Cresud S.A.C.I.F. y A.

Good afternoon, everyone. I'm Santiago Donato, Investor Relations Officer of Cresut, and I welcome you to the Fiscal Year 2025 Results Conference Call. First of all, I would like to remind you that both Audi and StyleShow may be accessed through the company's investor relations website at www.cresut.com.ar by clicking on the banner webcast link. The following presentation and the earnings release are also available for download on the company website. After management remarks, there will be a question and answer session for analysts and investors. If you want to make a question, please use the chat. Before we begin, I would like to remind you that this call is being recorded and that information discussed today may include forward-looking statements regarding the company's financial and operating performance. All projections are subject to risk and uncertainties, and actual results may differ materially. Please refer to the detailed note in the company's earnings release regarding follow-up in statements. I will now turn the call over to Mr. Alejandro Elstein, CEO.

Good afternoon, everybody. We are finishing our fiscal year 2025. And if we begin in page number two, we can see the seven main highlights of the year related to agriculture. 2025 was a very big campaign in size, and the combination of leasing and owning land. It's not very big in comparison. It's close to the 50-50 or a little bigger than 50-50 in leasing compared to own, but larger in our history. I'm expecting to have a larger next year because the leasing conditions of this year. Related to climate, we have good conditions, but some areas of Argentina and Paraguay mainly suffer very tough, the scars of water. and that was impacting a lot in the hills of mainly the apostles farm and paraguay farms and the rest of argentina had a good weather and center and south so majority of the country was in good condition but our position of the north was not very good stable uh the year was stabling in commodity prices we had a big drop last year this year was more stable and improved cost made in some of them a big correction like crop production protection but in some of them like fertilizers still the prices were high so that made us lower margins and that affected their activity in argentina mainly there was a big impact on argentine macro and we're going to show you share you later about the reduction of rain taxes and exports and the buga on the two dollars And that is the next where the removal of capital controls in Argentina made a very, very important move for farmers of Argentina, that in the past we had 100 or 150% GAF, and today close to zero GAF, made us to be raising directly dollars when we do agriculture. Relating to Brasilago, was good related to production in sugarcane. Some yields were affected because some frozen and some lack of water in sugarcane, was more mixed in crops. There, some of them mainly soybeans and cotton were affecting yields. The price were almost the same we expected. The inputs went down, but the margins were better compared to last year, but much lower than in the past, comparing to the best years of Brazil. Related to cattle, the cattle is really spending very good time. We have higher prices, better margins, better production, more stock. So we are intensifying our activity in the two farms in Argentina. We are going to show you a little later. Related to real estate, there was some activity. One was in Argentina, the first quarter of the last year. They were affecting things. We have the first quarter in Los Pozos Farms was a sale, but the other quarters we had in other farms in Brazil. The other three are in Brazil. So, we are going to show you the gains that we have in these four sales. We are comparing in the page number three, we see the evolution on the crop planting in the region in the combination of the four countries. And we can see that we are achieving this close to 300,000 hectares of agriculture. And where main activity is soybean, corn the second, sugar cane the third, and wheat the fourth. We are growing, and we are forecasting a big growth for next year. We're surpassing the 300,000 for next year. What I said in the past, in a combination of more leases and maybe some more purchasing. But for the next campaign, we are forecasting much more volume related to agriculture. In Pegasus before, we can see the prices of the commodities. And here we can see, this is a long-term 50 years, And we see that in soybean and corn that they are very similar. We see that they were the years of 20 to 24 higher prices. The 24 to 25 was almost stable. A little rebound, 9% in soybeans, 8% in corn. There was some movement on plantation. They are losing some areas of soybean in U.S., and that is affecting more for more corn in U.S. So probably more recovery of stocks on corn. Less recovery in North America related to soybean, but Brazil. Brazil is forecasting again to plant a lot, and Argentina again too. So the combination of the countries related to corn and soybean is expecting for next year to have... good enough quantity of commodities for next campaign, so there are no big news related to prices in the region. If we move to the next stage, and related to Argentine government measures, they were really very favorable, and the permanent reduction of grain that was announced by the government in July of this year, saying it was not a transitional like it was at the beginning, now they did a permanent Before was 33% on taxes on soybeans and now I'm 36. They all went from 20 to 9.5. Wheat and barley the same. Sunflower from seven to 5.5. Beef cattle depending on the categories. Cows are at zero and steers at 5%. So there was a big reduction, but a part of that, the exchange rate, flexibilization and convergence. Look at before 23, the gap was 100, 150%. After the Milenis government's strength is 30%, but recently, from April of this year, the gap is close to zero, 0.5. So now farmers of Argentina are receiving the real sales of dollars, still with taxes on exports, but the promise of the government to keep reducing in the time they will have the surplus in the fiscal deficit. No, they don't want to be... reducing the tax before they have the increasing on the tax collection. And the government related to that is being serious, so it's doing its steps. And we expect the government to keep doing and finally to accomplish their promise to go to zero taxes on exports, that almost all the world is in taxes zero or subsidized. the world. So this is really relevant news affecting the margins, operational margins, and the real estate margins that we are going to show you later. If you go to page number six, we can see some of the current conditions, and we divided in Argentina and Brazil. Argentina, late and scattered rains, once again affected hills and then in the north, and that affected north of Argentina and Paraguay, the two regions were affected. In case of Argentina, we had the cotton business in the north that was very profitable, and there we had much better results because of the cotton business in that part of that. We didn't have that in Paraguay. Related to the southern areas, central and southern, there were much better