Rusagro is a leading vertically integrated agriholdings in Russia, present on five key markets: sugar, pork, oil and fats, dairy products and agricultural crops markets. The assets of the Company are located in 12 constituent entities of the Russian Federation and its products are sold across 62 countries to B2B and B2C clients under 23 retail brands.
The strategic goal of Rusagro is to increase returns for shareholders through expansion, added value products, innovations and high quality human capital. The business model is based on vertical integration across all key business segments and offers advantages of economies of scale, diversification and value chain control.
Rusagro business comprises of four key divisions: Agriculture, Oil and Fats, Meat and Sugar Segment. Plus, in 4Q 2018 it established Dairy Products Segment, which will be joined to Oil and Fats Segment in 2021. Today, Company is the largest in Russia producer of unrefined sunflower oil and consumer margarine, second largest producer of industrial fats and mayonnaise, and third largest sugar and pork producer, and agriculture land holder.
Rusagro has been a publicly traded company since 2011. Global depository receipts for ordinary shares of ROS AGRO PLC are listed on the London and Moscow Stock Exchanges. The public status of the Company requires high standards of corporate governance, since effective corporate governance system is crucial for the long-term stability of the business and the rise in shareholder’s value. The shareholders’ right to participate in Rusagro’s profits is exercised through the Dividend Policy, approved in 2013.
Adhering to its mission Making the life of people longer and better, Rusagro aims to achieve long-term growth and use responsible business practice, considering its stakeholders’ diverse interests. To support its sustainable development Rusagro focuses on three key priorities which are human capital development, environment protection and high quality corporate governance.
Amid the development of prices on global markets and the depreciation of the rouble, the Agriculture Business’s income hit a record high in 2020. The sales went up by 33% and reached RUB 34.3 billion (+RUB 8.5 billion) despite falling-off in total sales volume (-21%). With the production cost standing at more or less 2019 level, the Business’s profit margin reached 44% with the earnings before interest, taxation, depreciation & amortisation (EBITDA) of RUB 15.2 billion, posting an increase of 157% (+RUB 9.3 billion).
In 2020, the sales Oil and Fats segment grew by 22% (+RUB 13.8 billion) — to RUB 76.2 billion on the back of advancing selling prices for all products and a larger sales volume of industrial fats, bottled oil, and the mayonnaises. Thanks to the high share of sell products was made from cheaper sunflower seeds of the 2019 the earnings before interest, taxes, depreciation, and amortisation (EBITDA) increased by 177% and reached RUB 9.4 billion, and the adjusted EBITDA margin — by 7 p.p. from 5 to 12%.
In 2020, the Meat Business’s posted major increase in revenues (+6.6 RUB billion, or +26%) driven by higher sales of meat products against the backdrop of reaching full capacity of the pig farms built in 2019 in the Tambov Region, an increase in the productivity of slaughterhouses and deboning shops, as well as export development. Despite the rise in the price of the compound feed component of the live pork cost, profit margin improved by 1 p.p. — up to 20%, fuelling the growth of adjusted EBITDA by 34% — up to RUB 6.5 billion (+RUB 1.7 billion).
In 2020, the Sugar Business’s showed a decrease in sales as a result of a reduction in sugar sales volume (-21%, or 212 thousand tonnes) due to lower sugar production resulted from poorer yield of the sugar beet in Russia; on the other hand, lower cost of goods noticeably improved the adj. EBITDA (+59%, or RUB 2.4 billion) and margin from 13 to 23%.