SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 6-K
REPORT OF FOREIGN ISSUER
PURSUANT TO RULE 13a-16 OR 15b-16 OF
THE SECURITIES EXCHANGE ACT OF 1934
For the month of September, 2003
CRESUD SOCIEDAD ANONIMA COMERCIAL INMOBILIARIA FINANCIERA Y AGROPECUARIA
(Exact name of Registrant as specified in its charter)
CRESUD INC.
(Translation of registrant´s name into English)
Republic of Argentina
(Jurisdiction of incorporation or organization)
Hipolito Yrigoyen 440, 3rd Floor, (1001)
Buenos Aires, Argentina
(Address of principal executive offices)
Form 20-F x Form 40-F ¨
Indicate by check mark whether the registrant by furnishing the information contained in this Form is also thereby furnishing the information to the Commission pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934. Yes ¨ No x
CRESUD SOCIEDAD ANONIMA COMERCIAL INMOBILIARIA
FINANCIERA Y AGROPECUARIA
(THE COMPANY)
REPORT ON FORM 6-K
Attached is an English translation of the financial statements related to the fiscal year ended on June 30, 2003.
Cresud Sociedad Anónima
Comercial, Inmobiliaria, Financiera
y Agropecuaria
Annual Report and Financial Statements
as at June 30, 2003 and 2002
Cresud Sociedad Anónima
Comercial, Inmobiliaria, Financiera y Agropecuaria
Financial Statements
Index
Presentation |
Annual Report |
Consolidated Balance Sheet |
Consolidated Statement of Income |
Consolidated Statement of Cash Flows |
Notes to the Consolidated Financial Statements |
Consolidated Schedules |
Balance Sheet |
Income Statement |
Statement of Changes in Shareholders Equity |
Statement of Cash Flows |
Notes to the Financial Statements |
Schedules |
Additional Information to the Notes to the Financial Statements required by section 68 of the |
Buenos Aires Stock Exchange Regulations |
Business Highlights |
Auditors Report |
CORPORATE PROFILE
Cresud is one of the largest agribusiness companies in Argentina and the only company in this sector that is listed on the Buenos Aires Stock Exchange and on the NASDAQ in the United States.
Since September 1994 the company has experienced an important transformation, led by a professional management and based on an aggressive policy for investment in land, beef cattle and technology. Such policy has transformed the company into a type of Real Estate Investment Trust (REIT) in the Argentine rural sector. The REITs, in general, have been highly accepted in the United States, but they do not exist in our country. Given its dedication to the formation and exploitation of an attractive portfolio of farms, Cresud almost operates as a REIT.
One of the advantages of Cresud is its focus on Argentina, a country famous for the quality and extension of its land and its role as one of the principal worldwide exporters of agribusiness products.
Cresuds goal is to strengthen its competitive position as one of the leading companies in the agribusiness sector.
LETTER TO SHAREHOLDERS
The results achieved during the fiscal year ended June 30, 2003 reflect all the effort and work that has gone into the last few years, during which we have built up an excellent portfolio of land holdings, with considerable potential for growth in value and a high production capacity.
Following the departure from convertibility, agriculture was one of the sectors that benefited most from the new economic scenario in Argentina, once again becoming the force behind the countrys economic growth.
This new growth stage for the sector quickly resulted in a rise in land values, so that measured in dollars they are back at the levels recorded prior to the devaluation of the peso.
The result for the year ended June 30, 2003 has been a net profit of Ps. 65.0 million, compared to a loss of Ps. 51.8 million in the previous year, generated mainly by net income from exploitation, which went up from Ps. 16.4 million to Ps. 27.7 million this year, in spite of the decline in hectares used for agriculture, and the result of Ps. 68.1 million generated by our related companies.
When planning for the season ended on June 30, 2003, we noted that the lack of investment opportunities in the financial sector and the euphoria in the agricultural sector had provoked a rise in the price of agricultural leases, driving them to extremely high levels. We adopted a cautious strategy in the face of this situation, leasing only land where we could be guaranteed an adequate return.
With a large part of the sector affected by lack of liquidity and the unavailability of credit, we have remained alert to the opportunities provided by the market. As a result, during the year we acquired a new 8,360 hectares establishment in the province of La Pampa, currently used for livestock farming but fully able to be used for agriculture. The transaction was agreed at a price of US$1,100 per hectare, and we consider that with the required investment it will have a considerable potential for appreciation.
In addition, during the year we sold Los Maizales and San Luis establishments, of 618 and 706 hectares respectively, at very good prices averaging US$3,100 per hectare, generating a profit of Ps. 4.9 million, 68% above book value.
Looking forward, we will remain alert to the possibility of taking advantage of other such opportunities that may appear on the market, purchasing land being used for livestock raising but which also has a high potential for agricultural use.
We believe that the potential for this sector lies in the development of marginal areas, as has been the case in various countries around the world. Thanks to current technology, we can obtain similar yields and a higher profitability than in central areas. Cresud at present holds land reserves amounting to over 272,000 hectares, purchased at very low prices. We are convinced that as this land is developed, and on the basis of the progress being made in technology, the value of this land will appreciate, generating significant profits for the Company.
As part of our expansion strategy, we have begun to clear 1,100 hectares for agriculture under irrigation at our Agro Riego San Luis property, work that will be completed this year. In addition, we continue to develop our Los Pozos facility, to which we will add 1,000 hectares for agriculture and almost 20,000 hectares for livestock.
In these almost 10 years of activity, we have made efforts to position the CRESUD brand as a reflection of leadership, responsibility and sound performance within the sector, building up excellent commercial relationships.
These relationships currently enable us to add to our line of services for agriculture, beginning various projects, which include the production of specialties and seed for the leading seed firms, and exporting companies.
In addition, as part of our strategy to move along the production chain, during the year we began to slaughter some of our own livestock, having obtained the appropriate licenses. We also plan to begin to export for the account of third parties.
Without doubt, one of the main achievements during the year was our issue of convertible bonds for US$50 million, which were taken up by our shareholders and new investors at a time when the economic and political uncertainty in the country was responsible for a severe crisis of confidence. This issue allowed us to remain suitably liquid, and helped us to subscribe to a portion of the convertible bonds issued by IRSA, which was thus able to complete the process for the restructuring of its financial debt and achieve an adequate working capital, a situation that will ensure we can preserve the long-term value of our investment.
Our investment in IRSA Inversiones y Representaciones Sociedad Anónima is beginning to generate the yield we intended at the time of the purchase of our existing interest. During the current year, the result from this investment amounted to Ps. 64.9 million.
Under the new administration headed by President Kirchner, Argentina has overcome its political and economic crisis. The country appears to once again be headed along the path to growth, and society is showing greater cohesion.
Although the Presidents agenda includes a large number of matters that must still be resolved, we are confident that the present government has both the will and the skills to be able to resolve them.
A new stage of growth has begun for the sector, and the prospects are highly encouraging, in spite of the withholding taxes placed on exports. Forecasts for agricultural and livestock prices are favorable, and land prices have appreciated significantly and will no doubt lead to a gain in the value of our assets.
Cresud currently owns 440,000 hectares of land, over 80,000 cattle heads, presents a favorable financial position and operates with a professional management that is equipped to face the current circumstances, allowing us to play our part in the economic growth of the country.
As the president of Cresud S.A. I could not conclude these comments without conveying our special thanks to our shareholders, investors, customers and suppliers for their constant support and trust, as well as our gratitude for the commitment and efforts of our directors and employees, without whom the success achieved this year would not have been possible. We will make every effort to ensure we are worthy of such dedication.
Buenos Aires, September 8, 2003
Eduardo Sergio Elsztain |
President |
PURPOSE
Our purpose is to strengthen our position as one of the leading agricultural companies in Argentina through:
| acquisition and lease of farmland and subsequent increase in production, |
| optimization of yields, |
| product and geographical diversification, |
| vertical integration, and |
| preservation over the long term of Cresuds investment in IRSA |
Acquisition and lease of farmland and subsequent increase in production
Our three principal means for increasing crop, livestock and milk production are:
1) Significantly increasing our total land area in various regions of the country by capitalizing on opportunities to acquire land as they arise. We believe that due to the current credit constraint and lack of liquidity of the Argentine agricultural sector, many local producers are willing to sell their businesses and landholdings at attractive prices.
2) Leasing of farmlands. Our land leasing policy is designed to complement our growth strategy, using our liquidity for investments in our main agricultural businesses. In addition, our strategy based on the leasing of land provides us with an added level of flexibility with respect to the share that each our products represents in total production.
3) Developing farmlands in marginal areas: Cresud at present holds land reserves amounting to over 272,000 hectares, located in areas not exploited at their full potential. We believe that the technological tools we have available will allow us to make successful developments that will result in the appreciation of our land portfolio.
Optimization of Yields
We intend to continue using modern technology to increase production yield. We have already made and plan to make further investments in modern machinery to enhance crop production. Irrigation equipment will be installed on some of our farms in order to achieve higher output levels. In addition, we believe it can improve crop yields by using high-potential seeds and fertilizers and by introducing advanced land rotation techniques.
We expect to improve beef cattle production through the use of advanced breeding techniques and health-related technologies. In addition, we plan to improve the use of pastures. We also plan to continue investing in infrastructure (water facilities, electric fences, etc.)
With respect to our milk production, we will invest in the use of advanced feeding and health techniques.
Product and geographical diversification
We maintain a strategy of diversification with respect to both our product mix and the geographical location of our farmlands. This strategy is intended to counterbalance the two major risks associated with the business, namely climate and the unpredictable fluctuations of commodity prices. In order to minimize such risks, we own and lease land in various regions of the country with different weather patterns, and we seed a diversity of products.
Vertical integration
Our growth in size and the increase in production volume may, in the future, allow us to expand our operations into the processing of some of our products. Although no fixed timetable has been established for the implementation of such activities, we continue to evaluate opportunities as they arise and we believe this will occur naturally as our operations grow.
Preservation over the long term of our investment in IRSA
In view of the extent of the Companys investment in IRSA, the results of IRSA´s operations have a significant impact on the results of our operations.
During this fiscal year we subscribed a substantial portion of the convertible bonds issued by IRSA, that allowed concluding the restructuring process of its financial debts. In this way, IRSA managed to have adequate working capital levels, which will allow us to preserve the value of our investment over the long term.
MACROECONOMIC CONTEXT
International Overview
During almost the whole year 2002 and the first half of 2003, the growth rates of the most important economies worldwide stood below expected levels. This led the monetary authorities, the US Federal Reserve and the European Central Bank in the European community to intervene by reducing interest rates, in the case of the USA, to 1%. This aggressive monetary policy initiated in the USA early in 2001, coupled with a sharp increase in the fiscal deficit, seek a potential growth in its economy, which should stand at no less than an annual 3.5% and which in the first quarter of 2003 barely reached an annual 1.4%.