conditions, and the yields were much better compared to the normal. And in relation to Brazil, the adverse weather conditions produced soybean and cotton in the spring, too, and sugarcane, too, were affected, too. But related to previous seasons, there were better prices of corn, and in corn, better yields. So, finally, the operational business in Brazil is better than in Argentina in comparison. So, we can go to the next page and to look at the volumes, total volumes. There was a big jump in a comparable size, a little bigger, but there was a 17% increase in volume in crop volumes, still lower compared to the years that we expected when we planted, but much better compared to last year. Relating to the sugarcane, the same, there was a big effect. and early frozen in Brazil. So that is affecting at least hectares though. There are some less hectares in Brazil at the sugar production. When we compare the yields of year to year, we see a little increase in the corn yield. Last year we had 5.09. This year we're having 5.5 in corn. So corn gave us good results in yield and in the prices. There was a good price in the region for corn and that was a very positive. a crop and in the southeast there was a small grow 2.71 to 2.6 so year to year we have a much normal yield by two regions the cycle of possum region and paraguay they were the more effective Moving to the next page, we can see what happened in Kabul, that it's representing again some importance in Kresut. In some years, Kabul was at $2-3 million a business, but these last two years was more than $8-9 million gross margin number. 24 and 25. We close to 60,000 heads of cattle in Argentina. And this is becoming a more relevant basis. We are introducing, as we did in the combination of only land and leaf land in the agriculture, we are doing now on the beef industry, we are doing more feed goods, finalization of the animals, and that in this case is where the drop of the prices of like the corn that we are now spending, and the corn well down, With the combination of six, seven kilograms of corn doing a kilogram of beef at its maximum prices in the U.S., and in Argentina, and in the region, we are doing a very good business, and that's why we are intensifying a lot. Argentina is in a much better price than in the past, and all the regions a better price, and the lower price of grain with a better price of beef is making a more balanced activity, and more important for Brazil, the cattle activity too. and we expect the same, we are expanding our operation in some two fields that we have on farms. In the old past, we had fields, professional fields in Villa Mercedes, that was for clients, but now we are doing two smaller fields of close to 10,000 heads each of them in the farm of El Tir and the farm of El Oposos, and the two are very profitable, and that's the reason why this margin of average loss To move now to page number 9, we see the four fractions. They are not sales of the total farm, all the types of preference are yes. Total farm, 18,000 hectares, we sold 100% of that activity. The rest are small portions of farms that were sold, and we did final sales of 60 more million. in the year. So when we talk about these four transactions, only one in Argentina, Los Pozos, that was just land reserve, that was in a book value of $10, and we sold to $500 and $600 per hectare. Huge gain, majority gain, close to zero in the book value. And in the case of Brazil, there's a difference. So we are again, reflecting a big portion of the gain of Cresul through Graciagro and Cresul through the real estate part. That every year, not trading too much, this is comparing to all of the hectares of the company, small fractions, but still bringing good gains to the balance sheet. We always show only the gain of the pieces we are selling every year and here in the next graph we see this here are four pieces fractions or one that is 100 66 million total dollars in nominal sale bringing 56 million of gain so big majority in nominal gain so and look at the what we expected and we expressed in the past about the land value some of the land is decreasing the price in in the current rate of U.S. or the best year areas of Brazil, but there is some increasing price in Argentina that is a combination of better private traditions and better operational yields, and the GALABU's poll and the taxes reduction, and Argentina is re-entering to the price valuation of the world, still very far, but the trend of the year was in the against of the rest of the countries. So, saying that, we can move to the next page, the commercial services. And here, we are seeing the evolution of FIO as our subsidiary, with a result of 51.2%. this company that is in segments of apopio, capital, credits, advisory puts, and digital, so helping farmers to improve their commercial parts. This is advising to sell and to buy better, and not entering into production, the only production in the Mauta, where we sell some fertilizers, but majority is helping farmers in inputs and outputs, and this company that didn't exist in the past went to more than 7 million tons, This is our record year, 7.25. We are expecting to close. That represents 6% of Argentina's total growth. So, the largest broker of Argentina, made in a very big net income. There was a drop this year because of inflation and devaluation, but still a very positive number that is impacting the balance sheet of Crescent. I will now introduce Mr. Santiago Minato, We'll share with us some progress related to ESG. Thank you, Alejandro. Well, here on this page, we can share some of the main achievements on the ESG agenda this year. On the environmental side, we continue advancing in our RGRS certification program, both in soybean and corn. nine in our portfolio in Argentina, almost 36,000 tons in soybean and in corn. This is approximately 25% of our total production of soy in Argentina and 15% in the case of corn. So we are very proud of this. This is a very well-known certification that implies that the farm has no deforestation since 2008. and the best agricultural practices in the farm, and also relationship with the communities near the farm. In parallel, we maintain our international certifications, including 2BS, Carnegie Triple S, and the APAP. On the social fronts, one of the highlights of this year was the anniversary of our school at Los Pozos Farm in Salta. This is a school founded by Cresur in 2005, which today educates both primary and secondary students in the community. This is a farm that is 350 kilometers far away from the city of Salta. So in the middle of anywhere that the company provides health service, school, inside the farm. Apart from that, more broadly during 2025, in different communities in the country, in social programs directly, and through Fundación ILSA, building relationships with more than 80 NGOs and carrying out like 100 community initiatives. These actions reaffirm CREZUR's long-term vision that is produce food responsibly from South America to the world, creating positive impact both in the environment and in the communities where Cresud operates. I will now give the word to Mattias Rebinovsky, CFO for Cresud Investments in IRSA and the financial director.

