss)/ profit of associates and joint ventures | (1,580) | 5,409 | 3,829 | (1,295) | - | (6) | 2,528 |
Segment profit/ (loss) | 2,080 | (49,046) | (46,966) | 675 | (3,995) | 4 | (50,282) |
Reportable assets | 438,418 | 1,016,712 | 1,455,130 | (5,710) | - | 772,794 | 2,222,214 |
Reportable liabilities (*) | - | - | - | - | - | (1,297,053) | (1,297,053) |
Net reportable assets | 438,418 | 1,016,712 | 1,455,130 | (5,710) | - | (524,259) | 925,161 |
(i)
Represents the equity value of joint ventures that were proportionately consolidated for information by segment purposes.
(ii)
Includes ARS (377) and ARS (360) corresponding to Expenses and FPC as of December 31, 2023 and 2022, respectively, and ARS 5,638 and ARS 3,807 to management fees, as of December 31, 2023 and 2022.
(iii)
Includes deferred income tax assets, income tax and MPIT credits, trade and other receivables, investment in financial assets, cash and cash equivalents and intangible assets except for rights to receive future units under barter agreements.
(*)
The CODM focuses its review on reportable assets.
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Cresud Sociedad Anónima,
Comercial, Inmobiliaria, Financiera y Agropecuaria
(I)
Agriculture line of business
The following tables present the reportable segments of the agriculture line of business:
12.31.2023 | |||||
Agricultural production | Land transformation and sales | Corporate | Others | Total Agricultural business | |
Revenues | 70,498 | - | - | 33,065 | 103,563 |
Costs | (62,914) | (66) | - | (20,420) | (83,400) |
Initial recognition and changes in the fair value of biological assets and agricultural products at the point of harvest | (642) | - | - | - | (642) |
Changes in the net realizable value of agricultural products after harvest | 6,924 | - | - | - | 6,924 |
Gross profit / (loss) | 13,866 | (66) | - | 12,645 | 26,445 |
Net gain from fair value adjustment of investment properties | - | 955 | - | - | 955 |
Gain from disposal of farmlands | - | 4,223 | - | - | 4,223 |
General and administrative expenses | (5,173) | (16) | (1,209) | (2,952) | (9,350) |
Selling expenses | (7,476) | (39) | - | (3,004) | (10,519) |
Other operating results, net | 302 | 5,575 | - | 1,404 | 7,281 |
Profit / (loss) from operations | 1,519 | 10,632 | (1,209) | 8,093 | 19,035 |
Share of profit/ (loss) of associates and joint ventures | 1,000 | - | - | (1,055) | (55) |
Segment profit / (loss) | 2,519 | 10,632 | (1,209) | 7,038 | 18,980 |
Investment properties | - | 66,269 | - | - | 66,269 |
Property, plant and equipment | 378,857 | 699 | - | 2,145 | 381,701 |
Investments in associates | 4,457 | - | - | 1,935 | 6,392 |
Other reportable assets | 120,626 | 2,458 | - | 48,018 | 171,102 |
Reportable assets | 503,940 | 69,426 | - | 52,098 | 625,464 |
12.31.2022 | |||||
Agricultural production | Land transformation and sales | Corporate | Others | Total Agricultural business | |
Revenues | 76,043 | - | - | 38,881 | 114,924 |
Costs | (68,651) | (84) | - | (22,216) | (90,951) |
Initial recognition and changes in the fair value of biological assets and agricultural products at the point of harvest | (8,012) | - | - | - | (8,012) |
Changes in the net realizable value of agricultural products after harvest | 1,423 | - | - | - | 1,423 |
Gross profit / (loss) | 803 | (84) | - | 16,665 | 17,384 |
Net gain from fair value adjustment of investment properties | - | 279 | - | - | 279 |
Gain from disposal of farmlands | - | 1,761 | - | - | 1,761 |
General and administrative expenses | (4,310) | (12) | (1,630) | (2,438) | (8,390) |
Selling expenses | (7,184) | (12) | - | (2,834) | (10,030) |
Other operating results, net | (1,427) | 3,429 | - | 654 | 2,656 |
(Loss) / profit from operations | (12,118) | 5,361 | (1,630) | 12,047 | 3,660 |
Share of loss of associates and joint ventures | (248) | - | - | (1,332) | (1,580) |
Segment (loss) / profit | (12,366) | 5,361 | (1,630) | 10,715 | 2,080 |
Investment properties | - | 60,734 | - | - | 60,734 |
Property, plant and equipment | 236,658 | 1,227 | - | 1,601 | 239,486 |
Investments in associates | 3,724 | - | - | 2,021 | 5,745 |
Other reportable assets | 83,500 | 601 | - | 48,352 | 132,453 |
Reportable assets | 323,882 | 62,562 | - | 51,974 | 438,418 |
Véase nuestro informe de fecha 11/11/22
PRICE WATERHOUSE & Co. S.R.L.
C.P.C.E.C.A.B.A. T° 1 F° 17
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Cresud Sociedad Anónima,
Comercial, Inmobiliaria, Financiera y Agropecuaria
(II)
Urban properties and investments line of business
Below is a summarized analysis of the lines of business of Group’s in the urban properties and investments line of business:
12.31.2023 | ||||||
Shopping Malls | Offices | Sales and developments | Hotels | Others | Total | |
Revenues | 56,210 | 3,512 | 4,527 | 18,871 | 1,184 | 84,304 |
Costs | (2,909) | (284) | (2,459) | (8,410) | (804) | (14,866) |
Gross profit | 53,301 | 3,228 | 2,068 | 10,461 | 380 | 69,438 |
Net gain/ (loss) from fair value adjustment of investment properties (i) | 152,015 | 466 | (12,968) | - | 370 | 139,883 |
General and administrative expenses | (6,475) | (620) | (2,572) | (2,734) | 5,359 | (7,042) |
Selling expenses | (2,466) | (112) | (1,705) | (1,286) | (194) | (5,763) |
Other operating results, net | (549) | (58) | (2,078) | (141) | 984 | (1,842) |
Profit / (Loss) from operations | 195,826 | 2,904 | (17,255) | 6,300 | 6,899 | 194,674 |
Share of profit of associates and joint ventures | - | - | - | - | 18,970 | 18,970 |
Segment profit / (loss) | 195,826 | 2,904 | (17,255) | 6,300 | 25,869 | 213,644 |
Investment and trading properties | 534,349 | 222,074 | 527,169 | - | 2,312 | 1,285,904 |
Property, plant and equipment | 1,221 | 220 | 10,611 | 16,100 | 1,794 | 29,946 |
Investment in associates and joint ventures | - | - | - | - | 77,950 | 77,950 |
Other reportable assets | 820 | 708 | 29,985 | 348 | 1,189 | 33,050 |
Reportable assets | 536,390 | 223,002 | 567,765 | 16,448 | 83,245 | 1,426,850 |
(i)
For the six-month period ended December 31, 2023, the net gain from fair value adjustment of investment properties was ARS 139,883. The net impact of the values in pesos of our properties was mainly a consequence of the change in macroeconomic conditions:
(a)
loss of ARS 8,128 as a consequence of the variation in the projected income growth rate increase and the conversion to dollars of the projected cash flow in pesos according to the exchange rate estimates used in the cash flow from shopping malls.
(b)
positive impact of ARS 355,318 resulting from the conversion into pesos of the value of the shopping malls in dollars based on the exchange rate at the end of the period.
(c)
an increase of 30 basis points in the discount rate used for cash flows and an increase of 15 basis points in the discount rate used for perpetuity, mainly due to an increase in the country-risk rate component and risk-free rate of the WACC discount rate used to discount the cash flow, which led to a decrease in the value of the shopping malls of ARS 6,565.
(d)
Additionally, due to the impact of the inflation adjustment, ARS 197,934 were reclassified for shopping malls from “Net gain from fair value adjustment” to “Inflation Adjustment” in the Statement of Income and Other Comprehensive Income.
(e)
The value of our office buildings and other rental properties measured in real terms decreased by 9.18% during the six-month period ended as of December 31, 2023, due to the variation of the implicit exchange rate. Likewise, there is an impact for the sales of the period.
12.31.2022 | ||||||
��Shopping Malls | Offices | Sales and developments | Hotels | Others | Total | |
Revenues | 49,181 | 5,092 | 6,764 | 15,480 | 1,074 | 77,591 |
Costs | (3,179) | (395) | (1,554) | (7,492) | (859) | (13,479) |
Gross profit | 46,002 | 4,697 | 5,210 | 7,988 | 215 | 64,112 |
Net loss from fair value adjustment of investment properties | (18,364) | (24,140) | (49,726) | - | (153) | (92,383) |
General and administrative expenses | (6,048) | (820) | (2,242) | (2,236) | (1,171) | (12,517) |
Selling expenses | (2,283) | (65) | (436) | (1,158) | (115) | (4,057) |
Other operating results, net | 358 | (44) | (9) | (75) | (9,840) | (9,610) |
Profit / (Loss) from operations | 19,665 | (20,372) | (47,203) | 4,519 | (11,064) | (54,455) |
Share of profit of associates and joint ventures | - | - | - | - | 5,409 | 5,409 |
Segment profit / (loss) | 19,665 | (20,372) | (47,203) | 4,519 | (5,655) | (49,046) |
Investment and trading properties | 285,779 | 206,983 | 430,680 | - | 1,339 | 924,781 |
Property, plant and equipment | 813 | 15,088 | 10,610 | 14,203 | 3,338 | 44,052 |
Investment in associates and joint ventures | - | - | - | - | 36,055 | 36,055 |
Other reportable assets | 778 | 707 | 9,293 | 187 | 859 | 11,824 |
Reportable assets | 287,370 | 222,778 | 450,583 | 14,390 | 41,591 | 1,016,712 |
Véase nuestro informe de fecha 11/11/22
PRICE WATERHOUSE & Co. S.R.L.
C.P.C.E.C.A.B.A. T° 1 F° 17
15
Cresud Sociedad Anónima,
Comercial, Inmobiliaria, Financiera y Agropecuaria
7.
Investments in associates and joint ventures
Changes in the Group’s investments in associates and joint ventures for the six-month period ended December 31, 2023 and for the year ended June 30, 2023 were as follows:
12.31.2023 | 06.30.2023 | |
Beginning of the period/ year | 82,004 | 79,794 |
Share capital increase and contributions (Note 27) | - | 113 |
Sale of interest in joint ventures (Note 27) | (14,462) | - |
Share of profit | 19,873 | 3,262 |
Other comprehensive income | 976 | 104 |
Dividends (Note 27) | (245) | (1,318) |
Others | - | 49 |
End of the period/ year (i) | 88,146 | 82,004 |
(i)
As of December 31, 2023 includes ARS (6) and as of June 30, 2023 includes ARS (2) reflecting interests in companies with negative equity, which were disclosed in “Provisions” (see Note 19).
Below is additional information about the Group’s investments in associates and joint ventures:
% ownership interest | Value of Group's interest in equity | Group's interest in comprehensive income/ (loss) | ||||
Name of the entity | 12.31.2023 | 06.30.2023 | 12.31.2023 | 06.30.2023 | 12.31.2023 | 12.31.2022 |
New Lipstick | 49.96% | 49.96% | 945 | 502 | 327 | 6 |
BHSA | 29.91% | 29.91% | 62,256 | 49,430 | 12,826 | 3,893 |
GCDI (2) | 27.94% | 27.82% | 2,772 | 3,958 | (1,165) | (44) |
Quality (1) | - | 50.00% | - | 14,440 | - | (1,526) |
La Rural S.A. | 50.00% | 50.00% | 8,595 | 2,509 | 6,085 | 1,585 |
Other associates and joint ventures | N/A | N/A | 13,578 | 11,165 | 2,776 | (1,386) |
Total associates and joint ventures | 88,146 | 82,004 | 20,849 | 2,528 |
Last financial statement issued | ||||||
Name of the entity | Location of business / Country of incorporation | Main activity | Common shares 1 vote | Share capital (nominal value) | (Loss)/ profit for the period | Shareholders' equity |
New Lipstick | U.S. | Real estate | 23,631,037 | (*) 47 | (*) (1) | (*) (46) |
BHSA | Argentina | Financing | 448,689,072 | (**) 1,500 | (**) 42,877 | (**) 203,407 |
GCDI (2) | Argentina | Real estate | 255,747,035 | 915 | (1,637) | 9,918 |
La Rural S.A. | Argentina | Organization of events | 715 | 1 | 12,245 | 16,811 |
(*) Amounts expressed in dollars under USGAAP.
(**)
Information as of December 31, 2023 according to NIIF.
(1)
The interest held in Quality S.A. was sold on August 31, 2023. See Note 4 to these financial statements.
(2)
See Note 8 to the annual consolidated financial statements as of June 30, 2023.
8.
Investment properties
Changes in the Group’s investment properties for the six-month period ended December 31, 2023 and for the year ended June 30, 2023 were as follows:
12.31.2023 | 06.30.2023 | |||
Level 2 | Level 3 | Level 2 | Level 3 | |
Fair value at the beginning of the period/ year | 846,116 | 365,603 | 969,871 | 377,524 |
Additions | 1,264 | 2,356 | 6,856 | 5,603 |
Disposals | (21,707) | - | (53,646) | - |
Transfers | (16,003) | (2) | 6,721 | 1,823 |
Net (loss)/ gain from fair value adjustment | (8,854) | 148,551 | (87,381) | (19,417) |
Additions of capitalized leasing costs | 3 | 41 | 28 | 105 |
Amortization of capitalized leasing costs (i) | (45) | (60) | (38) | (35) |
Currency translation adjustment | 21,120 | - | 3,705 | - |
Fair value at the end of the period/ year | 821,894 | 516,489 | 846,116 | 365,603 |
(i) Amortization charges of capitalized leasing costs were included in “Costs” in the Statement of Income and Other Comprehensive Income (Note 24).
Véase nuestro informe de fecha 11/11/22
PRICE WATERHOUSE & Co. S.R.L.
C.P.C.E.C.A.B.A. T° 1 F° 17
16
Cresud Sociedad Anónima,
Comercial, Inmobiliaria, Financiera y Agropecuaria
The following is the balance by type of investment property of the Group as of December 31, 2023 and June 30, 2023:
12.31.2023 | 06.30.2023 | |
Leased out farmland | 66,268 | 54,266 |
Offices and other rental properties | 232,388 | 253,184 |
Shopping malls (i) | 534,344 | 383,498 |
Undeveloped parcels of land | 503,680 | 519,532 |
Properties under development | 1,703 | 1,239 |
Total | 1,338,383 | 1,211,719 |
(i)
Includes parking spaces.
The following amounts have been recognized in the Statement of Income and Other Comprehensive Income:
12.31.2023 | 12.31.2022 | |
Revenues | 81,503 | 76,326 |
Direct operating expenses | (24,126) | (24,930) |
Development expenses | (409) | (241) |
Net unrealized gain/ (loss) from fair value adjustment of investment property (i) | 125,545 | (93,375) |
Net realized gain from fair value adjustment of investment property (ii) | 14,152 | 3,429 |
(i)
It includes the result from changes in the fair value of those investment properties that are in the portfolio and have not yet been sold. It has been generated in accordance with what is described in the section called "valuation techniques".
(ii)
As of December 31, 2023 corresponds (ARS 9,260) to the realized result from fair value adjustment for the period ((ARS 10,163) for the Ezpeleta land plot barter agreement, ARS 4,114 for the sale of floors in the “261 Della Paolera” building, (ARS 3,206) for the sale of Maple Building and (ARS 5) for the sale of parking spaces in Libertador 498) and ARS 23,412 for realized result from fair value adjustment made in previous years (ARS 11,064 for the Ezpeleta land plot barter agreement, ARS 8,258 for the sale of floors in the “261 Della Paolera” building, ARS 3,977 for the sale of Maple Building and ARS 113 for the sale of parking spaces in Libertador 498). As of December 31, 2022, ARS 193 corresponds to the result for changes in the fair value realized for the period ((ARS 34) for the sale of parking spaces in Libertador 498 and ARS 227 for the sale of floors in the “261 Della Paolera” building) and ARS 3,236 for the result of changes in fair value made in previous years (ARS 149 for the sale of parking spaces in Libertador 498 and ARS 3,087 for the sale of floors in the “261 Della Paolera” building).
Valuation techniques are described in Note 9 to the Annual Financial Statements. There were no changes to such techniques.
Costa Urbana –former Solares de Santa María– Costanera Sur, Buenos Aires City (IRSA)
On December 21, 2021, it was published the law from Buenos Aires City congress approving the Regulations for the development of the property of approximately 70 hectares, owned by the Company since 1997, previously known as "Solares de Santa María", located in front of the Río de la Plata in the South Coast of the Autonomous City of Buenos Aires, southeast of Puerto Madero. The published law grants a New Standard, designated: "U73 - Public Park and Costa Urbana Urbanization", which enables the combination of diverse uses such as homes, offices, retail, services, public spaces, education, and entertainment.
IRSA will have a construction capacity of approximately 866,806 sqm, which will drive growth for the coming years through the development of mixed-use projects.
IRSA agreed to give in 50.8 hectares for public use, which represents approximately 71% of the total area of the property to the development of public green spaces and will contribute with three additional lots of the property, two for the Sustainable Urban Development Fund (FODUS) and one for the Innovation Trust, Science and Technology of the Government of the Autonomous City of Buenos Aires, and the sum of USD 2 million in cash and the amount of 3,000,000 sovereign bonds (AL35) which have already been paid.
In March 2023, Mensura was approved with a proposal for subdivision, fractioning, transfer of streets and public space and we are in the process of deeding the 3 plots and the public park sector that is transferred for consideration.
Likewise, the Company will be in charge of the infrastructure and road works on the property and will carry out the public space works contributing up to USD 40 million together with the maintenance of the public spaces assigned for 10 years or until the sum of USD 10 million is completed.
Véase nuestro informe de fecha 11/11/22
PRICE WATERHOUSE & Co. S.R.L.
C.P.C.E.C.A.B.A. T° 1 F° 17
17
Cresud Sociedad Anónima,
Comercial, Inmobiliaria, Financiera y Agropecuaria
“Costa Urbana” will change the landscape of Buenos Aires City, giving life to an undeveloped area and will be in an exceptional property due to its size, location and connectivity, providing the City the possibility of expanding and recovering access to the Río de la Plata coast with areas for walks, recreation, green spaces, public parks and mixed uses.
On the judicial front, it should be noted that there are two (2) related judicial processes:
(i)
On October 29, 2021, IRSA was notified of the amparo lawsuit initiated by the Civil Association Observatory of Law in the City in relation to the property, in which it was stated that there were nullities that affected the approval process of the Agreement. Urban Planning (CU). The lawsuit was subsequently expanded, also challenging issues proposed in the CU. IRSA proceeded to answer the claim on November 12, 2021, requesting its rejection, and on March 10, 2022, the court issued a ruling partially granting protection, which was appealed by the Company and the GCBA. On March 6, 2023, the Chamber of Administrative, Tax and Consumer Relations Litigation - Chamber IV decided to revoke the first instance ruling, and consequently reject the claim. Since this ruling was not appealed, the case has concluded favorably for the Company.
(ii)
On October 18, 2023, IRSA was notified of the amparo lawsuit initiated by Messrs. Jonatan Baldiviezo and María Eva Koutsovitis in relation to the property, in which they intend to suspend the holding of the public hearing (which took place in August 2021), extend the registration period for the aforementioned hearing and declare the nullity of the public hearing, in the event that it had already been carried out, based on alleged violations of the right to informed participation in the same and access to environmental information. In this regard, IRSA answered the complaint on November 1, 2023, requesting its rejection. This is based on the fact that the issue was already partially resolved by the trial referred to in point (i), and that all the relevant information for carrying out the approval process of the Urban Planning Agreement was fully provided. The environmental issues of the project must be addressed at the corresponding stage, as established by Law 123. On November 8, 2023, the Public Prosecutor's Office issued an opinion recommending that the action be rejected. As of the current date, the case is pending judgment. Considering the issues discussed in this process, a resolution favorable to the interests of IRSA is expected.
9.
Property, plant and equipment
Changes in the Group’s property, plant and equipment for the six-month period ended December 31, 2023 and for the year ended June 30, 2023 were as follows:
Owner occupied farmland | Bearer plant (iii) | Buildings and facilities | Machinery and equipment | Others (i) | 12.31.2023 | 06.30.2023 | |
Costs | 261,865 | 21,045 | 66,855 | 22,704 | 13,484 | 385,953 | 339,795 |
Accumulated depreciation | (22,351) | (11,939) | (23,010) | (20,474) | (7,370) | (85,144) | (75,005) |
Net book amount at the beginning of the period / year | 239,514 | 9,106 | 43,845 | 2,230 | 6,114 | 300,809 | 264,790 |
Additions | 9,102 | 1,157 | 2,011 | 622 | 777 | 13,669 | 53,194 |
Disposals | (590) | - | (7,014) | (3) | (98) | (7,705) | (15,379) |
Currency translation adjustment | 95,088 | 4,039 | 3,028 | (8) | 1,892 | 104,039 | 13,659 |
Transfers | 11,424 | (37) | - | 6 | - | 11,393 | (5,316) |
Transfers to assets held for sale | (1,575) | - | - | - | - | (1,575) | - |
Depreciation charges (ii) | (1,920) | (2,120) | (1,365) | (462) | (518) | (6,385) | (10,139) |
Balances at the end of the period / year | 351,043 | 12,145 | 40,505 | 2,385 | 8,167 | 414,245 | 300,809 |
Costs | 375,314 | 26,204 | 64,880 | 23,321 | 16,055 | 505,774 | 385,953 |
Accumulated depreciation | (24,271) | (14,059) | (24,375) | (20,936) | (7,888) | (91,529) | (85,144) |
Net book amount at the end of the period / year | 351,043 | 12,145 | 40,505 | 2,385 | 8,167 | 414,245 | 300,809 |
(i)
Includes furniture and fixtures and vehicles.
(ii)
As of December 31, 2023, the depreciation charge has been charged to the line "Costs" for ARS 1,219, "General and administrative expenses" for ARS 555 and "Selling expenses" for ARS 58, in the Statement of Income and Other Comprehensive Income (Note 24), ARS 4,553 were capitalized as part of the cost of biological assets.
(iii)
Corresponds to the plantation of sugarcane with a useful life of more than one year.
Véase nuestro informe de fecha 11/11/22
PRICE WATERHOUSE & Co. S.R.L.
C.P.C.E.C.A.B.A. T° 1 F° 17
18
Cresud Sociedad Anónima,
Comercial, Inmobiliaria, Financiera y Agropecuaria
10.
Trading properties
Changes in the Group’s trading properties for the six-month period ended December 31, 2023 and for the year ended June 30, 2023 were as follows:
Completed properties | Properties under development | Undeveloped properties | 12.31.2023 | 06.30.2023 | |
Beginning of the period / year | 1,228 | 6,703 | 4,839 | 12,770 | 14,410 |
Additions | - | 189 | 24 | 213 | 655 |
Currency translation adjustment | - | 2,378 | - | 2,378 | 30 |
Transfers | - | - | - | - | (893) |
Disposals | (23) | (1,552) | - | (1,575) | (1,432) |
End of the period / year | 1,205 | 7,718 | 4,863 | 13,786 | 12,770 |
Non-current | 13,415 | 12,472 | |||
Current | 371 | 298 | |||
Total | 13,786 | 12,770 |
11.
Intangible assets
Changes in the Group’s intangible assets for the six-month period ended December 31, 2023 and for the year ended June 30, 2023 were as follows:
Goodwill | Information systems and software | Future units to receive under barter transactions and others | 12.31.2023 | 06.30.2023 | |
Costs | 2,718 | 8,719 | 21,349 | 32,786 | 30,144 |
Accumulated amortization | - | (7,562) | (4,625) | (12,187) | (11,067) |
Net book amount at the beginning of the period / year | 2,718 | 1,157 | 16,724 | 20,599 | 19,077 |
Additions | 5 | 566 | 4,392 | 4,963 | 3,391 |
Disposals | - | - | (132) | (132) | (378) |
Transfers | - | - | 15,248 | 15,248 | (412) |
Currency translation adjustment | 161 | 183 | - | 344 | 41 |
Amortization charges (i) | - | (336) | (68) | (404) | (1,120) |
Balances at the end of the period / year | 2,884 | 1,570 | 36,164 | 40,618 | 20,599 |
Costs | 2,884 | 9,468 | 40,857 | 53,209 | 32,786 |
Accumulated amortization | - | (7,898) | (4,693) | (12,591) | (12,187) |
Net book amount at the end of the period / year | 2,884 | 1,570 | 36,164 | 40,618 | 20,599 |
(i)
As of December 31, 2023, amortization charge was recognized in the amount of ARS 155 under "Costs" and in the amount of ARS 249 under "General and administrative expenses" in the Statement of Income and Other Comprehensive Income (Note 24).
12.
