I’m [Operator Name], and I’ll be your moderator for today’s call. [Operator Instructions] Nandita Nandita, Head of Investor Relations, will be leading the call. Nandita, please begin.

Federico Trucco: Thanks, Paula, and good morning to everyone. Please turn to Slide number 3 to review the highlights for today’s presentation. Fiscal year 2024 has been another challenging year for agriculture, with on-farm economics declining in key crops and geographies, particularly in the second half of the fiscal period. For instance, the price of soybeans, a key crop in our portfolio has dropped by 28% since January, just to provide one metric that strongly correlates with the purchasing power of our end users. Despite this general situation, we were able to consolidate Bioceres’ financial performance at record high revenue and EBITDA levels at $464.8 million and $81.4 million, respectively. We closed the year with improved momentum in the last quarter, which we already anticipated during our third quarter call.

* The company achieved significant growth in sales and EBITDA. * HB4 sales contributed significantly to the growth. * The company is planning to expand its operations in the future.

Enrique Lopez Lecube, CEO of the company, takes the stage to discuss the company’s financial performance. He begins by acknowledging the challenges of the current economic climate and the impact of inflation on the company’s operations. He then transitions to a detailed analysis of the company’s financial results, highlighting key performance indicators (KPIs) and discussing the company’s strategies for navigating the current economic environment.

Moreover, HB4 played a crucial role in maintaining a double-digit topline growth in the year-over-year comparison of the quarter. From an annual perspective, the quarterly growth resulted in full year revenues that reached $465 million, 11% higher on sales in fiscal 2023. Revenue performance for the full year was shaped by several factors. In the first half of the year, post-drought recovery in Argentina and the nature of the seed oriented part of our portfolio helped us achieve growth, despite challenging market conditions in some geographies such as Brazil and the U.S., where channel destocking process altered farmers’ purchasing behavior. Our third quarter, as you might recall, saw the negative impact of a lower Syngenta payment accrual in comparison to the year before.

HB4 is a new product that we launched in the fourth quarter. It’s a high-performance, low-cost, and versatile product that caters to a wide range of customers. This product has been well-received by customers and has generated significant revenue. The company’s revenue growth was driven by a combination of factors, including the launch of HB4, strong customer demand, and a favorable market environment.

Micro-beaded fertilizers sales dropped compared to the year ago quarter as the negative impact of the corn leafhopper, or Chicharrita, which decimated corn yields last year, led to lower corn acreage in Argentina, and hence softer demand for phosphate, a key ingredient of our fertilizers. A positive in Crop Nutrition was that both inoculant and biostimulants sales grew during the quarter, which to some degree buffered the drop from fertilizers, leading to a modest 3% drop for the segment. Now for the full year, dynamics in Seed & Integrated products were similar to those of the quarter, delivering a 70% growth. Segment growth was driven by HB4 sales in this fourth quarter, as well as downstream sales throughout the year as part of our efforts to make HB4 business more capital efficient and also to expand the commercial footprint of HB4 grain buyers.

The company’s focus on crop protection products has led to a significant increase in sales. This success is attributed to the company’s innovative and effective crop protection solutions, which have helped farmers improve crop yields and protect their crops from pests and diseases. **Detailed Text:**

The company’s commitment to crop protection has been a driving force behind its recent sales success.

* **Biostimulants:** These are substances that enhance plant growth and development without adding nutrients. * **Crop Nutrition:** This refers to the science of providing plants with the necessary nutrients for optimal growth and development. * **Fertilizers:** These are substances that provide plants with essential nutrients. * **Biostimulants vs.

And this was driven by margin expansion in bioprotection products as well as a more selective approach to third-party products being commercialized by our sales force. Crop Nutrition gross profit performed equal to revenues, primarily driven by softer micro-beaded fertilizers. Overall, margin for the quarter remained almost flat year-over-year at 38%. Now, for the full year, revenue growth did not translate into gross profit, which remained stable above the $185 million mark, mainly explained by the lower accrual of the Syngenta down payment in crop nutrition, which you can see there in light gray or shaded gray. At the individual segment level, dynamics for the year were slightly different than those for the quarter. In terms of gross profit growth, Crop Protection was the top performer with increased gross profit across all product categories in the segment.