Furthermore, the economic authorities of both the European Union and the USA warned about a possible deflationary effect similar to that which has been affecting the Japanese economy for more than thirteen months and which keeps it in its current weak position. The measures implemented have begun to show the first good results in the USA with an unemployment rate of approximately 6% and a slight increase in consumption.
The most optimistic outlook for 2003 envisages an increase of approximately 2.4% in the GDP. In the European Community, there is still uncertainty as to its most important economy, which is that of Germany. A recent IMFs report and the analysis made by several consultants agree with a possible establishment of a long-lasting deflationary process similar to that affecting Japan. Should this forecast be confirmed, it is very likely that it will bear an impact on the European Nations block as a whole.
Emerging economies in light of the circumstances currently faced by developed countries, encounter a scenario with potential risks of a decrease in the commodities prices, their major export component, as a result of a reduced demand by purchasing countries, but showing optimism as to the possible attraction of idle capital, considering the current level of interest rates in the main financial centers worldwide. In addition, countries with a high level of indebtedness, such as Argentina, will benefit at the time of rescheduling their debts; it being able to obtain rates significantly lower than those existing at the time its debt was declared in default.
The Argentine Economy
The year 2002 will stand as the period in which the Argentine economic activity experienced one of the greatest declines in history, similar to that of 1914 and higher than that of 1931/32, local version of the so-called 1930 world crisis. The GDP at constant prices dropped by 10.9%. This formidable destruction of richness was translated into a deep deterioration of social indicators, unemployment reaching, according to a survey carried out in May 2002, 21.5% in all urban populations. The aggregate macroeconomic indicators reflected negative values, e.g., total consumption dropped by 12.9%, and private consumption to 14,9%, with a higher decline in investments and imports of 36.1% and 49.7% respectively, and only exports recorded a slight rise of 3.2%.
In view of these economic circumstances, most analysts forecasted a possible serious social agitation with uncertain consequences. However, the application of a mega plan by the provisional President Eduardo Duhalde aimed at preventing a social revolution, the so called Plan de Jefes y Jefas de Hogar (Household Chief Plan), which grants a subsidy of 150 Lecops to the unemployed, proved to be an effective means to undergo the most conflictive period of the crisis. By the end of the second quarter and contrary to the forecast of most local economic analysis and negative comments on the future national economy by the principal authorities of international bodies, such as the International Monetary Fund and the World Bank, the economy ceased to collapse and began to show some positive signs.
Source: Estudio Miguel Angel Broda y Asoc.
This incipient recovery originated in a highly unstable monetary and financial context. In fact, money supply recorded significant increase because as a result of elimination of convertibility and breach of existing contracts, savers sought to withdraw their local currency assets from the banking system and to acquire foreign currency assets outside such system. Coupled with this financial system chaos, the Argentine Central Banks intervention in the foreign exchange market in response to the demand for dollars by individuals, led international reserves to reach US$ 9,529 million, that is to say, approximately US$ 5,000 million less than the reserve recorded at the end of 2001, the reference rate of exchange being Ps. 3.80 per dollar. July 2002 may be regarded as the turning point, which marks the beginning of slow regularization of the financial system.
The second half of 2002 commenced with a positive change in the savers attitude, as not only deposit drainage was stopped but also the high rates offered by the banks attracted new deposits and for the first time in the year, the demand for pesos rose. By the end of the second half of 2002, international reserves reached US$ 10,476 million, even though a debt installment was paid to international agencies for US$ 500 million, while the rate of exchange dropped to Ps. 3.30 per dollar.
The above-mentioned context which remained unchanged throughout the first half of 2003 was possible due to a gradual release of restrictions on the free availability of the savers deposits. At the end of 2002 sight deposits were fully released, and during the first quarter of 2003, Decree 739/2003 established that the holders of rescheduled deposits up to Ps. 42,000 had the option to request their total or partial reimbursement, adjusted by the Reference Stabilization Rate (CER) until crediting of corresponding funds. Most savers decided to leave their deposits at the banks, substantially improving the system liquidity. Furthermore, the monetary authority had to take an active role in the foreign exchange market as the significant sales of currency generated by the great surplus was not counterbalanced by a sustained demand. The Central Bank issued the necessary pesos to maintain the rate of exchange and during the first half of 2003, this financial entity purchased US$ 3,000 million.
Notwithstanding the accelerated remonetization of the economy and significant increase in activity, the wholesale and consumer prices index stabilized as from late 2002. As a result, beginning February 28, 2003, the economic authority decided to discontinue the application of the adjustment for inflation to the balance sheets of companies. Disinflation is mainly explained by the drop in the purchasing power of salaries as from devaluation, which hinders quick recovery of the domestic market. This effect was reflected in the dissimilar performance of the different economic sectors. The export-related sectors, such as the agro-
farming segment and those substituting imports, mainly the textile industry, recorded the highest growth.
Source: Estudio M.A. Broda y Asoc.
At June 30 2003, the dollar quotation closed at Ps. 2.80 per dollar, which meant an increase of 26.0% in the local currency value for the latest 12 months. In addition, price indices recorded a slight growth with an increase in retail prices and wholesale prices indices of 10.2% and 8.3%, respectively for the 12-month period ended June 30, 2003. The first half of 2003 did not experience any upheaval in the fiscal sector and successive tax revenue records, mainly explained by export withholdings, enabled to surpass the primary surplus goals defined with the IMF under the short-term agreement entered into on January 16, 2003.
In May 2003 national elections to select the presidential formula to rule the country for the following four years and a half took place. Although such elections faced no trouble, the suspension of the second ballot to choose among the most voted formulae in the first electoral ballot, due to the fact that the binomial formula led by Carlos Menem abandoned the election, resulted in Néstor Kirchner becoming president. As he only obtained 22% of the votes, some analysts forecasted that the little consensus obtained by the new president could result in negative effects on the economic activity, although this did not happen.
Source: Estudio M.A. Broda y Asoc.
In view of the fact that the trade balance in the first five months of 2003 accumulated a surplus of US$ 6,956 million, the forecast for the whole year could reach US$ 17,000 million. This positive foreign trade behavior is explained by the effects of devaluation on its composition, a drop of 20.9% in imports being recorded in the latest 12 months through May 2003, while exports increased by 5.4% for the same period, supported by the rise of the international prices of commodities as from the second half of 2002, with remarkable benefits for the agro-industrial sector, such as the soybean segment.
The significant growth of the Argentine economy recorded during the first quarter of 2003, with a rise of 2.4 % of the GDP which could even reach an annual 5%, has not been reflected in any recovery for the labor market. The employment demand index published by the Labor Ministry shows a drop of 2.3% for the first five months of 2003 as compared to the same period of 2002. It is estimated that the unemployment index measured at May 2003 would reach 16.9% of the work force.
Performance of the Argentine capital market during the twelve-month period through June 30, 2003 shows significant recovery as during such period the Merval indicator expressed in dollars showed a rise of 177.6%, while in the first six months of 2003 it only recorded an increase of 75.3%. This extraordinary stock performance in the principal middle segment measured in dollars is mainly due to the abovementioned-increased value of the peso and to the recovery of leading shares. Although the value of government debt bonds somewhat recovered, their future evolution will depend on obtaining a long-term agreement with the IMF for a debt rescheduling with international bodies, which will enable negotiation with the private holders of the bonds, with a presumed reduction of the respective principal and interest.
Source: Estudio M.A. Broda y Asoc
The following macroeconomic indicators summarize the evolution of the Argentine economy over the latest eight years:
Main indicators
1996 |
1997 |
1998 |
1999 |
2000 |
2001 |
2002 |
2003 (P) |
|||||||||||||||||
Actual GDP growth (in %) |
5,53 | 8,11 | 3,85 | -3,39 | -0,79 | -4,41 | -10,90 | 5,30 | ||||||||||||||||
Inflation (price mix) in % * |
1,70 | 0,30 | -1,10 | -2,10 | -1,50 | -1,70 | 15,5 | 6,0 | ||||||||||||||||
Fiscal result (in % of the GDP) |
-2,22 | % | -1,47 | % | -1,39 | % | -2,59 | % | -2,44 | % | -3,22 | % | -1,5 | % | 0,2 | % | ||||||||
FOB exports (in million dollars) |
24,04 | 26,43 | 26,43 | 23,31 | 26,41 | 26,66 | 25,71 | 29,00 | ||||||||||||||||
CIF imports (in million dollars) |
23,86 | 30,50 | 31,40 | 25,51 | 25,24 | 20,31 | 8,99 | 12,65 | ||||||||||||||||
Payment balance current account (MM US$)** |
-6,82 | -12,29 | -14,55 | -11,95 | -8,97 | -4,43 | 9,59 | 8,29 | ||||||||||||||||
Trade balance (Million of US$) |
0,18 | -4,07 | -4,97 | -2,20 | 1,17 | 6,34 | 16,72 | 16,35 | ||||||||||||||||
Unemployment rate *** |
17,20 | 14,9 | 12,9 | 14,30 | 15,10 | 17,35 | 19,70 | 16,17 |
(P) Projected*
Annual average**
Accrual basis***
Country average (as a % de la P.E.A.)
Source: Estudio M.A. Broda y Asoc.
While in other circumstances over the history of the Argentine economy and after undergoing its worst crisis, the country has shown its potential capacity and great responsiveness to recover in the worst times, there is still a long way to go as regards pending structural reforms and recovery of international confidence to make Argentina re-enter the world market.
AGRICULTURE AND CATTLE-RAISING SECTORS IN ARGENTINA
Argentina has gained in strength in recent years as one of the worlds leading food producers and exporters.
The agricultural sector has been one of the main protagonists of the Argentine recovery, taking advantage of a suitable scenario and the technological improvements achieved during the last decade.
Total agrifood exports increased 24% as compared to the previous year, hitting a new record, showing an upsurge of 21% in primary and fresh products and 26% in manufactured products. The principal destinations whose share increased were the European Union and Asia.
The agrifood sector is one of the most important components of the Argentine economy. In 2001 it accounted for near 9 % of gross domestic product, of which 6.25% corresponded to the primary sector.
AGRICULTURE SECTOR
As a result of changes in production systems with the extension of direct sowing and greater use of agrochemicals, fertilizers and irrigation, in the last 10 years agricultural production has risen significantly. The main reasons for this growth have been the increase in sown areas, with the incorporation of marginal areas to production, and higher yields.
As it arises from preliminary data of the 2002/2003 season it is expected that new production records will be set, with an expected harvest close to 71 million tons. The increase in the production of soybean, corn, wheat and sunflower as compared to the previous season is 4%.