Right of use assets
The Group’s right-of-use assets as of December 31, 2023 and June 30, 2023 are the following:
12.31.2023 | 06.30.2023 | |
Farmland | 42,192 | 31,487 |
Convention center | 4,964 | 5,120 |
Offices, shopping malls and other buildings | 3,172 | 1,705 |
Machinery and equipment | 1,861 | 416 |
Right-of-use assets | 52,189 | 38,728 |
Non-current | 52,189 | 38,728 |
Total | 52,189 | 38,728 |
The depreciation charge of the right of use assets is detailed below:
12.31.2023 | 12.31.2022 | |
Farmland | 3,864 | 5,649 |
Convention center | 155 | 155 |
Offices, shopping malls and other buildings | 370 | 144 |
Machinery and equipment | 181 | 96 |
Depreciation charge of right-of-use assets (i) | 4,570 | 6,044 |
(i)
As of December 31, 2023, the amortization charge has been allocated ARS 281 within "Costs", ARS 149 in "General and administrative expenses" and ARS 96 in “Selling expenses” in the Statement of Income and Other Comprehensive Income (Note 24), ARS 4,044 were capitalized as part of the cost of biological assets.
Véase nuestro informe de fecha 11/11/22
PRICE WATERHOUSE & Co. S.R.L.
C.P.C.E.C.A.B.A. T° 1 F° 17
19
Cresud Sociedad Anónima,
Comercial, Inmobiliaria, Financiera y Agropecuaria
13.
Biological assets
Changes in the Group’s biological assets and their allocation to the fair value hierarchy for the six-month period ended December 31, 2023 and for the year ended June 30, 2023 were as follows:
Agricultural business | ||||||||
Sown land-crops | Sugarcane fields | Breeding cattle and cattle for sale (i) | Other cattle (i) | Others | 12.31.2023 | 06.30.2023 | ||
Level 1 | Level 3 | Level 3 | Level 2 | Level 2 | Level 1 | |||
Net book amount at the beginning of the period / year | 18,383 | 3,586 | 12,950 | 22,361 | 347 | 237 | 57,864 | 68,087 |
Purchases | - | - | - | 1,632 | - | - | 1,632 | 2,419 |
Transfers | (503) | 503 | - | - | - | - | - | - |
Initial recognition and changes in the fair value of biological assets | - | 638 | (771) | (253) | (98) | - | (484) | (2,783) |
Decrease due to harvest | - | (34,183) | (20,627) | - | - | - | (54,810) | (145,421) |
Sales | - | - | - | (5,010) | (3) | - | (5,013) | (9,464) |
Consumes | - | - | - | (26) | (1) | (27) | (54) | (117) |
Costs for the period / year | 12,454 | 36,166 | 18,184 | 5,738 | - | 4 | 72,546 | 142,892 |
Currency translation adjustment | 14,339 | 645 | 4,837 | 2,333 | - | - | 22,154 | 2,251 |
Balances at the end of the period / year | 44,673 | 7,355 | 14,573 | 26,775 | 245 | 214 | 93,835 | 57,864 |
Non-current (Production) | - | - | - | 19,848 | 188 | 212 | 20,248 | 19,230 |
Current (Consumable) | 44,673 | 7,355 | 14,573 | 6,927 | 57 | 2 | 73,587 | 38,634 |
Net book amount at the end of the period / year | 44,673 | 7,355 | 14,573 | 26,775 | 245 | 214 | 93,835 | 57,864 |
(i)
Biological assets with a production cycle of more than one year (that is, cattle) generated “Initial recognition and changes in fair value of biological assets” amounting to ARS (351) and ARS (17,093) for the six-month period ended December 31, 2023 and for the fiscal year ended June 30, 2023, respectively; amounts of ARS 1,925 and ARS (10,638), was attributable to price changes, and amounts of ARS (2,276) and ARS (6,455), was attributable to physical changes, respectively.
During the six-month period ended December 31, 2023, there were transfers for ARS 503 between the fair value hierarchies 1 and 3 of sown land-crops. Likewise, there were no reclassifications among their respective categories.
The fair value less estimated point of sale costs of agricultural produce at the point of harvest (which have been harvested during the period/year) amount to ARS 36,804 and ARS 140,109 for the six-month period ended December 31, 2023 and the year ended June 30, 2023, respectively.
See information on valuation processes used by the entity in Note 14 to the Annual Financial Statements.
As of December 31, 2023, and June 30, 2023, the better and maximum use of biological assets shall not significantly differ from the current use.
Capitalized cost of production as of December 31, 2023 and 2022 are as follows:
12.31.2023 | 12.31.2022 | |
Supplies and labors | 55,736 | 69,400 |
Salaries, social security costs and other personnel expenses | 3,481 | 2,812 |
Depreciation and amortization | 8,597 | 9,146 |
Fees and payments for services | 171 | 125 |
Maintenance, security, cleaning, repairs and others | 496 | 476 |
Taxes, rates and contributions | 62 | 106 |
Leases and service charges | 39 | 22 |
Freights | 330 | 480 |
Travelling, library expenses and stationery | 400 | 417 |
Other expenses | 3,234 | 8,791 |
72,546 | 91,775 |
Véase nuestro informe de fecha 11/11/22
PRICE WATERHOUSE & Co. S.R.L.
C.P.C.E.C.A.B.A. T° 1 F° 17
20
Cresud Sociedad Anónima,
Comercial, Inmobiliaria, Financiera y Agropecuaria
14.
Inventories
Breakdown of Group’s inventories as of December 31, 2023 and June 30, 2023 are as follows:
12.31.2023 | 06.30.2023 | |
Crops | 26,251 | 26,642 |
Materials and supplies | 47,344 | 30,841 |
Sugarcane | 928 | 417 |
Agricultural inventories | 74,523 | 57,900 |
Supplies for hotels | 348 | 413 |
Total inventories | 74,871 | 58,313 |
15.
Financial instruments by category
Determining fair values
The present note shows the financial assets and financial liabilities by category of financial instrument and a reconciliation to the corresponding line in the Consolidated Statements of Financial Position, as appropriate. Financial assets and liabilities measured at fair value are assigned based on their different levels in the fair value hierarchy. For further information related to fair value hierarchy refer to Note 16 to the Annual Financial Statements.
Financial assets and financial liabilities as of December 31, 2023 are as follows:
Financial assets at fair value through profit or loss | ||||||
Financial assets at amortized cost | Level 1 | Level 2 | Subtotal financial assets | Non-financial assets | Total | |
December 31, 2023 | ||||||
Assets as per Statement of Financial Position | ||||||
Trade and other receivables (excluding the allowance for doubtful accounts and other receivables) (Note 16) | 223,847 | 35,292 | - | 259,139 | 65,828 | 324,967 |
Investment in financial assets: | ||||||
- Public companies’ securities | - | 13,871 | - | 13,871 | - | 13,871 |
- Bonds | - | 35,659 | - | 35,659 | - | 35,659 |
- Mutual funds | - | 56,518 | 639 | 57,157 | - | 57,157 |
- Others | 2,605 | 18,816 | - | 21,421 | - | 21,421 |
Derivative financial instruments: | ||||||
- Commodities options contracts | - | 1,605 | - | 1,605 | - | 1,605 |
- Commodities futures contracts | - | 361 | - | 361 | - | 361 |
- Foreign-currency options contracts | - | 520 | - | 520 | - | 520 |
- Foreign-currency future contracts | - | 4,006 | - | 4,006 | - | 4,006 |
- Swaps | - | - | 1,076 | 1,076 | - | 1,076 |
- Others | - | 2,366 | - | 2,366 | - | 2,366 |
Restricted assets (i) | 3,718 | - | - | 3,718 | - | 3,718 |
Cash and cash equivalents (excluding bank overdrafts): | ||||||
- Cash on hand and at bank | 43,962 | - | - | 43,962 | - | 43,962 |
- Short-term investments | - | 57,832 | - | 57,832 | - | 57,832 |
Total assets | 274,132 | 226,846 | 1,715 | 502,693 | 65,828 | 568,521 |
Financial liabilities at fair value through profit or loss | |||||
Financial liabilities at amortized cost | Level 1 | Subtotal financial liabilities | Non-financial liabilities | Total | |
December 31, 2023 | |||||
Liabilities as per Statement of Financial Position | |||||
Trade and other payables (Note 18) | 184,531 | - | 184,531 | 70,976 | 255,507 |
Borrowings (Note 20) | 740,618 | - | 740,618 | - | 740,618 |
Derivative financial instruments: | |||||
- Commodities options contracts | - | 1,239 | 1,239 | - | 1,239 |
- Commodities futures contracts | 6 | 793 | 799 | - | 799 |
- Foreign-currency options contracts | - | 23 | 23 | - | 23 |
- Foreign-currency future contracts | - | 4 | 4 | - | 4 |
Total liabilities | 925,155 | 2,059 | 927,214 | 70,976 | 998,190 |
Véase nuestro informe de fecha 11/11/22
PRICE WATERHOUSE & Co. S.R.L.
C.P.C.E.C.A.B.A. T° 1 F° 17
21
Cresud Sociedad Anónima,
Comercial, Inmobiliaria, Financiera y Agropecuaria
Financial assets and financial liabilities as of June 30, 2023 were as follows:
Financial assets at fair value through profit or loss | ||||||
Financial assets at amortized cost | Level 1 | Level 2 | Subtotal financial assets | Non-financial assets | Total | |
June 30, 2023 | ||||||
Assets as per Statement of Financial Position | ||||||
Trade and other receivables (excluding the allowance for doubtful accounts and other receivables) (Note 16) | 152,653 | 30,690 | - | 183,343 | 50,280 | 233,623 |
Investment in financial assets: | ||||||
- Public companies’ securities | - | 10,428 | - | 10,428 | - | 10,428 |
- Bonds | - | 26,937 | 1,586 | 28,523 | - | 28,523 |
- Mutual funds | - | 51,738 | - | 51,738 | - | 51,738 |
- Others | 1,436 | 2,705 | - | 4,141 | - | 4,141 |
Derivative financial instruments: | ||||||
- Commodities options contracts | - | 432 | - | 432 | - | 432 |
- Commodities futures contracts | - | 4,261 | - | 4,261 | - | 4,261 |
- Foreign-currency options contracts | - | 570 | - | 570 | - | 570 |
- Foreign-currency future contracts | - | 3,664 | - | 3,664 | - | 3,664 |
- Swaps | - | - | 577 | 577 | - | 577 |
- Others | - | 4,040 | - | 4,040 | - | 4,040 |
Restricted assets (i) | 2,484 | - | - | 2,484 | - | 2,484 |
Cash and cash equivalents (excluding bank overdrafts): | ||||||
- Cash on hand and at bank | 19,148 | - | - | 19,148 | - | 19,148 |
- Short-term investments | - | 61,320 | - | 61,320 | - | 61,320 |
Total assets | 175,721 | 196,785 | 2,163 | 374,669 | 50,280 | 424,949 |
Financial liabilities at fair value through profit or loss | Non-financial liabilities | Total | |||
Financial liabilities at amortized cost | Level 1 | Subtotal financial liabilities | |||
June 30, 2023 | |||||
Liabilities as per Statement of Financial Position | |||||
Trade and other payables (Note 18) | 127,572 | - | 127,572 | 63,879 | 191,451 |
Borrowings (Note 20) | 541,573 | - | 541,573 | - | 541,573 |
Derivative financial instruments: | |||||
- Commodities options contracts | - | 1,674 | 1,674 | - | 1,674 |
- Commodities futures contracts | 31 | 693 | 724 | - | 724 |
- Foreign-currency future contracts | - | 261 | 261 | - | 261 |
- Swaps | - | 12 | 12 | - | 12 |
Total liabilities | 669,176 | 2,640 | 671,816 | 63,879 | 735,695 |
(i)
Corresponds to deposits in guarantee and escrows.
The valuation models used by the Group for the measurement of Level 2 instruments are no different from those used as of June 30, 2023.
As of December 31, 2023, there have been no changes to the economic or business circumstances affecting the fair value of the financial assets and liabilities of the Group.
The Group uses a range of valuation models for the measurement of Level 2 instruments, details of which may be obtained from the following table. When no quoted prices are available in an active market, fair values (particularly with derivatives) are based on recognized valuation methods.
Description | Pricing model / method | Parameters | Fair value hierarchy | Range |
Derivative financial instruments – Swaps | Theoretical price | Underlying asset price and volatility | Level 2 | - |
Véase nuestro informe de fecha 11/11/22
PRICE WATERHOUSE & Co. S.R.L.
C.P.C.E.C.A.B.A. T° 1 F° 17
22
Cresud Sociedad Anónima,
Comercial, Inmobiliaria, Financiera y Agropecuaria
16.
Trade and other receivables
Group’s trade and other receivables as of December 31, 2023 and June 30, 2023 are as follows:
12.31.2023 | 06.30.2023 | |
Trade, leases and services receivable (*) | 211,535 | 153,319 |
Less: allowance for doubtful accounts | (3,150) | (3,126) |
Total trade receivables | 208,385 | 150,193 |
Prepayments | 40,839 | 27,513 |
Borrowings, deposits and others | 29,465 | 19,702 |
Contributions pending integration | - | 94 |
Guarantee deposits | 63 | 22 |
Tax receivables | 21,545 | 17,235 |
Others | 21,520 | 15,738 |
Total other receivables | 113,432 | 80,304 |
Total trade and other receivables | 321,817 | 230,497 |
Non-current | 93,767 | 69,668 |
Current | 228,050 | 160,829 |
Total | 321,817 | 230,497 |
(*) Includes field sales credits, which are revalued based on the soybean price at each balance sheet date. The related impact in the Statement of Income and Other Comprehensive income is presented within “Financial results, net.
The fair value of current trade and other receivables approximate their respective carrying amounts due to their short-term nature, as the impact of discounting is not considered significant.
Movements on the Group’s allowance for doubtful accounts were as follows:
12.31.2023 | 06.30.2023 | |
Beginning of the period/ year | 3,126 | 4,571 |
Additions (i) | 192 | 675 |
Recovery (i) | (116) | (275) |
Currency translation adjustment | 1,722 | 781 |
Used during the year | (3) | (7) |
Inflation adjustment | (1,771) | (2,619) |
End of the period/ year | 3,150 | 3,126 |
(i) The additions and recovery of the allowance for doubtful accounts have been included in “Selling expenses” in the Statement of Income and Other Comprehensive Income (Note 24).
Véase nuestro informe de fecha 11/11/22
PRICE WATERHOUSE & Co. S.R.L.
C.P.C.E.C.A.B.A. T° 1 F° 17
23
Cresud Sociedad Anónima,
Comercial, Inmobiliaria, Financiera y Agropecuaria
17.
Cash flow information
Following is a detailed description of cash flows generated by the Group’s operations for the six-month periods ended December 31, 2023 and 2022:
Note | 12.31.2023 | 12.31.2022 | |
Profit for the period | 122,205 | 59,907 | |
Adjustments for: | |||
Income tax | 21 | 37,685 | (82,794) |
Amortization and depreciation | 24 | 2,867 | 2,877 |
Gain from disposal of trading properties | (2,221) | (5,266) | |
Loss/ (gain) from disposal of property, plant and equipment | 1,084 | (21) | |
Realization of currency translation adjustment | - | (888) | |
Net (gain)/ loss from fair value adjustment of investment properties | (139,697) | 89,946 | |
Loss from disposal of subsidiary and associates | 865 | - | |
Financial results, net | 67,759 | (34,867) | |
Provisions and allowances | (1,035) | 15,905 | |
Share of profit of associates and joint ventures | 7 | (19,873) | (2,528) |
Management fees | 5,638 | 3,807 | |
Changes in net realizable value of agricultural products after harvest | (6,924) | (1,423) | |
Unrealized initial recognition and changes in fair value of biological assets and agricultural products at the point of harvest | (4,940) | 2,395 | |
Gain from disposal of farmlands | (4,223) | (1,761) | |
Changes in operating assets and liabilities: | |||
(Increase)/ decrease in inventories | (3,321) | 1,956 | |
(Increase)/ decrease in trading properties | (117) | 293 | |
Increase in biological assets | (10) | (159) | |
Increase in trade and other receivables | (899) | (12,633) | |
Increase/ (decrease) in trade and other payables | 3,833 | (21,910) | |
Decrease in salaries and social security liabilities | (7,172) | (9,504) | |
Decrease in provisions | (210) | (78) | |
Decrease in lease liabilities | (1,941) | (3,005) | |
Net variation in derivative financial instruments | 2,391 | 1,193 | |
Decrease/ (increase) in right of use assets | 2 | (6) | |
Net cash generated from operating activities before income tax paid | 51,746 | 1,436 |
The following table presents a detail of significant non-cash transactions occurred in the six-month periods ended December 31, 2023 and 2022:
Véase nuestro informe de fecha 11/11/22
PRICE WATERHOUSE & Co. S.R.L.
C.P.C.E.C.A.B.A. T° 1 F° 17
24
Cresud Sociedad Anónima,
Comercial, Inmobiliaria, Financiera y Agropecuaria
12.31.2023 | 12.31.2022 | |
Increase in investment properties through an increase in trade and other payables | - | 134 |
Decrease in investment properties through an increase in property, plant and equipment | 6,917 | 31 |
Currency translation adjustment and other comprehensive results from associates and joint ventures | 48,792 | 3,793 |
Other changes in shareholders' equity | 2,063 | 10,043 |
Increase of non-convertible notes through a decrease in non-convertible notes | - | 120,708 |
Decrease in lease liabilities through a decrease in trade and other receivables | 28 | 93 |
Decrease in property, plant and equipment through an increase in investment properties | 4,760 | 8,844 |
Increase in shareholders' equity through an increase in investment properties | 1,615 | 1,794 |
Increase in deferred income tax liabilities through a decrease in shareholders' equity | 353 | 651 |
Decrease in trading properties through an increase in intangible assets | - | 1,037 |
Decrease in property, plant and equipment through an increase in shareholders' equity | - | 545 |
Decrease in investment properties through an increase in investment in financial assets | - | 162 |
Decrease in investment in financial assets through a decrease in trade and other payables | - | 760 |
Decrease in trade and other receivables through an increase in investment in financial assets | - | 22 |
Increase in property, plant and equipment through an increase in trade and other payables | 5,441 | 15,583 |
Decrease in property, plant and equipment through an increase in trade and other receivables | 1,498 | 22 |
Increase in investment in financial assets through an increase in borrowings | 276 | - |
Decrease in shareholders' equity through a decrease in investment in financial assets | - | 6,393 |
Increase in right of use assets through an increase in lease liabilities | 9,276 | 8,744 |
Increase in intangible assets through a decrease in investment properties | 15,248 | - |
Increase in intangible assets through an increase in trade and other payables | 4,391 | - |
Decrease in investment in associates and joint ventures through an increase in trade and other receivables | 748 | - |
Decrease in investment properties through an increase in trade and other receivables | 1,567 | - |
Barter transaction investment properties | 392 | - |
Decrease in shareholders' equity through an increase in trade and other payables | 19,186 | - |
Increase in group of assets held for sale through a decrease in property, plant and equipment | 2,458 | - |
Decrease in shareholders' equity through a decrease in trade and other receivables | 2,316 | - |
18.
Trade and other payables
Group’s trade and other payables as of December 31, 2023 and June 30, 2023 were as follows:
12.31.2023 | 06.30.2023 | |
Trade payables | 126,027 | 76,014 |
Advances from sales, leases and services (*) | 39,169 | 33,935 |
Accrued invoices | 9,135 | 8,111 |
Deferred income | 282 | 300 |
Admission fees (*) | 16,294 | 16,886 |
Deposits in guarantee | 454 | 292 |
Total trade payables | 191,361 | 135,538 |
Dividends payable to non-controlling interests | 12,423 | 5,644 |
Tax payables | 15,206 | 12,755 |
Director´s Fees | 3,163 | 24,480 |
Management fees | 5,638 | 6,462 |
Others | 27,716 | 6,572 |
Total other payables | 64,146 | 55,913 |
Total trade and other payables | 255,507 | 191,451 |
Non-current | 30,998 | 25,327 |
Current | 224,509 | 166,124 |
Total | 255,507 | 191,451 |
(*) Corresponds mainly to admission rights and rents collected in advance, which will accrue in an average term of 3 to 5 years.
Véase nuestro informe de fecha 11/11/22
PRICE WATERHOUSE & Co. S.R.L.
C.P.C.E.C.A.B.A. T° 1 F° 17
25
Cresud Sociedad Anónima,
Comercial, Inmobiliaria, Financiera y Agropecuaria
19.
Provisions
The table below shows the movements in the Group's provisions categorized by type:
Legal claims (iii) | Investments in associates and joint ventures (ii) | 12.31.2023 | 06.30.2023 | |
Beginning of period/ year | 15,149 | 2 | 15,151 | 3,204 |
Additions (i) | 2,176 | - | 2,176 | 16,761 |
Decreases (i) | (88) | - | (88) | (780) |
Participation in the results | - | 4 | 4 | (31) |
Inflation adjustment | 4,160 | - | 4,160 | (3,863) |
Currency translation adjustment | 64 | - | 64 | 23 |
Used during the period / year | (210) | - | (210) | (163) |
End of period/ year | 21,251 | 6 | 21,257 | 15,151 |
Non-current | 19,635 | 13,362 | ||
Current | 1,622 | 1,789 | ||
Total | 21,257 | 15,151 |
(i)
Additions and recovery are included in "Other operating results, net".
(ii)
Corresponds to investments in Puerto Retiro as of December 31, 2023 and as of June 30, 2023. The increase and recovery is included in "Share of profit of associates and joint ventures "
(iii)
Contains the provision for the IDBD lawsuit. See Note 7 to the annual financial statements as of June 30, 2023.
There were no significant changes to the processes mentioned in Note 21 to the Annual Financial Statements.
IDBD
The Group lost control of IDBD on September 25, 2020.
On September 21, 2020, IDBD filed a lawsuit against Dolphin Netherlands B.V. (“Dolphin BV”) and IRSA before the Tel-Aviv Jaffa District Court (civil case no. 29694-09-20). The amount claimed by IDBD is NIS 140 million, alleging that Dolphin BV and IRSA breached an alleged legally binding commitment to transfer to IDBD 2 installments of NIS 70 million. On December 24, 2020, and following approval by the insolvency court, the IDBD trustee filed a motion to dismiss the claim, maintaining the right as IDBD trustee, to file a new inter alia claim in the same matter, after conduct an investigation into the reasons for IDBD's insolvency. On December 24, 2020, the court entered a judgment to dismiss the claim as requested. On October 31, 2021, the Insolvency Commissioner notified that he did not oppose the motion, and on that same date, the court affirmed the motion initiated by the trustee of IDBD.
On December 26, 2021 IDBD filed the lawsuit against Dolphin BV and IRSA for the sum of NIS 140 million, plus interest and costs.
On January 30, 2023, a copy of the lawsuit was sent to us and we evaluated the legal defense alternatives for the company's interests. Throughout the year 2023 and up to the present date, the legal process has continued as usual, and the Company has responded to all requests made to it.
The company is currently discussing the validity of the claim regarding its liability and, subsidiarily, rebutting the substantive arguments raised by IDBD. However, based on the analysis conducted by the Company's lawyers to date, a provision related to this claim has been recorded in accordance with applicable accounting standards. As of the issuance date of these condensed interim financial statements, the legal process is still ongoing.
20.
Borrowings
The breakdown and fair value of the Group’s borrowings as of December 31, 2023 and June 30, 2023 was as follows:
Véase nuestro informe de fecha 11/11/22
PRICE WATERHOUSE & Co. S.R.L.
C.P.C.E.C.A.B.A. T° 1 F° 17
26
Cresud Sociedad Anónima,
Comercial, Inmobiliaria, Financiera y Agropecuaria
Book value | Fair value | |||
12.31.2023 | 06.30.2023 | 12.31.2023 | 06.30.2023 | |
Non-convertible notes | 600,027 | 433,689 | 577,354 | 442,214 |
Bank loans | 86,620 | 56,826 | 86,620 | 56,826 |
Bank overdrafts | 45,064 | 40,869 | 45,064 | 40,869 |
Others | 8,907 | 10,189 | 8,907 | 10,189 |
Total borrowings | 740,618 | 541,573 | 717,945 | 550,098 |
Non-current | 482,015 | 329,324 | ||
Current | 258,603 | 212,249 | ||
Total | 740,618 | 541,573 |
Véase nuestro informe de fecha 11/11/22
PRICE WATERHOUSE & Co. S.R.L.
C.P.C.E.C.A.B.A. T° 1 F° 17
27
Cresud Sociedad Anónima,
Comercial, Inmobiliaria, Financiera y Agropecuaria
21.