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* Revenue growth was almost complemented by margin expansions in bioprotection. * Third-party product sales also saw a positive trend. * Seed and Integrated products contributed to gross profit growth. * HB4 fourth quarter sales were a key driver.

Similar to revenues, gross profit from fertilizer was flat and the best performer for the segment were the biostimulants with healthy growth in Europe and Brazil during the year. Overall, gross margin for fiscal year ’24 decreased from 44% to 40%. Let’s turn to Slide 7, and look at adjusted EBITDA for the quarter. To reiterate what I mentioned at the beginning of the call, we were hoping to achieve more than what we did this quarter. At the time of the prior earnings call, we were aiming to grow profitability by 3x on the back of what seemed at the moment the delay in farmers purchasing of fertilizers in Argentina and bioprotection in other countries such as the U.S. The recovery in fertilizers finally didn’t take place like we already discussed, and the market for bioprotection, particularly in specialty crops in the U.S. remained a complex one.

Yet, I would like to point out that we were able to maintain gross profit contribution for crop nutrition in the quarter, and still have HB4 and crop protection products contribute to growing profitability in a meaningful way and growing EBITDA two-fold in the quarter. Also, in the face of challenges for some of our products, we focused on the cost side of the business, and during the quarter lowered fixed SG&A by $1.6 million compared to the year ago quarter. Variable SG&A grew in line with topline growth and was the only negative contributor to EBITDA. To this regard, on lowering fixed SG&A, although, I don’t expect this to be the trend for a growing business, we do aspire to significant operational leverage by growing gross profits and keeping fixed costs as flat as possible.

The full year adjusted EBITDA on Slide 8, is an example of that in terms of costs, as fixed SG&A remained roughly flat and variable SG&A grew in line with topline. For the year in terms of gross profit like I already described, the main explanation behind the flat performance was the drop in the Syngenta upfront accrual, which was coupled by flat performance in fertilizers, explaining that almost $15 million drop in gross profit from Crop Nutrition. Crop Protection and Seed & Integrated products contributed to offsetting that, and at the end of the day is what explains our EBITDA mark at $81.4 million for the full year. Finally, let’s turn to Slide 9 to look at financial debt. Total and net financial debt increased compared to the year ago, but decreased on a sequential basis compared to the last quarter.

This statement is made in the context of a company’s financial health and its ability to manage debt. The company’s financial health is assessed by analyzing its financial ratios, such as debt-to-equity ratio, current ratio, and quick ratio. These ratios provide insights into the company’s ability to meet its short-term and long-term obligations.

The CEO of a company is addressing the shareholders and investors during a conference call. The CEO is outlining the company’s financial performance for the past year and discussing the company’s future plans. He emphasizes that this year’s results are a stepping stone, not a milestone, and that the company is focused on profitability and financial performance.

The summary discusses the concept of non-identity preserving GMOs and their potential benefits in the agricultural sector. It highlights the advantages of these GMOs, including reduced working capital requirements and increased efficiency. Non-identity preserving GMOs are a type of genetically modified organism that allows for the production of multiple products from a single plant. This means that a single plant can be used to produce multiple products, such as food, feed, and biofuels.

We are looking at the price, volume, and quality of the soy beans. We are also considering the environmental impact of the soy bean production. We are looking at the sustainability of the supply chain. We are looking at the potential for innovation in the company. We are looking at the overall impact of the company on the environment. This is a comprehensive review process that is being conducted by a dedicated team of experts.

**HB4 Wheat: A New Hope for U.S.

* **HB4 Wheat:** A specific type of wheat with unique characteristics. * **APHIS:** The Animal and Plant Health Inspection Service, a division of the U.S. Department of Agriculture.