Provisional estimations as of 8/15/03
Source: Estimaciones Agrícolas - SAPYA
According to USDA estimates, the area devoted to agriculture in Argentina will continue to grow in coming years, although the increase will be more moderate. In addition, increases are expected in yields for corn and wheat, ensuring Argentina retains its position as the second and fifth leading exporter of these grains. Some analysts consider that corn is the crop with the greatest growth potential, through higher yields,
as the gap that exists in this regard compared to the U.S., the worlds leading exporter, is significant.
In the case of oilseeds, the outlook is for continuous growth although at a lower rate than that seen in recent years. The area sown with soybean rose rapidly during the 70´s and 80´s, due to the positive soybean/corn ratio. In the last decade the sown area has grown mainly due to a reduction in the area used for grazing.
Argentina is currently the leading exporter of soybean oil and soybean flour. The growth in sown area has been accompanied by greater and more efficient processing capacity.
In the next season soybean production is expected to hit a new historical record, with an expected harvest of 37 million tons. As the main crop in Argentina, it contributes near US$ 5,500 million through exports. In measuring the success of this growth, exchange rate trends and commodity prices will be two variables to be taken into account.
Sunflower is the other important oil crop in Argentina, and the country is currently the number one worldwide exporter of sunflower oil and flour. Here again, a significant increase in production is expected in coming years.
Argentina has recently filed with the World Trade Organization (WTO) a claim against restrictions imposed by the European Union since 1998 to the marketing of genetically modified products. The United States also filed a separate claim with the same purpose. The first reply by the WTO has been that it has decided to analyze the subject. We believe that a favorable answer would strongly benefit Argentina by opening new doors for its exports.
LIVESTOCK SECTOR
Argentina, with a herd close to 50 million head of cattle, is one of the worlds leading producers and exporters of beef.
The development of the livestock sector in Argentina has always been very closely linked to control of foot-and-mouth disease. Having been declared free of the disease in 1999 without the need for vaccination, in 2001 there was an outbreak that affected the herd, making vaccination necessary once again. Towards the end of 2002 the outbreak was brought under control, and after exports had been suspended for 11 months export destinations were reopened, with 53 new ports having been added to date. This notwithstanding, the reopening of important destinations such as the United States, Mexico and Canada is still pending as restrictions in these countries have not been lifted, although they are expected to do so in the next few months.
The renewal of exports following the control of foot-and-mouth and the devaluation of the peso have created conditions that are favorable to the whole meat industry, enabling the re-opening of a large number of meat packers.
Source: SAPYA
BSE (Bovine Spongiform Encephalopathy) still affects livestock at worldwide level. The last victim was Canada. Argentina is one of the few countries among the main world producers that are free of this disease. The SENASA (Agrifood Sanitation and Quality Service) has played a major role in this issue, imposing urgent sanitary control measures for isolating the country and prevent the disease. During the last year it also established a tracing system for all specimens intended for export, in alignment with the new requirements imposed by the world consumers.
Livestock prices have been rising since January 2002, after reaching a floor at the end of a year marked by the foot-and-mouth epidemic. Since then, steer prices have increased by 182% in pesos and 86% in dollars. The categories recording the greatest increase were the heavy ones, the principal export category.
APPRECIATION OF LAND VALUE
This new growth stage for the sector quickly resulted in a rise in land values, so that measured in dollars they are back at the levels recorded prior to the devaluation of the peso.
Source: Company data Agricultural margins
PRODUCT PROSPECTS
WHEAT
The 2003/2004 season is expected to show a downward production trend of exporters such as Europe, Australia, Canada and China, which situation occurs in the fifth year of a worldwide production standstill after the 1997/98 production record which reached 610 million tons. The latest USDA estimates forecasted 548 million tons. Subsequent official estimates in Canada and Australia have already cut back harvest forecasts by 6 million tons in excess of the figure forecasted by the aforementioned agency.
An analysis of worldwide consumption shows that it reaches approximately 570 million tons during the last five periods, thus creating a low stock level situation. Another clue to take into account for the forthcoming season is the drop in forage wheat in Eastern Europe which competed in the worldwide market at low prices.
Worldwide wheat trade has not grown in the last 25 years, and remains at barely above 100 million tons. The USDA estimates that, depending mainly on the sales to be made by USA, worldwide stocks would fall to their lowest historical level of 130 million tons. In respect of the stock/consumption ratio, more adjusted results are expected, with figures of 22.4% for the next year as compared to 23.3% and 25.5% in the previous seasons.
In view of the foregoing we forecast a high-price scenario during the next season, which including present withholdings, would reach about US$ 110 to 150 per ton.
CORN
The worldwide supply and demand for corn is basically defined by the results of the harvest in the USA. In this new 2003/2004 season weather conditions are not encouraging; therefore estimated production has dropped from 265 million tons to 254 million. Private estimates made available in the last few days forecast a new reduction in harvest estimates.
Worldwide corn production was estimated at 614 million tons, higher than the 601 million tons produced in the previous season and the record of 607 million tons in the 99/00 season.
In the 2003/2004 season, the worldwide production would increase by 13 million tons as compared to the previous season, although for the fourth consecutive year it would be lower than the worldwide consumption, estimated at 634 million tons, thus causing a 20 million tons drop in the worldwide stock.
Present stock levels are lower than the levels recorded in the past, and therefore with the estimated demand, final stocks would be reduced to significantly lower levels. Final stocks are estimated at 145 million tons, as compared to 165 million tons during the 2002/03 season and 197 million tons in the 2001/02 season. The stock/consumption ratio would be reduced to only 22%, lower than the 27.5% and 33.5% recorded in previous periods.
Worldwide corn trade has also stagnated since the 90s, being significantly lower than the levels recorded in the 80s, when sales from the USA to the former Soviet Union predominated. The internal US market and exports of corn-fed beef cattle have developed significantly.
In this market segment there is fear that price increases may significantly affect demand, as there are signs of reduction of beef production plans due to the increase in costs within the USA, which could also take place in Asian countries.
Under this scenario, we estimate that prices should not be lower than the present levels (US$ 80 per ton, including tax withholding) depending on how the USA sells its harvest during the year.
SOYBEAN
The USDA has recently reduced the estimates of USA harvest from 81 million tons to 75 million tons. Therefore, a marginal increase in worldwide soybean production is expected with respect to the previous year, to 207 million tons. The South American production is expected to offset the drop in the USA.
During the last five seasons the increase in production from 170 million tons to 210 million tons was absorbed by the worldwide consumption, therefore giving rise to a drop in stocks to critical levels, turning it more and more dependant on good harvests.
Unlike crops, there has been an almost threefold increase in worldwide soybean trade since the 80s. A trade volume of 65 million tons has been estimated compared to 32 million tons in the 95/96 season and 23 million tons in the 88/89 season. This would increase the price sensitivity to a reduction in available supply.
With demand estimated by USDA at 205 million tons, stocks would fall by 2 million tons, to 28 million tons, still higher than the 17.5 and 17.9 million tons recorded in the 95/96 and 88/89 seasons. The stock/consumption ratio would experience a slight recovery at about 19%.
Under this scenario, we believe that, depending on how the southern hemisphere sowing is made during the next season, prices should not decrease from their present values (US$ 150 per ton, including tax withholdings).
SUNFLOWER
In respect of vegetable oils, there is a drop in global production of vegetable oils, especially in rapeseed and sunflower oils, and a slight decrease in palm oil.
Soybean oil stocks have decreased during the last year, which has contributed to increasing the volatility of the oil market. All these factors have contributed to increasing the premium on sunflower oil over soybean oil by 40%.
An increase in the sowing intention (10%) is observed locally, which will result in an approximate production of 3.6 millions tons. The fall in production, together with bad weather conditions in the European and Canadian producing areas could cause the maintenance of an upward price trend during 2003.
We believe that prices should not decrease from their present level of US$ 150 per ton, including withholdings, depending on how the southern hemisphere sowing is made during the next season.
BEEF CATTLE
The most relevant matters in this segment were the overcoming of foot-and-mouth disease and the reestablishing of exports to the European Union and other markets.
The control of foot-and-mouth disease and the devaluation of the peso have created favorable conditions for beef cattle exports, permitting reopening of a large number of meat packing plants and the reincorporation of personnel. This is reflected on the market, where the prices of heavy animals for export have risen higher than the rest. A reopening of markets such as USA, Mexico and Canada is expected for 2004, which would enable an increase in prices.
Beef cattle prices have increased since January, both for producers and consumers, up from the floor reached in December, at the end of a year affected by foot-and-mouth disease. The increase in these prices is mainly due to three factors: a decrease in supply, an increase in exports and the effects of inflation. Prices regained the US$ 0.65 cents value prevailing before devaluation.
The analysts of this segment are optimistic with respect to the evolution of this sector, as a result of the strengthening of the export market, which contributes to improving the integration of the animal, and a firm domestic market, which even in the midst of a crisis was reluctant to increasing prices.
MILK
Argentina is suffering a slowdown in annual production levels. A decline in production is expected for 2003 due to several factors: adverse weather conditions in the first months of the year, less feed supplements due to higher crops prices, the shut down of dairy farms due to the competition of agriculture and particularly to the high soybean margin. According to the Livestock Division of the SAPYA, primary milk production for 2003 will be 15% lower than the levels recorded in fiscal 2001. This decrease in production caused the price to increase until reaching Ps. 0.50, which is consistent with the US$ 0.17 price prevailing before devaluation.
SUMMARY OF OPERATIONS
CROPS
In the last season the total sown area covered 23,638 hectares, 42% of which corresponded to own farmland and 58% to leased farmland.
As compared to the previous season, we reduced area use by 46% mainly due to a smaller area leased from third parties, caused by the increase in agricultural leases.
The strategy to focus on low risk crops created a diversity of products basically made up of soybean, corn, wheat and sunflower and, in a lesser scale, sorghum. Agreements for the production of seeds in farms with irrigation technology were subscribed, a business that generates significant return due to the high value of products.
Total production per product was as follows (in tons):
2002/03 |
2001/02 |
2000/01 |
1999/00 |
1998/99 | ||||||
Wheat |
9.397 | 28.051 | 9.835 | 26.283 | 34.474 | |||||
Corn |
27.508 | 63.175 | 44.161 | 81.343 | 39.880 | |||||
Sunflower |
3.074 | 4.122 | 5.080 | 19.413 | 26.396 | |||||
Soybean |
25.056 | 43.335 | 41.437 | 31.704 | 30.199 | |||||
Peanut |
1.990 | |||||||||
Cotton |
2.866 | |||||||||
Other |
5.334 | 3.795 | 1.246 | 1.249 | 558 | |||||
TOTAL |
70.369 | 142.478 | 101.759 | 159.992 | 136.363 | |||||
Yields of wheat were lower than those obtained in the previous year because two of our highest yielding lands were affected by hail, reducing the average return of our diversified portfolio. Yields of corn and soybean, our main crops, were optimal as a result of the good weather conditions in the producing areas.