Thank you Santi and good afternoon everybody. So if we move to page 13, we can see the results of our stake in IRSA, where we control 54% of the shares. IRSA has a very good year, with a net gain of 196 billion pesos, compared with a loss last year of 32 billion pesos. There was a strong annual recovery in shopping malls with a 10% increase in pesos terms and a higher increase in dollar terms. Tenant sales finished the year with a small drop of 2.8%, but in very good levels when we measure on historical records. About the malls portfolio, there was a a lot of movement in the portfolio. We acquired a new shopping center during the year. We acquired also a plot of land adjoining Alto Avellaneda to double the size of the shopping mall. And also, we are launching a new mall development. It's a greenfield in La Plata City in the province of Buenos Aires. Office portfolio remained stable compared with the previous year, with almost full occupancy. And the hotels suffered a little drop in the margins because of the inflation. Basically, the tariff in dollar terms remained stable, and the cost in pesos terms increased by inflation. Another significant milestone during the year was the commercialization of Ramblas del Plata project. Remember, this is the most ambitious project of IRSA for the last decade, or probably for the whole history of IRSA. We started the commercialization during the fiscal year, and we already signed 13 transactions that IRSA will receive around $111,000. sorry, will receive around 58,000 square meters of sellable square meters in the future. Also, there was A new issuance of a note in the international capital market. It has attacked the international capital market after probably 10 years. So we issued a $300 million note that will expire in 2035. And as we already discussed during the year, it has paid a significant dividends to Cresul and to the rest of the shareholders with an 8% dividend yield and 3.6% of owned shares. On the right side of the slide, we can see the evolution in dollar terms of the EBITDA, the rental EBITDA, and we can see a significant improvement against last year, 15.3%, and shopping malls reaching $169 billion. That is a record for the last 10 years. In the next page, so As part of the review of this fiscal year, we detected a mistake in the calculation of the inflation adjustment on the share premium from the Warren's exercise in fiscal years 2022, 2023, and 2024. Basically, the error duplicated the inflation adjustment overstating the share premium and decreased the net income result. For the last year, this decrease was approximately 17.2%. 8 billion pesos. So, after detecting this error and in line with YAS 8, the company restated the affected items of prior financial statement retroactively, and all details are presented in the current fiscal year. So, in this page, we can see already the restated numbers of the previous year. So I will explain the main drivers of the increase that we are finishing the fiscal year with a net income of 224.3 billion pesos compared with 163.8 billion pesos. According to controlling interest, it's 96.1 against 135.7 of the last year. So there is... many drivers here that affect the result. The main driver is in line six, the change in fur value of investment properties regarding IRSA, regarding the urban properties. Every quarter and every year, IRSA revalue its investment properties according to different methodologies. Last year, because of the evolution of the exchange rate and the inflation, we have to post a significant amount impairment of the investment properties. This year we are recovering because basically the shopping malls with better performance and lower cost of capital, we improved significantly evaluation of the shopping malls, so that this year generates a gain of 6.6 billion pesos. So when we see the rest of the results, we can see an improvement in the urban properties, if the operating income from last year was 256 to a gain of 180.8. Related to agribusiness, we can see a decrease from 96.3 billion pesos to 49.1 billion pesos gain this year that we will enter in more details in the current pages. And also the other important numbers are in line 13 and line 14, related to net financial results and income tax that also we will show it in the following pages. So going to the next one, we can see here the, so entering more details on the operating results on the agriculture business. We can see that the drop this year against last year is basically related to lower results in farmland sales. Although we sold this year, as Alejandro mentioned, the four farms, last year we sold a little more, generating more results and also adjusting that by inflation. This number is bigger. So this is the reason of the 30% drop. And when we see the farming activity on the right side of the page, we can see an improvement from 2.5 billion pesos to 15.9 billion pesos this year. So we can see an important gain in sugarcane related to better prices, more yields, and more area under control. Under production, also in cattle, we see a significant increase related to more production also and much better prices than inflation. Last year, the prices increased much lower than inflation. This year, much higher, so that generates results from the holding and also from the production. And about the grains, we see this drop from 3.9 billion pesos to a loss of 5.6 billion pesos. There are different drivers here as well. There is an adjustment in the estimations that we did at the beginning of the campaign that generate a loss because of lower prices and and a little lower yields that we expected at the beginning of the campaign. And when we measure some numbers and historical levels without adjusting inflation, that is positive, but when then we adjust by inflation, since prices increased lower than inflation, we are posting a decrease in the numbers. If we see the breakdown here between the part that came from Argentina and part from Brazil, Argentina is suffering against last year and Brazil is better than the previous year. Going to next page, and finally we have the evolution of our net financial results that is still positive. So we have here basically all the interest burden of our debt and assets is still positive. Since there is more inflation than devaluation, all numbers related to our dollar denominated debt generate positive results. And also we have the evaluation of all the liquidity and assets, financial assets that are generating positive numbers. And finally, with all of this, we are finishing this fiscal year with this gain of 224 and attributable to our controlling shareholders, 96.1 billion pesos. About our debt, there was two transactions in the recent quarter. We issued two new bonds, one for a three-year tenor, $43.7 million at an interest rate of 8%. The other was a couple of weeks ago that we issued $31.3 million at a rate of 7.25% for a two-year tenor note. So with this, we are financing part of the amortization of this fiscal year 2026. So there is still a remaining that we are planning to refinance in the local market during this fiscal year. The net debt remains stable at levels of $354 million. So with this, we finish the formal presentation. Now we open the line to receive your questions.