Taxation
The details of the Group’s income tax, is as follows:
12.31.2023 | 12.31.2022 | |
Current income tax | (11,875) | 33,866 |
Deferred income tax | (25,810) | 48,928 |
Income tax from continuing operations | (37,685) | 82,794 |
Below is a reconciliation between income tax recognized and the amount which would result from applying the prevailing tax rate on profit before income tax for the six-month periods ended December 31, 2023 and 2022:
12.31.2023 | 12.31.2022 | |
Tax calculated at the tax rates applicable to profits in the respective countries | (47,214) | (17,498) |
Permanent differences: | ||
Share of profit of joint ventures and associates | 7,590 | 13,565 |
Tax rate differential | (26) | (146) |
Provision for unrecoverability of tax loss carry-forwards | (2,419) | (28,207) |
Difference between affidavit and provision | 3,123 | 35,226 |
Non-taxable profit, non-deductible expenses and others | (22,117) | 57,290 |
Tax inflation adjustment | (15,303) | (27,276) |
Fiscal transparency | (3,903) | (4,111) |
Inflation adjustment permanent difference | 36,267 | 52,918 |
Others | 6,317 | 1,033 |
Income tax | (37,685) | 82,794 |
The gross movement in the deferred income tax account is as follows:
12.31.2023 | 06.30.2023 | |
Beginning of period / year | (396,868) | (517,633) |
Currency translation adjustment | (12,267) | (1,928) |
Revaluation surplus | (559) | (862) |
Charged to the Statement of Income | (25,810) | 123,555 |
End of the period / year | (435,504) | (396,868) |
Véase nuestro informe de fecha 11/11/22
PRICE WATERHOUSE & Co. S.R.L.
C.P.C.E.C.A.B.A. T° 1 F° 17
28
Cresud Sociedad Anónima,
Comercial, Inmobiliaria, Financiera y Agropecuaria
22.
Revenues
12.31.2023 | 12.31.2022 | |
Crops | 43,535 | 53,949 |
Sugarcane | 19,691 | 18,466 |
Cattle | 6,378 | 5,861 |
Supplies | 16,301 | 14,866 |
Consignment | 9,360 | 12,656 |
Advertising and brokerage fees | 5,319 | 6,280 |
Agricultural rental and other services | 2,741 | 1,994 |
Income from sales and services from agricultural business | 103,325 | 114,072 |
Trading properties and developments | 3,796 | 6,267 |
Rental and services | 78,762 | 74,332 |
Hotel operations, tourism services and others | 18,862 | 15,478 |
Income from sales and services from urban properties and investment business | 101,420 | 96,077 |
Total revenues | 204,745 | 210,149 |
23.
Costs
12.31.2023 | 12.31.2022 | |
Other operative costs | 69 | 82 |
Cost of property operations | 69 | 82 |
Crops | 39,562 | 44,318 |
Sugarcane | 16,370 | 17,984 |
Cattle | 5,013 | 5,315 |
Supplies | 13,940 | 13,801 |
Consignment | 2,185 | 5,064 |
Advertising and brokerage fees | 4,295 | 3,351 |
Agricultural rental and other services | 1,969 | 1,034 |
Cost of sales and services from agricultural business | 83,334 | 90,867 |
Trading properties and developments | 2,231 | 1,289 |
Rental and services | 22,156 | 23,897 |
Hotel operations, tourism services and others | 8,407 | 7,491 |
Cost of sales and services from sales and services from urban properties and investment business | 32,794 | 32,677 |
Total costs | 116,197 | 123,626 |
Véase nuestro informe de fecha 11/11/22
PRICE WATERHOUSE & Co. S.R.L.
C.P.C.E.C.A.B.A. T° 1 F° 17
29
Cresud Sociedad Anónima,
Comercial, Inmobiliaria, Financiera y Agropecuaria
24.
Expenses by nature
The Group discloses expenses in the statements of income by function as part of the line items “Costs”, “General and administrative expenses” and “Selling expenses”. The following table provides additional disclosures regarding expenses by nature and their relationship to the function within the Group.
Costs | General and administrative expenses | Selling expenses | 12.31.2023 | 12.31.2022 | |
Change in agricultural products and biological assets | 49,613 | - | - | 49,613 | 57,660 |
Salaries, social security costs and other personnel expenses | 15,120 | 10,919 | 1,458 | 27,497 | 25,106 |
Fees and payments for services | 14,508 | 3,212 | 1,070 | 18,790 | 16,056 |
Cost of sale of goods and services | 17,283 | - | - | 17,283 | 18,653 |
Maintenance, security, cleaning, repairs and others | 9,152 | 1,103 | 23 | 10,278 | 10,339 |
Taxes, rates and contributions | 1,744 | 1,386 | 7,257 | 10,387 | 8,299 |
Advertising and other selling expenses | 4,802 | 32 | 806 | 5,640 | 6,621 |
Freights | 7 | 489 | 3,091 | 3,587 | 3,684 |
Director's fees (i) | - | (3,199) | - | (3,199) | 3,690 |
Depreciation and amortization | 1,878 | 834 | 155 | 2,867 | 2,877 |
Leases and service charges | 595 | 249 | 22 | 866 | 947 |
Travelling, library expenses and stationery | 449 | 383 | 193 | 1,025 | 713 |
Supplies and labors | 362 | - | 18 | 380 | 769 |
Other expenses | 374 | 147 | 1,368 | 1,889 | 924 |
Bank expenses | 45 | 637 | - | 682 | 420 |
Conditioning and clearance | - | - | 755 | 755 | 483 |
Interaction and roaming expenses | 265 | 12 | 6 | 283 | 265 |
Allowance for doubtful accounts, net | - | - | 76 | 76 | 262 |
Total expenses by nature as of 12.31.2023 | 116,197 | 16,204 | 16,298 | 148,699 | - |
Total expenses by nature as of 12.31.2022 | 123,626 | 20,671 | 13,471 | - | 157,768 |
(i) On October 5, 2023, fees to the Board of Directors were approved at the General Ordinary and Extraordinary Shareholders' Meeting of IRSA for ARS 9,050. The Board of Directors of the Company had proposed Director´s fees for ARS 13,500 and accordingly made provision for such amount in the Annual Consolidated Financial Statements as of June 30, 2023, issued on September 5, 2023, and submitted to the CNV. During the current period, with the final approval of said fee, IRSA proceeded to recover the excess in the provision, with a balancing entry in the line that gave rise to it. The amounts are expressed in currency defined as approved by the Ordinary and Extraordinary Shareholders' Meeting.
25.
Other operating results, net
12.31.2023 | 12.31.2022 | |
Gain/ (loss) from commodity derivative financial instruments | 1,335 | (1,295) |
(Loss)/ gain from sale of property, plant and equipment | (1,084) | 21 |
Realization of currency translation adjustment (i) | - | 888 |
Loss from sale of joint ventures | (865) | - |
Donations | (192) | (227) |
Lawsuits and other contingencies | (2,088) | (11,953) |
Interest and allowances generated by operating assets | 7,239 | 4,179 |
Administration fees | 123 | 119 |
Others | 1,042 | 1,411 |
Total other operating results, net | 5,510 | (6,857) |
(i)
Corresponds to Condor, Real Estate Investment Group VII LP and Jiwin S.A’s liquidation.
26.
Financial results, net
12.31.2023 | 12.31.2022 | |
Financial income | ||
Interest income | 8,662 | 3,419 |
Total financial income | 8,662 | 3,419 |
Financial costs | ||
Interest expense | (15,172) | (34,041) |
Other financial costs | (3,507) | (2,608) |
Total finance costs | (18,679) | (36,649) |
Other financial results: | ||
Foreign exchange, net | (208,946) | 17,830 |
Fair value gain from financial assets and liabilities at fair value through profit or loss | 94,933 | 4,057 |
(Loss)/ gain from repurchase of non-convertible notes | (104) | 2,507 |
(Loss)/ gain from derivative financial instruments (except commodities) | (15,184) | 1,506 |
Others | 4,673 | (1,815) |
Total other financial results | (124,628) | 24,085 |
Inflation adjustment | 68,277 | 36,540 |
Total financial results, net | (66,368) | 27,395 |
Véase nuestro informe de fecha 11/11/22
PRICE WATERHOUSE & Co. S.R.L.
C.P.C.E.C.A.B.A. T° 1 F° 17
30
Cresud Sociedad Anónima,
Comercial, Inmobiliaria, Financiera y Agropecuaria
27.
Related party transactions
The following is a summary of the balances with related parties as of December 31, 2023 and June 30, 2023:
Item | 12.31.2023 | 06.30.2023 |
Trade and other receivables | 21,212 | 17,122 |
Investments in financial assets | 3,561 | 2,676 |
Trade and other payables | (18,980) | (31,945) |
Borrowings | (886) | (455) |
Total | 4,907 | (12,602) |
Véase nuestro informe de fecha 11/11/22
PRICE WATERHOUSE & Co. S.R.L.
C.P.C.E.C.A.B.A. T° 1 F° 17
31
Cresud Sociedad Anónima,
Comercial, Inmobiliaria, Financiera y Agropecuaria
Related party | 12.31.2023 | 06.30.2023 | Description of transaction | Item |
New Lipstick | 196 | 128 | Reimbursement of expenses | Trade and other receivables |
Other associates and joint ventures (i) | 35 | 25 | Leases and/or right of use assets receivable | Trade and other receivables |
- | 93 | Contributions pending subscription | Trade and other receivables | |
1,757 | 1,155 | Other investments | Investments in financial assets | |
(423) | (277) | Non-convertible notes | Borrowings | |
1 | 2 | Equity incentive plan receivable | Trade and other receivables | |
1,663 | 1,645 | Loans granted | Trade and other receivables | |
(463) | (178) | Borrowings | Borrowings | |
- | 2 | Reimbursement of expenses | Trade and other receivables | |
21 | 56 | Management fees receivable | Trade and other receivables | |
(69) | (428) | Other payables | Trade and other payables | |
2,901 | 3,286 | Other receivables | Trade and other receivables | |
Total associates and joint ventures | 5,619 | 5,509 | ||
CAMSA and its subsidiaries | (5,639) | (6,462) | Management fee payables | Trade and other payables |
Yad Levim LTD | 15,261 | 9,794 | Loans granted | Trade and other receivables |
Other related parties (ii) | 998 | 1,066 | Other receivables | Trade and other receivables |
(10,090) | (256) | Other payables | Trade and other payables | |
1,804 | 1,521 | Other investments | Investments in financial assets | |
8 | 52 | Reimbursement of expenses receivable | Trade and other receivables | |
(28) | (19) | Legal services | Trade and other payables | |
Total other related parties | 2,314 | 5,696 | ||
IFISA | 128 | 973 | Financial operations receivables | Trade and other receivables |
Total direct parent company | 128 | 973 | ||
Directors and Senior Management | (3,154) | (24,780) | Fees for services received | Trade and other payables |
Total Directors and Senior Management | (3,154) | (24,780) | ||
Total | 4,907 | (12,602) |
(i)
Includes Quality Invest S.A., Banco Hipotecario S.A., Cyrsa S.A., Nuevo Puerto Santa Fe S.A., Banco Hipotecario, GCDI S.A., Avenida Inc., Avenida Compras S.A., Agrofy S.A., BHN Seguros Generales S.A., BHN Vida S.A. and OFC S.R.L.
(ii)
Includes Estudio Zang, Bergel y Viñes, Fundación Puerta 18, Sociedad Rural Argentina, CAM Communication LP, Sutton, Fundación Museo de los Niños, Viflor S.A and Agrofy S.A.
The following is a summary of the results with related parties for the six-month periods ended December 31, 2023 and 2022:
Related party | 12.31.2023 | 12.31.2022 | Description of transaction |
BHN Vida S.A. | (115) | (6) | Financial operations |
BHN Seguros Generales S.A. | (39) | - | Financial operations |
Other associates and joint ventures | 20 | (62) | Leases and/or right of use assets |
78 | 100 | Corporate services | |
945 | 159 | Financial operations | |
Total associates and joint ventures | 889 | 191 | |
CAMSA and its subsidiaries | (5,638) | (3,807) | Management fee |
Other related parties (i) | (20) | (6) | Leases and/or rights of use |
(305) | (106) | Fees and remunerations | |
16 | 19 | Corporate services | |
(128) | (109) | Legal services | |
3,140 | 184 | Financial operations | |
(113) | (156) | Donations | |
659 | 448 | Income from sales and services from agricultural business | |
Total other related parties | (2,389) | (3,533) | |
IFISA | - | 40 | Financial operations |
Total Parent Company | - | 40 | |
Directors (ii) | 3,605 | (2,273) | Management fee |
Senior Management | (170) | - | Compensation of Directors and senior management |
Total Directors and Senior Management | 3,435 | (2,273) | |
Total | 1,935 | (5,575) |
(i)
Includes Fundación Puerta 18, Galerías Pacífico, Estudio Zang, Austral Gold, Bergel y Viñes, Fundación Museo de los Niños, Sociedad Rural Argentina, Sutton, Espacio Digital S.A., Casposo Argentina Ltd, Uranga Trading, Agro Uranga, Isaac Elsztain e Hijos S.C.A. and Hamonet S.A.
(ii)
See Note 24 to these financial statements.
Véase nuestro informe de fecha 11/11/22
PRICE WATERHOUSE & Co. S.R.L.
C.P.C.E.C.A.B.A. T° 1 F° 17
32
Cresud Sociedad Anónima,
Comercial, Inmobiliaria, Financiera y Agropecuaria
The following is a summary of the transactions with related parties for the six-month periods ended December 31, 2023 and 2022:
Related party | 12.31.2023 | 12.31.2022 | Description of transaction |
Viflor S.A. | - | (50) | Irrevocable contributions |
Total irrevocable contributions | - | (50) | |
Agro-Uranga S.A. | - | 417 | Dividends received |
Uranga Trading S.A. | - | 72 | Dividends received |
Condor | - | 215 | Dividends received |
Nuevo Puerto Santa Fe S.A. | 245 | 445 | Dividends received |
Total dividends received | 245 | 1,149 | |
Quality | (14,440) | - | Sale of shares |
GCDI | (22) | - | Sale of shares |
Total sale of shares | (14,462) | - |
28.
CNV General Resolution N° 622
As required by Section 1°, Chapter III, Title IV of CNV General Resolution N° 622, below there is a detail of the notes to this Financial Statements that disclose the information required by the Resolution in Exhibits.
Exhibit A - Property, plant and equipment | Note 8 - Investment properties | |
Note 9 - Property, plant and equipment | ||
Exhibit B - Intangible assets | Note 11 - Intangible assets | |
Exhibit C - Equity investments | Note 7 - Investments in associates and joint ventures | |
Exhibit D - Other investments | Note 15 - Financial instruments by category | |
Exhibit E – Provisions and allowances | Note 16 – Trade and other receivables and Note 19 - Provisions | |
Exhibit F - Cost of sales and services provided | Note 29 - Cost of sales and services provided | |
Exhibit G - Foreign currency assets and liabilities | Note 30 - Foreign currency assets and liabilities |
29.
Cost of goods sold and services provided
Description | Cost of sales and services from agricultural business (i) | Cost of sales and services from sales and services from urban properties and investment business (ii) | 12.31.2023 | 12.31.2022 |
Inventories at the beginning of the period | 31,680 | 12,770 | 44,450 | 41,463 |
Initial recognition and changes in the fair value of biological assets and agricultural products at the point of harvest | 396 | - | 396 | (1,604) |
Changes in the net realizable value of agricultural products after harvest | 6,924 | - | 6,924 | 1,429 |
Additions | 128 | - | 128 | 442 |
Currency translation adjustment | 5,323 | 2,378 | 7,701 | (4,540) |
Harvest | 81,021 | - | 81,021 | 69,625 |
Acquisitions and classifications | 54,673 | 33,355 | 88,028 | 110,986 |
Consume | (9,554) | - | (9,554) | (10,171) |
Disposals due to sales | - | (1,575) | (1,575) | (962) |
Expenses incurred | 14,634 | - | 14,634 | 12,192 |
Inventories at the end of the period | (101,891) | (14,134) | (116,025) | (95,316) |
Cost as of 12.31.2023 | 83,334 | 32,794 | 116,128 | - |
Cost as of 12.31.2022 | 90,867 | 32,677 | - | 123,544 |
(i)
Includes biological assets (see Note 13).
(ii)
Includes trading properties (see Note 10).
Véase nuestro informe de fecha 11/11/22
PRICE WATERHOUSE & Co. S.R.L.
C.P.C.E.C.A.B.A. T° 1 F° 17
33
Cresud Sociedad Anónima,
Comercial, Inmobiliaria, Financiera y Agropecuaria
30.
Foreign currency assets and liabilities
Book amounts of foreign currency assets and liabilities are as follows:
Item / Currency (1) | Amount (2) | Prevailing exchange rate (3) | 12.31.2023 | 06.30.2023 |
Assets | ||||
Trade and other receivables | ||||
US Dollar | 120.97 | 805.45 | 97,438 | 44,005 |
Euros | 0.08 | 889.38 | 71 | 48 |
Uruguayan pesos | - | - | - | 2 |
Trade and other receivables related parties | ||||
US Dollar | 19.26 | 808.45 | 15,573 | 10,817 |
Total Trade and other receivables | 113,082 | 54,872 | ||
Investment in financial assets | ||||
US Dollar | 102.17 | 805.45 | 82,292 | 48,279 |
Brazilian Reais | 1.09 | 168.00 | 183 | 378 |
New Israel Shekel | 4.35 | 223.54 | 973 | 721 |
Pounds | 0.63 | 1,026.63 | 647 | 490 |
Total Investment in financial assets | 84,095 | 49,868 | ||
Derivative financial instruments | ||||
US Dollar | 1.71 | 805.45 | 1,378 | 4,388 |
Total Derivative financial instruments | 1,378 | 4,388 | ||
Cash and cash equivalents | ||||
US Dollar | 23.53 | 805.45 | 18,956 | 23,998 |
Euros | 0.01 | 889.38 | 5 | 4 |
New Israel Shekel | 0.50 | 223.54 | 112 | 54 |
Pounds | 0.002 | 1,026.63 | 2 | 2 |
Uruguayan pesos | 0.10 | 20.77 | 2 | 2 |
Total Cash and cash equivalents | 19,077 | 24,060 | ||
Total Assets | 217,632 | 133,188 | ||
Liabilities | ||||
Trade and other payables | ||||
US Dollar | 69.73 | 808.45 | 56,371 | 22,926 |
Euros | - | - | - | 2 |
Uruguayan pesos | 1.20 | 20.77 | 25 | 25 |
Chilenean pesos | 0.07 | 178.00 | 13 | - |
Trade and other payables related parties | ||||
US Dollar | 12.53 | 808.45 | 10,126 | 39 |
Total Trade and other payables | 66,535 | 22,992 | ||
Lease liabilities | ||||
US Dollar | 14.86 | 808.45 | 12,011 | 6,777 |
Total Lease liabilities | 12,011 | 6,777 | ||
Provisions | ||||
New Israel Shekel | 81.63 | 223.54 | 18,249 | 11,441 |
Total Provisions | 18,249 | 11,441 | ||
Borrowings | ||||
US Dollar | 627.41 | 808.45 | 507,228 | 383,618 |
Borrowings with related parties | ||||
US Dollar | 0.52 | 808.45 | 423 | 645 |
Total Borrowings | 507,651 | 384,263 | ||
Derivative financial instruments | ||||
US Dollar | 0.08 | 808.45 | 65 | 219 |
Total Derivative financial instruments | 65 | 219 | ||
Total Liabilities | 604,511 | 425,692 |
(1)
The Company uses derivative instruments as a complement in order to reduce its exposure to exchange rate movements (Note 15).
(2)
Considering foreign currencies those that differ from each Group’s subsidiaries functional currency at each period/year-end.
(3)
Exchange rates as of December 31, 2023 according to Banco Nación Argentina.
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PRICE WATERHOUSE & Co. S.R.L.
C.P.C.E.C.A.B.A. T° 1 F° 17
34
Cresud Sociedad Anónima,
Comercial, Inmobiliaria, Financiera y Agropecuaria
31.
Other relevant events of the period
Shares Buyback Program – New program - IRSA
On June 15, 2023, the Board of Directors of IRSA approved a new program for the buyback program of shares issued by the Company and established the terms and conditions for the acquisition of treasury shares issued by the Company, under the terms of Article 64. of Law No. 26,831 and the CNV regulations, for up to a maximum amount of ARS 5,000 million and up to 10% of the share capital, up to a daily limit of up to 25% of the average volume of daily transactions that the shares have experienced of the Company, jointly in the markets it is listed, during the previous 90 business days, and up to a maximum price of USD 8 per GDS and ARS 425 per share. Likewise, the repurchase period was set at up to 180 days, beginning the day following the date of publication of the information in the Daily Bulletin of the Buenos Aires Stock Exchange.
IRSA reported that on September 5, 2023, the Company's Board of Directors resolved to modify the acquisition price of its own shares, establishing a maximum value of USD 9 per GDS and up to a maximum value in pesos of ARS 720 per share, maintaining the remaining terms and conditions duly communicated.
On November 6, 2023, the Board of Directors of IRSA resolved to extend the term of the shares repurchase program for an additional period of 180 days from the expiration of the term of the current share buyback program for the acquisition of own shares approved on June 15, 2023, which expired on December 13, 2023, with the remaining terms and conditions duly communicated.
On November 29, 2023, the Board of Directors of IRSA resolved to modify the acquisition price of its own shares, establishing a maximum value of USD 11.00 per GDS and up to a maximum value in pesos of ARS 1,320 per share, maintaining the remaining terms and conditions duly communicated.
Since the beginning of the program approved on June 15, 2023 and until the closing date of these condensed consolidated interim financial statements, the Company acquired 7,839,874 common shares (nominal value ARS 10 per share) for a total of ARS 4,997 million, 99.95% of the program approved on June 15, 2023. The amounts are expressed in the currency at the time of acquisition.
Change in the total amount of shares and its nominal value - IRSA
On September 13, 2023, IRSA announced that having obtained the authorizations from the CNV and the Buenos Aires Stock Exchange as resolved at the Shareholders' Meeting held on April 27, 2023, in relation to:
(i)
an increase in the capital stock in the amount of ARS 6,552.4 million, through the partial capitalization of the Issue Premium account, resulting in the issuance of 6,552,405,000 common shares, with a par value of ARS 1 (one peso) and with the right to one vote per share; and
(ii)
changing the nominal value of the ordinary shares from ARS 1 to ARS 10 each and entitled to one (1) vote per share.
Having obtained the authorizations from the Comisión Nacional de Valores (the Argentine National Securities Commission) and from the Buenos Aires Stock Exchange, the Company informs all shareholders who have such quality as of September 19, 2023, according to the registry maintained by Caja de Valores S.A., that from September 20, 2023, the shares distribution and the change in nominal value was made simultaneously and the entry of the change of 811,137,457 book-entry common shares, with a nominal value of ARS 1 each and one vote per share, for the amount of 736,354,245 book-entry common shares with a nominal value of ARS 10 each and one vote per share, consequently, a reverse split of the Company’s shares shall be carried out, where every 1 (one) old share with nominal value of ARS 1 shall be exchanged for 0.907804514 new shares with nominal value ARS 10. The new shares distributed due to the described capitalization have economic rights under equal conditions with those that are currently in circulation.
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PRICE WATERHOUSE & Co. S.R.L.
C.P.C.E.C.A.B.A. T° 1 F° 17
35
Cresud Sociedad Anónima,
Comercial, Inmobiliaria, Financiera y Agropecuaria
Regarding the shareholders who, because of the entry in the Scriptural Registry, have fractions of common shares with a nominal value of ARS 10 and one vote per share, they were settled in cash in accordance with the listing regulations of Bolsas y Mercados Argentinos. Regarding the shareholders who, due to the exchange of shares did not reach at least one share with a nominal value of ARS 10, the necessary amount was assigned to them until the nominal value of ARS 10 is completed.
The Company share capital after the indicated operations will amount to ARS 7,364 million represented by 736,354,245 book-entry common shares with a nominal value of ARS 10 each and one vote per share.
Likewise, the Buenos Aires Stock Exchange has been requested to change the modality of the negotiation of the shares representing the share capital. Specifically, the negotiation price will be registered per share instead of being negotiated by Argentine peso (ARS) of nominal value, given that the change in nominal value, and the issuance of shares resulting from the capitalization, would produce a substantial downward effect on the share price.
This capitalization and change in the nominal value of the shares do not modify the economic values of the holdings or the percentage of participation in the share capital.
Warrants – Modification on Ratio and Price - IRSA
On September 14, 2023, IRSA reported that as a result of (i) an increase in the capital stock through the partial capitalization of the Issue Premium account; and (ii) an amendment to section seven of its bylaws, changing the nominal value of the ordinary shares from one peso (ARS 1) to ten pesos (ARS 10) each and entitled to one (1) vote per share, which was informed in September 13, 2023, where the outstanding shares will change from 811,137,457 common shares, with a nominal value of ARS 1 each and one vote per share, to the amount of 736,354,245 common shares with a nominal value of ARS 10 each and one vote per share, as it was approved by the shareholders meeting held on April 27, 2023. The terms and conditions of the outstanding warrants for common shares of the Company have been modified as follows:
Amount of shares to be issued per warrant:
● Ratio previous to the adjustment: 1.1719 (Nominal Value ARS 1);
● Ratio after the adjustment (current): 1.0639 (Nominal Value ARS 10).