Yields (ton / hectare):
2002/03 |
2001/02 |
2000/01 |
1999/00 |
1998/99 | ||||||
Wheat |
2.43 | 3.18 | 3.59 | 3.25 | 2.77 | |||||
Corn |
5.97 | 4.78 | 4.61 | 5.97 | 4.61 | |||||
Sunflower |
1.34 | 2.03 | 2.64 | 1.67 | 1.44 | |||||
Soybean |
2.67 | 2.37 | 2.02 | 2.34 | 2.09 |
BEEF CATTLE
As of June 2003, the cattle stock of the Company was 83,051 heads, with a total of 135,257 hectares used for this activity.
Beef cattle production was 9,121 tons, which represented a 13.1% decrease over the previous year mainly due to less cattle finished in the feed lot and a reduction in average stock.
A significant percentage of cattle were finished in the feed lot in Villa Mercedes, in the Province of San Luis. The categories that are generally finished with grain are grass-rebred steers with a weight not exceeding 300 kg and part of the calves, which are transformed into small ball calves through this process, providing significant profit margins.
The breeding herd reproduction rate, which has improved year after year, recorded satisfactory efficiency levels. The work on genetics and handling of herds is expected to result in further improvements in the coming years.
Within the process of de-commoditization and technological innovation we implemented a self-developed identification and tracing system in compliance with European and Senasa standards.
With a view to distinguishing our production and obtaining higher prices in production sales, we plan to extend the use of the tracing system to our whole herd.
MILK
Milk production was 11.2% lower than in the previous year due the shutdown of La Adela dairy farm, partially offset by the higher number of milking cows in La Juanita.
At present, the only dairy farm owned by the Company is located in La Juanita, which is mostly based on pasture feeding. This lower cost system enables to improve milk margins as compared to grain feeding systems.
The milk business in Argentina suffered significant ups and downs over time, from the euphoria of 1997 and 1998 to the 2001 crisis. At present, with more beneficial prices, this sector has regained attractiveness.
LEASE OF LAND
During the year 13.628 hectares were leased for agricultural activities, most of them at a fixed price prior to harvest. Only a small percentage of the leasing was agreed at a production percentage.
Upon the increase of land prices, the company decided not to accept such prices and only to lease land at a price, which may enable us to obtain appropriate margins. We have leased 46% less hectares than the previous year.
CLEARING AND DEVELOPMENT OF MARGINAL AREAS
We believe that the potential for this sector lies in the development of marginal areas, as has been the case in various countries around the world. Thanks to current technology, we can obtain similar yields and a higher profitability than in central areas.
During this fiscal year we made an experimental plot consisting in the clearing of 300 hectares for soybean production in our Los Pozos property, located in the Province of Salta. In addition, we have started clearance of 1,000 additional hectares in that property for agricultural production in the next season, and we plan to extend the development of 20,000 hectares for livestock during the next years.
We also started clearance of 1,100 hectares in our Agro Riego San Luis property, located in the Province of San Luis, for crops under irrigation.
Cresud at present holds land reserves amounting to over 272,000 hectares, purchased at very low prices. We are convinced that as this land is developed, and on the basis of the progress being made in technology, the value of this land will appreciate, generating significant profits for the Company.
INTERNET
Fyo.com, the Internet portal in which we hold a 70% interest, showed a positive EBITDA during this fiscal year. The Internet portal continues consolidating as the leading site of the agricultural sector and has begun to expand the range of commercial services offered to the agricultural sector, incorporating direct sales of supplies and grain brokerage services.
At present, Futuros y Opciones.com S.A. has a database of 35,000 users and over 5,000 agribusiness producers authorized to make deals. Our strategy is to focus on commercial services to agribusiness producers, taking advantage of Cresuds experience and operating capacity in the business, with FyO as liaison with the customers.
During the fiscal year ended June 30, 2003, Futuros y Opciones. com S.A.s income was Ps. 0.5 million, 97% higher than the previous year.
FEED LOT
During this fiscal year the 170 hectare feed lot located in the Province of San Luis, in which we hold a 50% interest through Cactus Argentina S.A., continued to consolidate growth by operating at high occupation levels and thus providing a relevant cash generation that enabled us to repay all financial indebtedness.
One of the most important achievements of the year includes the execution of an agreement with one of the largest hypermarkets of the country for the direct sale of a portion of the feed lot production.
During the last years, due to the highly profitable agricultural margins, cattle production was displaced by grain production towards marginal areas. This is the reason for the decrease in beef production under the traditional pasture system and the increase in lot production.
Argentine producers have found the use of hosting services as an alternative to finishing their animals. Cactus Argentina S.A. has been pioneer in this kind of service, and thanks to it during this year our average occupation level was 70% and in the last 5 months we operated at 100% of our capacity.
Due to the growing increase in demand for use of our feed lot we are planning to expand the capacity of our first facility by approximately 5,000 heads, and to develop a second facility whose capacity has not been determined yet.
The homogeneity of feed lot final products has provided a high quality product for purchasers, turning marketing easier and enabling to obtain higher sales prices.
During the year ended June 30, 2003, Cactus Argentina S.A.s revenues were Ps. 17.5 million, a 144% increase from the previous year. Net income was Ps. 0.6 million, compared to a loss of Ps. 0.05 million in the previous year.
Main indicators for the years ended June 30, 2003 and 2002:
Year Ended June 30, 2003 |
Year Ended June 30, 2002 |
Change |
|||||
Sales (volume) |
|||||||
Wheat (tons) |
14,362 | 26,101 | -45.0 | % | |||
Corn (tons) |
56,060 | 41,139 | 36.3 | % | |||
Sunflower (tons) |
5,234 | 2,156 | 142.8 | % | |||
Soybean (tons) |
40,659 | 47,629 | -14.6 | % | |||
Other (tons) |
5,111 | 3,599 | 42.0 | % | |||
Total Crops (tons) |
121,425 | 120,624 | 0.7 | % | |||
Beef-cattle (tons) |
9,561 | 17,969 | -46.8 | % | |||
Milk (thousand of liters) |
6,024 | 6,785 | -11.2 | % | |||
Production |
|||||||
Wheat (tons) * |
9,367 | 28,051 | -66.5 | % | |||
Corn (tons) * |
27,507 | 63,175 | -56.5 | % | |||
Sunflower (tons) * |
3,082 | 4,122 | -25.2 | % | |||
Soybean (tons) * |
25,056 | 43,335 | -42.2 | % | |||
Beef-cattle (tons) |
9,121 | 10,493 | -13.1 | % | |||
Milk (thousand of liters) |
6,024 | 6,783 | -11.2 | % | |||
Exploited surface (in hectares) |
|||||||
Crops** Own land |
10,010 | 18,471 | -45.8 | % | |||
Leased land |
13,628 | 25,306 | -46.1 | % | |||
Beef-cattle Own land |
135,257 | 144,925 | -6.7 | % | |||
Leased land |
| 5,394 | -100,0 | % | |||
Surface under irrigation |
2,814 | 3,765 | -25.3 | % | |||
Storage capacity (tons)*** |
23,450 | 14,600 | 60.6 | % | |||
Total heads of cattle |
83,051 | 79,358 | 4.7 | % | |||
Dairy Farm Stock (heads) |
2,546 | 2,590 | -1.7 | % | |||
Milking Cows (heads) |
1,272 | 1,143 | 11.3 | % |
DISCUSSION OF RESULTS
Year ended June 30, 2003 compared to the year ended June 30, 2002
Sales
Sales reached Ps. 71.9 million, 10.3% lower than those recorded in the previous year. Higher agricultural sales partially offset smaller sales from the other segments.
Crops. Crop sales increased 6.0% to Ps. 51.4 million in fiscal year 2003, from Ps. 48.5 million in fiscal year 2002. The 0.7% increase in the volume of sales to 121,425 tons from 120,624 tons was accompanied by a 5.3% higher unit price in fiscal year 2003 as compared to 2002. The average price per sold ton was Ps. 423 in fiscal year 2003 as compared to Ps. 402 obtained in the previous year. Crop production decreased 50.6% from 142,478 tons in fiscal year 2002 to 70,369 tons in fiscal year 2003 (wheat, corn and soybean production decreased 66.5%, 54.9%, 42.2%, respectively). Total sowed area decreased to 23,638 hectares in fiscal year 2003 from 43,777 hectares in fiscal year 2002. Sowed area on leased lands decreased to 13,628 hectares during 2003 from 25,306 hectares in fiscal year 2002, and sowed area on own lands was reduced to 10,010 hectares in fiscal year 2003 from 18,471 hectares in fiscal year 2002. This reduction mainly results from the high cost of leases that triggered a reduction in leased hectares, and the impact of the sale of own farmlands during the past fiscal year (La Sofía and El Coro).
Beef Cattle. Beef cattle sales decreased 37.3% to Ps. 17.3 million in fiscal year 2003 from Ps. 27.6 million in fiscal year 2002. The 47.5% reduction in the sales volume was partially offset by the 19.3% increase in the price per sold ton. The sales volume decreased to 9,561 tons from 18,200 tons, while the sales price increased to Ps. 1.81 per kilogram in fiscal year 2003 from Ps. 1.52 per kilogram in fiscal year 2002. Average cattle stock decreased to 86,234 heads in fiscal year 2003 from 93,380 heads in fiscal year 2002, and total beef cattle production decreased 13.1% to 9,121 tons in fiscal year 2003 from 10,493 tons in fiscal year 2002. This decrease was due to the reduction of our stock position in this segment and the smaller number of heads finished in the feed lot. The own area devoted to beef cattle production decreased to 135,257 hectares in fiscal year 2003 from 153,435 hectares in fiscal year 2002. This reduction is mainly related to the sale of the El Coro property during the previous fiscal year.
Milk. Sales of milk increased 6.9% to Ps. 2.4 million in fiscal year 2003 from Ps. 2.3 million in fiscal year 2002, mainly due to a 20.5% increase in the average sales price to Ps. 401 per thousand liters in fiscal year 2003 as compared to Ps. 333 per thousand liters in fiscal year 2002. Lower milk sales attributable to the 11.2% fall in production, caused by the shutdown of La Adela dairy facility during the previous year, was partially offset by a larger number of milking cows in La Juanita. Total production was 6.0 millions of liters in fiscal year 2003 as compared to 6.8 millions of liters in fiscal year 2002.
Other. Sales decreased 57.3% to Ps. 0.8 million in fiscal year 2003 from Ps. 1.9 million in fiscal year 2002 mainly due to the recessive market conditions, that pushed down sales prices of firewood and charcoal, partially offset by a higher income from services.
