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Notification of emergency response at Dobrobut LLC

Alfa-Bank Ukraine and ASTARTA have concluded a partnership programme for agricultural producers

ASTARTA published Report for the six months of 2020

ASTARTA published Report for the six months of 2020

Key highlights:ASTARTA’s consolidated revenues amounted to EUR172m in the 1H20 with exports’ share of 53%. The Agricultural segment’s revenues were EUR54m in 1H20 compared to EUR103m in 1H19 as majority of the grain and oilseeds’ 2019 harvest were sold by the end of 2019.

A 3% y-o-y revenue growth to EUR57m helped the Sugar segment becoming the main contributor to consolidated revenues in 1H20. The Soybean Processing and the Cattle Farming segments generated EUR40m and EUR18m of revenues, correspondingly. EBITDA stood firm at EUR67m, almost at the same level as in 1H19. The Company paid down a further EUR20m of bank debt on a Cash Flow Basis leading to the Net Debt reduction to EUR239m as of 30 June 2020.

AgricultureThe Agriculture segment revenues amounted to EUR54m in 1H20 as majority of the grain and oilseeds’ 2019 harvest were sold by the end of 2019. Exports accounted for 96% of the Agricultural segment revenues in 1H20 versus 91% in 1H19. EBITDA totalled EUR53m in 1H20. As of August 12, the Company harvested early grains such as winter wheat and rapeseeds in the amount of 230kt and 4kt with an average yield of 4.8 t/ha (versus 5.1t/ha in 2019) and 2.6 t/ha, correspondingly.

SugarSugar revenues amounted to EUR57m (up by 3% y-o-y) on improvement of realized prices to EUR354 per t compared to EUR329 per t a year ago. This lead to the EBITDA increasing to EUR8.1m in 1H20 from EUR4.0m in 1H19.

Market news

ASTARTA MONTHLYAugust 2020

№158

Ukraine. Grain memorandum signed

USA. Corn Hits Six-Week High on Worsening Crop Outlook, China Demand

Argentina. Drought and Frosts Are Threatening Argentina’s Record Wheat Crop

Soybean processingThe Soybean processing-related revenues totalled EUR40m, down by 12% y-o-y on lower sales volumes. Exports contributed 86% of revenues. The EBITDA margin declined from 11% in 1H19 to 9% in 1H20 on higher cost of sales due to regulatory changes in the industry.

Сattle FarmingSlightly higher revenues of the Cattle Farming segment (EUR18m in 1H20 versus EUR17m in 1H19) were driven by higher milk prices offsetting lower sale volumes. EBITDA margin improved to 22% in 1H20 from 21% in 1H19.

Astarta Monthly No1582

1H20 report

«ASTARTA continues to demonstrate its resilient business model by delivering much needed hard currency revenues and taxes to Ukraine, cereals and feedstock products to global markets and reduced leverage profile to its shareholders amid very difficult macroeconomic backdrop created by the pandemic which disrupted not only the world’s largest economies but our every day-to-day life. We are fully prepared to face the challenges of the present times and continue servicing our customers in Ukraine and globally with sustainable and affordable food produce».

Within the framework of the joint partnership programme Alfa-Bank Ukraine and Astarta-Kyiv agri-industrial holding offer agribusiness producers unsecured loans of up to UAH 7.5 million.ASTARTA Partnership Centre continues to expand the opportunities for co-operation with independent agricultural producers. Alfa-Bank — is one of the leading banks of Ukraine which has joined Astarta’s ecosystem.Alfa-Bank Ukraine has a strong position in servicing the agricultural sector and is constantly expanding favourable conditions for its clients.

Due to deep agricultural expertise, Alfa- Bank Ukraine offers prompt decision-making and a wide range of financial products for convenience of agribusiness producers.

Under the terms of the partnership programme agribusiness producers can obtain a loan from Alfa-Bank Ukraine on favourable terms against the grain supply agreement of the future harvest concluded with Astarta-Kyiv agri-industrial holding.

The partners guarantee quick processing of loan applications and rapid decision making. The maximum loan amount may be up to UAH 7.5 million. No collateral but only a guarantee from the business owner (agribusiness producer) is required to enter into a loan agreement.

To apply for a loan the agribusiness producer is required to:

agree with Astarta-Kyiv on the terms of grain supply of the future harvest (crop, quantity, supply terms and basis);

Сomments of Valery Sokolenko, Executive Director of ASTARTA:

Alfa-Bank Ukraine and ASTARTA have concluded a partnership programme for agricultural producers

enter into a loan agreement with a reduced interest rate with the Alfa-Bank Ukraine and obtain financing;

enter into a grain supply agreement for the future harvest with Astarta-Kyiv;

obtain a preliminary decision from Alfa-Bank Ukraine on obtaining a loan;

provide the Bank with the full package of documents to draw a loan and to open bank accounts at Alfa-Bank Ukraine (UAH and/or USD accounts);

supply grain to Astarta-Kyiv at market terms.