Warrant exercise price per new share to be issued:
● Price previous to the adjustment: USD 0.3689 (Nominal Value ARS 1);
● Price after the adjustment (current): USD 0.4063 (Nominal Value ARS 10).
The other terms and conditions of the warrants remain the same.
General Ordinary and Extraordinary Shareholders’ Meeting - IRSA
On October 5, 2023, the General Ordinary and Extraordinary Shareholders’ Meeting of IRSA was held where it was resolved to allocate the results of the year as follows: (I) ARS 2,867.5 million to the integration of the Legal Reserve, (ARS 3,428.9 million in homogeneous currency of the date of the Shareholders’ Meeting) and, (II) the remainder for the sum of ARS 54,483.3 million (ARS 65,148.9 million in homogeneous currency of the date of the Shareholders’ Meeting), to the distribution of a dividend to Shareholders in proportion to their shareholdings, payable in cash for the sum of ARS 64,000 million. Taking into consideration that the restated results were sufficient to cover the payment of the proposed dividends, it was approved to allocate the balance of the restated results for the year (ARS 1,148.9 million) to the integration of the Reserve for the distribution of future dividends. The amounts are expressed in currency defined as approved by the Ordinary and Extraordinary Shareholders' Meeting.
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C.P.C.E.C.A.B.A. T° 1 F° 17
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Cresud Sociedad Anónima,
Comercial, Inmobiliaria, Financiera y Agropecuaria
Likewise, it was approved to distribute 13,928,410 own shares in the portfolio of nominal value ARS 1 to the Shareholders in proportion to their shareholdings. Due to the aforementioned change in nominal value, each share of nominal value ARS1 corresponds to 0.90780451408 shares of nominal value ARS10, therefore, said amount updated by the aforementioned liquidation corresponds to the amount of 12,644,273 shares of nominal value ARS 10.
On October 20, 2023, IRSA reported that it had made the payment of the dividend approved at the meeting held on October 5, 2023 in Argentina.
The cash dividend and treasury shares distribution among GDS holders have been delayed due to the exchange and securities restrictions in force in Argentina. On October 20, 2023, the Company deposited the amount corresponding to the cash dividend in the mutual fund called “Super Ahorro $” managed by Santander Asset Management Gerente de Fondos Comunes de Inversión S.A., to preserve the value of the dividend in Argentine pesos. On December 12, 2023, the Company transferred the funds to the Depositary Bank of New York, fulfilling its obligation to pay dividends and leaving in the hands of the Depositary the completion of the process with the distribution to the holders.
After the end of the period, on January 19, 2024, once the corresponding administrative processes had been completed, the Depositary paid the cash dividend, for a net amount per GDS of USD 0.955110, including the yield of the “Super Ahorro $” fund. Likewise, on January 29, 2024, the distribution of treasury shares was carried out among GDS holders.
The aforementioned corresponds to the payment of dividends to foreign holders, the dividends to local shareholders were canceled on October 12, 2023.
Change in Warrants terms and conditions - IRSA
Because of the payment of cash dividends and the pro-rata distribution of treasury shares among its shareholders, made by IRSA on October 12, 2023, certain terms and conditions of the outstanding warrants to subscribe common shares have changed:
●
Number of shares to be issued per warrant: Pre-dividend ratio: 1.0639. Post-dividend ratio: 1.2272 (nominal value ARS 10).
●
Exercise price per new share to be issued: Pre-dividend price: USD 0.4063. Post-dividend price: USD 0.3522 (nominal value ARS 10).
The other terms and conditions of the warrants remain the same.
Warrants exercise - IRSA
During the six-month period ended December 31, 2023, certain warrant holders exercised their right to purchase additional shares. For this reason, USD 168,662 were received, from the convertion of 390,263 common share warrants.
Extension of the concession contract of La Rural S.A. – OGDEN
On December 11, 2023 in the Autonomous City of Buenos Aires (CABA), Ogden S.A., a company controlled by the Group, together with Sociedad Rural Argentina (“SRA”) and La Rural de Palermo S.A. entered into a Joint Venture and Shareholders Agreement through which the extension of the exploitation term of the Property located at 4431 Juncal Street, CABA (of which La Rural S.A. is the usufructuary) was extended until December 31, 2037 with the option of extension until December 31, 2041.
The aforementioned agreement is the extension of the Usufruct Contract for the “Predio Ferial de Palermo” (“CUP99/04”), signed in 1999 and modified in 2004, and the Joint Venture Agreement AJV/13 signed between the parties on September 25, 2013.
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PRICE WATERHOUSE & Co. S.R.L.
C.P.C.E.C.A.B.A. T° 1 F° 17
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Cresud Sociedad Anónima,
Comercial, Inmobiliaria, Financiera y Agropecuaria
For the extension of the usufruct term under La Rural S.A., Ogden S.A. will pay the SRA the sum of twelve million US dollars (USD 12,000,000) for all purposes.
The validity of the aforementioned agreement was subject to the approval of the Shareholders’ Meeting of the SRA, approval which took place on February 1, 2024.
Las Londras Farmland
On December 20, 2020, BrasilAgro acquired the following companies established in Bolivia from Cresud: (i) Agropecuaria Acres del Sud S.A.; (ii) Ombú Agropecuaria S.A.; (iii) Yatay Agropecuaria S.A.; and (iv) Yuchan Agropecuaria S.A. (“Bolivian Companies”). The Bolivian Companies maintained possession, ownership or presumed ownership of various rural properties in Bolivia, including the rural property called "Las Londras" (part of the assets of Agropecuaria Acres del Sud), with an area of 4,485 hectares. At the time of the aforementioned operation, Las Londras was subject to an administrative land regularization process ("Land Regularization Process") initiated and conducted by the National Institute of Agrarian Reform of Bolivia ("INRA"), whose objective is the perfection of rights over property.
On November 25, 2021, as part of the Land Regularization Process, INRA issued the Final Land Regularization Resolution No. RA-SS 0504/2021 (“Definitive Resolution”), through which it declared the illegality of the possession of 4,435 hectares of Las Londras. On January 5, 2022, Agropecuaria Acres del Sud S.A. filed a “Contentious Administrative Lawsuit” challenging the Final Resolution in its entirety. However, on September 15, 2023, the Agro-Environmental Court issued a ruling declaring the Administrative Litigation Claim unfounded and confirming the Final Resolution (“Judgment”). In this context, Agropecuaria Acres del Sud S.A. will file a “Constitutional Amparo Action” against the Sentence, with the objective of revoking it.
BrasilAgro's external legal advisors have evaluated that the prospects of revoking the Judgment through the “Constitutional Amparo Action” are possible.
General Ordinary and Extraordinary Shareholders’ Meeting - CRESUD
On October 5, 2023, General Ordinary and Extraordinary Shareholders’ Meeting was held, where it was approved to allocate the results of the year as follows: (I) to the integration of the Legal Reserve for the sum of ARS 2,141.8 million , which updated as of the date of this meeting, amounts to the sum of ARS 2,561 million; and (II) the balance for the sum of ARS 40,693.3 million, which updated as of the date of this meeting amounts to the sum of ARS 48,659.4 million, to be used for the distribution of a dividend to shareholders in proportion to their holdings. shares, payable (i) in cash for the sum of ARS 22,000 million; (ii) in kind, the species being shares issued by IRSA Inversiones y Representaciones Sociedad Anónima (“IRSA”), owned by the Company and for the amount of 22,090,627 VN ARS 10, an amount that was updated by the liquidation derived from the distribution of released shares and change in par value, by applying a conversion ratio that for each share of par value ARS1 corresponded to 0.90780451408 shares of par value ARS10, at the closing price on October 4, 2023 of ARS 644 .75 per IRSA share; and, (iii) the balance for the sum of ARS 12,416.5 million to the constitution of a Reserve for future dividends.
Likewise, it was decided to approve the distribution of the total amount of 5,791,355 treasury shares in the portfolio to the Shareholders in proportion to their shareholdings.
On October 20, 2023, CRESUD reported that it had made the payment of the dividend approved at the meeting held on October 5, 2023 in Argentina.
With respect to our holders of Global Depositary Shares (“GDS”), and due to the exchange and stock exchange regulations in force in the Argentine Republic, which have increased their restrictions in recent weeks, the Bank of New York Mellon (“BONY” ), depositary bank of the GDS, is prevented from distributing the dividend paid by the Company.
Given the aforementioned restrictions, the Company has deposited the corresponding funds in a common investment fund Super Ahorro ARS (pure money market fund) managed by Banco Santander, BONY's representative bank in Argentina and is collaborating with BONY in order to analyze possible alternatives for the distribution or investment of said funds until such time as that entity can channel them in favor of the GDS holders, making available to any GDS holder who so decides the pesos corresponding to their dividend.
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PRICE WATERHOUSE & Co. S.R.L.
C.P.C.E.C.A.B.A. T° 1 F° 17
38
Cresud Sociedad Anónima,
Comercial, Inmobiliaria, Financiera y Agropecuaria
After the end of the period, on January 29, 2024, once the corresponding administrative processes had been completed, the distribution of treasury shares was carried out among ADS holders. Likewise, on February 5, 2024, the Depositary paid the cash dividend for a net amount per ADS of USD 0.370747, including the yield of the “Super Ahorro $” fund, and on February 6, 2024, the distribution of the dividend in kind in IRSA shares was completed, corresponding 0.03759066 GDS of IRSA for each ADS of CRESUD.
The aforementioned corresponds to the payment of dividends to foreign holders, the dividends to local holders were canceled on October 12, 2023. According to this, at the end of this period, the liability "Dividends payable" included in the item “Commercial Debts and Other Debts” amounts to ARS 11,623 million and corresponds to the portion of dividends that were paid during the month of February 2024.
Change in Warrants terms and conditions - CRESUD
Because of the payment of cash dividends and the pro-rata distribution of treasury shares among its shareholders, made by the Company on October 12, 2023, certain terms and conditions of the outstanding warrants to subscribe common shares have changed:
●
Number of shares to be issued per warrant: Pre-dividend ratio: 1.1232. Post-dividend ratio: 1.2548.
●
Exercise price per new share to be issued: Pre-dividend price: USD 0.5036. Post-dividend price: USD 0.4508.
The other terms and conditions of the warrants remain the same.
Warrants exercise - CRESUD
During the six-month period ended December 31, 2023, certain warrant holders exercised their right to purchase additional shares. For this reason, USD 324,987.13 were received, for a converted warrants of 575,548, equivalents to 720,912 common shares.
BrasilAgro – Payment of dividends
At the General Ordinary and Extraordinary Shareholders’ Meeting held on October 24, 2023, BrasilAgro approved the payment of dividends for BRL 320 million, corresponding to BRL 3.2387 per share.
FYO – Payment of dividends
At the General Ordinary and Extraordinary Shareholders’ Meeting held on October 29, 2023, FYO approved the payment of dividends for USD 9.7 million. As of December 31, 2023 they are pending payment.
32.
Subsequent events
Series XII Notes Redemption - IRSA
On December 28, 2023, IRSA notified the holders of Series XII Notes of the early redemption of all of them for a principal amount of UVA 53,784,674, which were outstanding and in circulation with maturity on March 31, 2024, in accordance with the terms and conditions detailed in the Offering Memorandum dated March 26, 2021. The redemption and payment were carried out on January 5, 2024. The redemption price was 100% of the face value of the Series XII Notes, plus accrued and unpaid interest, as of the date set for redemption.
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C.P.C.E.C.A.B.A. T° 1 F° 17
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Cresud Sociedad Anónima,
Comercial, Inmobiliaria, Financiera y Agropecuaria
Shares Buyback Program - IRSA
On January 4, 2024, IRSA reported that the Share Buyback Program approved by the Board of Directors on June 15, 2023, for up to the sum of ARS 5.000 million, with a validity period set at 180 days, extended for an additional period of 180 days from the initial expiration date on December 13, 2023, ended on December 20, 2023, as the amount duly approved for the acquisition of own shares had been fully utilized, with 99.95% of the program completed.
On January 5, 2024, the Board of Directors of IRSA approved a new program for the buyback program of shares issued by the Company and established the terms and conditions for the acquisition of treasury shares issued by the Company, under the terms of Article 64. of Law No. 26,831 and the CNV regulations, for up to a maximum amount of ARS 6,500 million and up to 10% of the share capital, up to a daily limit of up to 25% of the average volume of daily transactions that the shares have experienced of the Company, jointly in the markets it is listed, during the previous 90 business days, and up to a maximum price of USD 10 per GDS and ARS 1,200 per share. Likewise, the repurchase period was set at up to 180 days, beginning the day following the date of publication of the information in the Daily Bulletin of the Buenos Aires Stock Exchange.
Series XLIII and XLIV Notes - CRESUD
On January 17, 2023, Cresud issued Notes on the local market for a total amount of USD 64 million through the following instruments:
●
Series XLIII: Denominated and payable in Argentine pesos for ARS 19,886 million at a variable interest rate BADLAR plus 0% spread, with quarterly interests’ payments. The Capital amortization will be 100% at maturity, on January 17, 2025. The issuance price was 100.0% of the nominal value.
●
Series XLIV: Denominated in dollars for USD 39.8 million, with 6% interest rate and semiannual interests’ payments. The Capital amortization will be in three installments: 33% on October 4, 2025, 33% on January 4, 2026, and 34% at maturity, on May 4, 2026. The issuance price was 100.0%.
The funds were mainly used to refinance short-term liabilities and/or working capital, as defined in the issuance documents.
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C.P.C.E.C.A.B.A. T° 1 F° 17
40
REVIEW REPORT ON THE UNAUDITED CONDENSED INTERIM CONSOLIDATED FINANCIAL STATEMENTS
To the Shareholders, President and Directors of
Cresud Sociedad Anónima, Comercial, Inmobiliaria, Financiera y Agropecuaria
Legal address: Carlos Della Paolera 261, 9° floor
Autonomous City of Buenos Aires
Tax Registration Number: 30-50930070-0
Introduction
We have reviewed the accompanying unaudited condensed interim consolidated financial statements of Cresud Sociedad Anónima, Comercial, Inmobiliaria, Financiera y Agropecuaria (“the Company”), which comprise the unaudited condensed interim separate statement of financial position at December 31, 2023, the unaudited condensed interim consolidated statements of income and other comprehensive income for the six month period and three month period ended December 31, 2023, the interim consolidated statement of changes in shareholders’ equity and of cash flows for the six-month period then ended, and selected explanatory notes.
Management’s responsibility
The Board of Directors of the Company is responsible for the preparation and presentation of these unaudited condensed interim consolidated financial statements in accordance with International Financial Reporting Standards, adopted by the Argentine Federation of Professional Councils in Economic Sciences (FACPCE) as professional accounting standards and included by the National Securities Commission (CNV) in its regulations, as approved by the International Accounting Standards Board (IASB), and is therefore responsible for the preparation and presentation of the unaudited condensed interim consolidated financial statements mentioned in the first paragraph, in accordance with International Accounting Standard 34 Interim Financial Information (IAS 34).
Scope of our review
Our review was limited to the application of the procedures established under International Standards on Review Engagements ISRE 2410 Review of Interim Financial Information Performed by the Independent Auditor of the Entity, adopted as a review standard in Argentina by Technical Pronouncement No. 33 of the FACPCE and approved by the International Auditing and Assurance Standards Board (IAASB). A review of interim financial information consists of inquiries of Company staff responsible for preparing the information included in the unaudited condensed interim consolidated financial statements and of analytical and other review procedures. This review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.
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C.P.C.E.C.A.B.A. T° 1 F° 17
41
Conclusion
On the basis of our review, nothing has come to our attention that causes us to believe that the unaudited condensed interim consolidated financial statements mentioned in the first paragraph of this report have not been prepared, in all material respects, in accordance with International Accounting Standard 34 Interim Financial Reporting.
Report on compliance with current regulations
In accordance with current regulations, we report, in connection with Cresud Sociedad Anónima, Comercial, Inmobiliaria, Financiera y Agropecuaria, that:
a)
the unaudited condensed interim consolidated financial statements of Cresud Sociedad Anónima, Comercial, Inmobiliaria, Financiera y Agropecuaria have not been transcribed into the Inventory and Balance Sheet book and, except for the above mentioned situation, as regards those matters that are within our competence, they are in compliance with the provisions of the General Companies Law and pertinent resolutions of the National Securities Commission;
b)
the unaudited condensed interim consolidated financial statements of Cresud Sociedad Anónima, Comercial, Inmobiliaria, Financiera y Agropecuaria arise from accounting records carried in all formal aspects in accordance with legal requirements except for i) the lack of transcription to the Inventories and Balance Sheet Book, and ii) the lack of transcription to the General Journal Book of the accounting entries corresponding to the month of December 2023;
c)
at December 31, 2023 the debt of Cresud Sociedad Anónima, Comercial, Inmobiliaria, Financiera y Agropecuaria accrued in favor of the Argentine Integrated Social Security System, as shown by the Company’s accounting records, amounted to $ 237,887,661, which is not due at that date.
Autonomous City of Buenos Aires, February 8, 2024
PRICE WATERHOUSE & CO. S.R.L. (Partner) | |
C.P.C.E.C.A.B.A. V° 1 F° 17 | |
Carlos Brondo Public Accountant (UNCUYO) C.P.C.E.C.A.B.A. V. 391 F. 078 |
42
Cresud Sociedad Anónima, Comercial, Inmobiliaria, Financiera y Agropecuaria
Unaudited Condensed Interim Separate Financial Statements as of December 31, 2023 and for the six and three-month periods ended as of that date, presented comparatively.
43
Cresud Sociedad Anónima
Comercial, Inmobiliaria, Financiera y Agropecuaria
Unaudited Condensed Interim Separate Statements of Financial Position
as of December 31, 2023 and June 30, 2023
(All amounts in millions of Argentine Pesos, except otherwise indicated)
Free translation from the original prepared in Spanish for publication in Argentina
Note | 12.31.2023 | 06.30.2023 | |
ASSETS | |||
Non-current assets | |||
Investment properties | 7 | 3,497 | 6,352 |
Property, plant and equipment | 8 | 69,897 | 65,209 |
Intangible assets | 9 | 1,967 | 1,881 |
Right of use assets | 10 | 18,640 | 13,396 |
Biological assets | 11 | 15,595 | 14,935 |
Investments in subsidiaries and associates | 6 | 695,248 | 589,580 |
Income tax and minimum presumed income tax credit | 1 | 3 | |
Trade and other receivables | 14 | 2,236 | 4,212 |
Total non-current assets | 807,081 | 695,568 | |
Current assets | |||
Biological assets | 11 | 14,346 | 13,663 |
Inventories | 12 | 37,436 | 21,859 |
Income tax credit | 15 | 3 | |
Trade and other receivables | 14 | 17,101 | 14,109 |
Investments in financial assets | 13 | 134 | 5,296 |
Derivative financial instruments | 13 | 18 | 71 |
Cash and cash equivalents | 13 | 2,382 | 2,620 |
Total current assets | 71,432 | 57,621 | |
TOTAL ASSETS | 878,513 | 753,189 | |
SHAREHOLDERS’ EQUITY | |||
Shareholders' equity (according to corresponding statements) | 493,120 | 442,485 | |
TOTAL SHAREHOLDERS' EQUITY | 493,120 | 442,485 | |
LIABILITIES | |||
Non-current liabilities | |||
Trade and other payables | 16 | - | 622 |
Borrowings | 18 | 220,157 | 135,239 |
Deferred income tax liabilities | 19 | 15,594 | 32,474 |
Provisions | 17 | 763 | 980 |
Lease liabilities | 1,968 | 772 | |
Total non-current liabilities | 238,482 | 170,087 | |
Current liabilities | |||
Trade and other payables | 16 | 65,863 | 29,087 |
Payroll and social security liabilities | 1,540 | 3,194 | |
Borrowings | 18 | 74,077 | 103,607 |
Derivative financial instruments | 13 | 6 | 31 |
Provisions | 17 | 35 | 46 |
Lease liabilities | 5,390 | 4,652 | |
Total current liabilities | 146,911 | 140,617 | |
TOTAL LIABILITIES | 385,393 | 310,704 | |
TOTAL SHAREHOLDERS' EQUITY AND LIABILITIES | 878,513 | 753,189 |
The accompanying notes are an integral part of these Financial Statements.
) | ||||
Alejandro G. Elsztain Vice President II |
44
Cresud Sociedad Anónima,
Comercial, Inmobiliaria, Financiera y Agropecuaria
Unaudited Condensed Interim Separate Statements of Income and Other Comprehensive Income for the six and three-month periods ended December 31, 2023 and 2022
(All amounts in millions of Argentine Pesos, except otherwise indicated)
Free translation from the original prepared in Spanish for publication in Argentina
Six months | Three months | ||||
Note | 12.31.2023 | 12.31.2022 | 12.31.2023 | 12.31.2022 | |
Revenues | 20 | 21,850 | 29,539 | 9,915 | 11,068 |
Costs | 21 | (17,343) | (25,104) | (8,052) | (9,274) |
Initial recognition and changes in the fair value of biological assets and agricultural products at the point of harvest | (12) | (9,566) | 2,859 | (2,426) | |
Changes in the net realizable value of agricultural products after harvest | 6,492 | 1,339 | 3,630 | 163 | |
Gross profit/ (loss) | 10,987 | (3,792) | 8,352 | (469) | |
Gain from disposal of farmlands | 3,698 | - | 3,698 | - | |
Net gain from fair value adjustment of investment properties | 7 | 955 | 279 | 1,024 | 425 |
General and administrative expenses | 22 | (2,802) | (2,833) | (1,424) | (1,109) |
Selling expenses | 22 | (3,275) | (4,316) | (1,391) | (1,963) |
Other operating results, net | 23 | (282) | (153) | (227) | (335) |
Management fees | (5,638) | (3,807) | 1,335 | (2,248) | |
Profit/ (loss) from operations | 3,643 | (14,622) | 11,367 | (5,699) | |
Share of profit of subsidiaries and associates | 6 | 112,349 | 31,822 | 44,135 | 24,481 |
Profit before financing and taxation | 115,992 | 17,200 | 55,502 | 18,782 | |
Finance income | 24 | 3,527 | 2,233 | 429 | 1,163 |
Finance costs | 24 | (804) | (16,134) | 1,016 | (10,608) |
Other financial results | 24 | (121,672) | 9,997 | (118,094) | 4,785 |
Inflation adjustment | 24 | 36,461 | 13,359 | 31,976 | 3,348 |
Financial results, net | 24 | (82,488) | 9,455 | (84,673) | (1,312) |
Profit/ (loss) before income tax | 33,504 | 26,655 | (29,171) | 17,470 | |
Income tax | 19 | 17,233 | 7,638 | 17,155 | 2,791 |
Profit/ (loss) for the period | 50,737 | 34,293 | (12,016) | 20,261 | |
Other comprehensive income: | |||||
Items that may be reclassified subsequently to profit or loss: | |||||
Currency translation adjustment and other comprehensive results from subsidiaries and associates (i) | 53,981 | (4,205) | 58,337 | 3,360 | |
Revaluation surplus/ (deficit) | 655 | 1,207 | (4) | (148) | |
Other comprehensive income/ (loss) the period | 54,636 | (2,998) | 58,333 | 3,212 | |
Total comprehensive income for the period | 105,373 | 31,295 | 46,317 | 23,473 | |
Profit/ (loss) per share for the period (ii) | |||||
Basic | 85.70 | 58.03 | (20.30) | 34.28 | |
Diluted | 72.69 | 49.63 | (17.21) | 29.32 |
(i)
Components of other comprehensive income / (loss) have no impact on income tax.
(ii)
See Note 30 to the Annual Consolidated Financial Statements as of June 30, 2023.
The accompanying notes are an integral part of these Financial Statements.