Cost of sales
The cost of sales increased 20.7% to Ps. 51.0 million in fiscal year 2003 from Ps. 42.3 million in fiscal year 2002. Cost of sales as a percentage of net sales increased to 70.9% in fiscal year 2003 from 52.7% in fiscal year 2002.
Crops. The cost of sales for crops increased to Ps. 39.4 million in fiscal year 2003 from Ps. 13.8 million in fiscal year 2002. This increase is mainly attributable to the impact of currency exchange rates on the cost of supplies and to a lesser extent, to the positive effect of the initial stock valuation during fiscal year 2002.
Beef cattle. Cost of sales for beef cattle decreased 61.6% to Ps. 8.7 million in fiscal year 2003 from Ps. 22.8 million in fiscal year 2002. Such reduction is mainly attributable to the impact of a smaller number of heads finished in the feed lot. The cost of sales for beef cattle as a percentage of beef cattle sales decreased to 50.5% in fiscal year 2003 from 82.5% in fiscal year 2002. The cost per ton sold also decreased to Ps. 907 in fiscal year 2003 from Ps. 1,252 in fiscal year 2002 for the same reason.
Milk. Cost of sales for milk decreased 58.4% to Ps. 1.5 million in fiscal year 2003 from Ps. 3.6 million in fiscal year 2002. This reduction is due to the impact of the shutdown of La Adela dairy farm and the effect of changes in the feeding system. The cost of sales for milk per thousands of liters decreased to Ps. 246 in fiscal year 2003 from Ps. 525 in fiscal year 2002.
Other. Costs decreased 34.6% to Ps. 1.4 million in fiscal year 2003 from Ps. 2.1 million in fiscal year 2002 mainly because of the fact that although the firewood and charcoal business was affected by the recessive market conditions that forced us to lower final sales prices, there was no such reduction in costs. Therefore, the margin on this business decreased.
Gross Profit
As a result of the above, the gross profit amounted to Ps. 20.9 million during 2003 as compared to a Ps. 38.0 million profit during 2002.
Selling Expenses
Selling expenses decreased from Ps. 10.2 million during 2002 to Ps. 6.0 million during 2003. Selling expenses from agricultural activities accounted for 73.1% of total selling expenses, selling expenses from livestock activities accounted for 20.4% and other activities accounted for the remaining 6.5%. Selling expenses from crops, as a percentage of sales amounted to 8.6% during 2003. Selling expenses per ton of crop sold amounted to Ps. 36 during this year, reflecting a decrease with respect to the previous year. This is mainly due to better commercial agreements with our customers and to lower conditioning costs, as a result of the better quality of cereals produced. Selling expenses as a percentage of beef cattle sales increased from 6.6% during 2002 to 7.1% during 2003.
Sales of milk do not give rise to selling expenses as milk production is sold directly.
Administrative Expenses
Administrative expenses decreased by 48.5% from Ps. 8.4 million during 2002 to Ps. 4.3 million during 2003, mainly due to the reduction in fees for services and general office expenses. Administrative expenses include the Companys general expenses and exclude expenses relating to farmland management.
Result from sales of fixed assets
The result from sales of fixed assets amounted to Ps. 4.9 million, as a result of the sale of San Luis farm, covering 706 hectares in Junín, Province of Buenos Aires and Los Maizales farm, covering 618 hectares in Villa Cañás, Province of Santa Fe.
The sale of San Luis farm was agreed at US$ 2.2 million, providing a net income amounting to Ps. 0.6 million.
The sale of Los Maizales farm was agreed at US$ 1.8 million, providing a net income of Ps. 4.3 million.
Holding result
The profit from inventory holding amounted to Ps. 12.2 million during 2003, as compared to a Ps. 19.6 million loss during 2002. Most of this result corresponds to a profit from cattle stock holding resulting from the increase in real prices.
Operating result
As a result of the foregoing, the operating income amounted to Ps. 27.7 million during 2003 as compared to a Ps. 16.4 million profit recorded during 2002. The operating margin amounted to 14.7% during 2003 and 24.1% during 2002.
Financial results
Net financial results provided Ps. 10.9 million and Ps. 8.7 million losses for 2003 and 2002, respectively. This was mainly due to foreign exchange differences during 2003 and the result from shares and securities transactions during 2002.
Financial results are attributable to (i) a Ps. 0.2 million profit resulting from shares and securities transactions, (ii) a Ps. 1.2 million profit due to inflation effects, (iii) a Ps. 0.3 million loss provided by interest, (iv) a Ps. 11.1 million loss from foreign exchange differences and (v) a Ps. 0.9 million loss from tax on debits and credits in bank accounts.
Result of investment in related companies
The result of investments in shares increased from a Ps. 41.2 million loss during 2002 to a Ps. 68.1 million profit during 2003, mainly due to IRSAs net result during the year which amounted to Ps. 64.9, the profit obtained from the operation of Cactus Argentina S.A., which amounted to Ps. 0.3 million, Agro Uranga S.A. operating profit which amounted to 2.4 million and goodwill and intangible assets amortizations for an amount of Ps. 0.5 million.
Other income and expenses, net
Other income and expenses, net during 2003 amounted to a Ps. 0.2 million loss as compared to a Ps. 0.07 million profit during 2002.
Management Fees
Under the agreement entered into with Dolphin Fund Management S.A., we pay a fee equal to 10% of our net income for agricultural advisory services and other management services. During 2003, fees amounted to Ps. 7.2 million and during 2002 we paid no management fees due to the net loss recorded during such year.
Gifts
During 2003 a gift charge for Ps. 2.0 million was recorded while no charge was recorded during the previous year.
Income tax
Income tax decreased from Ps. 18.7 million during 2002 to Ps. 10.6 million during 2003. The Company recognized its income tax charge on the basis of the differed tax liability method, thus recognizing temporary differences between accounting and tax assets and liabilities measurements. The main temporary differences derive from cattle stock valuation. For purposes of determining the deferred assets and liabilities, the tax rate expected to be in force at the time of their reversion or use, according to the legal provisions enacted as of the date of issuance of these financial statements (35%) has been applied to the identified temporary differences and tax losses.
Minority interest
A third party interest amounting to Ps. 0.2 million was recorded during 2003 to show the minority interest in Futuros y Opciones.com S.A. results.
Net result
As a result of the foregoing, the net result increased from a Ps. 51.8 million loss during 2002 to a Ps. 65.0 million net income during 2003. The net margin, computed as net result over total sales amounted to Ps. 90.4% during 2003.
PROSPECTS FOR THE NEXT FISCAL YEAR
The new economic conditions existing in Argentina place the agribusiness sector and our company in highly favorable conditions to take advantage of opportunities as they arise. Therefore, we will continue our strategy of supplementing agriculture in our own farmlands with agriculture in third-party farmlands, provided that return on invested capital from this activity reaches the minimum standards required for this business. So far, the leased area for the next season is 8,690 hectares.
Due to the effects of devaluation on the beef export industry and expected opening-up of the U.S., Mexican and Canadian markets after having checked the foot-and-mouth disease, the outlook for this activity is much promising. As we expect an increase in cattle assets in dollar terms, we will focus on obtaining the highest productivity and increasing our production levels in the livestock business.
We are developing agreements with exporter meat packers to slaughter our own cattle and export for the account of third parties. To do so, we have obtained a license for operating as a slaughterhouse.
As part of our expansion strategy we will conclude clearance of 1,100 hectares for agriculture under irrigation in our Agro Riego San Luis property. We are also evaluating the opening of a dairy farm in that land, and will continue developing our Los Pozos property by adding 1,000 hectares for crop production and up to 20,000 hectares for livestock rising.
We will continue working strongly on the development of a line of business oriented to agricultural services involving, inter alia, production of specialties and seed for the leading seed producers and exporting companies.
In Cactus Argentina S.A. we are evaluating the possibility of expanding the capacity of our first facility and developing a second one in order to serve increasing market demands.
The goal of Futuros y Opciones.com S.A., our Internet company, is to continue generating business agreements and expand the range of services offered to the agricultural community. We have started grain brokerage activities, to which effect we obtained a qualifying license, and expect to increase our market share in this profitable business.
Without doubt the agricultural sector has been one of the segments that benefited most from the new economic measures in Argentina, and the outlook is very attractive. In this context of high illiquidity and lack of credit lines, new opportunities will arise on which we will capitalize.
BOARD OF DIRECTORS
The Board of Directors, which is responsible for our Companys management, is made up of six directors and four alternate directors, each of whom is appointed by our shareholders at an ordinary meeting, to hold office for a term of three years. Full and alternate directors can be reelected to hold office unlimitedly.
Our current Board of Directors was designated by the Shareholders meeting held in October 2000, October 2001 and November 2002 for terms of office expiring in fiscal years 2003, 2004 and 2005, as the case may be. The following table shows the current members of the Board of Directors.
Name |
Date of birth |
Position held at Cresud |
Year in which office was taken |
End of office |
Current position, since | |||||
Eduardo S. Elsztain | 01/26/1960 | Chairman | 2002 | 2005 | 1994 | |||||
M. Marcelo Mindlin | 01/19/1964 | First vice-chairman | 2002 | 2005 | 1994 | |||||
Saúl Zang | 12/30/1945 | Second vice-chairman | 2002 | 2005 | 1994 | |||||
Gary S. Gladstein | 07/07/1944 | Director | 2001 | 2004 | 1994 | |||||
Alejandro G. Elsztain | 03/31/1966 | Director | 2001 | 2004 | 1994 | |||||
Clarisa D. Lifsic | 07/28/1962 | Director | 2001 | 2004 | 1994 | |||||
Salvador D. Bergel | 04/17/1932 | Alternate Director | 2002 | 2005 | 1996 | |||||
Juan C. Quintana Terán | 06/11/1937 | Alternate Director | 2002 | 2005 | 1994 | |||||
Jorge O. Fernández | 01/08/1939 | Alternate Director | 2000 | 2003 | 1997 | |||||
Gastón A. Lernoud | 06/04/1968 | Alternate Director | 2002 | 2005 | 1999 |
The directors Eduardo S. Elsztain, M. Marcelo Mindlin, Saúl Zang, Alejandro G. Elsztain, Clarisa D. Lifsic and the alternate directors Salvador D. Bergel, Juan C. Quintana Terán and Gastón A. Lernoud do not qualify as independent directors within the meaning of Resolution No. 400 of the CNV. The alternate director Jorge O. Fernández qualifies as independent director within the meaning of such resolution. The legal address of the Board of Cresud S.A.C.I.F. y A. is Av. Hipólito Yrigoyen 440, 3rd floor, (C1066AAB) Buenos Aires, Argentina.