Well, now is the time for the Q&A session. If you have a question, please use the chat.

We're going to take them in the order we received them.

Yeah, we have a first that is related to the value of Cresut today, given that it's undervalued in the opinion of this investor. If the management is considering taking an action in order to unlock value of Cresut, today it says that the market cap of Cresut is equal to the value of its taking EVSA, so the rest of the assets are given for free.

So what's the opinion of the management here, and if the management is thinking to take actions in this direction? So let me answer the question. So if we analyze what we have been doing during the last five years, I would say that both IRSA and Cresut were very concentrated in our own capital structure. So we haven't launched significant projects during the last years because of the volatility, basically, in Argentina. There's different environment in Brazil. But we have been selling much more assets than buying assets. And at the same time, canceling debt, paying back to our shareholders through dividends and through buybacks of shares. So I think I'm trying to simplify also the structure, our corporate structure. So sometimes I think the question is related more between the arbitrage that you can see between EARS and Crescent and which one is cheaper than the other. So that part we can't to the arbitrage. It's more for our investors than for the company itself. What we can do, and I think we have been doing a lot during the years, is to pay dividends that our shareholders, if they believe that it's cheap, they can keep buying shares, or also to launch buyback programs for the companies. That is something that we did probably during the last years, both in Crescent and Irsa. But there we have some limitations. It's not that the company can buy back all the shares that we want. There is some restrictions according to the CMV about the value of the volume that we can buy. So we can do it through both ways, not to distribute dividends on our shareholders we buy or to buy back shares directly.

