Good morning, ladies and gentlemen, and thank you for waiting. At this time, we would like to welcome everyone to Adecoagro's Fourth Quarter 2023 Results Conference Call. Today with us, we have Mr. Mariano Bosch, CEO; Mr. Emilio Gnecco, CFO; Mr. Renato Junqueira Pereira, Sugar, Ethanol and Energy VP; and Mrs. Vitoria Cabello, Investor Relations Officer. We would like to inform you that this event is being recorded and all participants will be in a listen-only mode during the company's presentation. After the company's remarks are completed, there will be a question-and-answer session. At this time, further instructions will be given. 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 2023 fourth quarter results conference. We are presenting all-time records in gross sales, adjusted EBITDA and net cash from operations. Despite having experienced the worst drought in Argentina's history, these accomplishments were possible because of the investment made through the years to grow our production capability, strengthen our asset base and teams, the synergies achieved across all our businesses, our continuous focus on efficiency and being the low-cost producer, our geographic and product diversification, our flexibility to shift across markets and products. These results made us reduce our net debt by more than $150 million, while we continued investing in growth projects with attractive IRRs and also distributing to shareholders via dividends and buybacks. Based on the results presented and according to our distribution policy, this year we will distribute at least $70 million, a new record for the company. Some brief comments on ESG. As food and renewable energy producers, taking care of the natural resources and the environment is in our DNA. Throughout the years, we have developed sustainable production models in each of the places where we operate. We expect to achieve our newly disclosed 2030 decarbonization targets by reinforcing these models and investing in new technologies with attractive financial returns, like the biomethane. In Brazil, our Angelica mill facility received the CORSIA certification which guarantees that our ethanol can be used for Sustainable Aviation Fuel production, a potential new market for our ethanol production. In our Dairy segment, our second biodigester is injecting renewable electricity to the local grid by using cow manure as an input. This is a clear example of how circular economy model works. From this manure, we also produce biofertilizer which is then used in our crop farms and later produce cow feed. The…

Thank you, Mariano. Good morning, everyone. Let's start on Page 4 with a summary of our consolidated financial results. Gross sales totaled $400 million during the fourth quarter, 5% higher year-over-year while adjusted EBITDA reached $96 million, 9% down versus the same period of last year. On an annual basis, gross sales amounted to $1.4 billion and adjusted EBITDA was $477 million making a 7% and 10% increase, respectively, versus the prior year as well as all-time records for the company. These results were mostly explained by an outperformance of the sugar, ethanol and energy business on greater cane productivity which enabled us to increase our sugar production and execute sales at solid prices. Results were also positively impacted by solid returns from our rice segment on higher average selling prices and the sale of a farm in September. This in turn fully offset the decline reported in the crops production explained by the effects of an unprecedented drought event and higher costs in dollars. Now please turn to Slide 5. As you can see on the upper right chart, we generated $176 million of net cash from operations in 2023, 24% higher than the prior year. The increase in cash generation was driven by an outstanding operational performance. Investments carried out throughout the past years across all our operations, along with an action plan which aimed to reduce expenses and generate savings, among other initiatives, have paid off. Regarding our production figures in the bottom right chart, we can see that crushing volumes in our sugar, ethanol and energy business were up 19% versus 2022. Higher crushing translates into higher production volume, increasing sales and diluting costs. This was mostly possible thanks to the implementation of innovative agriculture techniques such as pre-sprouted seedling which enabled us to reproduce sugar…

Thank you. [Operator Instructions]. Our first question comes from Isabella Simonato with Bank of America. You can activate your microphone.

Thank you very much. Good morning, everyone. Thanks for the call. I have two questions. First of all on sugar and ethanol you mentioned in the press release right that you expect crushing to be up year-over-year. So I was wondering if you could give us a sense of what volume of cane crush this year we should be looking at, and if you could elaborate a little bit more on the mix between sugar and ethanol and also the export market of ethanol which you took advantage in 2023 and how do you see the outlook for that? And second on the crop business and that includes price you mentioned also about yield perspective for the season as if weather permitting right and next couple of weeks, but also when we think about the cost side, right? If you could give us some sort of outlook for north where cost per hectare is looking like for the upcoming season I think that would help us to understand the outlook for 2024? Thank you so much.