A brief biographic description of each Board member is as follows:
Eduardo S. Elsztain. Mr. Elsztain studied Economic Sciences at the University of Buenos Aires. He has been carrying out activities in the Real Estate sector for more than twenty years. He has founded Dolphin Fund Management. He is the Chairman of the Board of IRSA, APSA, Shopping Alto Palermo S.A. and Dolphin Fund Management; he is Vice-president of the Board of Banco Hipotecario, among other positions. Eduardo S. Elsztain is the brother of our Director Alejandro G. Elsztain.
M. Marcelo Mindlin. Mr. Mindlin has a degree in Economic Sciences from the University of Buenos Aires and a Master Degree in Business Administration from the Center of Macroeconomic Studies of Buenos Aires. Mr. Mindlin is the First Vice-chairman of the Board of Directors of IRSA, APSA and Dolphin Fund Management, and Director of Banco Hipotecario, among other positions.
Saúl Zang. Mr. Zang is a lawyer graduated from the University of Buenos Aires. He has been a founding member of the law firm Zang, Bergel & Viñes. He is also Second Vice-Chairman of the Board of Directors of IRSA and Vice-Chairman of the Board of Directors of Puerto Retiro and Fibesa; Director of APSA, Banco Hipotecario, Nuevas Fronteras S.A., Tarshop and Palermo Invest S.A., and Alternate Director of Shopping Alto Palermo S.A.
Gary S. Gladstein. Mr. Gladstein graduated as a Public Certified Accountant from the University of Connecticut and concluded his postgraduate studies at the University of Columbia. He is Senior Executive Director at Soros Fund Management LLC.
Alejandro G. Elsztain. Mr. Elsztain is an Agricultural Engineer graduated from the University of Buenos Aires. He is Chairman of Inversiones Ganaderas S.A. Moreover, Mr. Elsztain is a member of the Board of Directors of IRSA and APSA. Mr. Alejandro Elsztain is the brother of our Chairman Eduardo S. Elsztain.
Clarisa D. Lifsic. Mrs. Lifsic is a graduate in Economic Sciences from the University of Buenos Aires and she obtained a Master Degree in Sciences with management expertise at Massachusetts Institute of Technology. She has also held offices on research and financial analysis areas in the private sector since 1987. She is an executive officer at Dolphin Fund Management and Chairman of the Board of Director of Banco Hipotecario S.A., among other positions.
Salvador D. Bergel. Mr. Bergel is a Lawyer graduated from the National University of the Litoral and Doctor in Social and legal sciences. He is a founding member of Zang, Bergel & Viñes and legal advisor of Repsol YPF S.A. He is also an Alternate Director of APSA.
Juan C. Quintana Terán. Mr. Quintana Terán is a Lawyer graduated from the University of Buenos Aires. He is also a legal advisor of the law firm Zang, Bergel & Viñes. He has been President and Judge of the Honorable National Court of Appeals in Commercial Matters of the City of Buenos Aires. He is an Alternate Director of APSA.
Jorge Oscar Fernández. Mr. Fernández graduated from the University of Buenos Aires in Economic Sciences. He has carried out commercial activities as General Accountant for Banco del Este, Administrative Officer, Director and Second Vice-President for Banco Río de la Plata. He was also a member of the Board of Directors of various companies: Banelco, La Patagonia, Cía Previsional Río Citi, Siembra AFJP, Siembra Cía de Seguros, Río Valores, Sur Seguros, Inter Río Holdings Establishment, Banco Río and Sur Seguros. He is also a member of ADEBA (Argentine Banking Association).
Gastón Armando Lernoud. Mr. Lernoud graduated as a Lawyer from University of El Salvador, Buenos Aires, in 1992. He obtained a Master degree in Corporate Law in 1996 from the University of Palermo, Buenos Aires. He was a Senior associated member of Zang, Bergel & Viñes until June 2002, when he formed part of APSAs team of lawyers.
Board of Directors Compensation
Under the laws of Argentina, if the Board compensation is not provided by the companys by-laws, it shall be determined by the shareholders meeting. The maximum amount of compensation to be received by Board members , including compensation for permanent technical-administrative duties shall not exceed 25% of the companys profits. Such amount shall be limited to 5% when no dividend is distributed to shareholders and shall be increased in proportion to such distribution.
When one or more Directors are assigned special commitments or technical-administrative duties and profits are either non-existent or limited, the Shareholders meeting may approve compensations in excess of the aforementioned limits.
The compensation of our Directors for each fiscal year is determined in accordance with the business companys law, taking into account the years results and the performance of additional technical-administrative duties. Upon the amounts being determined they are submitted to our shareholders for consideration at the Shareholders meeting. On the other hand, we have not entered into employment agreements with our Directors.
General Manager
Our General Manager is Mr. Alejandro G. Elsztain, who is also one of our Directors. The general manager performs his duties according to instructions given by the Board of Directors. All the remaining managements are required to report to the General Manager.
Senior Managers
Our Board of Directors appoints and removes senior managers who report to the General Manager.
The following table shows our current senior management:
Name |
Position | |
Alejandro G. Elsztain |
General Manager | |
Clarisa D. Lifsic |
Financial Manager | |
Alejandro Bartolomé |
Production Manager | |
David A. Perednik |
Administrative Manager | |
José Luis Rinaldini |
Management Assistant | |
Alejandro Casaretto |
Production Manager | |
Carlos Blousson |
Commercial Manager |
There follows a brief biographical description of the senior managers. Except for Mr. Alejandro G. Elsztain and Ms. Clarisa D. Lifsic, who are Directors of our Company, the senior managers are not Directors of our Company:
Alejandro Bartolomé. Mr. Bartolomé is an Agricultural Engineer graduated from the University of Buenos Aires and obtained a Master Degree in Sciences in Animal Production at the University of Reading, England. He was Treasurer of CREA Monte Buey Inriville and coordinator of the Santa Emilia Dairy Products Group from 1993 to 1996. He was also Manager of the Agricultural Sector and was an associate of an agricultural management company called Administración Abelenda, Magrane, Anchorena.
David A. Perednik. Mr. Perednik graduated as a Public Certified Accountant from the University of Buenos Aires. He worked for different companies, such as Marifran Internacional S.A., a subsidiary of Louis Dreyfus Amateurs, where he was Financial Manager from 1986 to 1997. He was also a Senior Consultant at Deloitte & Touche administration and system department from 1983 to 1986.
José Luis Rinaldini. Mr. Rinaldini is an Agricultural Engineer graduated from the University of Buenos Aires. He worked for Inversiones Ganaderas S.A. and in the production land selling area of an agricultural and forest-related company.
Alejandro Cassaretto. Mr. Casaretto is an Agricultural Engineer graduated from the University of Buenos Aires. He worked as Technical Manager, Manager of the Agricultural Areas and Technical Coordinator of our company since 1975.
Carlos Blousson. Mr. Blousson is an Agricultural Engineer graduated from the University of Buenos Aires. He has worked for Cresud since 1996 and he is currently the Commercial Manager. Before joining Cresud, he worked as futures and options operator at Vanexva Bursátil - Sociedad de Bolsa and before that he worked as Manager of the agricultural area and Technical Advisor of Leucon S.A.
Modality of Senior Management compensation
The members of our senior management receive a fixed amount determined on the basis of their qualification, capability and expertise and an annual bonus, which varies according to their personal performance and our general results. At present our company has no plans providing for retirement or similar benefits, except for those relating to our Senior Management.
Internal Control Audit Committee
According to the Public Offering System provided for by Decree 677/01, the regulations of the Argentine Securities Commission (CNV), Resolutions No. 400 and 402 of the CNV, our Board of Directors resolved that, commencing on the first annual fiscal period following effectiveness of Decree 677/01, the Audit Committee shall be a Board Committee which main duties shall be to assist the Board in complying with its duty to act with due care, diligence and skill in respect of our company particularly in the application of the accounting policies and issuance of the accounting and financial information, management of business risks and internal control systems, the companys business behavior and ethics, in monitoring the sufficiency of our financial statements, the companys compliance with the laws, independence and capacity of independent auditors and performance of the internal audit duties both by our company and independent auditors.
The Audit Committee shall consist of three (3) or more Regular Directors, most of which shall qualify as Independent Directors. The number of members shall be determined by and the appointment thereof shall be made at the first Board meting to be held immediately after the Annual Regular Shareholders Meeting and the members so appointed shall hold office until the next Annual Regular Shareholders Meeting.
The Audit Committee shall be formed solely by Directors having expertise in business, financial or accounting issues.
The Audit Committee shall issue its own internal operating regulations which shall be notified to the Board of Directors.
The Audit Committee shall prepare an annual performance plan for the year, which shall be submitted to the Board and the Surveillance Committee within sixty (60) calendar days after commencement of the fiscal year.
Upon submission and publication of the annual financial statements, the Audit Committee shall prepare a Performance Report for the Board in which it shall notify its treatment of the issues within its scope as provided for in section 15 of Article III of the CNV Regulations during the year.
The Audit Committee shall issue its opinion concerning the Boards proposed appointment and removal of the independent auditors to be engaged by the company and shall supervise the maintenance of their independent nature; it shall review the independent auditors plans and shall evaluate their performance, which opinion to the Board in this respect shall be contained in the annual performance report.
It shall be charged with the supervision of internal systems, shall monitor the performance of the internal control systems and the accounting registration system, shall verify the reliability of the accounting registration system and of the financial information, shall review the internal auditors plans and shall evaluate their performance by approving and monitoring compliance with the Annual Audit Plan.
It shall monitor application of our companys risk management information policies; it shall provide full information of transactions in which there is a conflict of interest with members of the corporate bodies or controlling shareholders; it shall issue its opinion in respect of fees and option plans relating to Board and Managers shares, the issuance of shares and the transactions with related parties; and it shall issue a report before any Board decision to acquire shares of our company.
Our Company shall organize training courses for the members of the Audit Committee, commencing on May 2004, which shall be addressed to the members that shall hold office during such year.
Surveillance Committee
The Surveillance Committee is charged with the review and supervision of management actions and of our companys affairs and monitors compliance with the by-laws and the resolutions of the shareholders meetings. The members of the Surveillance Committee are appointed by the annual regular shareholders meeting and hold office for one year. The Surveillance Committee consists of three regular members and three alternate members.
The following table includes information about the members of our Surveillance Committee appointed at the Annual Regular Shareholders Meeting held in November, 2002:
Name |
Position held at Cresud | |
Martín Barbafina |
Statutory Auditor | |
Corina I. Pando |
Statutory Auditor | |
Carlos Rebay |
Statutory Auditor | |
Carlos Rivarola |
Alternate Statutory Auditor | |
Gabriel Martini |
Alternate Statutory Auditor | |
Diego Niebuhr |
Alternate Statutory Auditor |
All of the Surveillance Committee members qualify as independent, within the meaning of Resolution 400 of the CNV. Notwithstanding the foregoing, they have provided remunerated professional assistance in respect of companies included in section 33 of Law No. 19,550.
