Trigon Agri downplayed threats from both Ukraine's weather
and its political crisis as the farm operator heralded becoming "significantly
cash flow positive in its operations", contrasting with a net outflow in the
first three months of the year.
The dairy and arable group, which has planted some 67,000
hectares of crops this year in Russia and Ukraine, said that its winter crops "look
to be in good condition", despite regional rainfall falling below average
And although frosts in late April and early May hit its
rapeseed "visually quite hard", the crop "appears to have recovered well after
some warm nights and light rainfall".
Spring sowings had already been completed, ahead of
schedule, with early development "of a high standard".
"The current condition of the crop as of the end of May is
better even than the condition of our all-time record crop last year at the
same point in time," Joakim Helenius, the Kernel chairman, said.
The comments echo those of Kernel Holding, the Ukraine
sunflowers-to-sugar group which said that its crops – comprising 339,000
hectares of spring corn, sunflowers and soybeans, and 34,000 hectares of winter
grains – were "all… reported to be in good condition".
Mr Helenius downplayed the dent from the Ukraine political
crisis too, saying that the "continued political uncertainty in Ukraine has not
impacted Trigon Agri's business in a major way".
"About a third of our operating expenses are paid in hryvnia,"
the Ukraine currency, which has hit a record low against the dollar, as Kernel Holding highlighted separately on Friday.
"But they are likely to adjust fairly rapidly towards
pre-crisis dollar equivalent levels," he said.
Where the turmoil had affected the group was in "complicating
the work we are doing" on a programme of sales of non-core assets, although the
sale of its Penza farms in central Russia was nearing completion, and other
disposals were "moving forwards".
The comments came as the group unveiled a third successive
quarter in the red, reporting a loss of E11.2m for the January-to-March period,
wider than the E7.27m loss a year before.
However, the wider loss, on revenues up 6.4% at E10.2m, reflected
an earlier start to spring sowings, which brought forward the booking of
Looking ahead, "assuming no extreme weather conditions and
no significant drop in commodity prices from current levels Trigon Agri should
be significantly cash flow positive in its operations," Mr Helenius said.