Next question, is the company thinking in buying farms in Argentina or selling farms in the country? Are you seeing opportunities? And in terms of prices, which trends are you seeing in the local country, in Argentina? Argentina, at the time that it's being reconnected to the world, is giving more liquidity to the real estate. And with that, probably we are going to do the two. We are going to be selling some of the assets that they revaluate a lot, and we don't see a lot of more potential because of the situation of that land, of that region, but at the same time to be buying again because some farms are very delayed of the prices of the worm. So yes, I imagine liquidity is going to help us to do the two. and we are in the process of doing the two, exactly that. In Brazil, liquidity was not a subject, it was not in the past, it's still not in the present. Little lower prices comparing what they were, but there we are a little waiting for more adjustment on price to buy and again, because the adjustment is not enough to be buying activity. If there is any other question, we'll give some minutes more in the chat. There's one more related to outlook for next campaign, what you're expecting in terms of prices, climate in Argentina and the region. We are going to record our plantation and our cattle in the past we had many years a long time ago some more cattle than now but in the case of grain we're going to surpass our records and we are going to i think we are doing a good adjustment on the margin and the intensification of agriculture what i'm saying with that you we are advancing a lot in searching machinery following what we plant uh understanding images so there is a big change in agriculture for the future and the two are adjusting their model for this moment of slower margins, smaller margins, and we think we're going to do fast in a big size. We surpassing the 300,000 hectares of planted area and with the understanding of the maturity of the land that in some regions We were beginning to learn that was not enough material, but it's beginning to be every year more. So we are optimistic that the tools that they are building on the market as Starlink is helping to give Wi-Fi to 100% of some farms and following machinery and advancing in the using of less inputs per hectare because of that tracking of the machinery and the use of goods. and pesticides, we are expecting a big campaign related to climate. Up to now, the winter in Argentina was very good and rained a lot. So the winter crop is coming with a very good condition in our fans. It will be more relevant. This is a summer crop for us. So we are expecting a big and a good campaign and related to that too. We expect the prices to keep high and with the big number of heads made in Argentina and growing in Paraguay. So, yes, we expect that we are related to Bionji, our step in Brazil related to the services of field. Bionji is, this year, is surpassing 300,000 tons of servicing in Brazil. 500% of our campaign volume, but we are expecting to double to next year. So it's going to grow a lot in Brazil, our evolution on servicing. So we are optimistic that our company is very used to these prices because of our origin in Argentina. So we are expecting a good campaign for next year and maybe some small rebound in some of the prices. Saying that, we are going to have next quarter, we are going to be discussing about the, we hope to have more real estate too next year, mainly in Argentina, and so we are optimistic in the business and the company. having these three branches, the operational, in the two, in the more irrigation, we are going to keep doing more irrigation of the region, so we are increasing in irrigation of the region. So the operational, the real estate and the services, Plus the other things that we should own through IRSA. We are really very optimistic. So let's see and the gap that Argentina is going to receive if the government keeps doing what we expect, that is reduction in taxes. They did the rates effects. So we expect some reduction on the taxes too. It's going to benefit us too again. So, saying that, we are optimistic on our evolution, and keeping decreasing our deaths, that was a very good job that we did the last five years. Saying that, there is another question, a late question, and we close then with this. Which is the cost of capital of the company? How do we estimate that? And what are the best investment opportunities?

You know, you have to mention some in the agribusiness, but for the next couple of years, as a folding company or a Cresut, which are the best investment opportunities that you are seeing?

Cost of capital, Mati, what is the cost of capital from Cresut, would you say?

Today we are using weighted average cost of capital more or less about 12%, so that is probably our hurdle rate today.

And related to, we are going to keep increasing the rating, the buying probably in Argentina and the buying of farms in Brazil with the adjustment. But we don't buy up to when we find the opportunity. So we are patient enough. We have years of buying and years of selling. And in Brazil it's not still clear that it's which is now the moment of buying. So I'm keeping investing in the technology to have a good margin in the volume that we have. So we are expecting the campaign of 300 or close to 10,000. It's really a big campaign, so to be very effective related to production and service through the funds. So, good condition for this company, and in a company, some companies in Argentina are suffering of solvency, and this company is really very strong, so that is helping. If the contracts are long-term, Crescent can get benefit on that too, because this company can be leasing 100,000 in 6, 10, or 12 years, or sometimes 30 years. In case of Argentina, in the past there were one year, now we are increasing to two to three, And we can benefit from that because of the solvency of the company. Perfect. Well, with this, if there are no more questions, we can conclude the presentation. I think Alejandro closed the year. So we see you next quarter from the beginning of fiscal year 2026 and the initiation of the next campaign. Thank you very much. Thank you.