There follows a brief biographical description of each member of our Surveillance Committee.
Martin Barbafina. Mr. Barbafina graduated as a Public Certified Accountant from the Argentine Catholic University. He is a partner of PricewaterhouseCoopers. In addition, he is a member of the Surveillance Committees of APSA and IRSA.
Corina I. Pando Ms. Pando graduated as a Public Certified Accountant from the University of Buenos Aires and she is a partner of PricewaterhouseCoopers. She is also a member of the Surveillance Committee of Ford Credit Holding Argentina S.A. and Frimetal S.A.
Carlos A. Rebay. Mr. Rebay studied Economic Sciences and Business Administration at the Universidad Argentina de la Empresa. He is a partner of PricewaterhouseCoopers. He is also a member of the Surveillance Committee of Massalin Particulares S.A., Hart S.A., Tapiales S.A. and AT&T Argentina S.A.
Carlos H. Rivarola. Mr. Rivarola graduated as a Public Certified Accountant from the University of Buenos Aires and he is a partner of PricewaterhouseCoopers. He is also a member of the Surveillance Committees of Tornquist Asesores de Seguros S.A. and Toyota Argentina S.A.
Gabriel Martini. Mr. Martini graduated as a Public Certified Accountant from the University of Buenos Aires and he is a partner of PricewaterhouseCoopers. He is a member of the Professional Council of Economic Sciences of the City of Buenos Aires. Mr. Martini is also a member of the Surveillance Committee of Cibie Argentina S.A. and Emelar S.A.
Diego Niebuhr. Mr. Diego Niebuhr graduated as a Public Certified Accountant from the University of Buenos Aires. He is a partner of PricewaterhouseCoopers. In addition, he is a member of the Surveillance Committee of Commercial Union S.A., Ford Credit Cia. Financiera S.A., Nutricia Bagó S.A., Ace Seguros, EPSON Argentina S.A.
Dividends and dividend policy
According to the Argentine Law, the distribution and payment of dividends to shareholders may only be validly made if they result from the companys net and realized profits arising from the annual financial statements approved by shareholders. The approval, amount and payment of dividends is subject to the approval of our shareholders at the annual regular shareholders meeting. The approval of dividends requires the affirmative vote of the majority of voting shares.
According to the Argentine law and to our by-laws the net and realized profits of each fiscal year shall be distributed as follows:
| 5% of net profits to our legal reserve, until it reaches 20% of our adjusted corporate capital stock; |
| a specified amount fixed by shareholders meeting resolution is assigned to compensation of our Directors and members of our Surveillance Committee; and |
| dividends, additional dividends on preferred shares, if any, or application of proceeds to optional or contingent reserves or to a new account, or for any other purpose as may be determined by the shareholders meeting. |
In the past, we paid cash dividends at an average of Ps. 0.024 per share. At the shareholder meeting held on October 23, 1998, our shareholders approved the distribution of 7,997,577 treasury stock among our shareholders on a proportional basis, which are stated in the attached table as cash dividends.
As the result of the year ended June 30, 2002 was a $ 39,556,328 loss (stated in historic pesos) , the shareholders meeting resolved not to distribute dividends for such year.
The following table shows the ratio of dividends paid and total amount of dividends paid per fully paid-in common share for each year since 1995. The amounts in pesos are stated in historic pesos as of the relevant payment dates.
Year of declaration |
Cash dividends(1) |
Total per share | ||
(Pesos) | (Pesos) | |||
1995 |
| | ||
1996 |
| | ||
1997 |
| | ||
1998 |
0.099 | 0.099 | ||
1999 |
0.092 | 0.092 | ||
2000 |
0.011 | 0.011 | ||
2001 |
0.030 | 0.030 | ||
2002 |
| |
(1) | It corresponds to payments per share. To compute the dividends paid per ADS, the payment per share shall be multiplied by ten. The amounts in Pesos are stated in historic Pesos as of the relevant payment date. |
Further, the Board of Directors shall propose to the next Regular Shareholders Meeting the distribution of a cash dividend for an amount up to $ 1,500,000 or Ps. 0.012 per share. For such purpose it has specially taken into account, in addition to the years positive result, the non-distribution of dividends during the previous year and the fact that the Companys Board of Directors does not contemplate the immediate use of such funds.
Although we intend to distribute cash dividends in the future, we may not assure that we shall be in a condition to do so.
STOCK INFORMATION
Information of the value of our shares at the BASE
Our common shares are listed at the Buenos Aires Stock Exchange under the CRES symbol. Our common shares are listed at the Buenos Aires Stock Exchange since December 12, 1960. The following table shows the highest and lowest closing prices of our common shares at the Buenos Aires Stock Exchange during the specified periods.
Pesos per share | ||||
Highest |
Lowest | |||
1996 |
2.25 | 1.38 | ||
1997 |
2.47 | 1.67 | ||
1998 |
2.14 | 1.07 | ||
1999 |
||||
1st quarter |
1.20 | 0.95 | ||
2nd quarter |
1.30 | 1.03 | ||
3rd quarter |
1.09 | 1.09 | ||
4th quarter |
0.99 | 0.89 | ||
2000 |
||||
1st quarter |
1.03 | 0.81 | ||
2nd quarter |
0.96 | 0.81 | ||
3rd quarter |
0.90 | 0.79 | ||
4th quarter |
0.85 | 0.75 | ||
2001 |
||||
1st quarter |
0.93 | 0.76 | ||
2nd quarter |
1.05 | 0.80 | ||
3rd quarter |
1.02 | 0.90 | ||
4th quarter |
0.89 | 0.63 | ||
2002 |
||||
1st quarter |
1.90 | 0.75 | ||
2nd quarter |
2.35 | 1.88 | ||
3rd quarter |
2.50 | 1.52 | ||
4th quarter |
2.42 | 1.75 | ||
2003 |
||||
January |
2.50 | 1.75 | ||
February |
2.80 | 2.45 | ||
March |
2.59 | 2.05 | ||
April |
2.45 | 2.10 | ||
May |
2.45 | 2.30 | ||
June |
2.74 | 2.49 |
Source: Bloomberg.
Information of the value of our shares at the NASDAQ
Each ADS of CRESUD represents 10 common shares. The American Depository Shares are listed and traded at the NASDAQ under the CRESY symbol. The ADS are traded at the NASDAQ since March 1997 and were issued by the Bank of New York, Inc. as Depository for the ADS. The following table shows the highest and lowest closing prices of our ADS at the NASDAQ during the specified periods.
US Dollars per ADS | ||||
Highest |
Lowest | |||
1997 (since March 27, 1997) |
24.5 | 16.8 | ||
1998 |
21.4 | 10.6 | ||
1999 |
||||
1st quarter |
12.3 | 10.0 | ||
2nd quarter |
12.9 | 10.2 | ||
3rd quarter |
10.9 | 10.7 | ||
4th quarter |
10.6 | 8.8 | ||
2000 |
||||
1st quarter |
10.4 | 8.3 | ||
2nd quarter |
10.1 | 7.9 | ||
3rd quarter |
9.3 | 8.0 | ||
4th quarter |
8.6 | 7.4 | ||
2001 |
||||
1st quarter |
9.4 | 7.5 | ||
2nd quarter |
10.5 | 8.0 | ||
3rd quarter |
10.1 | 9.0 | ||
4th quarter |
9.0 | 6.1 | ||
2002 |
||||
1st quarter |
7.0 | 5.8 | ||
2nd quarter |
6.7 | 5.2 | ||
3rd quarter |
6.7 | 4.1 | ||
4th quarter |
6.3 | 4.6 | ||
2003 |
||||
January |
7.6 | 5.2 | ||
February |
8.5 | 7.4 | ||
March |
8.0 | 6.7 | ||
April |
8.5 | 6.8 | ||
May |
8.8 | 8.0 | ||
June |
10.0 | 8.8 |
Source: Bloomberg.