) | ||||
Alejandro G. Elsztain Vice President II |
Cresud Sociedad Anónima,
Comercial, Inmobiliaria, Financiera y Agropecuaria
Unaudited Condensed Interim Separate Statements of Changes in Shareholders’ Equity
for the six-month period ended December 31, 2023
(All amounts in millions of Argentine Pesos, except otherwise indicated)
Free translation from the original prepared in Spanish for the publication in Argentina
Share capital | ||||||||||
Outstanding shares | Treasury shares | Inflation adjustment of share capital and treasury shares (i) | Warrants (ii) | Share premium | Additional paid-in capital from treasury shares | Legal reserve | Other reserves (iii) | Retained earnings | Total Shareholders' equity | |
Balance as of June 30, 2023 | 586 | 7 | 113,036 | 10,552 | 140,280 | (7,919) | 10,847 | 84,082 | 91,014 | 442,485 |
Profit for the period | - | - | - | - | - | - | - | - | 50,737 | 50,737 |
Other comprehensive income for the period | - | - | - | - | - | - | - | 54,636 | - | 54,636 |
Total comprehensive income for the period | - | - | - | - | - | - | - | 54,636 | 50,737 | 105,373 |
Issuance of shares | 1 | (1) | - | - | - | (753) | - | 753 | - | - |
Assignment of results - Shareholders’ meeting | - | - | - | - | - | - | 4,426 | 32,802 | (37,228) | - |
Dividends distribution | - | - | - | - | - | - | - | - | (51,298) | (51,298) |
Exercise of warrants (ii) | 1 | - | 5 | (76) | 2,681 | - | - | - | - | 2,611 |
Reserve for share-based payments | - | - | - | - | - | (187) | - | (43) | - | (230) |
Changes in non-controlling interest | - | - | - | - | - | - | - | (5,821) | - | (5,821) |
Other changes in equity | - | - | - | - | - | - | - | 2,488 | (2,488) | - |
Balance as of December 31, 2023 | 588 | 6 | 113,041 | 10,476 | 142,961 | (8,859) | 15,273 | 168,897 | 50,737 | 493,120 |
(i)
Includes ARS 8 of inflation adjustment of treasury shares. See Note 19 to the Annual Financial Statements as of June 30, 2023.
(ii)
See Note 31 and 32 to the Unaudited Condensed Interim Consolidated Financial Statements.
(iii)
Group’s Other reserves as of December 31, 2023 are comprised as:
Cost of treasury shares | Reserve for currency translation adjustment | Reserve for the acquisition of securities issued by the Company | Special reserve | Reserve for future dividends | Other reserves (i) | Total Other reserves | |
Balance as of June 30, 2023 | (5,350) | 4,296 | 1,091 | 70,742 | - | 13,303 | 84,082 |
Other comprehensive income for the period | - | 53,840 | - | - | - | 796 | 54,636 |
Total comprehensive income for the period | - | 53,840 | - | - | - | 796 | 54,636 |
Repurchase of treasury shares | 753 | - | - | - | - | - | 753 |
Assignment of results - Shareholders’ meeting | - | - | - | - | 32,802 | - | 32,802 |
Reserve for share-based payments | 192 | - | - | - | - | (235) | (43) |
Changes in non-controlling interest | - | - | - | - | - | (5,821) | (5,821) |
Other changes in equity | - | - | - | 2,488 | - | - | 2,488 |
Balance as of December 31, 2023 | (4,405) | 58,136 | 1,091 | 73,230 | 32,802 | 8,043 | 168,897 |
(i)
Includes revaluation surplus.
There are no cumulative unpaid dividends on preferred shares.
The accompanying notes are an integral part of these Financial Statements.
) | ||||
Alejandro G. Elsztain Vice President II |
46
Cresud Sociedad Anónima,
Comercial, Inmobiliaria, Financiera y Agropecuaria
Unaudited Condensed Interim Separate Statements of Changes in Shareholders’ Equity
for the six-month period ended December 31, 2022
(All amounts in millions of Argentine Pesos, except otherwise indicated)
Free translation from the original prepared in Spanish for publication in Argentina
Share capital | ||||||||||
Outstanding shares | Treasury shares | Inflation adjustment of share capital and treasury shares (i) | Warrants | Share premium | Additional paid-in capital from treasury shares | Legal reserve | Other reserves (ii) | Retained earnings | Total Shareholders' equity | |
Balance as of June 30, 2022 | 590 | 2 | 113,028 | 10,702 | 139,093 | 1,013 | 5,118 | (5,824) | 114,584 | 378,306 |
Profit for the period | - | - | - | - | - | - | - | - | 34,293 | 34,293 |
Other comprehensive loss for the period | - | - | - | - | - | - | - | (2,998) | - | (2,998) |
Total comprehensive (loss) / income for the period | - | - | - | - | - | - | - | (2,998) | 34,293 | 31,295 |
Assignment of results - Shareholders’ meeting | - | - | - | - | - | - | 5,729 | 95,044 | (100,773) | - |
Dividends distribution | - | - | - | - | - | - | - | - | (13,811) | (13,811) |
Repurchase of treasury shares | (9) | 9 | - | - | - | - | - | (5,138) | - | (5,138) |
Exercise of warrants | - | - | 1 | (9) | 77 | - | - | - | - | 69 |
Changes in non-controlling interest | - | - | - | - | - | - | - | 9,037 | - | 9,037 |
Reserve for share-based payments | - | - | - | - | - | - | - | 170 | - | 170 |
Other changes in equity | - | - | - | - | - | - | - | (759) | - | (759) |
Balance as of December 31, 2022 | 581 | 11 | 113,029 | 10,693 | 139,170 | 1,013 | 10,847 | 89,532 | 34,293 | 399,169 |
(i)
Includes ARS 3 of inflation adjustment of treasury shares. See Note 19 to the Annual Financial Statements as of June 30, 2023.
(ii)
Group’s Other reserves as of December 31, 2022 are comprised as:
Cost of treasury shares | Reserve for currency translation adjustment | Reserve for the acquisition of securities issued by the Company | Special reserve | Other reserves (i) | Total Other reserves | |
Balance as of June 30, 2022 | (1,625) | (3,335) | 1,091 | - | (1,955) | (5,824) |
Other comprehensive (loss) / income for the period | - | (4,023) | ��- | - | 1,025 | (2,998) |
Total comprehensive (loss) / income for the period | - | (4,023) | - | - | 1,025 | (2,998) |
Assignment of results - Shareholders’ meeting | - | - | - | 95,044 | - | 95,044 |
Repurchase of treasury shares | (5,138) | - | - | - | - | (5,138) |
Changes in non-controlling interest | - | - | - | - | 9,037 | 9,037 |
Reserve for share-based payments | - | - | - | - | 170 | 170 |
Other changes in equity | - | (508) | - | - | (251) | (759) |
Balance as of December 31, 2022 | (6,763) | (7,866) | 1,091 | 95,044 | 8,026 | 89,532 |
(i) Includes revaluation surplus.
There are no cumulative unpaid dividends on preferred shares.
The accompanying notes are an integral part of these Financial Statements.
) | ||||
Alejandro G. Elsztain Vice President II |
47
Cresud Sociedad Anónima,
Comercial, Inmobiliaria, Financiera y Agropecuaria
Unaudited Condensed Interim Separate Statements of Cash Flows
for the six-month periods ended December 31, 2023 and 2022
(All amounts in millions of Argentine Pesos, except otherwise indicated)
Free translation from the original prepared in Spanish for publication in Argentina
Note | 12.31.2023 | 12.31.2022 | |
Operating activities: | |||
Cash used in operations | 15 | (8,524) | (4,287) |
Net cash used in operating activities | (8,524) | (4,287) | |
Investing activities: | |||
Acquisition of property, plant and equipment | 8 | (1,214) | (1,003) |
Proceeds from disposals of property, plant and equipment | 2,772 | - | |
Acquisition of intangible assets | 9 | (158) | - |
Proceeds from disposals of investment in financial assets | 29,248 | 3,643 | |
Acquisition of investment in financial instruments | (21,998) | (1,949) | |
Payments from derivative financial instruments | (20) | (492) | |
Interests collected | 40 | 137 | |
Dividends collected | 50,137 | 8,523 | |
Net cash generated from investing activities | 58,807 | 8,859 | |
Financing activities: | |||
Borrowings, issuance and new placement of non-convertible notes | 22,458 | 69,702 | |
Payment of borrowings and non-convertible notes | (26,072) | (54,932) | |
Obtaining of short-term loans, net | 1,890 | 1,591 | |
Repurchase of treasury shares | - | (5,138) | |
Exercise of warrants | 2,611 | 69 | |
Dividends paid | (31,139) | (13,811) | |
Interests paid | (20,406) | (20,830) | |
Net cash used in financing activities | (50,658) | (23,349) | |
Net decrease in cash and cash equivalents | (375) | (18,777) | |
Cash and cash equivalents at beginning of the period | 2,620 | 25,314 | |
Result from exposure to inflation on cash and cash equivalents | 1,629 | 315 | |
Foreign exchange loss in cash and changes in fair value of cash equivalents | (1,492) | (5,325) | |
Cash and cash equivalents at the end of the period | 13 | 2,382 | 1,527 |
The accompanying notes are an integral part of these Financial Statements.
) | ||||
Alejandro G. Elsztain Vice President II |
Cresud Sociedad Anónima,
Comercial, Inmobiliaria, Financiera y Agropecuaria
Notes to the Unaudited Condensed Interim Financial Statements
(All amounts in millions of Argentine Pesos, except otherwise indicated)
1.
General information
Cresud Sociedad Anónima, Comercial, Inmobiliaria, Financiera y Agropecuaria (“Cresud” or the “Company”) was founded in 1936 as a subsidiary of Credit Foncier, a Belgian company primarily engaged in providing rural and urban loans in Argentina and administering real estate holdings foreclosed by Credit Foncier. Credit Foncier was liquidated in 1959, and as part of such liquidation, the shares of Cresud were distributed to Credit Foncier’s shareholders. From the 1960s through the end of the 1970s, the business of Cresud shifted exclusively to agricultural activities.
Cresud is a company organized and domiciled in the Republic of Argentina. The address of its registered office is Carlos Della Paolera 261, 9th Floor, Buenos Aires, Argentina.
Economic context in which the Company operated
See Note 1 to the Unaudited Condensed Interim Consolidated Financial Statements
These Unaudited Condensed Interim Separate Financial Statements have been approved for issue by the Board of Directors on February 8, 2024.
2.
Summary of significant accounting policies
2.1.
Basis of preparation
See Note 2.1. to the Unaudited Condensed Interim Consolidated Financial Statements
2.2.
Significant accounting policies
The accounting policies applied in the preparation of these Unaudited Condensed Interim Financial Statements are consistent with those applied in the Annual Financial Statements as of June 30, 2023.
2.3.
Comparative information
The amounts as of June 30, 2023 and December 31, 2022, which are disclosed for comparative purposes, arise from the financial statements at such dates restated in accordance with IAS 29 (Note 2.1). Certain items from prior periods have been reclassified for consistency purposes.
2.4.
Use of estimates
The preparation of Financial Statements at a certain date requires Management to make estimates and evaluations affecting the amount of assets and liabilities recorded and contingent assets and liabilities disclosed at such date, as well as income and expenses recorded during the period. Future results might differ from the estimates and evaluations made at the date of preparation of these Unaudited Condensed Interim Separate Financial Statements.
In the preparation of these Unaudited Condensed Interim Separate Financial Statements, the significant judgments made by Management in applying the Company’s accounting policies and the main sources of uncertainty were the same applied by the Company in the preparation of the Annual Separate Financial Statements for the fiscal year ended June 30, 2023, described in Note 3 to those financial statements.
3.
Seasonal effects on operations
See Note 3 to the Unaudited Condensed Interim Consolidated Financial Statements.
4.
Acquisitions and disposals
See description of acquisitions and disposals of the Company for the six-month period ended December 31, 2023 in Note 4 to the Unaudited Condensed Interim Consolidated Financial Statements.
49
Cresud Sociedad Anónima,
Comercial, Inmobiliaria, Financiera y Agropecuaria
5.
Financial risk management and fair value estimates
5.1.
Financial risk
The Unaudited Condensed Interim Separate Financial Statements do not include all the information and disclosures of the risk management, so they should be read together with the Annual Separate Financial Statements as of June 30, 2023. There have been no significant changes in the risk management or risk management policies applied by the Company since the fiscal year.
Since June 30, 2023 and up to the date of issuance of these Financial Statements, there have been no significant changes in business or economic circumstances affecting the fair value of the Company's assets or liabilities, (either measured at fair value or amortized cost).
6.
Investments in subsidiaries and associates
The Company conducts its business through several subsidiaries and associates.
Set out below are the changes in Company’s investment in subsidiaries and associates for the six-month period ended December 31, 2023 and for the fiscal year ended June 30, 2023:
12.31.2023 | 06.30.2023 | |
Beginning of the period / year | 589,580 | 536,674 |
Share of profit | 112,349 | 73,985 |
Others changes in subsidiaries’ equity | (6,051) | 14,455 |
Sale of interest in subsidiaries | (3,338) | - |
Other comprehensive results | 53,981 | 7,108 |
Decrease of interest | - | (63) |
Dividends distributed (Note 25) | (51,273) | (42,579) |
End of the period / year | 695,248 | 589,580 |
See changes in Company’s investment in associates and joint ventures for the six-month period ended December 31, 2023 in Note 7 to the Unaudited Condensed Interim Consolidated Financial Statements and for the year ended June 30, 2023 in Note 8 to the Annual Consolidated Financial Statements.
% of ownership interest | Registered value | Entity's interest in comprehensive income / (loss) | ||||
Name of the entity | 12.31.2023 | 06.30.2023 | 12.31.2023 | 06.30.2023 | 12.31.2023 | 12.31.2022 |
Subsidiaries | ||||||
Brasilagro Companhia Brasileira de Propriedades Agrícolas (“Brasilagro”) | 1.35% | 1.35% | 9,792 | 6,882 | 3,276 | (124) |
Futuros y Opciones.Com S.A. | 51.21% | 49.55% | 11,384 | 6,185 | 6,185 | 3,007 |
Amauta Agro S.A. (continuation of FyO Trading S.A.) | 2.20% | 2.20% | (67) | 14 | (81) | (18) |
FyO Acopio S.A. (continuation of Granos Olavarría S.A.) | 2.20% | 2.20% | 259 | 135 | 124 | 151 |
Helmir S.A. | 100.00% | 100.00% | 246,473 | 173,103 | 79,430 | (1,092) |
IRSA Inversiones y Representaciones Sociedad Anónima | 54.25% | 54.06% | 422,950 | 399,804 | 76,396 | 25,934 |
Total Subsidiaries | 690,791 | 586,123 | 165,330 | 27,858 | ||
Associates | ||||||
Agrouranga S.A. | 34.86% | 34.86% | 3,231 | 2,683 | 547 | (295) |
Uranga Trading S.A. | 34.86% | 34.86% | 1,226 | 774 | 453 | 54 |
Total Associates | 4,457 | 3,457 | 1,000 | (241) | ||
Total Investments in subsidiaries and associates | 695,248 | 589,580 | 166,330 | 27,617 |
50
Cresud Sociedad Anónima,
Comercial, Inmobiliaria, Financiera y Agropecuaria
Last financial statement issued | |||||||
Name of the entity | Market value as of 12.31.2023 | Place of business / country of incorporation | Main activity | Amount of common shares 1 vote | Common shares (nominal value) | Income /(loss) for the period | Shareholders' equity |
Subsidiaries | |||||||
Brasilagro Companhia Brasileira de Propriedades Agrícolas (“Brasilagro”) | 26.71 | Brazil | Agricultural | 1,334,400 | 17,742 | 3,005 | 417,692 |
Futuros y Opciones.Com S.A. | Not publicly traded | Argentina | Brokerage | 197,824,615 | 386 | 12,226 | 21,177 |
Amauta Agro S.A. (continuation of FyO Trading S.A.) | Not publicly traded | Argentina | Brokerage | 506,440 | 23 | (3,676) | (3,045) |
FyO Acopio S.A. (continuation of Granos Olavarría S.A.) | Not publicly traded | Argentina | Warehousing and Brokerage | 11,264 | 1 | 5,632 | 11,757 |
Helmir S.A. | Not publicly traded | Uruguay | Investment | 10,287,750,845 | 10,288 | 25,987 | 245,346 |
IRSA Inversiones y Representaciones Sociedad Anónima | 854.35 | Argentina | Real Estate | 394,730,827 | 728 | 141,518 | 788,455 |
Agrouranga S.A. | Not publicly traded | Argentina | Agricultural | 2,532,579 | 7 | 1,570 | 2,389 |
Uranga Trading S.A. | Not publicly traded | Argentina | Marketing, warehousing and processing | 637,498 | 2 | 1,299 | 3,519 |
7.
Investment properties
Changes in Company’s investment properties for the six-month period ended December 31, 2023 and for the fiscal year ended June 30, 2023 were as follows:
12.31.2023 | 06.30.2023 | |
Beginning of the period / year | 6,352 | 4,113 |
Transfers | (3,810) | 2,476 |
Net gain/ (loss) from fair value adjustment of investment properties | 955 | (237) |
End of the period / year | 3,497 | 6,352 |
During the six-month period ended December 31, 2023 and for the year ended June 30, 2023, there were no financial costs activated as there have been no assets that qualify for capitalization. No investment property of the Company has been mortgaged to guarantee some of the Company´s loans.
The amounts recognized in the statement of income and other comprehensive income are not material for any of the exercises analyzed.
As described in Note 2.6 to the Annual Consolidated Financial Statements corresponding to the year ended June 30, 2023, the Group uses the valuation made by qualified external appraisers to determine the fair value of its investment properties. Fair values are based on comparable values (Level 2 of the fair value hierarchy). The sales prices of comparable land are adjusted considering the specific aspects of each land, the most important used premise being the price per hectare.
51
Cresud Sociedad Anónima,
Comercial, Inmobiliaria, Financiera y Agropecuaria
8.
Property, plant and equipment
Changes in Company’s property, plant and equipment for the six-month period ended December 31, 2023 and for the fiscal year ended June 30, 2023 were as follows:
Owner occupied farmland (ii) | Others (iii) | Total as of 12.31.2023 | Total as of 06.30.2023 | |
Costs | 76,602 | 5,378 | 81,980 | 78,145 |
Accumulated depreciation | (12,885) | (3,886) | (16,771) | (15,255) |
Net book amount at the beginning of the period / year | 63,717 | 1,492 | 65,209 | 62,890 |
Additions | 717 | 497 | 1,214 | 4,258 |
Disposals | (557) | (2) | (559) | (2) |
Transfers | 4,818 | - | 4,818 | (421) |
Depreciation charge (i) | (518) | (267) | (785) | (1,516) |
Balances at the end of the period / year | 68,177 | 1,720 | 69,897 | 65,209 |
Costs | 81,580 | 5,873 | 87,453 | 81,980 |
Accumulated depreciation | (13,403) | (4,153) | (17,556) | (16,771) |
Net book amount at the end of the period / year | 68,177 | 1,720 | 69,897 | 65,209 |
(i) As of December 31, 2023 the depreciation expense of property, plant and equipment has been charged as follows: ARS 38 in "Costs", ARS 46 in “General and administrative expenses” and ARS 1 in “Selling expenses”in “the Statement of Income and Other Comprehensive Income" (Note 22);ARS 700 were capitalized as part of the biological assets costs.
(ii) Includes farms, buildings and facilities of farmlands properties.
(iii) Includes producing plants, machinery and equipment, furnitures and supplies and vehicles.
9.
Intangible assets
Changes in Company’s intangible assets for the six-month period ended as of December 31, 2023 and for the fiscal year ended as of June 30, 2023 were as follows:
Software | Concession rights | Total as of 12.31.2023 | Total as of 06.30.2023 | |
Costs | 368 | 3,609 | 3,977 | 3,925 |
Accumulated amortization | (318) | (1,778) | (2,096) | (1,955) |
Net book amount at the beginning of the period / year | 50 | 1,831 | 1,881 | 1,970 |
Additions | 158 | - | 158 | 52 |
Amortization charges (i) | (15) | (57) | (72) | (141) |
Balances at the end of the period / year | 193 | 1,774 | 1,967 | 1,881 |
Costs | 526 | 3,609 | 4,135 | 3,977 |
Accumulated amortization | (333) | (1,835) | (2,168) | (2,096) |
Net book amount at the end of the period / year | 193 | 1,774 | 1,967 | 1,881 |
(i) Amortization charges are included in “General and administrative expenses” in the Statement of Income and Other Comprehensive Income (Note 22). There are no impairment charges for any of the years presented.
10.
Right of use assets
The composition in the Company's rights of use assets for the six-month period ended as of December 31, 2023 and for the fiscal year ended as of June 30, 2023 is as follows:
12.31.2023 | 06.30.2023 | |
Offices | 828 | 54 |
Farmland | 17,812 | 13,342 |
Total right of use assets | 18,640 | 13,396 |
Non-current | 18,640 | 13,396 |
Total | 18,640 | 13,396 |
52
Cresud Sociedad Anónima,
Comercial, Inmobiliaria, Financiera y Agropecuaria
The depreciation charge of the right of use assets is detailed below:
12.31.2023 | 12.31.2022 | |
Farmland | 1,990 | 4,133 |
Offices | 102 | 106 |
Total depreciation of right of use assets (i) | 2,092 | 4,239 |
(i) As of December 31, 2023 the depreciation expense has been charged for ARS 100 in “General and administrative expenses” and ARS 2 in “Selling expenses” in “the Statement of Income and Other Comprehensive Income" (Note 22); ARS 1,990 were capitalized as part of the biological assets costs.
11.
Biological assets
Changes in the Company’s biological assets for the six-month period ended as of December 31, 2023 and for the fiscal year ended as of June 30, 2023 were as follows:
Sown land-crops | Breeding cattle | Other cattle | Others | Total as of 12.31.2023 | Total as of 06.30.2023 | ||
Level 1 | Level 3 | Level 2 | Level 2 | Level 1 | |||
Net book amount at the beginning of the period / year | 1,390 | 10,422 | 16,224 | 327 | 235 | 28,598 | 33,847 |
Purchases | - | - | 1,345 | - | - | 1,345 | 1,246 |
Transfers | (503) | 503 | - | - | - | - | - |
Initial recognition and changes in the fair value of biological assets | - | (547) | 526 | (98) | - | (119) | (11,181) |
Decrease due to harvest | - | (17,144) | - | - | - | (17,144) | (39,579) |
Sales | - | - | (2,780) | (3) | - | (2,783) | (6,837) |
Consumes | - | - | (22) | (1) | (27) | (50) | (114) |
Costs for the period | 8,234 | 7,357 | 4,499 | - | 4 | 20,094 | 51,216 |
Balances at the end of the period / year | 9,121 | 591 | 19,792 | 225 | 212 | 29,941 | 28,598 |
Non-current (production) | - | - | 15,195 | 188 | 212 | 15,595 | 14,935 |
Current (consumable) | 9,121 | 591 | 4,597 | 37 | - | 14,346 | 13,663 |
Net book amount at the end of the period / year | 9,121 | 591 | 19,792 | 225 | 212 | 29,941 | 28,598 |
During the six-month period ended December 31, 2023, there were transfers for ARS 503 between the fair value hierarchies 1 and 3 of sown land-crops. Likewise, there were no reclassifications among their respective categories.
Capitalized costs of production as of December 31, 2023 and 2022 are as follows:
12.31.2023 | 12.31.2022 | |
Supplies and labors | 14,151 | 13,272 |
Leases and expenses | 39 | 22 |
Amortization and depreciation | 2,690 | 4,786 |
Maintenance, security, cleaning, repairs and others | 468 | 458 |
Payroll and social security liabilities | 1,779 | 1,812 |
Fees and payments for services | 168 | 125 |
Freight expenses | 330 | 480 |
Travel expenses and stationery | 400 | 417 |
Taxes, rates and contributions | 65 | 106 |
20,090 | 21,478 |
See information on valuation processes used by the entity in Note 14 to the Annual Consolidated Financial Statements as of June 30, 2023.
As of December 31, 2023, and June 30, 2023, the better and maximum use of biological assets shall not significantly differ from the current use.
53
Cresud Sociedad Anónima,
Comercial, Inmobiliaria, Financiera y Agropecuaria
12.
Inventories
Breakdown of Company’s inventories as of December 31, 2023 and June 30, 2023 are as follows:
12.31.2023 | 06.30.2023 | |
Crops | 17,806 | 9,349 |
Materials and supplies | 70 | 46 |
Seeds and fodders | 19,560 | 12,464 |
Total inventories | 37,436 | 21,859 |
Current | 37,436 | 21,859 |
Total | 37,436 | 21,859 |
As of December 31, 2023 the cost of inventories recognized as expense amounted to ARS 14,096 and have been included in “Costs” in the Unaudited Condensed Interim Separate Statement of Income and Other Comprehensive Income.
13.
Financial instruments by category
Determining fair values
See determination of the fair value of the Company's financial instruments in Note 16 to the Annual Consolidated Financial Statements as of June 30, 2023.