Department of Agriculture, and the National Corn Growers Association. This statement highlights the potential of expanding opportunities in the agricultural sector in the Midwest, specifically targeting the Latin American and Australian markets. The statement emphasizes the significant potential for growth, suggesting that the existing opportunities in Latin America and Australia combined could be doubled by focusing on the Midwest.

approval. is a significant milestone for the company, as it signifies a major step towards achieving its global ambitions. This approval opens up new markets for the company, allowing it to expand its reach and influence beyond its current geographical boundaries. is a testament to the company’s commitment to quality and innovation.

A. Milen’s Leadership in Biologicals
B.

Milen’s expertise in biologicals, coupled with his leadership skills, has been instrumental in driving growth and innovation within the company. He has a proven track record of success in developing and launching new products, as well as in managing and optimizing existing product lines. Milen’s experience at Syngenta, where he played a key role in the development and commercialization of several successful products, has provided him with a deep understanding of the biologicals market.

A. Boosting Profits Through Operational Efficiency
B.

The company’s focus on cash generation and profit expansion is a strategic imperative, driven by the need to improve its financial performance and enhance shareholder value. This strategy is not limited to HB4 but is applicable across all businesses. The company aims to achieve this through a combination of operational efficiency improvements, cost reduction initiatives, and revenue growth strategies. Operational efficiency improvements are crucial for maximizing output and minimizing waste.

We also would like to leverage our portfolio of key biological AIs, and this might be a new term to some of you, to improve the efficacy of — not only the efficacy, but also the environmental profile of some well-established products, some of which come from our proprietary portfolio, like adjuvants and micro-beaded fertilizers that we can now combine with biologicals to improve their functionality and further differentiate them in the marketplace, but also third-party technologies with underutilized assets that are still valuable, but probably can be significantly improved in their ability to control pests by combining them with our actives, and also in doing so, significantly improve their environmental profile. So that is something we are more actively seeking to do in fiscal ’25 and forward.

This is a prime example of how we are strategically deploying our resources to ensure that we are not over-investing in any one market. This facility, located in the state of São Paulo, is a testament to our commitment to the Brazilian market. It is a state-of-the-art facility with advanced technology and a highly skilled workforce.

Thank you. I’m curious about the potential impact of the drought conditions in the Argentina and Brazil on Bioceres Crop Solutions’ business. How are you mitigating these risks? Operator: Thank you. Our next question comes from Ben Klieve from Lake Street Capital Markets. Please proceed.

I’m Federico Trucco, and I’m the CEO of the company. Ben: Hi Federico, thanks for taking my call. I’m Ben, and I’m the head of marketing. Federico: It’s a pleasure to speak with you, Ben. I’m glad you’re interested in our company. Ben: I am.

But the validation process, the level of documentation and verification, it’s quite significant. The process itself can be quite complex and lengthy, and it requires a significant investment of time and resources. It’s not just a one-time process, but it’s an ongoing process.

This statement highlights the cost-effectiveness of CRISPR-Cas9 technology compared to traditional genetic engineering methods. Let’s delve deeper into the cost breakdown:

* The team is reporting on a late-season discovery of a significant geological feature. * The feature is a large, complex structure with multiple layers. * The team had limited time to analyze and understand the feature before the season ended. * The discovery was made during a routine exploration activity.

Federico Trucco, CEO of a company, believes that the Board of Directors is reacting to the current reality of the company. He believes that while there isn’t a “seismic change,” there is an opportunity for the company to move forward. **Detailed Text:**

Federico Trucco, CEO of a company, offers a nuanced perspective on the Board of Directors’ response to the company’s current situation.

This is a critical juncture for the company. We need to be more efficient in our working capital management, and we need to be more efficient in our capital allocation. This is not just about cutting costs; it’s about fundamentally changing the way we operate. It’s about shifting our focus from short-term gains to long-term sustainability.

This is a challenge because we have to find a way to convince them that engaging directly with us in seeds is beneficial for them. We also have to find a way to convince them that we are a trustworthy partner. We have to find a way to convince them that we are a reliable partner.

