OREANDA-NEWS. July 09, 2012. KSG Аgro has published its results for the first quarter of 2012. The Group’s sales revenue increased 519% to USD 4 597 thousand comparably to USD 743 thousand for the first quarter of 2011. The Group’s result from operation activities rose 62% to USD 2 395 thousand. The Group’s net profit increased 65% to USD 1 794 thousand comparably to USD 1 086 thousand for 1Q 2011. The total assets of the company were higher by 3.5 times and improved by USD 88 344 thousand.

 “In the first quarter we achieved positive results. The sales growth is the result of successful implementation of the Group’s diversification strategy and increase of share of non-farming segments sales in total revenues. However the farming segment remains the core business segment for KSG Agro and the financial result for the first quarter is influenced by seasonality factor implying that the major part of crops is harvested and sold during second half of the year.” – said Sergiy Kasianov, the Head of the board of Directors of KSG Agro S.A.

The Group plans to achieve such further operational results in 2012: land bank under control of 110 thousands hectares by the end of the year (including 80 thousand ha of harvested land), storage capacities of 76 thousand tonnes and total grain harvest of 228 thousand tonnes. These operational results are expected to lead to the following financial performance in 2012: Revenue, EBITDA and net income of USD 66.7 mln, USD 42.3 mln and USD 31.8 mln, respectively. Purchase of more than 20 thousands ha is already at the negotiations stage. Starting from 2012, the management plans to expand the share of cultivated land under wheat, barley and corn in order to diversify revenues and increase land usage efficiency.

 In line with diversification strategy of the Group, forecasted sales of fuel agro-pellet and pig breeding segments, in aggregate, are expected to reach 30% of total Group’s revenue, by 2015. Diversification of operations also helps to maintain liquidity at sufficient level through the whole financial year, consequently contributes to solving problems of seasonal cash flow, which is attributable to companies of agricultural sector.

KSG Agro plans to strengthen dominant position in the Central Ukrainian regions, which are rich in black soils and have favorable geographic location due to proximity to Dnipro River, main railways and Black Sea ports. More than threefold increase of land bank under control from current 61.0 thousands to 200 thousands hectares by the end of 2015 is expected.