The following tables present the Company’s financial assets and financial liabilities that are measured at fair value as of December 31, 2023 and June 30, 2023 and their allocation to the fair value hierarchy:
Financial assets at amortized cost | Financial assets at fair value through profit or loss | Subtotal financial assets | Non-financial assets | Total | |
December 31, 2023 | Level 1 | ||||
Assets as per statement of financial position | |||||
Trade and other receivables (excluding the allowance for doubtful accounts and other receivables) (Note 14) | 12,244 | - | 12,244 | 7,105 | 19,349 |
Investment in financial assets | |||||
- Bonds | - | 134 | 134 | - | 134 |
Derivative financial instruments | |||||
- Commodities options contracts | - | 18 | 18 | - | 18 |
Cash and cash equivalents | |||||
- Cash on hand and at bank | 2,358 | - | 2,358 | - | 2,358 |
- Short-term investments | - | 24 | 24 | - | 24 |
Total | 14,602 | 176 | 14,778 | 7,105 | 21,883 |
Financial liabilities at amortized cost | Non-financial liabilities | Total | |
December 31, 2023 | |||
Liabilities as per statement of financial position | |||
Trade and others payables (Note 16) | 51,083 | 14,780 | 65,863 |
Borrowings (Note 18) | 294,234 | - | 294,234 |
Derivative financial instruments: | |||
- Commodities futures contracts | 6 | - | 6 |
Total | 345,323 | 14,780 | 360,103 |
54
Cresud Sociedad Anónima,
Comercial, Inmobiliaria, Financiera y Agropecuaria
Financial assets at amortized cost | Financial assets at fair value through profit or loss | Subtotal financial assets | Non-financial assets | Total | |
June 30, 2023 | Level 1 | ||||
Assets as per statement of financial position | |||||
Trade and other receivables (excluding the allowance for doubtful accounts and other receivables) (Note 14) | 12,026 | - | 12,026 | 6,299 | 18,325 |
Investment in financial assets | |||||
- Mutual funds | - | 5,296 | 5,296 | - | 5,296 |
Derivative financial instruments | |||||
- Commodities options contracts | - | 71 | 71 | - | 71 |
Cash and cash equivalents | |||||
- Cash on hand and at bank | 1,942 | - | 1,942 | - | 1,942 |
- Short-term investments | - | 678 | 678 | - | 678 |
Total | 13,968 | 6,045 | 20,013 | 6,299 | 26,312 |
Financial liabilities at amortized cost | Non-financial liabilities | Total | |
June 30, 2023 | |||
Liabilities as per statement of financial position | |||
Trade and others payables (Note 16) | 19,750 | 9,959 | 29,709 |
Borrowings (Note 18) | 238,846 | - | 238,846 |
Derivative financial instruments: | |||
- Commodities futures contracts | 31 | - | 31 |
Total | 258,627 | 9,959 | 268,586 |
As of December 31, 2023, there have been no changes to the economic or business circumstances affecting the fair value of the financial assets and liabilities of the Company.
14.
Trade and other receivables
Breakdown of the Company’s trade and other receivables as of December 31, 2023 and June 30, 2023 are as follows:
12.31.2023 | 06.30.2023 | |
Receivables from sale of agricultural products and services | 4,025 | 5,534 |
Debtors under legal proceedings | 2 | 3 |
Less: allowance for doubtful accounts | (12) | (4) |
Total trade receivables | 4,015 | 5,533 |
Prepayments | 1,565 | 936 |
Tax credits | 4,826 | 5,237 |
Loans granted | 524 | 245 |
Advance payments | 713 | 158 |
Expenses to recover | 310 | 138 |
Others | 738 | 1,009 |
Total other receivables | 8,676 | 7,723 |
Related parties (Note 25) | 6,646 | 5,065 |
Total trade and other receivables | 19,337 | 18,321 |
Non-current | 2,236 | 4,212 |
Current | 17,101 | 14,109 |
Total trade and other receivables | 19,337 | 18,321 |
(i)
Net of implicit interests
The fair value of current trade and other receivables approximate their respective carrying amounts because, due to their short-term nature, as the impact of discounting is not considered significant.
55
Cresud Sociedad Anónima,
Comercial, Inmobiliaria, Financiera y Agropecuaria
The carrying amounts of the Company’s trade and other receivables denominated in foreign currencies are detailed in Note 28.
Trade receivables are generally presented in the statement of financial position net of allowances for doubtful receivables. Impairment policies and procedures by type of receivables are discussed in detail in Note 2.16 to the Annual Consolidated Financial Statements as of June 30, 2023.
Movements on the Company’s allowance for doubtful accounts are as follows:
12.31.2023 | 06.30.2023 | |
Beginning of the period / year | 4 | 26 |
Additions | 2 | 10 |
Recovery | (1) | (11) |
Inflation adjustment | 7 | (21) |
End of the period / year | 12 | 4 |
The addition and recovery of allowance for doubtful accounts have been included in “Selling expenses” in the Unaudited Condensed Interim Separate Statement of Income and Other Comprehensive Income (Note 22). Amounts charged to the provision account are generally written off when there is no expectation of recovering additional cash.
15.
Cash flow information
Following is a detailed description of cash flows used in the Company’s operations for the six-month periods ended as of December 31, 2023 and 2022:
Note | 12.31.2023 | 12.31.2022 | |
Profit for the period | 50,737 | 34,293 | |
Adjustments for: | |||
Income tax | 19 | (17,233) | (7,638) |
Amortization and depreciation | 22 | 259 | 274 |
Gain from disposal of farmlands | (3,698) | - | |
Loss from sale of subsidiaries | 22 | 393 | - |
Financial results, net | 65,880 | 3,310 | |
Unrealized initial recognition and changes in the fair value of biological assets | (5,426) | 4,017 | |
Changes in net realizable value of agricultural products after harvest | (6,492) | (1,339) | |
Provisions and allowances | 583 | 404 | |
Management fees | 5,638 | 3,807 | |
Share of profit from participation in subsidiaries and asscociates | 6 | (112,349) | (31,822) |
Gain from sale of property, plant and equipment | (13) | (21) | |
Net gain from fair value adjustment of investment properties | 7 | (955) | (279) |
Changes in operating assets and liabilities: | |||
Decrease in biological assets | 6,773 | 6,346 | |
(Increase)/ decrease in inventories | (9,085) | 5,649 | |
Decrease/ (increase) in trade and other receivables | 2,085 | (3,821) | |
Decrease/ (increase) in right of use assets | 2 | (6) | |
Decrease in lease liabilities | (1,941) | (3,008) | |
Decrease in derivative financial instruments | - | 1,457 | |
Increase/ (decrease) in trade and other payables | 17,989 | (14,845) | |
Decrease in payroll and social security liabilities | (1,654) | (1,065) | |
Net cash used in operating activities before income tax paid | (8,507) | (4,287) | |
Income tax paid | (17) | - | |
Net cash used in operating activities | (8,524) | (4,287) |
56
Cresud Sociedad Anónima,
Comercial, Inmobiliaria, Financiera y Agropecuaria
The following table shows a detail of non-cash transactions occurred in the six-month periods ended as of December 31, 2023 and 2022:
12.31.2023 | 12.31.2022 | |
Non-cash transactions | ||
Decrease in investments in subsidiaries and associates through an increase in trade and other receivables | 1,748 | 1,893 |
Currency translation adjustment and other comprehensive results from subsidiaries and associates | 53,981 | 4,205 |
Other changes in equity | 6,051 | 8,448 |
Increase of non-convertible notes through a decrease in non-convertible notes | - | 34,818 |
Decrease in shareholders´ equity through an increase in trade and other payables | 16,451 | - |
Increase in investments in subsidiaries and associates through an increase in trade and other payables | 763 | - |
Decrease in shareholders´ equity through a decrease in investments in subsidiaries and associates | 3,708 | - |
Increase in right of use assets through an increase in lease liabilities | 7,338 | 8,744 |
Increase in investment properties through a decrease in property, plant and equipment | - | 2,214 |
Increase in shareholders´ equity through an increase in investment properties | 1,008 | 1,794 |
Increase in deferred tax liability through a decrease in shareholders´ equity | 353 | 651 |
Decrease in trade and other receivables through a decrease in lease liabilities | 28 | 93 |
Decrease in trade and other receivables through a decrease in borrowings | 117 | 62 |
Decrease in property, plant and equipment through an increase in trade and other receivables | 1,498 | 22 |
Decrease in investment properties through an increase in property, plant and equipment | 3,810 | - |
57
Cresud Sociedad Anónima,
Comercial, Inmobiliaria, Financiera y Agropecuaria
16.
Trade and other payables
The detail of the Company’s trade and other payables as of December 31, 2023 and June 30, 2023 are as follows:
12.31.2023 | 06.30.2023 | |
Trade payables | 21,901 | 5,910 |
Provisions | 4,791 | 3,986 |
Sales, rent and services payments received in advance | 13,881 | 9,697 |
Total trade payables | 40,573 | 19,593 |
Dividends payable | 11,623 | - |
Taxes payable | 501 | 249 |
Others | 1,603 | - |
Total other payables | 13,727 | 249 |
Related parties (Note 25) | 11,563 | 9,867 |
Total trade and other payables | 65,863 | 29,709 |
Non-current | - | 622 |
Current | 65,863 | 29,087 |
Total trade and other payables | 65,863 | 29,709 |
The fair value of trade and other payables approximate their respective carrying amounts due to their short-term nature, as the impact of discounting is considered as not significant. Fair values are based on discounted cash flows (Level 3). Book value of trade and other payables denominated in foreign currencies are detailed in Note 28.
17.
Provisions
The table below shows the movements in Company's provisions categorized by type of provision:
Labor and tax claims and other claims (i) | Total as of 12.31.2023 | Total as of 06.30.2023 | |
Beginning of period / year | 1,026 | 1,026 | 1,328 |
Additions | 424 | 424 | 644 |
Decreases | - | - | (70) |
Used during the period | - | - | (25) |
Inflation adjustment | (652) | (652) | (851) |
End of period / year | 798 | 798 | 1,026 |
Non-current | 763 | 980 | |
Current | 35 | 46 | |
Total | 798 | 1,026 |
(i)
The net is included in “Other operating results, net”.
18.
Borrowings
Company’s borrowings as of December 31, 2023 and June 30, 2023 are comprised as follows:
Book value | Fair Value | |||
12.31.2023 | 06.30.2023 | 12.31.2023 | 06.30.2023 | |
Non-convertible notes | 218,246 | 177,986 | 201,036 | 185,098 |
Bank loans and others | 6,021 | 4,707 | 6,021 | 4,707 |
Related parties (Note 25) | 56,462 | 29,104 | 56,390 | 29,153 |
Bank overdrafts | 13,505 | 27,049 | 13,505 | 27,049 |
Total borrowings | 294,234 | 238,846 | 276,952 | 246,007 |
Non-current | 220,157 | 135,239 | ||
Current | 74,077 | 103,607 | ||
Total borrowings | 294,234 | 238,846 |
See Note 20 to the interim condensed consolidated financial statements.
58
Cresud Sociedad Anónima,
Comercial, Inmobiliaria, Financiera y Agropecuaria
19.
Taxation
The detail of the provision for the Company’s income tax is as follows:
12.31.2023 | 12.31.2022 | |
Deferred income tax | 17,233 | 7,638 |
Income tax | 17,233 | 7,638 |
Below is a reconciliation between income tax recognized and the amount which would arise from applying the prevailing tax rate on profit before income tax for the six-month periods ended December 31, 2023 and 2022:
12.31.2023 | 12.31.2022 | |
Net profit at tax rate (i) | (11,726) | (9,329) |
Permanent differences: | ||
Share of profit of subsidiaries and associates | 39,322 | 11,138 |
Loss from sale of subsidiaries | (138) | - |
Use of tax loss carry-forwards | (1,973) | 4,382 |
Tax transparency | (3,903) | (4,111) |
Tax loss carry-forwards update | (33,169) | - |
Non-taxable results, non-deductible expenses and others | - | (327) |
Tax inflation adjustment | (7,658) | (20,394) |
Inflation adjustment permanent difference | 36,478 | 26,279 |
Income tax | 17,233 | 7,638 |
(i) The income tax rate applicable as of December 31, 2023 and 2022 is 35%.
Changes in the deferred tax account are as follows:
12.31.2023 | 06.30.2023 | |
Beginning of the period / year | (32,474) | (47,908) |
Revaluation surplus | (353) | (711) |
Charged to the Statement of Comprehensive Income | 17,233 | 16,145 |
End of the period / year | (15,594) | (32,474) |
See Note 21 to the interim condensed consolidated financial statements.
20.
Revenues
12.31.2023 | 12.31.2022 | |
Crops | 17,082 | 24,550 |
Cattle | 4,054 | 4,635 |
Supplies | - | 15 |
Leases and agricultural services | 714 | 339 |
Total revenues | 21,850 | 29,539 |
21.
Costs
12.31.2023 | 12.31.2022 | |
Crops | 14,096 | 20,772 |
Cattle | 2,783 | 4,156 |
Leases and agricultural services | 398 | 91 |
Other costs | 66 | 85 |
Total costs | 17,343 | 25,104 |
59
Cresud Sociedad Anónima,
Comercial, Inmobiliaria, Financiera y Agropecuaria
22.
Expenses by nature
The Company discloses expenses in the Statements of Income and Other Comprehensive Income by function as part of the line items “Costs”, “General and administrative expenses” and “Selling expenses”. The following table provides additional disclosure regarding expenses by nature and their relationship to the function within the Company.
Costs (i) | General and administrative expenses | Selling expenses | Total as of 12.31.2023 | Total as of 12.31.2022 | |
Supplies and labors | 362 | - | 12 | 374 | 53 |
Leases and expenses | - | 55 | 3 | 58 | 72 |
Amortization and depreciation | 38 | 218 | 3 | 259 | 274 |
Doubtful accounts (charge and recovery) (Note 14) | - | - | 1 | 1 | 40 |
Cost of sale of agricultural products and biological assets | 16,879 | - | - | 16,879 | 24,928 |
Advertising, publicity and other selling expenses | - | - | - | - | 283 |
Maintenance, security, cleaning, repairs and others | 5 | 155 | 3 | 163 | 193 |
Payroll and social security liabilities | 35 | 1,519 | 121 | 1,675 | 1,971 |
Fees and payments for services | 15 | 419 | 164 | 598 | 573 |
Freights | - | 1 | 1,876 | 1,877 | 2,661 |
Bank commissions and expenses | - | 176 | - | 176 | 50 |
Travel expenses and stationery | 8 | 99 | 5 | 112 | 86 |
Conditioning and clearance | - | - | 680 | 680 | 489 |
Director’s fees (Note 25) | - | 158 | - | 158 | 153 |
Taxes, rates and contributions | 1 | 2 | 407 | 410 | 427 |
Total expenses by nature as of 12.31.2023 | 17,343 | 2,802 | 3,275 | 23,420 | - |
Total expenses by nature as of 12.31.2022 | 25,104 | 2,833 | 4,316 | - | 32,253 |
(i)
Include ARS 66 and ARS 85 of other agricultural operating costs as of December 31, 2023 and 2022, respectively.
23.
Other operating results, net
12.31.2023 | 12.31.2022 | |
Administration fees | 152 | 30 |
Gain / (loss) from commodity derivative financial instruments | 435 | (270) |
Interest and allowances generated by operating assets | - | 84 |
Gain from disposal of property, plant and equipment | 13 | 21 |
Contingencies | (424) | (211) |
Donations | (4) | (40) |
Loss from sale of subsidiaries | (393) | - |
Others | (61) | 233 |
Total other operating results, net | (282) | (153) |
24.
Financial results, net
12.31.2023 | 12.31.2022 | |
Interest income | 3,527 | 2,233 |
Total financial income | 3,527 | 2,233 |
Interest expenses | (206) | (15,220) |
Other financial costs | (598) | (914) |
Total financial costs | (804) | (16,134) |
Exchange rate difference, net | (125,068) | 10,097 |
Fair value gain of financial assets and liabilities at fair value through profit or loss | 3,399 | 1,363 |
Loss from derivative financial instruments (except commodities) | - | (500) |
Loss from repurchase of non-convertible notes | (3) | - |
Others | - | (963) |
Total other financial results | (121,672) | 9,997 |
Inflation adjustment | 36,461 | 13,359 |
Total financial results, net | (82,488) | 9,455 |
60
Cresud Sociedad Anónima,
Comercial, Inmobiliaria, Financiera y Agropecuaria
25.
Related party transactions
See description of the main transactions conducted with related parties in Note 32 to the Annual Consolidated Financial Statements as of June 30, 2023.
The following is a summary of the balances with related parties as of December 31, 2023 and June 30, 2023:
Items | 12.31.2023 | 06.30.2023 |
Right of use assets | - | 54 |
Trade and other receivables | 6,646 | 5,065 |
Trade and other payables | (11,563) | (9,867) |
Borrowings | (56,462) | (29,104) |
Lease liabilities | - | (48) |
Total | (61,379) | (33,900) |
Related party | 12.31.2023 | 06.30.2023 | Description of transaction | Item |
IRSA Inversiones y Representaciones Sociedad Anónima | 476 | 1,620 | Corporate services receivable | Trade and other receivables |
- | 525 | Reimbursement of expenses receivable | Trade and other receivables | |
(386) | (6) | Reimbursement of expenses to pay | Trade and other payables | |
(533) | (420) | Non-convertible notes | Borrowings | |
- | 54 | Right of use assets | Right of use assets | |
- | (48) | Leases | Lease liabilities | |
3 | 6 | Share-based payments | Trade and other receivables | |
Brasilagro | (133) | (192) | Rentals and services received | Trade and other payables |
- | 85 | Dividends receivable | Trade and other receivables | |
28 | 212 | Debtors for sales, rentals and services | Trade and other receivables | |
Helmir S.A. | (55,548) | (27,870) | Borrowings | Borrowings |
- | 1 | Debtors for sales, rentals and services | Trade and other receivables | |
(9) | (6) | Rentals and services received | Trade and other payables | |
(4,781) | (3,136) | Other payables | Trade and other payables | |
FyO Acopio S.A. | - | 881 | Debtors for sales, rentals and services | Trade and other receivables |
(144) | - | Rentals and services received | Trade and other payables | |
- | 117 | Dividends receivable | Trade and other receivables | |
Amauta Agro S.A. | 2 | 5 | Debtors for sales, rentals and services | Trade and other receivables |
Futuros y Opciones.Com S.A. | 2,233 | 1,060 | Brokerage operations receivable | Trade and other receivables |
3,886 | 526 | Dividends receivable | Trade and other receivables | |
(399) | (13) | Advanced payments received | Trade and other payables | |
Total subsidiaries | (55,305) | (26,599) | ||
Tyrus S.A. | 1 | - | Rentals and services received | Trade and other payables |
Fibesa S.A.U. | (225) | (446) | Non-convertible notes | Borrowings |
Agropecuaria Acres del Sud | 2 | 1 | Debtors for sales, rentals and services | Trade and other receivables |
Total subsidiaries of the subsidiaries | (222) | (445) | ||
Consultores Asset Management S.A. | (1) | - | Rentals and services received | Trade and other payables |
(5,638) | (6,461) | Management fee payables | Trade and other payables | |
Agrofy S.A. | 8 | 9 | Debtors for sales, rentals and services | Trade and other receivables |
(20) | (13) | Rentals and services received | Trade and other payables | |
Agrofy Pay SAU | 3 | - | Debtors for sales, rentals and services | Trade and other receivables |
Ombú Agropecuaria S.A. | (40) | (26) | Rentals and services received | Trade and other payables |
BHN Seguros Generales S.A. | (155) | (102) | Non-convertible notes | Borrowings |
Fundación Museo de los Niños | 4 | 9 | Debtors for sales, rentals and services | Trade and other receivables |
BHN Vida S.A. | (1) | (266) | Non-convertible notes | Borrowings |
San Bernardo de Córdoba | 1 | - | Debtors for sales, rentals and services | Trade and other receivables |
Estudio Zang, Bergel y Viñes | (7) | - | Legal services | Trade and other payables |
Total other related parties | (5,846) | (6,850) | ||
Inversiones Financieras del Sur S.A. | - | 41 | Loans granted | Trade and other receivables |
Total parent company | - | 41 | ||
Directors and Senior Management | - | (33) | Reimbursement of expenses receivable | Trade and other receivables |
(6) | (14) | Directors' fees | Trade and other payables | |
Total directors and senior management | (6) | (47) | ||
Total | (61,379) | (33,900) |
61
Cresud Sociedad Anónima,
Comercial, Inmobiliaria, Financiera y Agropecuaria
The following is a summary of the results with related parties for the six-month period ended as of December 31, 2023 and 2022:
Related party | 12.31.2023 | 12.31.2022 | Description of transaction |
IRSA Inversiones y Representaciones Sociedad Anónima | (55) | (106) | Leases and/or rights of use |
(173) | (810) | Financial operations | |
2,867 | 2,054 | Corporate services | |
Futuros y Opciones.Com S.A. | (75) | (65) | Purchase of goods and/or services |
8 | 7 | Supplies and labor | |
(22) | (16) | Corporate services | |
Brasilagro | 102 | 5 | Administration fees |
Amauta Agro S.A. | - | 203 | Purchase of goods and/or services |
11 | 16 | Administration fees | |
FyO Acopio S.A. | (136) | (855) | Purchase of goods and/or services |
3 | 4 | Administration fees | |
2 | 3 | Financial operations | |
Helmir S.A. | (13,899) | 2,107 | Financial operations |
Total subsidiaries | (11,367) | 2,547 | |
Tyrus S.A. | - | 415 | Financial operations |
Panamerican Mall S.A. | - | (77) | Financial operations |
Fibesa S.A.U. | 68 | 45 | Financial operations |
Total subsidiaries of the subsidiaries | 68 | 383 | |
Uranga Trading S.A. | 653 | 449 | Income from agricultural sales and services |
Total associates | 653 | 449 | |
Estudio Zang, Bergel & Viñes | (36) | (38) | Legal services |
Consultores Asset Management S.A. | (5,638) | (3,807) | Administration fees |
BNH Vida S.A. | (36) | 13 | Financial operations |
BHN Seguros Generales S.A. | (54) | - | Financial operations |
Hamonet S.A. | (4) | (5) | Leases and/or rights of use |
Isaac Elsztain e Hijos S.C.A. | (9) | (12) | Leases and/or rights of use |
Agrofy S.A. | 5 | 2 | Administration fees |
Agrofy Pay SAU | 13 | - | Administration fees |
Other related parties | (5,759) | (3,847) | |
Directors | (158) | (153) | Compensation of Directors |
Senior Management | (43) | (61) | Fees |
Total Directors y Senior Management | (201) | (214) | |
Inversiones Financieras del Sur S.A. | (1) | 40 | Financial operations |
Total parent company | (1) | 40 | |
Total | (16,607) | (642) |
The following is a summary of the transactions with related parties for the six-month period ended as of December 31, 2023 and 2022:
Related party | 12.31.2023 | 12.31.2022 | Description of transaction |
IRSA Inversiones y Representaciones Sociedad Anónima | 49,145 | 10,441 | Dividends received |
Brasilagro Companhia Brasileira de Propriedades Agrícolas | 380 | 268 | Dividends received |
Agro-Uranga S.A. | - | 417 | Dividends received |
Uranga Trading S.A. | - | 69 | Dividends received |
Futuros y Opciones.Com S.A. | 1,748 | 1,398 | Dividends received |
Total dividends received | 51,273 | 12,593 |
26.
CNV General Resolution N° 622/13
As required by Section 1°, Chapter III, Title IV of CNV General Resolution N° 622/13, below there is a detail of the notes to the Unaudited Condensed Interim Separate Financial Statements that disclosure the information required by the Resolution in Exhibits.
Exhibit A - Property, plant and equipment | Note 7 – Investment properties | |
Note 8 – Property, plant and equipment | ||
Exhibit B - Intangible assets | Note 9 – Intangible assets | |
Exhibit C - Equity investments | Note 6 - Investments in subsidiaries and associates | |
Exhibit D - Other investments | Note 13 – Financial instruments by category | |
Exhibit E - Provisions and allowances | Note 14 – Trade and other receivables | |
Note 17 – Provisions | ||
Exhibit F - Cost of sales and services | Note 27 – Cost of sales and services provided | |
Exhibit G - Foreign currency assets and liabilities | Note 28 – Foreign currency assets and liabilities | |
Exhibit H - Exhibit of expenses | Note 22 – Expenses by nature |
62
Cresud Sociedad Anónima,
Comercial, Inmobiliaria, Financiera y Agropecuaria
27.
Cost of sales and services provided
Description | Biological assets (1) | Agricultural stock | Services and other operating costs | Total as of 12.31.2023 | Total as of 12.31.2022 |
Beginning of the period | 16,551 | 21,859 | - | 38,410 | 48,028 |
Initial recognition and changes in the fair value of biological assets and agricultural products at the point of harvest | 428 | - | - | 428 | (5,630) |
Changes in the net realizable value of agricultural products after harvest | - | 6,492 | - | 6,492 | 1,339 |
Increase due to harvest | - | 17,027 | - | 17,027 | 14,076 |
Acquisitions and classifications | 1,345 | 15,631 | - | 16,976 | 12,114 |
Consume | (23) | (9,477) | - | (9,500) | (10,086) |
Expenses incurred | 4,499 | - | 464 | 4,963 | 4,229 |
Inventories | (20,017) | (37,436) | - | (57,453) | (38,966) |
Cost as of 12.31.2023 | 2,783 | 14,096 | 464 | 17,343 | - |
Cost as of 12.31.2022 | 4,156 | 20,772 | 176 | - | 25,104 |
(1)
Corresponds to breeding cattle movements and other cattle.
