Good morning, ladies and gentlemen, and thank you for waiting. At this time, we would like to welcome everyone to Adecoagro's Second Quarter 2017 Results Conference Call. Today with us, we have Mr. Mariano Bosch, CEO; Mr. Charlie Boero Hughes, CFO; and Mr. Hernan Walker, Investor Relations Manager. We would like to inform you that this event is being recorded and all participants will be in listen-only mode during the company's presentation. After the company's remarks are completed, there will be a question-and-answer section. At that time further instructions will be given. [Operator Instructions] Before proceeding, let me mention that forward-looking statements are based on the beliefs and assumptions of Adecoagro's management and on information currently available to the company. They involve risks, uncertainties and assumptions because they relate to future events, and therefore, depend on circumstances that may or may not occur in the future. Investors should understand that general economic conditions, industry conditions and other operating factors could also affect the future results of Adecoagro and could cause results to differ materially from those expressed in such forward-looking statements. Now, I'll turn the conference over to Mr. Mariano Bosch, CEO. Mr. Bosch, you may begin your conference.

Good morning and thank you for joining Adecoagro's 2017 second quarter results. We had strong results during second quarter with a 31% increase in EBITDA when compared with the same period of last year. This was mainly achieved by the constant enhancement of our agricultural and industrial operations coupled with good commercial strategy that allows us to capture above average prices in all the commodities we produce. It's important to highlight that these results were generated in a somewhat adverse scenario with falling commodity prices and real appreciation of both the Argentine peso and the Brazilian real. Regarding the sugar, ethanol and energy business, we had rainy quarter which on the one hand was very positive for the development of our sugarcane resulting in higher expected yield, but on the other hand delayed the harvest pace. However, offset by the increase in crushing capacity. Our expansion project is being executed at high speed. Milling and crushing capacity in Angelica was increased by 17% on a per hour basis and works in Ivinhema mill have already begun. The expansion of our sugarcane plantation to supply the new capacity is also advancing well. We have already leased our 19,000 hectares at very competitive price. As we always highlight, the availability of sugarcane is a most relevant factor in any increase in crushing capacity and we are in a very good position to execute the plan according to schedule. It's worth mentioning that we still expect this project to generate attractive returns despite current sugar prices. In this, the marginal invested CapEx will allow us to significantly enhance efficiencies and reduce production costs. Regarding the farming and land transformation business, our daily operations continue to deliver in great results. We keep on improving our operational performance. We are confident that we are by…

Thank you, Mariano. Good morning, everyone. Let's start on Page 4, where I would like to comment on the weather conditions in our cluster in Mato Grosso do Sul. As you may see on the chart, the region suffered excess rains during April and May which caused logistic and operational setbacks in our agricultural operations. When the soil is humid, we have to stop harvesting activities to avoid damaging the soil with heavy harvesters, tractors and trucks. It is worth pointing out that these rains were highly beneficial for sugarcane growth, increasing projected yields for the rest of the year. Let's move to Page 5, as a result of the excess rains, we had 16% less effective milling time in the quarter which resulted in a 90% decrease in crushing volumes. As you may see in the top left chart, excess rains were partially offset by a 90% decrease in milling per day. This was driven by enhanced operational efficiencies coupled with the fact that by the end of June, we successfully completed the expansion of the Angelica mill. Angelica's crushing capacity per hour has increased by 17% from 900 tons per hour to 1050 tons per hour. As a result, we were able to crush 1.5 million tons of sugarcane during July in our sugar and ethanol operations, which is an all time record. On a year-to-date basis, we crushed 3.9 million tons of sugarcane, 7 percentage of the same period of last year. Again, this is explained by the reduction in effective milling days as a result of excess rainfall. We are confident that as we move into the dry winter season and with our increased milling capacity, we will be able to accelerate the pace of harvest to compensate the current delays and reach full utilization of…

[Operator Instructions] Our first question comes from Danniela Eiger of Bank of America Merrill Lynch. Please go ahead.

I had two questions. First, it's been a while since you don’t sell land since the end of 2016, if I am not mistaken. I wanted to understand a little bit in how is the land market? How you are seeing the prospective going forward into the second half of the year? And also what is your expectation for cash generation in second half given cane crushing accelerating. Thanks.

Hi, Danniela. Can you repeat the second part of your question, please?

Sure. It's about your expectation for cash generation into the second half of the year given that you are accelerating cane crushing.

Okay. So I am going to start with the first part of your question regarding the sale of land and it's been a while since we haven't sold land because how we think about the selling the land is thinking on the future returns on each one of the assets. So once we determine what the future returns are, is a price at which we accept we are ready to sell that land. So the market has not reflected what we believe that’s the case and that’s why we haven't sold the land. Having said this, we are now negotiating two or three farms where we do expect to reach this level where the pricing is up, where we can reallocate that capital into something more with higher returns. So that’s why we do expect to sell land in the second half of the year. That’s the first part of the question. And then Charlie will address the second part of the question according to the cash generation on the increase of the cane crushing.