Okay. Thanks, Isabella, for your question. To take the first part of the question, I will ask Renato to give more clarity on the sugar and ethanol segment and then I will take the crops and rice comment.

Hi, Isabella. Thank you for your question. Regarding the sugarcane question as it was mentioned in the presentation in the last quarter of last year we have a very good range that's one of the reasons that we crushed less cane compared to the year before, but we entered the first quarter in a very good condition which was very good considering our continuous harvest model so today we have already crushed in the first quarter more sugarcane than we crushed in the first quarter of last year so it's a very good situation. In February and March the weather is being a little bit drier than normal so if we put all this in consideration we think that our yields are going to be similar to the ones that we had last year. But we are still optimistic that we're going to crush more cane than last year, because our area of sugarcane has increased. So we expect we'll have potential to crush approximately 5% more than we crushed last year. So regarding the second part of the question is the mix of production. We are keep maximizing the production of sugar because it's still paying much more than ethanol right now. Last year we have reached a mix of 52%.So we think this year we are going to achieve a mix similar to that maybe a little bit more due to small adjustments and focus on the sugar operation and I think it's important to mention that we believe that the ethanol price is going to increase and the parity rate is going to reach 7% at some point of the year and if that happens the ethanol equivalent is around $0.20 per pound. So this is this is like a floor that we have to change the mix. And regarding the export, I think we export a lot of ethanol to Europe in 2022, there was a very good opportunity. Last year we have exported approximately 50,000 cubic meters this year we haven't exported any ethanol to Europe yet because we expect that the prices in Brazil is going to increase so we don't have the export window open. Also the price of oil when we exported ethanol back in 2022 was very high which is not the case right now. But of course we have all the possibilities to export we have the Bonsucro certification we have all the equipments to produce the ethanol required by European market. So if that happens we will be getting this opportunity.

Thank you, Renato. And Isabella, regarding the crops and rice that you were asking and you're specifically asking about the rice. We are today in the middle of the harvest, so we are have already harvested 50% that is in a good shape and now we still need to harvest the other 50%. Thinking for next year the cost of production, so the cost of production of next year, we think that it's going to be in line with the previous year. Because there are many different factors and within the factors that are improving costs are all our efficiencies that we've been working with the increase in the area and coming into Uruguay and all the acquisition that we are taking care of last year. So there is an improvement because of the efficiencies and then in dollar terms that is what how we think about it there are most of the costs that are going to be more competitive this year than what they were last year that is a biofertilizer fertilizers in general and then even talking about the cost of fuel or irrigation cost as a total.

Thank you.

Next question from Thiago Duarte with BTG Pactual. You can activate your microphone.

Hello, everybody. Thank you for the opportunity. I have two questions and I think focused on the sugar and ethanol and energy business. The first one is kind of a follow-up I think you made a comment in your prepared remarks with regards to the cash cost in this business we saw an increase in the cost per pound in Q4. I presume this was due to the lower amount of cane crushed and obviously the lower dilution and if I understood you're still confident that you can see a downward trend in 2024 total relative to 2023.So just wanted to make sure these understandings are correct with regards to cost in Q4 and to unitary cost in 2024? That would be the first question. And the second question, when we when you look at the expansion CapEx, I think it was $52 million in 2023 and mostly focused on the built of the biodigester as well as the expansion of the planting so just wanted to know how much of that we should see moving on into 2024. My understanding is that most of these two particular projects are done in 2023 and how much of an expansion CapEx we could see carry over for the business into 2024? That would be it. Thank you.

Okay. Thank you, Thiago, for your question. Renato, do you want to answer and then I can complement.

Okay. So hi, Thiago. Thank you for your question. So regarding the cost, we think that there are some components of the cost that is going to increase, such as labor that increase according to inflation, freight that is still under pressure. But there are other factors also in the numerator part of the costs that are decreasing, such as inputs in general. So I would say that the numerator part of the cost is almost flat year-over-year. But the denominator part, I think is going to make the difference in our case. We --as I mentioned before we still believe that we're going to crush more sugarcane this year compared to last year. So this dilutes our cost more. So we expect a cost similar or slightly lower than we had last year. And regarding the question about the CapEx, I think the CapEx that we are projecting to do is exactly what we mentioned is the expansion of our planting to fulfill our capacity in MatoGrosso do Sul and also the biodigester expansion, we plan to increase our production of biomethane in MatoGrosso do Sul from 6 to 30,000 cubic meters per day in the next four years. So that's basically the CapEx that we are planning to do.