28.
Foreign currency assets and liabilities
Book amounts of foreign currency assets and liabilities as of December 31, 2023 and June 30, 2023 are as follows:
Items (1) | Amount of foreign currency | Prevailing exchange rate (2) | Total as of 12.31.2023 | Total as of 06.30.2023 |
Assets | ||||
Trade and other receivables | ||||
US Dollar | 4.51 | 805.45 | 3,631 | 845 |
Receivables with related parties: | ||||
US Dollar | 0.01 | 808.45 | 7 | 87 |
Total trade and other receivables | 3,638 | 932 | ||
Derivative financial instruments | ||||
US Dollar | 0.36 | 805.45 | 18 | 71 |
Total Derivative financial instruments | 18 | 71 | ||
Cash and cash equivalents | ||||
US Dollar | 2.92 | 805.45 | 2,353 | 1,244 |
Total Cash and cash equivalents | 2,353 | 1,244 | ||
Liabilities | ||||
Trade and other payables | ||||
US Dollar | 30.27 | 808.45 | 24,475 | 9,372 |
Trade and other payables with related parties: | ||||
US Dollar | 6.31 | 808.45 | 5,104 | 3,284 |
Uruguayan Pesos | 0.55 | 9.12 | 5 | - |
Bolivian Pesos | 0.79 | 50.69 | 40 | 27 |
Brazilian Reais | 0.08 | 178.00 | 14 | 192 |
Total trade and other payables | 29,638 | 12,875 | ||
Derivative financial instruments | ||||
US Dollar | 0.01 | 808.45 | 6 | 31 |
Total derivative instruments | 6 | 31 | ||
Lease Liabilities | ||||
US Dollar | 1.06 | 808.45 | 853 | - |
Lease Liabilities with related parties: | ||||
US Dollar | - | - | - | 48 |
Total Lease Liabilities | 853 | 48 | ||
Borrowings | ||||
US Dollar | 256.53 | 808.45 | 207,392 | 157,255 |
Borrowings with related parties: | ||||
US Dollar | 69.56 | 808.45 | 56,237 | 28,658 |
Total Borrowings | 263,629 | 185,913 |
(1)
Considering foreign currencies those that differ from the Group’s functional currency at each period / year.
(2)
Exchange rate as of December 31, 2023 according to Banco Nación Argentina records.
63
Cresud Sociedad Anónima,
Comercial, Inmobiliaria, Financiera y Agropecuaria
29.
CNV General Ruling N° 629/14 – Storage of documentation
On August 14, 2014, the CNV issued General Ruling N° 629 whereby it introduced amendments to rules related to storage and conservation of corporate books, accounting books and commercial documentation. In this sense, it should be noted that the Company has entrusted the storage of certain non-sensitive and old information to the following providers:
Documentation storage provider | Location | |
Bank S.A. | Ruta Panamericana Km 37,5, Garín, Buenos Aires Province. Av. Fleming 2190, Munro, Buenos Aires Province. Carlos Pellegrini 1401, Avellaneda, Buenos Aires Province. |
Iron Mountain Argentina S.A. | Av. Amancio Alcorta 2482, Autonomous City of Buenos Aires. | |
Pedro de Mendoza 2143, Autonomous City of Buenos Aires. | ||
Saraza 6135, Autonomous City of Buenos Aires. | ||
Azara 1245, Autonomous City of Buenos Aires. Polígono industrial Spegazzini, Autopista Ezeiza Km 45, Cañuelas, Buenos Aires Province. Cañada de Gomez 3825, Autonomous City of Buenos Aires. |
It is further noted that a detailed list of all documentation held in custody by providers, as well as documentation required in section 5 a.3) of section I, Chapter V, Title II of the RULES (N.T. 2013 as amended) are available at the registered office.
On February 5, 2014 there was a widely known fire in Iron Mountain’s warehouse, which is a supplier of the Company and where Company’s documentation was being kept. Based on the internal review carried out by the Company, duly reported to CNV on February 12, 2014, the information kept at the Iron Mountain premises that were on fire do not appear to be sensitive or capable of affecting normal operations.
30.
Negative working capital
At the end of the period, the Company carried a working capital deficit of ARS 75,479, whose treatment is under consideration by the Board of Directors and the respective Management.
31.
Other relevant events of the period
See Note 31 to the Unaudited Condensed Interim Consolidated Financial Statements.
32.
Subsequent events
See others subsequent events in Note 32 to the Unaudited Condensed Interim Consolidated Financial Statements.
64
REVIEW REPORT ON THE UNAUDITED CONDENSED INTERIM SEPARATE FINANCIAL STATEMENTS
To the Shareholders, President and Directors of
Cresud Sociedad Anónima, Comercial, Inmobiliaria, Financiera y Agropecuaria
Legal address: Carlos Della Paolera 261, 9° floor
Autonomous City of Buenos Aires
Tax Registration Number: 30-50930070-0
Introduction
We have reviewed the accompanying unaudited condensed interim separate financial statements of Cresud Sociedad Anónima, Comercial, Inmobiliaria, Financiera y Agropecuaria (“the Company”), which comprise the unaudited condensed interim separate statement of financial position at December 31, 2023, the unaudited condensed interim separate statements of income and other comprehensive income for the six month period and three month period ended December 31, 2023, the interim separate statement of changes in shareholders’ equity and of cash flows for the six-month period then ended, and selected explanatory notes.
Management’s responsibility
The Board of Directors of the Company is responsible for the preparation and presentation of these unaudited condensed interim separate financial statements in accordance with International Financial Reporting Standards, adopted by the Argentine Federation of Professional Councils in Economic Sciences (FACPCE) as professional accounting standards and included by the National Securities Commission (CNV) in its regulations, as approved by the International Accounting Standards Board (IASB), and is therefore responsible for the preparation and presentation of the unaudited condensed interim separate financial statements mentioned in the first paragraph, in accordance with International Accounting Standard 34 Interim Financial Information (IAS 34).
Scope of our review
Our review was limited to the application of the procedures established under International Standards on Review Engagements ISRE 2410 Review of Interim Financial Information Performed by the Independent Auditor of the Entity, adopted as a review standard in Argentina by Technical Pronouncement No. 33 of the FACPCE and approved by the International Auditing and Assurance Standards Board (IAASB). A review of interim financial information consists of inquiries of Company staff responsible for preparing the information included in the unaudited condensed interim separate financial statements and of analytical and other review procedures. This review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing and, consequently, does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion.
65
Conclusion
On the basis of our review, nothing has come to our attention that causes us to believe that the unaudited condensed interim separate financial statements mentioned in the first paragraph of this report have not been prepared, in all material respects, in accordance with International Accounting Standard 34 Interim Financial Reporting.
Report on compliance with current regulations
In accordance with current regulations, we report, in connection with Cresud Sociedad Anónima, Comercial, Inmobiliaria, Financiera y Agropecuaria, that:
a)
the unaudited condensed interim Separate financial statements of Cresud Sociedad Anónima, Comercial, Inmobiliaria, Financiera y Agropecuaria have not been transcribed into the Inventory and Balance Sheet book and, except for the above mentioned situation, as regards those matters that are within our competence, they are in compliance with the provisions of the General Companies Law and pertinent resolutions of the National Securities Commission;
b)
the unaudited condensed interim separate financial statements of Cresud Sociedad Anónima, Comercial, Inmobiliaria, Financiera y Agropecuaria arise from accounting records carried in all formal aspects in accordance with legal requirements except for i) the lack of transcription to the Inventories and Balance Sheet Book, and ii) the lack of transcription to the General Journal Book of the accounting entries corresponding to the month of December 2023;
c)
at December 31, 2023 the debt of Cresud Sociedad Anónima, Comercial, Inmobiliaria, Financiera y Agropecuaria accrued in favor of the Argentine Integrated Social Security System, as shown by the Company’s accounting records, amounted to $ 237,887,661, which is not due at that date.
Autonomous City of Buenos Aires, February 8, 2024
PRICE WATERHOUSE & CO. S.R.L. (Partner) |
C.P.C.E.C.A.B.A. V° 1 F° 17 |
Carlos Brondo Public Accountant (UNCUYO) C.P.C.E.C.A.B.A. V. 391 F. 078 |
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Cresud Sociedad Anónima, Comercial, Inmobiliaria, Financiera y Agropecuaria
Brief comment on the Company’s activities during the period, including references to significant events occurred after the end of the period.
Consolidated Results
(In ARS million) | 6M 24 | 6M 23 | YoY Var |
Revenues | 204,745 | 210,149 | (2.6)% |
Costs | (116,197) | (123,626) | (6.0)% |
Initial recognition and changes in the fair value of biological assets and agricultural produce at the point of harvest | (377) | (7,765) | (95.1)% |
Changes in the net realizable value of agricultural produce after harvest | 6,924 | 1,423 | 386.6% |
Gross profit | 95,095 | 80,181 | 18.6% |
Net gain from fair value adjustment on investment properties | 139,697 | (89,946) | - |
Gain from disposal of farmlands | 4,223 | 1,761 | 139.8% |
General and administrative expenses | (16,204) | (20,671) | (21.6)% |
Selling expenses | (16,298) | (13,471) | 21.0% |
Other operating results, net | 5,510 | (6,857) | - |
Management Fee | (5,638) | (3,807) | 48.1% |
Result from operations | 206,385 | (52,810) | - |
Depreciation and Amortization | 11,464 | 12,023 | (4.6)% |
Rights of use installments | (4,845) | (4,652) | 4.1% |
EBITDA (unaudited) | 213,004 | (45,439) | - |
Adjusted EBITDA (unaudited) | 79,677 | 54,913 | 45.1% |
Loss from joint ventures and associates | 19,873 | 2,528 | 686.1% |
Result from operations before financing and taxation | 226,258 | (50,282) | - |
Financial results, net | (66,368) | 27,395 | (342.3)% |
Result before income tax | 159,890 | (22,887) | - |
Income tax expense | (37,685) | 82,794 | (145.5)% |
Result for the period | 122,205 | 59,907 | 104.0% |
Attributable to | |||
Equity holder of the parent | 48,800 | 32,929 | 48.2% |
Non-controlling interest | 73,405 | 26,978 | 172.1% |
Consolidated revenues decreased during the first half of fiscal year 2024 by 2.6%, compared to the same period of fiscal year 2023, while Adjusted EBITDA grew by 45.1% during the same period. Agribusiness segments adjusted EBITDA was ARS 23,857 million, 39.3% higher than in the same period of 2023, mainly due to higher farmland sales. The urban properties and investments business (through IRSA) adjusted EBITDA was ARS 63,262 million.
The net result for the first semester of fiscal year 2024 registered a gain of ARS 122,205 million, a 104.0% higher than the registered in the same period of 2023. This higher result is mainly explained by the gain in from changes in fair value of investment properties in the urban properties and investment business.
67
Cresud Sociedad Anónima, Comercial, Inmobiliaria, Financiera y Agropecuaria
Summary as of December 31, 2023
Description of Operations by Segment
6M 2024 | Agribusiness | Urban Properties and Investments | Total | 6M 24 vs. 6M 23 |
Revenues | 103,563 | 84,304 | 187,867 | (2.4)% |
Costs | (83,400) | (14,866) | (98,266) | (5.9)% |
Initial recognition and changes in the fair value of biological assets and agricultural produce at the point of harvest | (642) | - | (642) | (92.0)% |
Changes in the net realizable value of agricultural produce after harvest | 6,924 | - | 6,924 | 386.6% |
Gross profit | 26,445 | 69,438 | 95,883 | 17.7% |
Net gain from fair value adjustment on investment properties | 955 | 139,883 | 140,838 | - |
Gain from disposal of farmlands | 4,223 | - | 4,223 | 139.8% |
General and administrative expenses | (9,350) | (7,042) | (16,392) | (21.6)% |
Selling expenses | (10,519) | (5,763) | (16,282) | 15.6% |
Other operating results, net | 7,281 | (1,842) | 5,439 | - |
Result from operations | 19,035 | 194,674 | 213,709 | - |
Share of profit of associates | (55) | 18,970 | 18,915 | 394.0% |
Segment result | 18,980 | 213,644 | 232,624 | - |
6M 2023 | Agribusiness | Urban Properties and Investments | Total |
Revenues | 114,924 | 77,591 | 192,515 |
Costs | (90,951) | (13,479) | (104,430) |
Initial recognition and changes in the fair value of biological assets and agricultural produce at the point of harvest | (8,012) | - | (8,012) |
Changes in the net realizable value of agricultural produce after harvest | 1,423 | - | 1,423 |
Gross profit | 17,384 | 64,112 | 81,496 |
Net gain from fair value adjustment on investment properties | 279 | (92,383) | (92,104) |
Gain from disposal of farmlands | 1,761 | - | 1,761 |
General and administrative expenses | (8,390) | (12,517) | (20,907) |
Selling expenses | (10,030) | (4,057) | (14,087) |
Other operating results, net | 2,656 | (9,610) | (6,954) |
Result from operations | 3,660 | (54,455) | (50,795) |
Share of profit of associates | (1,580) | 5,409 | 3,829 |
Segment result | 2,080 | (49,046) | (46,966) |
2024 Campaign
The 2024 campaign is advancing with better weather conditions in the region and particularly in Argentina, which experienced one of its worst historical droughts last seasons. Although the country experienced a lack of rain at the beginning of the campaign and last January, we project very good production levels for the company, in line with Argentina, which estimates a soybean production of 50 million tons and corn of 55 million tons. International commodity prices and input costs have been correcting compared to last season. We will apply the best agricultural practices to achieve high yields and increase margins per hectare.
Our Portfolio
During the second quarter of fiscal year 2024, our portfolio under management consisted of 745,047 hectares, of which 310,466 hectares are productive and 434,581 hectares are land reserves distributed in the four countries of the region where we operate.
68
Cresud Sociedad Anónima, Comercial, Inmobiliaria, Financiera y Agropecuaria
Summary as of December 31, 2023
Breakdown of Hectares
Own and under Concession(*) (**) (***)
Productive Lands | ||||
Agricultural | Cattle | Reserved | Total | |
Argentina | 71,817 | 140,405 | 318,346 | 530,568 |
Brazil | 60,780 | 10,519 | 74,584 | 145,883 |
Bolivia | 7,925 | - | 1,950 | 9,875 |
Paraguay | 14,865 | 4,155 | 39,701 | 58,721 |
Total | 155,387 | 155,079 | 434,581 | 745,047 |
(*) Includes Brazil, Paraguay, Agro-Uranga S.A. at 34.86% and 132,000 hectares under Concession.
(**) Includes 85,000 hectares intended for sheep breeding
(***) Excludes double crops.
Leased(*)
Agricultural | Cattle | Other | Total | |
Argentina | 45,396 | 10,896 | - | 56,292 |
Brazil | 51,013 | 700 | 7,380 | 59,093 |
Bolivia | 1,065 | 1,065 | ||
Total | 97,474 | 11,596 | 7,380 | 116,450 |
(*) Excludes double crops.
Segment Income – Agricultural Business
I)
Land Development and Sales
We periodically sell properties that have reached a considerable appraisal to reinvest in new farms with higher appreciation potential. We analyze the possibility of selling based on a number of factors, including the expected future yield of the farmland for continued agricultural and livestock exploitation, the availability of other investment opportunities and cyclical factors that have a bearing on the global values of farmlands.
in ARS million | 6M 24 | 6M 23 | YoY Var |
Revenues | - | - | - |
Costs | (66) | (84) | (21.4)% |
Gross loss | (66) | (84) | (21.4)% |
Net gain from fair value adjustment on investment properties | 955 | 279 | 242.3% |
Gain from disposal of farmlands | 4,223 | 1,761 | 139.8% |
General and administrative expenses | (16) | (12) | 33.3% |
Selling expenses | (39) | (12) | 225.0% |
Other operating results, net | 5,575 | 3,429 | 62.6% |
Profit from operations | 10,632 | 5,361 | 98.3% |
Segment profit | 10,632 | 5,361 | 98.3% |
EBITDA | 10,643 | 5,383 | 97.7% |
Adjusted EBITDA | 9,688 | 5,104 | 89.8% |
Segment profit increased by ARS 5,269 million, mainly explained by the fractions sold and the valuation of accounts receivable in the current period for the sale of agreed soybean farms (included in Other Operating Results), from Brazil.
On October 6, 2023, the Company informs that it has sold a 4,262 hectares fraction of land reserve with productive potential of “Los Pozos” farm, located in the Province of Salta, Argentina, keeping the ownership of approximately 235,300 hectares of the property.
The total amount of the operation was set at USD 2.3 million, of which USD 0.9 million has been collected to date. The remaining balance of USD 1.4 million, guaranteed with a mortgage on the property, will be collected in 2 installments, the first of USD 0.27 million in September 2024 and the remainder of USD 1.13 million in September 2025.
69
Cresud Sociedad Anónima, Comercial, Inmobiliaria, Financiera y Agropecuaria
Summary as of December 31, 2023
The book value of the fraction sold was ARS 119.2 million and the gain from the operation, which will be recognized in the company's financial statements for the second quarter of fiscal period 2024, amounts to the approximate sum of ARS 722.9 million.
Likewise, on December 15, 2023,the company sold and transferred a fraction of 500 hectares of agricultural activity from its “El Tigre” farm, located in the department of Trenel, province of La Pampa, Argentina.
The total amount of the operation was set at USD 3.75 million (USD 7,500 per hectare), of which USD 2,812,500 has been collected to date. The remaining balance of USD 937,500, secured with a mortgage, will be collected as follows: USD 468,750 on December 13, 2024, and USD 468,750 on December 12, 2025. The accounting profit from the operation amounts to the approximate sum of ARS 2,629 million.
After this transaction, the company keeps the ownership of approximately 7,860 hectares of “El Tigre” farm.
II)
Agricultural Production
The result of the Farming segment went from a ARS 12,366 million loss during the first semester of fiscal year 2023 to a ARS 2,519 million gain during the same period of the fiscal year 2024.
in ARS million | 6M 24 | 6M 23 | YoY Var |
Revenues | 70,498 | 76,043 | (7.3)% |
Costs | (62,914) | (68,651) | (8.4)% |
Initial recognition and changes in the fair value of biological assets and agricultural produce at the point of harvest | (642) | (8,012) | (92.0)% |
Changes in the net realizable value of agricultural produce after harvest | 6,924 | 1,423 | 386.6% |
Gross profit | 13,866 | 803 | 1,626.8% |
General and administrative expenses | (5,173) | (4,310) | 20.0% |
Selling expenses | (7,476) | (7,184) | 4.1% |
Other operating results, net | 302 | (1,427) | - |
Results from operations | 1,519 | (12,118) | - |
Results from associates | 1,000 | (248) | - |
Segment results | 2,519 | (12,366) | - |
EBITDA | 5,592 | (7,330) | - |
Adjusted EBITDA | 5,212 | (529) | - |
II.a) Crops and Sugarcane
Crops
in ARS million | 6M 24 | 6M 23 | YoY Var |
Revenues | 42,366 | 50,034 | (15.3)% |
Costs | (39,562) | (44,318) | (10.7)% |
Initial recognition and changes in the fair value of biological assets and agricultural produce at the point of harvest | 368 | (1,784) | - |
Changes in the net realizable value of agricultural produce after harvest | 6,745 | 1,398 | 382.5% |
Gross profit | 9,917 | 5,330 | 86.1% |
General and administrative expenses | (3,702) | (2,930) | 26.3% |
Selling expenses | (6,129) | (6,260) | (2.1)% |
Other operating results, net | 400 | (2,420) | - |
Profit from operations | 486 | (6,280) | - |
Results from associates | 993 | (245) | - |
Activity Profit | 1,479 | (6,525) | - |
70
Cresud Sociedad Anónima, Comercial, Inmobiliaria, Financiera y Agropecuaria
Summary as of December 31, 2023
Sugarcane
in ARS million | 6M 24 | 6M 23 | YoY Var |
Revenues | 19,691 | 18,466 | 6.6% |
Costs | (16,370) | (17,984) | (9.0)% |
Initial recognition and changes in the fair value of biological assets and agricultural produce at the point of harvest | (766) | 249 | (407.0)% |
Gross profit | 2,555 | 731 | 249.5% |
General and administrative expenses | (799) | (782) | 2.2% |
Selling expenses | (733) | (411) | 78.3% |
Other operating results, net | 60 | 900 | (93.3)% |
Profit from operations | 1,083 | 438 | 147.3% |
Activity profit | 1,083 | 438 | 147.3% |
Operations
Production Volume (1) | 6M 24 | 6M 23 | 6M 22 | 6M 21 | 6M 20 |
Corn | 226,709 | 159,712 | 231,058 | 185,889 | 286,685 |
Soybean | 7,499 | 13,760 | 10,559 | 10,079 | 14,077 |
Wheat | 24,495 | 22,696 | 33,615 | 35,029 | 35,590 |
Sorghum | 3,161 | 2,066 | 2,725 | 795 | 3,229 |
Sunflower | 177 | (7) | 232 | - | (1) |
Cotton | 14,676 | 3,353 | 3,094 | 6,818 | 3,237 |
Other | 10,138 | 6,939 | 5,860 | 3,298 | 3,840 |
Total Crops (tons) | 286,855 | 208,519 | 287,143 | 241,908 | 346,657 |
Sugarcane (tons) | 1,305,064 | 1,287,194 | 1,532,990 | 1,679,465 | 1,634,521 |
(1)
Includes Brasilagro. Excludes Agro-Uranga.
Next, we present the total volume sold according to its geographical origin measured in tons:
Volume of | 6M24 | 6M23 | 6M22 | 6M21 | 6M20 | ||||||||||
Sales (1) | M.L | M.E | Total | M.L | M.E | Total | M.L | M.E | Total | M.L | M.E | Total | M.L | M.E | Total |
Corn | 152.4 | 94.4 | 246.8 | 153.8 | 84.4 | 238.2 | 193.8 | 65.3 | 259.1 | 218.9 | 70.0 | 288.9 | 238.4 | 54.3 | 292.7 |
Soybean | 22.1 | 34.9 | 57.0 | 47.9 | 15.5 | 63.4 | 83.7 | 50.3 | 134.0 | 84.8 | 23.3 | 108.1 | 117.0 | 42.3 | 159.3 |
Wheat | 6.8 | - | 6.8 | 8.4 | - | 8.4 | 12.0 | 1.0 | 13.0 | 15.9 | 1.3 | 17.2 | 19.7 | - | 19.7 |
Sorghum | 2.8 | - | 2.8 | 12.1 | - | 12.1 | 21.4 | - | 21.4 | - | - | - | - | - | - |
Sunflower | 2.0 | - | 2.0 | 0.7 | - | 0.7 | 0.3 | - | 0.3 | - | - | - | 5.8 | - | 5.8 |
Cotton | 9.9 | 1.2 | 11.1 | 5.0 | - | 5.0 | 3.8 | - | 3.8 | 2.6 | - | 2.6 | 1.8 | 1.4 | 3.2 |
Others | 6.4 | - | 6.4 | 6.0 | - | 6.0 | 5.6 | 1.2 | 6.8 | 3.3 | 1.0 | 4.3 | 2.1 | - | 2.1 |
Total Crops (thousands of tons) | 202.4 | 130.5 | 332.9 | 234.0 | 99.9 | 333.9 | 320.6 | 117.8 | 438.4 | 325.5 | 95.6 | 421.1 | 384.8 | 98.0 | 482.8 |
Sugarcane (thousands of tons) | 1,305.1 | - | 1,305.1 | 1,161.0 | - | 1,161.0 | 1,387.7 | - | 1,387.7 | 1,560.3 | - | 1,560.3 | 1,414.6 | - | 1,414.6 |
(1)
Includes BrasilAgro. Excludes Agro-Uranga S.A
The Grains activity presented a positive variation by ARS 8,004 million, from a ARS 6,525 million loss during the first semester of fiscal year 2023 to a ARS 1,479 million gain during the same period of fiscal year 2024, mainly because of:
●
A gain in the productive result in Argentina due to the diversion in 22-23 Corn Campaign due to a greater volume of tons obtained compared to a negative result in the 21-22 Campaign due to lower yields, higher direct costs and prices lower than projected.
●
Offset by a lower holding result in Brazil from soybeans due to a lower planted area and a drop in prices.
●
Better results in the wheat and barley harvest compared to the same period of fiscal year 2023, due to the impact of the drought in the previous campaign.
●
A higher gain in the holding result in Argentina, due to better prices performance in pesos against inflation compared with the same period of fiscal year 2023.
71
Cresud Sociedad Anónima, Comercial, Inmobiliaria, Financiera y Agropecuaria
Summary as of December 31, 2023
The result of the Sugarcane activity increased by ARS 645 million, from a gain of ARS 438 million in the first semester of fiscal year 2023 to a gain of ARS 1,083 million in the same period of 2024. This is mainly due to an improvement in the result from sales due to a greater volume sold, partially offset by lower productive results in Brazil due to lower prices.