Astarta Monthly No1583

Alfa-Bank Ukraine and ASTARTA have concluded a partnership programme for agricultural producers

For reference:

Astarta Partnership Centre was established for the development of an ecosystem of businesses related to agricultural production and trade in agricultural products, providing agricultural producers with resources, rendering services and consultations. By introducing new participants to partnership programmes, the Centre offers agrarians more comprehensive opportunities to support and develop their business. Astarta's subsidiaries and affiliate enterprises are also involved in partnership programmes, in particular, these are grain storage and handling services, tolling processing of sugar beet, harvest purchase, insurance, software for agribusiness management (AgriChain) and other services according to the needs of partners.

Alfa-Bank Ukraine is a large Ukrainian bank with international capital and is part of the private investment holding company ABH Holdings S.A. with its head office in Luxembourg. According to the classification of the National Bank of Ukraine, Alfa-Bank Ukraine is among foreign banking groups, is a systemically important bank and is ranked among top 10 financial institutions of the country by assets. The Bank holds leading positions in all key segments of the banking market and is one of the most stable and reliable banks in Ukraine.

Notification of emergency response at Dobrobut LLC

On August 22, at 02:30, an emergency situation occurred on the tractor station of Dobrobut LLC (in the village of Breusivka, Kozelshchyna district, Poltava region), which is a part of the Astarta-Kyiv agro-industrial holding: a fire broke out due to lightning.Rescuers arrived at the scene immediately and completely eliminated the fire. No one was injured in the fire. However, some agricultural machinery was damaged. The agricultural machinery had been in operation for more than 10 years, it is planned to be replaced in the next years. The losses incurred are not material.This event will not affect the course and quality of harvesting and soil preparation for winter wheat sowing next year.

Astarta Monthly No1584

Ukraine. Grain memorandum signed

On August 17, the Economy Ministry and grain market participants signed an appendix to the Memorandum limiting 2020/21 exports of wheat to 17.5 MMT and those of rye to 1 KMT. These volumes may be revised in Q4 depending on the final production results to be published by the State Statistics Service.As a reminder, UkrAgroConsult estimates this season’s wheat exports at 16.9 MMT.

UkrAgroConsult

“Wetter and cooler weather is expected this weekend but many observers say that the rains will be too late to help crops.“The outlook for production in Europe has also worsened following dry spells in key growers from France to Ukraine. In Europe, “it was the perfect vacation weather for sitting on the balcony, but not perfect for crops,” Rabobank International strategist Stefan Vogel said.Prices also gained after data showed China’s corn imports climbed to a three-year high in July as the nation sought more supplies to plug a widening shortage and cool surging prices. At the same time, crop futures were supported as the U.S. and China signaled progress on their phase-one trade deal. Read More: U.S., China Signal Progress on Trade Deal as Relations Fray Corn for December delivery advanced as much as 2.9% to $3.55 a bushel in Chicago, reaching the highest for a most-active contract since July 9.

Bloomberg

USA. Corn Hits Six-Week High on Worsening Crop Outlook, China Demand

Corn futures surged on concerns about worsening crop outlooks from the U.S. to Europe and optimism over demand in China, where imports have climbed. Benchmark prices rose to a six-week high in Chicago, extending gains following data on Monday that showed crop conditions in the the U.S. Midwest deteriorated the most in eight years, as a powerful windstorm that swept through Iowa added to the damage caused by drought. “The main feature is the hot and dry weather seen in just about all parts of the Midwest right now,“ Jack Scoville, vice president at Price Futures Group in Chicago, said in a report.

Argentina. Drought and Frosts Are Threatening Argentina’s Record Wheat Crop

A drought coupled with bouts of frost may curb wheat output across swaths of Argentina, the Buenos Aires Grain Exchange said in a report. “Current conditions are unfavorable for growth anddevelopment,” analysts led by Esteban Copati wrote. The impact of dryness that started in March is now being made worse by “frequent and intense” frosts. Wheat plants in the north -- which are in yield-defining development stages – may produce 50% less. Damage in southern areas, known as Argentina’s bread-basket, is lighter. But rain is needed for plants there to recover from delayed growth.Argentina has been expected to produce a record wheat crop after the government spared shipments of the grain from a tax hike. But the drought limited planting, which reined in some estimates.

Bloomberg