Very clear, Renato. And Thiago, just to complement, I wanted to make more open on our CapExes for this year and this has a lot to do with the capital allocation and how we think about it. First of all these results that we are seeing today and this increase in distribution because of the increase of net cash operations are the clear consequence of all the investments that we've been doing during these years. So today we still see a lot of growth opportunities and as Renato was explaining on the sugar and ethanol we have this clear opportunity on increasing this continue to increase the sugarcane plantation that is very efficient in this specific area continue to increase the biodigesting of the vinyas that then is transformed into a biofertilizer so the whole system still has a lot to grow and a lot to replace the diesel et cetera. So that is on the sugar and ethanol that there are many other things that are also very interesting. On top of this we have this expansion projects in the rice business. As you've seen in the rice business we've been growing and the results are clearly paying off. The same thing we have for the dairy. There are some opportunities that we think are very attractive. So we can expect this to continue to happen what you've been seeing in the last years. But this also means that we are fully convinced of our distribution policy we put in place this fully -- this distribution policy 2.5 years ago and we are following that very closely. We are fully committed to this and we are doing through both dividends and buybacks as Emilio explained and the dividends are something you will be seeing the $35 million and on top of that you saw that we bought back a $1.18 million of shares that is 1.7% of the company in only two months. So that is something that we expect or you can see to continue to happen, that is above the policy and most of the years we've been going above the policy and the policy says at least. So that's a view or a clearance something that we are clearly thinking on. So that was to complement the concept of how we think about the CapEx and capital allocation.

That's great, Mariano. Thank you for the additional color.

If you have a question, please write it down in the Q&A section or click on raise hand for audio questions. Please remember that your company's name should be visible for your question to be taken. We do ask that when you pose your question that you pick up your headset to provide optimum sound quality. Please hold while we pull for questions. Next question from Larissa Pérez with Itaú BBA. You can activate your microphone. Larissa Pérez: Hi guys. Good morning, Mariano, Emilio, Renato, Victoria, all the Adecoagro team. Thank you for taking my question and congratulations on the results once again indeed very resilient. I was wondering if you could share with us your thoughts on La Niña impacts because the probability of La Niña coming back by the second half of this year has been steadily increasing. And I wanted to hear from you, how much do you think it could impact both the Argentinean farming division and the Brazilian sugar and ethanol division? That would be my first question regarding the impacts on the second semester and the beginning of next year. And my second question would be on the process of SAF certification. Congratulations on getting the Angelica mill certified for SAF production. I would like to understand if you're planning on certifying your other mills? And what are the next steps here that you envision towards supplying ethanol for SAF production? Those would be my two questions. Thank you once again.

Okay, Larissa, thank you for both questions. I'm going to take some time to go in detail because I think are very relevant. First of all on La Niña year, we need to be clear we are all hearing about La Niña year coming ahead of us. This is totally different to what happened the previous year because now would be a La Niña year after El Nino year. The great issue that we had with La Niña the previous year was because of a third consecutive year of La Niña and this is a very different situation than what we have today where we have most of the reservoirs full and then you have a La Niña effect. That of course will have effects that I will go in detail in a segment-by-segment case and how this can how can this affect us. First of all, on the sugar and ethanol business, the area where we are with our sugarcane plantation in MatoGrosso do Sul is an area that is neutral to El Nino or La Niña so it doesn't really affect to our own production, so it doesn't have a clear consequence to our own production. But what we can see in La Niña is that center south in general is more dry and so the harvest will be shorter but also lower so as Renato explained before we expect a lower sugarcane production in center south as general and that means that is optimistic for prices of sugar and ethanol both. So, all in all for our sugar and ethanol business we believe it is a positive impact. Then when we go to the crops that is what has been more affected and is more affected by a La Niña year, we are already working on that…

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

Thank you all very much. Thank you for participating in the call, and we hope to see you in our upcoming events.

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