Landkom forecast it could report its first year in the black, at an underlying level, as the Ukraine farmer operator revealed that a cost cutting drive had borne fruit, and would see its efficiency improve by a further 35% this year.

The London-listed group said that reporting positive earnings before interest, tax, depreciation and amortisation (ebitda) was an "attainable target" for its 2010 financial year, which ends in October.

Landkom said that its forecast reflected "significant steps... made to reduce operating costs to achieve lower breakeven levels", as well as the higher yields that could be expected as successive years of tilling and fertilizer improve the quality of the soil.

Vitaliy Skotsyk, the Landkom chief executive, told Agrimoney.com that getting at least to breakeven this year "was my target from day one in the company.

"I truly believe we will reach it. I know how to make this company more efficiently run."

The comments followed the group's reporting of an ebitda loss of $21.1m for the 10 months to the end of October last year. In 2008, Landkom reported an ebitda loss of $52.4m.

Wages bill slashed 

The group's administrative expenses came in at $4.59m for the shortened 2009 financial period compared with $15.75m for the full-year before as Mr Skotsyk, in post since September, deepened a programme of cost cuts begun under his predecessor Richard Spinks.

The wages bill slumped to an average of $167,500 a month, from $340,600 a month in 2008, as the group's number of personnel per 1,000 hectares tumbled from 25.5 to 15.8.

As of January, the staffing rate had fallen to 10.4 personnel per hectare.

Overall operating costs per hectare would fall by 35% this year for rapeseed and winter wheat, with this trend also helped by a return to land acquisition, after a period of disposing of land to help cut expenses.

The group also flagged greater breadth in its crops portfolio, which will include spring sowings of corn, soybeans and sunflowers as well as the usual rapeseed and wheat areas.

Market reaction 

However, despite the cost cuts, the group reported an after-tax loss of $40.34m for the 2009 financial period, on revenues of $14.55m.

Revenues were "lower than expected due to the lack of success in timing 2009 crop sales", Landkom said.

For 2008, the group reported a loss of $55.56m and revenues of $10.65m.

Landkom shares closed 4.7% lower at 5.12p in London.