Enrique Lopez Lecube: So, Ben, maybe to compliment on what Federico said more from a kind of like, financial standpoint, I think that there are two underlying fundamentals that changed since we started with this strategy for HB4. One, of course, is the cost of capital that significantly increased in the last year or two. And the other one is that, of course, that we have competing capital allocation projects or destinations for the capital that the company has. And that is, to me, the acquisition of the meaningful bio protection platform that we now have in ProFarm, plus the biostimulants. So, there’s also a capital allocation competition. And I think that, like Federico highlighted, HB4 remains a key technology for us. I think that, that is well understood.

The discussion focused on the future of HB4, a key component of the company’s business. The company is exploring ways to optimize its capital allocation and maximize shareholder value while preserving the core value of HB4. This involves finding a balance between investing in new growth opportunities and maintaining the existing value of HB4.

But in other parts of the world, things are still quite challenging. Federico Trucco: We’re seeing a lot of challenges in the areas of access to healthcare, education, and infrastructure. These are the three pillars of development, and they’re all interconnected.

Planting corn early allows for a longer growing season, which can help to reduce the severity of the Chicharrita effect. The Chicharrita effect is a phenomenon that occurs when a large amount of rainfall in a short period of time leads to a significant increase in the price of corn. This effect is particularly pronounced in Mexico, where corn is a staple food.

Enrique Lopez Lecube: No. I think that that’s right on spot, maybe on sort of like some smaller geographies like Uruguay, Paraguay, I think that things are tracking along well, but completely agree with Federico’s comment on sort of like things yet to be seen in Argentina as it relates to weather, and how that affects sales evolution. So maybe just a reminder, remember that we usually have that discussion of Q1, Q2 from an underlying business perspective. We always look at the first half of the fiscal year as a more sort of like a relevant indicator of how we performed commercially. Since sometimes things go from Q1 to Q2, or sometimes we have advanced sales in Q1 on preseason sales of Q2. So, bear that in mind.

I think it’s important to understand that the cadence and seasonality of the market are not just random occurrences. They are driven by a complex interplay of factors. Let’s delve into some of these factors. First, we have the economic cycle. The economic cycle is a recurring pattern of expansion and contraction in economic activity.

Federico Trucco, CEO of a company, explains the new leadership structure within the company. He states that the new leadership is specifically focused on the biological side of the company’s portfolio. This means that the new leadership team will not be involved in activities or responsibilities related to the seed and HB4 parts of the business.

So, I do believe the seniority in the leadership today will not only allow us to strengthen our existing sales efforts directly as pure biologicals in certain geographies, for sure, in the cash crop market, and part of the sort of a seed treatment play where we go with 100% biologicals, but also enable us to do a little bit of what I indicated at the last — in the last part of my presentation, which is develop hybrid products where we can use our portfolio of biological AIs to revitalize, functionalize existing products. So there might be a way by which combining one of our biofungicides or bioinsecticides might improve the environmental profile of an existing fungicide or insecticide, while improving its efficacy in the control of certain pests.

This is a great opportunity for us to start building a portfolio of products that leverage this technology and to be a leader in the industry. This technology is based on the use of enzymes, specifically engineered enzymes, which are proteins that accelerate chemical reactions.

Enrique Lopez Lecube, CEO of a company, highlights the importance of focusing on two specific markets for growth in the midterm. He emphasizes that these markets have different complexities, requiring tailored strategies for success. **Detailed Text:**

Enrique Lopez Lecube, CEO of a company, underscored the significance of strategically focusing on two distinct markets for growth in the midterm.

We’re excited about the future of the business. We’re confident that we can continue to deliver strong growth in the years to come. This is a quote from a recent earnings call transcript. The quote highlights the company’s confidence in its future growth prospects, particularly in its biologicals business.

Federico Trucco: We’re seeing a lot of interest in HB4 Soy, and that’s a good thing. It’s a very promising crop, and it’s a good sign that the market is responding positively to it. Federico Trucco: We’re also seeing a lot of interest in the Argentine market, and that’s a good thing.

