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Adecoagro Q1 2025 Earnings Report
Adecoagro's Adjusted EBITDA reached $35.9 million in Q1 2025, driven by selective milling and strong commercial strategy, despite a 60.1% year-over-year decrease.
Key Takeaways
Adecoagro reported a significant decrease in Adjusted EBITDA for Q1 2025, down 60.1% year-over-year to $35.9 million. This decline was primarily due to a mark-to-market loss in biological assets in the Sugar, Ethanol & Energy business, lower crushing volume, and reduced Rice prices compared to record levels in Q1 2024. Despite these challenges, the Dairy business showed outperformance, and overall gross sales increased by 27.5% due to higher ethanol volumes sold.
Adjusted EBITDA decreased by 60.1% year-over-year to $35.9 million in Q1 2025.
Gross sales increased by 27.5% year-over-year, primarily driven by higher ethanol volumes and prices.
The Sugar, Ethanol & Energy segment experienced a 42.4% decline in Adjusted EBITDA due to lower crushing volume and biological asset losses.
The Farming business saw a 62.2% year-over-year decline in Adjusted EBITDA, mainly from lower Rice and Crops segment results, despite a positive performance in Dairy.
Adecoagro
Adecoagro
Adecoagro Revenue by Segment
Revenue by Segment
Sugar, Ethanol & Energy Revenue
CapyFin.comFarming Revenue
CapyFin.com Forward Guidance
Adecoagro anticipates an acceleration in crushing pace during 2H25, expecting crushing volume to be in line with or slightly above 2024 levels. The company foresees potential upside in sugar prices and a tight supply-demand scenario for ethanol. While crop yields are expected to improve, margins will remain pressured by lower prices and cost inflation. Rice production is projected to be similar to the previous year, with strong prices for value-added dairy products.
Positive Outlook
- Precipitations received during April aid in yield recovery, with crushing pace expected to accelerate in 2H25.
- Potential upside in sugar prices as global demand continues to depend on Brazil's production, with 48% of 2025 sugar production hedged at 20.5 cts/lb.
- Tight supply & demand scenario for ethanol, with consumer preference continuing to favor ethanol and sustained competitiveness versus gasoline.
- Strong prices for higher value-added Dairy products in the domestic market, with an expanding product portfolio.
- Record rice production on record yields and higher planted area, acting as a mitigant against global price declines.
Challenges Ahead
- Crops harvesting activities are underway, expecting slight improvement in yields versus prior campaign but still below historical average.
- Margins for Crops to remain pressured on lower prices and cost inflation in U.S. dollar terms.
- Global rice prices have significantly come down versus 2024 due to oversupply and India's return to the export market.
- Peanut yields are expected to decrease for the 2024/25 campaign compared to the prior record harvest due to below-average temperatures in early April.
- International dairy prices are expected to decline in 2H25 due to tariffs imposed between USA and China.