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Market overview

Cotton

Cotton

Global balance between supply and demand is expected to close the current cycle in a deficit condition of approximately 2.9 million bales, being an important supporting factor for fiber prices

Soybean

Soybean

Brazilian exports in 2020 accumulated maintained the growth trend, registering a volume of 82.9 million tons shipped, consolidating Brazil as an important global supplier

Corn

Corn

In Brazil, the market was heated throughout the year, driven by the animal protein sector and exports

Digital agriculture

Operating performance
2019/2020 Crop Year
The planted area contracted by 2.1% from the previous crop year, mainly due to the delay in the start of rains in the state of Maranhão. Noteworthy: the yield record, for the third year in a row, further increasing our distance from the national average. Our yield in soybeans is 15.4% above the national average and in corn, 34.4%. Cotton productivity grew by 5.5% in relation to the previous crop. The Cost of Production per hectare was 5.2% above the estimate, mainly due to the higher USD/BRL exchange rate, wich effets are protected under hedge policy of SLC Agrícola.
2020/2021 Crop Year
The estimate to the planted area for the crop year is 468.2 mil hectares, a new record and with a growth of 4.4% compared to previous crop year. The delay in planting soybeans in Midwest, due to climatic factors, impacted the window for planting cotton and second-crop corn. As a result, part of the second-crop initially planned for cotton was transfered to corn, which has a more extensive planting window, and to cotton first-crop. Despite the delay due rain, our expectation is to deliver the disclosed yield to both crops. The costs per hectare estimated for the 2020/2021 crop year show an average increase in reais of 9.1% in relation to realized in the 2019/2020 crop year, basically due to the devaluation of the real against the dollar in the period, since approximately 60% of the costs are dollarized.

SLC Sementes

Financial performance

Net revenue

In 2020, net revenue surpassed the mark of R$3 billion for the first time ever, representing growth of 22.1% on 2019. The increase was supported mainly by the higher prices invoiced for soybean and corn as well as the higher volume of cotton invoiced compared 2019.

Financial performance

Adjusted EBITDA

We ended 2020 with R$960.3 million of Adjusted EBITDA, reaching a new record. Considering only EBITDA from Agricultural Operations, there was an expansion of 34.2% compared to the prior year, in large part due to the higher prices for the soy-bean and corn invoiced.

Financial performance

Net income

In 2020, net income reached R$510.9 million, growing 74.4% from 2019, considering only the result from agricultural operations. The increase was mainly due to the higher gross income from soybean and corn, which was partially offset by the lower gross income from cotton.

Financial performance

Endividamento

Adjusted Net Debt ended 2020 at R$708.5 million, decreasing R$265.3 million compared to 2019. Note that, in November, the Company successfully placed its third CRA issue, in the amount of R$480 million which lengthened the debt maturity profile at an attractive cost.

Financial performance

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Sustainability at SLC Agrícola

Sustainability

Evaluating sustainability trends and understanding the social and environmental impacts of our business led us to organize our ESG model based on three priority vectors. We identified the Sustainable Development Goals (SDGs) and the Food and Agriculture Business Principles (FAB Principles) to which we can contribute most effectively through investments and internal programs, as well as through stronger relationships with local communities and other actors in civil society.

SLC Institute