Hi, Danniela. Thank you for your question. As I happened during the last three years, we have a seasonality on how we generate the cash, typically during the first semester, we consume cash and we move forward sales of basically sugar and ethanol. If you look at what happened last year, in the last quarter we generated most of the cash as we sold more than 40% of the TRS that we produced during the year. So I would expect and we are confident that we will be -- as we have been doing during that [for the] [ph] years generating the cash on the second semester and mainly on the fourth quarter.

Our next question comes from João Soares of Bradesco. Please go ahead. João Soares: I have two questions. First one, the ethanol prices. I am just trying to understand here a little bit. Your hedging and how you expect prices to behave going forward given the routine rise in fiscal [indiscernible] and this potential [indiscernible]. Looking at your numbers, you are climbing 6.5% year-over-year in BRL and correct me if I am mistaken. But this is really positive given the prices pointing year-to-date given the high imports. So if you could just talk a little bit about how you managed to achieve such positive [purchase] [ph] and how to you expect this to behave going forward. And my second question is, if you can provide an update on your M&A strategy. I understand in your investor statements you talk a little bit about analyzing certain plans [indiscernible] of what we might be good prices in Mato Grosso do Sul, close to your cluster. So if any opportunities are arising we can consider maybe something happening here in the second half. Those will be my questions. Thank you.

Okay. Thank you, João, for your question. I am going to ask Marcelo Sanchez to answer the question regarding our view on the ethanol and what we have been doing. Marcelo, please?

Yes. Thank you, João. Good morning. We have been selling our ethanol production and capturing very good prices in the first portion of the second quarter and that’s the reason why we are reflecting above average prices in the ethanol. Regarding the question on our -- the impact on the fiscal [indiscernible] and how that’s going to be affecting prices going forward. We think that [indiscernible] improve ethanol competitiveness at the time, of course. And consequently, generated a positive impact in demand as well and continued in our growing expectations of the auto cycle demand that is growing 2%. Brazilian ethanol production, we are positive that prices will continue to be attractive through the crop and we expect very good significant increment in prices by the fourth quarter and the remaining portion of the third quarter.

Okay. Then I will address the second part of your question on the M&A strategy on our sugar, ethanol and energy business. We have no real news on regards the M&A strategy. We are very happy on how we are advancing with our own growth in the cluster. So that’s working pretty well as have mentioned in the call and we have no real news on the other subject. I think we have nothing to comment other than we will continue to looking at things.

Our next question comes from Thiago Duarte of BTG. Please go ahead.

I have a quick question on the sugar and ethanol side. There were some news in the last couple of months regarding potential, regarding frost, that I think according to the news hit the state of Mato Grosso do Sul. So it would be nice to have from you guys an update on how that officially effected the sugarcane plantations of the company and of course when you think of the acceleration of the crushing pace in the second half of the year, you think you could reach the levels that you did in terms of productivity and pure asset you did last year. It will be nice to get an update on that. Thank you.

Okay. Thiago, thank you for your question. We have Renato in the mill, so I am going to ask Renato Pereira to address your question regarding the frost and the productivity levels. So Renato, please.

Hi, Thiago, thank you for your question. We had a low intensity frost in July. This will have a small impact in 2017 because we were able to harvest and crush the affected sugarcane just after the frost as the weather was very favorable for crushing. The impact will also be minimal in 2018 as we are having a good conclusion to sugarcane growth. In relation to your second question, I think the comparison which is the 2016 [indiscernible] were above average due to the high level of rains in the last quarter of '16 and first quarter of '17. In at least the last quarter of '16 and first quarter of '17, was dry than the average, make up to the fact in sugarcane looking this quarter. Still the high volumes of rains we had in the second quarter of '17 we expect sugarcane will be [groom] [ph] for the rest of the year. It's also important to highlight that our current [use] [ph] is still much better than the average of center [indiscernible] and that we are still planning to crush 11.2 million tons of sugarcane.

Our next question is from Javier Martinez of Morgan Stanley. Please go ahead.

Mariano, I will take that Marcelo is there to ask technical question. I was a little bit surprised with the high level of hedging prices that you have on call. And I was wondering that’s because on top of the hedge you have also some trading or maybe because of the basis last year in Brazil because of the prices going up so much in Brazil. So I was curious to know how well you are able to hedge prices so high for corn?

The reason why we reached this 460 cent per bushel in the corn, you are correct in your analysis. We had locked premium basis that portion is adding value into when you compare with achievable prices. That’s the reason. And the total amount of maybe 20,000 tons out of the 38,000 that shows in the report, and the rest of it is coming out from sales in the domestic market that also has been reflecting higher prices.

This concludes the question-and-answer session. At this time, I would like to turn the floor back to Mr. Bosch for any closing remarks.

Thank you. The first half of the year has shown good results in all our businesses. Now we have a challenging semester ahead of us. We will concentrate our efforts to keep our costs low and to maximize our returns. Our employees, contractors and stakeholders are ready and committed to do the job. So I look forward to seeing you in our upcoming IR events. Thank you for joining the call.

Thank you. This concludes today's presentation. You may disconnect your line at this time and have a nice day.