Area in Operation (hectares) (1) | As of 12/31/22 | As of 12/31/22 | YoY Var |
Own farms | 121,258 | 113,958 | 6.4% |
Leased farms | 119,054 | 121,071 | (1.7)% |
Farms under concession | 22,349 | 22,407 | (0.3)% |
Own farms leased to third parties | 21,380 | 27,975 | (23.6)% |
Total Area Assigned to Production | 284,041 | 285,411 | (0.5)% |
(1)
Includes Agro-Uranga.
II.b) Cattle Production
Production Volume | 6M24 | 6M23 | 6M22 | 6M21 | 6M20 |
Cattle herd (tons)(1) | 4,496 | 4,273 | 3,575 | 4,543 | 5,354 |
(1) Production measured in tons of live weight. Production is the sum of the net increases (or decreases) during a given period in live weight of each head of livestock we own.
Volume of | 6M 24 | 6M 23 | 6M 22 | 6M 21 | 6M 20 | |||||||||
Sales (1) | D.M F.M | Total | D.M | F.M | Total | D.M | F.M | Total | D.M | F.M | Total | D.M | F.M | Total |
Cattle herd | 6.3 | 6.3 | 5.2 | - | 5.2 | 6.2 | - | 6.2 | 8.5 | - | 8.5 | 9.3 | - | 9.3 |
D.M.: Domestic market
F.M.: Foreign market
Cattle
In ARS Million | 6M 24 | 6M 23 | YoY Var |
Revenues | 6,378 | 5,861 | 8.8% |
Costs | (5,013) | (5,315) | (5.7)% |
Initial recognition and changes in the fair value of biological assets and agricultural produce | (244) | (6,477) | (96.2)% |
Changes in the net realizable value of agricultural produce after harvest | 179 | 25 | 616.0% |
Gross Profit | 1,300 | (5,906) | - |
General and administrative expenses | (493) | (386) | 27.7% |
Selling expenses | (450) | (395) | 13.9% |
Other operating results, net | (126) | 81 | (255.0)% |
Result from operations | 231 | (6,606) | - |
Results from associates | 7 | -3 | - |
Activity Result | 238 | (6,609) | - |
Area in operation – Cattle (hectares) (1) | As of 12/31/23 | As of 12/31/22 | YoY Var |
Own farms | 68,013 | 68,456 | (0.6)% |
Leased farms | 10,896 | 10,896 | 0.0% |
Farms under concession | 2,696 | 2,604 | 3.5% |
Own farms leased to third parties | 70 | 70 | 0.0% |
Total Area Assigned to Cattle Production | 81,675 | 82,026 | (0.4)% |
(1) Includes Agro-Uranga, Braziland Paraguay,
Stock of Cattle Heard | As of 12/31/23 | As of 12/31/22 | YoY Var |
Breeding stock | 70,265 | 72,001 | (2.4)% |
Winter grazing stock | 10,588 | 6,509 | 62.7% |
Sheep stock | 15,917 | 14,145 | 12.5% |
Total Stock (heads) | 96,770 | 92,655 | 4.4% |
72
Cresud Sociedad Anónima, Comercial, Inmobiliaria, Financiera y Agropecuaria
Summary as of December 31, 2023
The result of the Cattle activity increase by ARS 6,847 million, from a ARS 6,609 million loss during the first semester of fiscal year 2023 to a ARS 238 million gain in the same period of fiscal year 2024, mainly explained by a positive variation from production result due to a better price performance compared to inflation and a greater gain in the sales result, due to an increase in average prices despite a lower number of heads sold.
II.c) Agricultural Rental and Services
In ARS Million | 6M 24 | 6M 23 | YoY Var |
Revenues | 2,063 | 1,682 | 22.7% |
Costs | (1,969) | (1,034) | 90.4% |
Gross profit | 94 | 648 | (85.5)% |
General and Administrative expenses | (179) | (212) | (15.6)% |
Selling expenses | (164) | (118) | 39.0% |
Other operating results, net | (32) | 12 | - |
Result from operations | (281) | 330 | - |
Activity Result | (281) | 330 | - |
The result of the activity was decreased by ARS 611 million, from a ARS 330 million gain in the first semester of fiscal year 2023 to a ARS 281 million gain in the same period of 2024.
III) Other Segments
We include within "Others" the results coming from our investment in FyO.
The result of the segment decreased by ARS 3,677 million, going from a gain of ARS 10,715 million for the first semester of fiscal year 2023 to a ARS 7,038 million gain for the same period of fiscal year 2024, mainly due to a lower profit on futures and options operations, on grain brokerage commissions and on stockpiling and consignment operations, as well as a higher selling and administrative expenses partially offset by a higher gain on the sale of inputs.
In ARS Million | 6M 24 | 6M 23 | YoY Var |
Revenues | 33,065 | 38,881 | (15.0)% |
Costs | (20,420) | (22,216) | (8.1)% |
Gross profit | 12,645 | 16,665 | (24.1)% |
General and administrative expenses | (2,952) | (2,438) | 21.1% |
Selling expenses | (3,004) | (2,834) | 6.0% |
Other operating results, net | 1,404 | 654 | 114.7% |
Profit from operations | 8,093 | 12,047 | (32.8)% |
Profit from associates | (1,055) | (1,332) | (20.8)% |
Segment Profit | 7,038 | 10,715 | (34.3)% |
EBITDA | 8,711 | 12,377 | (29.6)% |
Adjusted EBITDA | 8,957 | 12,553 | (28.6)% |
IV) Corporate Segment
The negative result went from ARS 1,630 million in the first semester of the fiscal year 2023 to a ARS 1,209 million in the same period of fiscal year 2024.
In ARS Million | 6M 24 | 6M 23 | YoY Var |
General and administrative expenses | (1,209) | (1,630) | (25.8)% |
Loss from operations | (1,209) | (1,630) | (25.8)% |
Segment loss | (1,209) | (1,630) | (25.8)% |
EBITDA | (1,209) | (1,614) | (25.1)% |
Adjusted EBITDA | (1,209) | (1,614) | (25.1)% |
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Cresud Sociedad Anónima, Comercial, Inmobiliaria, Financiera y Agropecuaria
Summary as of December 31, 2023
Urban Properties And Investments Business (through our subsidiary Irsa Inversiones y Representaciones Sociedad Anónima)
We develop our Urban Properties and Investments segment through our subsidiary IRSA. As of December 31, 2023, our direct and indirect equity interest in IRSA was 57.16% over stock capital.
Consolidated results of our subsidiary IRSA Inversiones y Representaciones S.A.
en ARS Millones | 6M 24 | 6M 23 | Var a/a |
Revenues | 101,416 | 96,079 | 5.6% |
Results from operations | 192,936 | (52,792) | - |
EBITDA | 196,641 | (52,102) | - |
Adjusted EBITDA | 63,262 | 43,710 | 44.7% |
Segment results | 213,644 | (49,046) | - |
Consolidated revenues from sales, rentals and services increased by 5.6% during the first semester of fiscal year 2024 compared to the same period of 2023. Adjusted EBITDA reached ARS 63,262 million, 44.7% higher than in the same period of previous fiscal year, mainly due to higher sales of investment properties.
Financial Indebtedness and Other
The following tables contain a breakdown of company’s indebtedness as of December 31, 2023:
Agricultural Business
Description | Currency | Amount (USD MM)(2) | Interest Rate | Maturity |
Loans and bank overdrafts | ARS | 19.8 | Variable | < 360 days |
Series XXXIX | ARS | 6.3 | Variable | feb-23 |
Series XXXIV | USD | 12.2 | 6.99% | jun-24 |
Series XXXIII | USD | 6.4 | 6.99% | jul-24 |
Series XXXV | USD | 31.4 | 3.50% | sep-24 |
Series XLI | ARS | 5.1 | Variable | oct-24 |
Series XXXVI | USD | 40.6 | 2.00% | feb-25 |
Series XXXVII | USD | 24.4 | 5.50% | mar-25 |
Series XXXVIII | USD | 70.4 | 8.00% | mar-26 |
Series XLII | USD | 30.0 | 0.00% | may-26 |
Series XL | USD | 38.2 | 0.00% | dic-26 |
Other debt | 32.0 | - | - | |
CRESUD’s Total Debt (3) | USD | 316.8 | ||
Cash and cash equivalents (3) | USD | 29.0 | ||
CRESUD’s Net Debt | USD | 287.8 | ||
Brasilagro’s Total Net Debt | USD | 95.8 |
(1) Net of repurchases
(2) Principal amount stated in USD (million) at an exchange rate of 808.45 ARS/USD and 4.818 BRL/USD, without considering accrued interest or elimination of balances with subsidiaries.
(3) Does not include FyO
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Cresud Sociedad Anónima, Comercial, Inmobiliaria, Financiera y Agropecuaria
Summary as of December 31, 2023
Urban Properties and Investments Business
Description | Currency | Amount (USD MM) (1) | Interest Rate | Maturity |
Bank overdrafts | ARS | 41.6 | Floating | < 360 days |
Series XI | USD | 12.8 | 5.0% | Mar-24 |
Series XII (3) | ARS | 26.1 | Floating | Mar-24 |
Series XIII | USD | 22.2 | 3.9% | Aug-24 |
Series XV | USD | 61.7 | 8.0% | Mar-25 |
Series XVI | USD | 28.3 | 7.0% | Jul-25 |
Series XVII | USD | 25.0 | 5.0% | Dic-25 |
Series XIV | USD | 159.1 | 8.75% | Jun-28 |
IRSA’s Total Debt | USD | 376.8 | ||
Cash & Cash Equivalents + Investments (2) | USD | 137.1 | ||
IRSA’s Net Debt | USD | 239.7 |
(1)
Principal amount in USD (million) at an exchange rate of ARS 808.45/USD, without considering accrued interest or eliminations of balances with subsidiaries.
(2)
Includes Cash and cash equivalents, Investments in Current Financial Assets and related companies notes holding.
(3) On January 5, 2024, Series XII was fully redeemed.
Comparative Summary Consolidated Balance Sheet Data
In ARS million | Dec-23 | Dec-22 | Dec-21 | Dec-20 | Dec-19 |
Current assets | 609,727 | 429,886 | 453,338 | 365,895 | 2,417,881 |
Non-current assets | 2,084,006 | 1,792,328 | 2,023,651 | 2,138,140 | 4,420,123 |
Total assets | 2,693,733 | 2,222,214 | 2,476,989 | 2,504,035 | 6,838,004 |
Current liabilities | 516,221 | 428,210 | 372,350 | 621,644 | 1,655,322 |
Non-current liabilities | 1,035,028 | 868,843 | 1,187,301 | 1,043,699 | 4,140,093 |
Total liabilities | 1,551,249 | 1,297,053 | 1,559,651 | 1,665,343 | 5,795,415 |
Total capital and reserves attributable to the shareholders of the controlling company | 474,903 | 387,693 | 336,149 | 274,820 | 186,365 |
Minority interests | 667,581 | 537,468 | 581,189 | 563,872 | 856,224 |
Shareholders’ equity | 1,142,484 | 925,161 | 917,338 | 838,692 | 1,042,589 |
Total liabilities plus minority interests plus shareholders’ equity | 2,693,733 | 2,222,214 | 2,476,989 | 2,504,035 | 6,838,004 |
Comparative Summary Consolidated Statement of Income Data
In ARS million | Dec-23 | Dec-22 | Dec-21 | Dec-20 | Dec-19 |
Gross profit | 95,095 | 80,181 | 88,826 | 52,562 | 117,821 |
Profit from operations | 206,385 | (52,810) | 205,921 | 82,019 | 55,717 |
Results from associates and joint ventures | 19,873 | 2,528 | 377 | (4,466) | (9,137) |
Profit from operations before financing and taxation | 226,258 | (50,282) | 206,298 | 77,553 | 46,580 |
Financial results, net | (66,368) | 27,395 | 50,535 | (8,414) | (118,736) |
Profit before income tax | 159,890 | (22,887) | 256,833 | 69,139 | (72,156) |
Income tax expense | (37,685) | 82,794 | (26,139) | (37,718) | (18,731) |
Result of the period of continuous operations | 122,205 | 59,907 | 230,694 | 31,421 | (90,887) |
Result of discontinued operations after taxes | - | - | - | (61,291) | 100,933 |
Result for the period | 122,205 | 59,907 | 230,694 | (29,870) | 10,040 |
Controlling company’s shareholders | 98,388 | 30,161 | 99,034 | (39,240) | (33,224) |
Non-controlling interest | 162,106 | 21,624 | 58,576 | (47,767) | 97,816 |
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Cresud Sociedad Anónima, Comercial, Inmobiliaria, Financiera y Agropecuaria
Summary as of December 31, 2023
Comparative Summary Consolidated Statement of Cash Flow Data
In ARS million | Dec-23 | Dec-22 | Dec-21 | Dec-20 | Dec-19 |
Net cash generated by operating activities | 48,767 | (1,155) | 62,904 | 29,771 | 242,633 |
Net cash generated by investment activities | 54,287 | 17,131 | 44,908 | 463,041 | 169,328 |
Net cash used in financing activities | (112,495) | (102,913) | (117,858) | (418,027) | (599,401) |
Total net cash generated during the fiscal period | (9,441) | (86,937) | (10,046) | 74,785 | (187,440) |
Ratios
In ARS million | Dec-23 | Dec-22 | Dec-21 | Dec-20 | Dec-19 |
Liquidity (1) | 1.181 | 1.004 | 1.218 | 0.589 | 1.461 |
Solvency(2) | 0.736 | 0.713 | 0.588 | 0.504 | 0.180 |
Restricted capital (3) | 0.774 | 0.807 | 0.817 | 0.854 | 0.646 |
(1) Current Assets / Current Liabilities
(2) Total Shareholders’ Equity/Total Liabilities
(3) Non-current Assets/Total Assets
Material events of the quarter and subsequent events
October 2023: General Ordinary and Extraordinary Shareholders’ Meeting
On October 5, 2023, our General Ordinary and Extraordinary Shareholders’ Meeting was held. The following matters. inter alia, were resolved by majority of votes:
●
Distribution of ARS 22,000 million as cash dividends and a dividend in kind through the delivery of 22,090,627 shares of IRSA INVERSIONES Y REPRESENTACIONES SOCIEDAD ANÓNIMA (“IRSA”) owned by the Company as of the date of the Shareholders’ Meeting.
●
Distribution of 5,791,355 of own shares of 1 vote per share and NV ARS 1.
●
Designation of board members.
●
Compensations to the Board of Directors for the fiscal year ended June 30, 2023
On October 12, 2023, the Company distributed among its shareholders the cash dividend in an amount of ARS 22,000,000,000 and a dividend in kind through the delivery of 22,090,627 shares of IRSA INVERSIONES Y REPRESENTACIONES SOCIEDAD ANÓNIMA (“IRSA”) owned by the Company, according to the price of said shares as of October 4, 2023 which amounts to the sum of ARS 644.75, charged to the fiscal year ended June 30, 2023, equivalent to 3,743.644234382% for the cash dividend and 2,423.657698% for the dividend in kind, of the stock capital, an amount per share of ARS 88.4687833212 (ARS 10 par value) and an amount per ADS of ARS 884,687833212.
On the same day, the Company distributed own shares, the distribution of the shares constitutes 0.0098548967 shares per ordinary share and 0.098548967 per ADS, a percentage of 0.98548967% of the stock capital of 587,662,679 shares and V$N 1, net of treasury shares.
The cash dividend, the dividend in kind, as well as the treasury shares distribution among ADS holders, have been delayed due to the exchange and securities restrictions in force in Argentina. On October 20, 2023, the Company deposited the amount corresponding to the cash dividend in the mutual fund called “Super Ahorro $” managed by Santander Asset Management Gerente de Fondos Comunes de Inversión S.A., to preserve the value of the dividend in Argentinean pesos. On December 12, 2023, the Company transferred the funds to the Depositary Bank of New York, fulfilling its obligation to pay dividends and leaving in the hands of the Depositary the completion of the process with the distribution to the holders.
After the end of the period, on January 29, 2024, once the corresponding administrative processes had been completed, the distribution of treasury shares was carried out among ADS holders. Likewise, on February 5, 2024,
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Cresud Sociedad Anónima, Comercial, Inmobiliaria, Financiera y Agropecuaria
Summary as of December 31, 2023
the Depositary paid the cash dividend for a net amount per ADS of USD 0.370747, including the yield of the “Super Ahorro $” fund, and on February 6, 2024, the distribution of the dividend in kind in IRSA shares was completed, corresponding 0.03759066 GDS of IRSA for each ADS of CRESUD.
The aforementioned corresponds to the payment of dividends to foreign holders, the dividends to local holders were canceled on October 12, 2023. According to this, at the end of this period, the liability "Dividends payable" included in the item “Commercial Debts and Other Debts” amounts to ARS 11,623 million and corresponds to the portion of dividends that were paid during the month of February 2024.
October 2023: Warrants – Post dividends distribution
On September 27, 2023, the Company reported that due to the cash dividend and own shares distributed to the shareholders, The terms and conditions of the outstanding warrants for common shares of the Company have been modified as follows, while the other terms and conditions remain the same:
Amount of shares to be issued per warrant:
●
Ratio previous to the adjustment: 1.1232 (Nominal Value ARS 1)
●
Ratio after the adjustment (current): 1.2548 (Nominal Value ARS 1)
Warrant exercise price per new share to be issued:
●
Price previous to the adjustment: USD 0.5036 (Nominal Value ARS 1)
●
Price after the adjustment (current): USD 0.4508 (Nominal Value ARS 1)
November, December 2023& January 2024: Shares Buyback Program –Extension, price modification & completion
On November 6, 2023, the Board of Directors has resolved to extend the term of the shares repurchase program for up to ARS 4,000 million approved on November 11, 2022, for an additional period of 180 days, and on November 29, 2023, the Board of Directors has resolved to modify the acquisition price of its own shares, establishing a maximum value of USD 11.00 per GDS and up to a maximum value in pesos of ARS 1,320 per share, maintaining the remaining terms and conditions duly communicated.
Likewise, on January 18, 2024, the Company completed the shares buyback program, having acquired the equivalent of 13,474,104 ordinary shares, which represent approximately 99.94% of the approved program and 2.27% of the outstanding shares.
November 2023: Warrants Exercise
In the month of November 2023, certain warrants holders have exercised their right to acquire additional shares and 720,912 ordinary shares of the Company were registered, with a nominal value of VN ARS 1. As a result of the exercise, USD 324,987.13 have been collected by the Company.
After the exercise of these warrants, the number of shares and the capital stock of the Company increased from 593,454,045 to 594,174,957, and the new number of outstanding warrants decreased from 88,236,618 to 87,662,070.
January 2024: Local Bond Issuance – Series XLIII & XLIV Notes
On January 17, 2023, Cresud issued Notes on the local market for a total amount of USD 64 million through the following instruments:
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Cresud Sociedad Anónima, Comercial, Inmobiliaria, Financiera y Agropecuaria
Summary as of December 31, 2023
●
Series XLIII: Denominated and payable in Argentine pesos for ARS 19,886 million at a variable interest rate BADLAR plus 0% spread, with quarterly interests’ payments. The Capital amortization will be 100% at maturity, on January 17, 2025. The issuance price was 100.0% of the nominal value.
●
Series XLIV: Denominated in dollars for USD 39.8 million,with 6% interest rate and semiannual interests’ payments. The Capital amortization will be in three installments: 33% on October 4, 2025, 33%on January 4, 2026, and 34% at maturity, on May 4, 2026. The issuance price was 100.0%.
The funds were mainly used to refinance short-term liabilities and/or working capital, as defined in the issuance documents.
EBITDA Reconciliation
In this summary report, we present EBITDA and Adjusted EBITDA. We define EBITDA as profit for the period excluding: (i) result of discontinued operations, (ii) income tax expense, (iii) financial results, net iv) results from participation in associates and joint ventures; and (v) depreciation and amortization. We define Adjusted EBITDA as EBITDA minus net profit from changes in the fair value of investment properties, not realized and realized sales.
EBITDA and Adjusted EBITDA are non-IFRS financial measures that do not have standardized meanings prescribed by IFRS. We present EBITDA and adjusted EBITDA because we believe they provide investors supplemental measures of our financial performance that may facilitate period-to-period comparisons on a consistent basis. Our management also uses EBITDA and Adjusted EBITDA from time to time, among other measures, for internal planning and performance measurement purposes. EBITDA and Adjusted EBITDA should not be construed as an alternative to profit from operations, as an indicator of operating performance or as an alternative to cash flow provided by operating activities, in each case, as determined in accordance with IFRS. EBITDA and Adjusted EBITDA, as calculated by us, may not be comparable to similarly titled measures reported by other companies. The table below presents a reconciliation of profit for the relevant period to EBITDA and Adjusted EBITDA for the periods indicated:
For the six-month period ended December 31 (in ARS million) | ||
2023 | 2022 | |
Result for the period | 122,205 | 59,907 |
Income tax expense | 37,685 | (82,794) |
Net financial results | 66,368 | (27,395) |
Share of profit of associates and joint ventures | (19,873) | (2,528) |
Depreciation and amortization | 11,464 | 12,023 |
Rights of use installments | (4,845) | (4,652) |
EBITDA (unaudited) | 213,004 | (45,439) |
Gain from fair value of investment properties, not realized - agribusiness | (955) | (279) |
Gain from fair value of investment properties, not realized - Urban Properties Business | (138,742) | 90,225 |
Realized sale – Real Estate | 14,152 | 3,429 |
Initial recognition and changes in fair value of biological assets | 198 | (1,638) |
Realized initial recognition and changes in fair value of biological assets | (332) | 8,615 |
Others (recovery of provision) | (7,648) | - |
Adjusted EBITDA (unaudited) | 79,677 | 54,913 |
78
Cresud Sociedad Anónima, Comercial, Inmobiliaria, Financiera y Agropecuaria
Summary as of December 31, 2023
Brief comment on prospects for the fiscal year
The 2024 campaign is advancing with better weather conditions in the region and particularly in Argentina, which experienced one of its worst historical droughts last seasons. Although the country experienced a lack of rain at the beginning of the campaign and last January, we project very good production levels for the company, in line with Argentina, which estimates a soybean production of 50 million tons and corn of 55 million tons.
International commodity prices have been correcting compared to last season, mainly explained by the growth in supply from South America, waiting for demand to be reactivated. Regarding input costs, they are still at high levels, but are expected to adjust in line with grain prices. We will apply the best agricultural practices to achieve high yields and increase margins per hectare.
Regarding livestock activity, a significant improvement in prices has been observed in Argentina, which, added to the good weather conditions of the campaign, predicts positive results for this activity with good levels of meat production. We will continue to concentrate our production in our own fields, mainly in the Northwest of Argentina and consolidating our activity in Brazil with a focus on improving productivity, controlling costs and working efficiently to achieve the highest possible operating margins.
On the real estate segment, we have been observing an upward trend in land prices worldwide that has not been replicated in Argentina and we are beginning to see greater interest in our assets in the country. As part of our business strategy, we will continue selling the farms that have reached their maximum level of appreciation in the region, hoping that Brazil maintains its liquidity and firm prices, and Argentina increases the number of transactions, with competitive valuations.
Our agricultural commercial services business, through FyO, plans to continue growing in the commercialization of grains, continue with the digital transformation of the company and advance in the regionalization of the input business in Brazil, Paraguay, Bolivia and Peru with the objective of increase sales and margins. For its part, Agrofy, the online agricultural platform, will focus on the profitability of the different categories and main clients. We will continue to achieve synergies with FyO in the development of commercial agreements with clients and giving visibility to our portfolio through the Marketplace.
The urban property and investment business, which we own through IRSA, has been recording very good results in all its rental segments and distributing high dividends. Although the economic context is challenging looking ahead to the coming quarters in terms of shopping mall sales and visitors, we trust in the quality of the portfolio and in the management's ability to adapt to changes in the context and continue offering the best proposals to its tenants and visitors.
During fiscal year 2024, we will continue working on the reduction and efficiency of the cost structure. At the same time we will continue evaluating financial, economic and/or corporate tools that allow the Company to improve its position in the market in which it operates and have the necessary liquidity to meet its obligations, such as public and/or private disposal of assets that may include real estate as well as negotiable securities owned by the Company, issuance of negotiable bonds, repurchase of own shares, among other instruments that be useful to the proposed objectives.
We believe that Cresud, owner of a diversified rural and urban real estate portfolio, with a management with many years of experience in the sector and a great track record in accessing the capital markets, will have excellent possibilities to take advantage of the best opportunities that arise in the market.
Alejandro G. Elsztain
CEO
Véase nuestro informe de fecha 11/11/22
PRICE WATERHOUSE & Co. S.R.L.
C.P.C.E.C.A.B.A. T° 1 F° 17
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