BrasilAgro - Companhia Brasileira de Propriedades Agrícolas
Q3 2016 Earnings Call Transcript

Published: 6 May 2016

[Operator:]

Good afternoon. Welcome everyone to BrasilAgro’s Third Quarter 2016 Results Conference Call. Today’s live webcast and presentation may be accessed through BrasilAgro’s website at www.brasil-agro.com. We’d like to inform you that this event is recorded and all participants will be in listen-only mode during the company’s presentation. After BrasilAgro’s remarks, there will be a question-and-answer session for analysts only. At that time, further instructions will be given. [Operator Instructions] Before proceeding, let me mention that forward-looking statements are based on the beliefs and assumptions of BrasilAgro management and on information currently available to the company. They involve risks and uncertainties because they relate to future events and therefore depend on circumstances that may or may not occur. Investors should understand that conditions related to the macroeconomic scenario, industry and other factors could also cause results to differ materially from those expressed in such forward-looking statements. Now, I’ll turn the conference over to Mr. Julio Piza, Chief Executive Officer. Sir, you may begin your conference.

[Julio Toledo Piza:]

Thank you. Thanks, everyone, for joining us. Let’s move into our presentation. On Page 2, highlights

[Operator:]

Thank you. The floor is now open for questions. [Operator Instructions] Please hold while we poll for questions. [Operator Instructions] Our first question is coming from Rodrigo Mugaburu of Morgan Stanley. You may proceed.

[Rodrigo Mugaburu:]

Thank you. Hi, Julio. Good afternoon. A question of the cattle project that you mentioned in the release, can you give some color on what kind of CapEx would that involve? Do you have any kind of targeted returns for that project? Thanks.

[Julio Toledo Piza:]

Rodrigo, thanks for the question. But I couldn’t understand a word. If you could speak real lower and not - voice a little on a high note, it would be helpful. Thank you.

[Rodrigo Mugaburu:]

Sure. Do you hear me better now?

[Julio Toledo Piza:]

Yes.

[Rodrigo Mugaburu:]

So my question was related to the cattle project that you mentioned on the release. If you can give some color on what’s the level of CapEx that will be involved in that project. How much money would you have to invest in that, and if you have any targeted returns for that project?

[Julio Toledo Piza:]

Okay, for the cattle project. Now I understand it. Probably in the first few months of it, it will be around R$10 million. That is the initial capital to be invested in the project. I don’t expect it to be much higher than that in a very short-term. So it should be around R$10 million for the next 6 to 12 months. And most likely part of it will be financed through the long-term [indiscernible] loans we are discussing and we’re waiting, so on a cash basis it should be very - little bit impact in our cash availability, but to put it roughly, R$10 million.

[Rodrigo Mugaburu:]

Good. Thank you.

[Operator:]

Now, I’ll turn over to Mr. Julio Piza for final considerations. Mr. Piza, you may give your final considerations now.

[Julio Toledo Piza:]

Thanks, everyone, for joining us. It’s [indiscernible] quarter, given the yields and the weather in Piauí and Bahia. But by June 30, you’re going to have a better understanding of all the impact of that. We just want to get ahead of [indiscernible] and start discussing this openly. But by June 30 we’re going to have a much clear stand on exactly the implications of all these [indiscernible] and how we have positioned the company for the next cycle. So thank you very much for being with us and see you again next quarter.

[Operator:]

Thank you. This concludes today’s BrasilAgro’s third quarter 2016 results conference call. You may disconnect your lines at this time.