This is a very interesting case study because it shows that even with a relatively small country, Brazil can still be a major player in the global soybean market. Brazil’s soybean production has been steadily increasing over the years, reaching a record high in 2022. This growth is attributed to several factors, including favorable weather conditions, government support, and the expansion of soybean cultivation.

This is a metaphor, but it’s a powerful one. It signifies the immense potential and untapped resources that lie beneath the surface of the Brazilian economy. The “ocean” represents the vast potential of the Brazilian market, its size, and its growth potential.

Marinov: Well, we’re seeing a shift in the way we report our business, and we’re moving towards a more granular, product-centric approach. This means that we’re going to be reporting on a much more detailed level, focusing on individual products and their performance. This is a significant change from our previous reporting structure, which was more focused on segments.

A. Slowdown in Growth, but Still Growth
B. Mr.

Mr. Smith: Well, we’re seeing a slowdown in the growth rate, but we’re still seeing growth. We’re projecting a 10% growth rate for next year.

Mr. Dolliver: Yes, there are. We’re seeing a growing demand for biofungicides and bioinsecticides in several geographic markets, particularly in regions where traditional chemical pesticides have been heavily used. AustinMoeller: Can you give us some examples of those markets? Dolliver: Absolutely. We’re seeing a strong demand in the Americas, particularly in the United States and Canada.

This is a market that is growing rapidly, and it’s a market that is becoming increasingly important. It’s a market that is becoming more and more attractive to companies. It’s a market that is becoming more and more important to the global economy. The company is looking to expand its presence in this market. The company is looking to increase its market share in this market.

We are expecting a two-year ramp-up period for the Syngenta agreement. We’re already seeing some positive signs, and we’re confident that we can achieve our revenue targets. **Key Points:**

* **Syngenta Agreement:** A two-year ramp-up period is anticipated for the Syngenta agreement to surpass the revenues generated by the company before the agreement.

We are now in the third year of the agreement, and we are finally starting to see some progress. This progress is being driven by a combination of factors, including:

We’re seeing some pretty significant growth in the U.S. market, and I’m curious about the factors driving this growth. What are the key drivers of this growth? Operator: Thank you. Mr. Moeller: Well, the U.S. market is a very dynamic and competitive market. It’s driven by a number of factors, including strong consumer demand, robust economic growth, and favorable government policies.

I’m excited to be here today. I’m really looking forward to sharing some insights with you. Scott: Thanks for having me, Federico. I’m excited to be here as well. Federico: So, let’s jump right in.

This is a new technology, and it’s still being developed. It’s not a magic bullet, and it’s not going to solve all the problems. It’s a tool that can help farmers improve their yields and efficiency, but it’s important to understand its limitations and potential risks.

It’s a big market. It’s a growing market. It’s a market that we need to be able to compete in. This is a complex issue, and it’s not just about the science. It’s about the economics, the politics, and the social implications.

It might take a few years, but that is moving forward in a predictable manner, and we already have the first permits in place to be planting HB4 Wheat in that geography. Scott Fortune: I appreciate the color. I know it’s been a long call, but one last thing. Just want to kind of summarize, I mean, you’re putting a lot of focus here on profitability and improving cash flow generation. You’ve talked about the different measures, but just want to get a sense for how much of this is coming from continued scale up HB4 versus kind of the biologics. Just kind of summarize your initiatives, your focus on reaching, increasing your profitability and generating that cash flow for ’25. Just kind of, that focus would be great.

We’ve been working on this for a while now, and we’ve made some progress. We’ve seen some positive results, but we still have a lot of work to do. Scott: Thanks for having me, Enrique. I’m excited to be here. I’m looking forward to hearing more about your progress. Enrique: Well, let’s dive in. We’ve been focusing on a few key areas.

We’ve had a lot of great questions and insightful discussions. We’re excited about the future of this company and the potential for growth. We’re confident that our strategy will drive significant value for our shareholders. We’re committed to transparency and communication, and we’ll continue to keep you informed about our progress.

Operator: That concludes our conference call. Thank you for your participation. You may now disconnect your line.