Name of the Company: |
Cresud Sociedad Anónima Comercial, Inmobiliaria, Financiera y Agropecuaria | |
Legal Address: |
Avda.Hipólito Yrigoyen 440, 3rd Floor, Ciudad Autónoma de Buenos Aires | |
Principal Activity: |
Agriculture and livestock and real-estate |
Financial statements for the year ended June 30, 2003
presented in comparative form with the previous year
Financial year Nº 68 started on July 1, 2002
DATES OF REGISTRATION AT THE PUBLIC REGISTRY OF COMMERCE
Of the by-laws: |
February 19,1937 | |
Of the latest amendment: |
June 2, 1997 | |
Duration of the Company: |
June 6, 2082 |
Information on controlled companies in Note 3.f.1
CAPITAL STATUS ( Note 4 ) | ||||||
SHARES | ||||||
Type of stock |
Authorized pesos |
Subscribed pesos |
Paid-in pesos | |||
Ordinary certified shares of $1 face value and 1 vote each |
124.098.095 | 124.098.095 | 124.098.095 |
Cresud Sociedad Anónima
Comercial, Inmobiliaria, Financiera y Agropecuaria and Subsidiaries
Consolidated Balance Sheet at June 30, 2003 and 2002
June 30, 2003 (Notes 1, 2, 3 and 4) Pesos |
June 30, 2002 (Notes 1, 2, 3 and 4) Pesos |
June 30, 2003 (Notes 1, 2, 3 and 4) Pesos |
June 30, 2002 (Notes 1, 2, 3 and 4) Pesos | |||||||||
ASSETS |
LIABILITIES | |||||||||||
Current Assets |
Current Liabilities | |||||||||||
Cash and banks (Note 5. a. ) |
16.995.803 | 44. 336.454 | Debts: | |||||||||
Short term investments (Note 5. b. ) |
5.459.835 | 94.461 | Trade accounts payable (Note 5. f. and Schedule G) |
4.399.323 | 13.861.820 | |||||||
Trade accounts receivable (Note 5. c. ) |
6.899.952 | 19.138.189 | Loans (Note 5. g. ) |
1.425.499 | 7.468.233 | |||||||
Other receivables and prepaid expenses (Note 5. d. ) |
6.231.659 | 8.730.539 | Salaries and social security payable (Note 5. h. ) |
1.096.627 | 930.914 | |||||||
Inventories (Note 5. e. ) |
22.841.977 | 38.202.209 | Taxes payable (Note 5. i. ) |
1.887.453 | 7.133.579 | |||||||
Total current assets |
58.429.226 | 110.501.852 | Other (Note 5. j. ) |
6.267.925 | 6.402.183 | |||||||
Total Debts |
15.076.827 | 35.796.729 | ||||||||||
Total current liabilities | 15.076.827 | 35.796.729 | ||||||||||
|
||||||||||||
Other receivables and prepaid expenses (Note 5. d. ) |
542.193 | 2.473.397 | ||||||||||
Inventories (Note 5. e. ) |
37.796.987 | 29.414.567 | ||||||||||
Investments from companies (Note 5. b. and Schedule C ) |
202.321.555 | 121.764.908 | Non-current liabilities | |||||||||
Other investments (Note 5. b. and Schedule C) |
139.160.243 | 20.717 | Loans (Note 5. g .) |
137.951.054 | | |||||||
Fixed assets, net (Schedule A) |
148.510.846 | 128.232.309 | Taxes payable (Note 5. i. ) |
22.749.374 | 21.033.814 | |||||||
Intangible assets (Schedule B) |
369.637 | 841.653 | Total non-current liabilities | 160.700.428 | 21.033.814 | |||||||
Subtotal Non-Current Assets |
528.701.461 | 282.747.551 | Subtotal | 175.777.255 | 56.830.543 | |||||||
Goodwill (Note 5. b. and Schedule C) |
(19.347.598 | ) | (13.370.988 | ) | Minority interest | 206.709 | 430.754 | |||||
Total Non-Current Assets |
509.353.853 | 269.376.563 | SHAREHOLDERS EQUITY | 391.799.125 | 322.617.118 | |||||||
Total Assets |
567.783.089 | 379.878.415 | Total Liabilities and Shareholders Equity | 567.783.089 | 379.878.415 | |||||||
The accompanying notes are an integral part of these complementary information
Cresud Sociedad Anónima
Comercial, Inmobiliaria, Financiera y Agropecuaria and Subsidiaries
Consolidated Statement of Income
For the years beginning on July 1st, 2002 and 2001 and ended June 30, 2003 and 2002
June 30, 2003 (Notes 1, 2, 3 and 4) Pesos |
June 30, 2002 (Notes 1, 2, 3 and 4) Pesos |
|||||
Sales |
||||||
Crops |
51.424.261 | 48.515.035 | ||||
Beef cattle |
17.311.212 | 27.609.516 | ||||
Milk |
2.414.992 | 2.258.210 | ||||
Others |
799.374 | 1.871.419 | ||||
Total Sales |
71.949.839 | 80.254.180 | ||||
Cost of sales (Schedule F) |
||||||
Crops |
(39.425.551 | ) | (13.817.006 | ) | ||
Beef cattle |
(8.746.014 | ) | (22.778.110 | ) | ||
Milk |
(1.483.172 | ) | (3.561.830 | ) | ||
Others |
(1.387.410 | ) | (2.122.473 | ) | ||
Total cost of sales |
(51.042.147 | ) | (42.279.419 | ) | ||
Gross income |
20.907.692 | 37.974.761 | ||||
Selling expenses (Schedule H) |
(6.045.309 | ) | (10.248.016 | ) | ||
Administrative expenses (Schedule H) |
(4.309.119 | ) | (8.368.493 | ) | ||
Gain from fixed assets sales |
4.902.218 | 16.604.275 | ||||
Gain (loss) from inventory holdings (Schedule F) |
12.224.813 | (19.603.010 | ) | |||
Operating income |
27.680.295 | 16.359.517 | ||||
Financial results (Note 5.k.) |
||||||
Financial loss generated by assets |
(51.269.561 | ) | (15.301.181 | ) | ||
Financial gain generated by liabilities |
40.329.234 | 6.562.725 | ||||
Other expenses |
||||||
Donations |
(2.000.000 | ) | | |||
Others |
(207.721 | ) | 70.836 | |||
Gain (loss) from related companies |
68.091.919 | (41.154.113 | ) | |||
Management fees |
(7.224.996 | ) | | |||
Income (loss) before income tax |
75.399.170 | (33.462.216 | ) | |||
Income tax expense |
(10.598.255 | ) | (18.654.461 | ) | ||
Minority interest |
224.046 | 348.883 | ||||
Net Income (loss) for the year |
65.024.961 | (51.767.794 | ) | |||
Basic earnings per share |
0,54 | (0,35 | ) | |||
Diluted earnings per share |
0,19 | (0,35 | ) |
The accompanying notes are an integral part of these complementary information.
Cresud Sociedad Anónima
Comercial, Inmobiliaria, Financiera y Agropecuaria and Subsidiaries
Consolidated Statement of Cash Flows
For the years beginning on July 1st, 2002 and 2001 and ended June 30, 2003 and 2002
June 30, 2003 (Notes 1, 2, 3) Pesos |
June 30, 2002 (Notes 1, 2, 3) Pesos |
|||||
Changes in funds |
||||||
Funds at the beginning of the year |
44.339.538 | 4.234.947 | ||||
Funds at the end of the year |
20.930.230 | 44.339.538 | ||||
Net (decrease) increase in funds |
(23.409.308 | ) | 40.104.591 | |||
Causes of changes in funds |
||||||
Operations activities |
||||||
Income (loss) for the year |
65.024.961 | (51.767.794 | ) | |||
Liabilities interest |
8.399.579 | 3.640.890 | ||||
Income tax |
10.598.255 | 18.654.461 | ||||
Adjustments made to reach net funds from operations activities |
||||||
Results from interest in controlled and related companies |
(68.091.919 | ) | 41.154.113 | |||
Minority interest |
(224.046 | ) | (348.883 | ) | ||
Increase in allowances and reserves |
5.728.774 | 260.946 | ||||
Amortization and depreciation |
3.553.867 | 3.971.571 | ||||
Results from inventory holdings |
(12.224.813 | ) | 19.603.010 | |||
Financial results |
(9.430.202 | ) | 5.558.058 | |||
Result from sale of fixed assets |
(4.902.218 | ) | (16.604.275 | ) | ||
Changes in operating assets and liabilities |
||||||
Decrease in current investments |
5.701.037 | 8.803.665 | ||||
Decrease (increase) in trade accounts receivable |
10.158.710 | (9.272.618 | ) | |||
Decrease in other receivables |
655.669 | 1.977.516 | ||||
Decrease (increase) in inventories |
18.992.074 | (3.697.701 | ) | |||
(Decrease) increase in social securities charges & taxes payable and advances to customers |
(10.845.802 | ) | 1.457.081 | |||
Decrease in trade accounts payable |
(7.996.890 | ) | (1.584.162 | ) | ||
Dividends collected |
1.478.533 | 1.708.820 | ||||
(Decrease) increase in other liabilities |
(5.146.094 | ) | 4.342.723 | |||
Net fund provided by operations |
11.429.475 | 27.857.421 | ||||
Investment activities |
||||||
Increase in permanent investments |
(176.627.072 | ) | | |||
Increase in interest in related companies |
(8.151.725 | ) | (21.863.150 | ) | ||
Acquisition and upgrading of fixed assets |
(30.998.217 | ) | (933.548 | ) | ||
Collection of receivables related to the sale of fixed assets |
2.543.257 | 776.176 | ||||
Sale of fixed assets |
12.750.598 | 55.811.598 | ||||
Net funds (applied to) provided by investment activities |
(200.483.159 | ) | 33.791.076 | |||
Financing activities |
||||||
Minority shareholders contribution |
| 245.939 | ||||
Dividends paid |
| (8.000.584 | ) | |||
Exercise of rights offering on treasury stock |
3.564.008 | 616.239 | ||||
Increase in financial loans |
177.457.104 | 39.324.931 | ||||
Decrease in financial loans |
(13.659.222 | ) | (53.730.431 | ) | ||
Issuance expenses of Convertible Bonds |
(1.717.514 | ) | | |||
Net funds provided by (applied to) financing activities |
165.644.376 | (21.543.906 | ) | |||
Net (decrease) increase in funds |
(23.409.308 | ) | 40.104.591 | |||
Items not involving changes in funds |
||||||
Transfer of inventory to fixed assets |
210.551 | 513.692 | ||||
Increase in long term investments by decrease in other receivables |
| 391.435 | ||||
Repayment of financial loans through issue of stock by exercise of conversion right |
593.038 | | ||||
Increase in long term investments through reduction in non-cash current investments |
| 112.578.617 |
Cresud Sociedad Anónima
Comercial, Inmobiliaria, Financiera y Agropecuaria
and Subsidiaries
Notes to the Consolidated Financial Statements
For the years ended June 30, 2003 and 2002
NOTE 1: | ARGENTINE ECONOMIC CONTEXT |
Argentinas current economic situation is highly sensitive, its main indicators being high levels of external indebtedness, a financial system in critical conditions and an economic recession that mainly until the end of 2002 brought about a major fall in the demand for goods and services and a significant increase in unemployment.
In response to the economic crisis, starting in December 2001, the Government adopted several measures and enacted laws, decrees and regulations that dramatically changed the economic model in force until that time. These changes included the flotation of the exchange rate, which led to a significant devaluation of the Argentine Peso in the first months of 2002, and the re-denomination into Pesos of certain assets and liabilities denominated in foreign currency and held in Argentina.
During 2002 in particular, this situation led to a significant and disparate increase in the various economic indicators, such as the exchange rate, the wholesale domestic price index (used to restate the financial statements for the previous year) and specific indexes for the goods and services related to the Companys business. These events have affected the comparability of the financial statements, which should be interpreted in the light of those circumstances.
Impact on the Companys economic condition
Following the devaluation of the Argentine Peso and the increase in the profitability of the agricultural-livestock business, the demand for land has begun to increase, leading to a considerable rise in US Dollar prices, which are now at levels comparable to those prior to the Argentine crisis. Given this scenario, the Companys Board of Directors will be in a position to identify and take advantage of market opportunities for purchases and sales of land.
In addition, by fiscal year end IRSA Inversiones y Representaciones S.A., in which we hold an interest, had overcome the crisis that had caused uncertainties in its course of business as of June 30, 2002. At present, this subsidiary has a liquidity position that will allow it to take advantage of any opportunities that may arise in the real estate market.
NOTE 2: | BASIS OF PRESENTATION OF THE FINANCIAL STATEMENTS |
As a consequence of the application of General Resolutions No. 368/01, 434/03 and 441/03 of the Argentine Securities and Exchange Commission, which require that consolidated Financial Statements be presented as established by Technical Resolution No. 4 of the Argentine Federation of Professional Councils in Economic Sciences, as amended by Technical Resolution No. 19, the Balance Sheet as of June 30, 2003 and 2002 and the Income Statements and the Statements of Cash Flows for the fiscal years then ended were consolidated on a line by line basis with the financial statements of such companies in which it holds a majority of the voting shares, by application of the new rules and discontinuation of adjustment for inflation, respectively (see Note 2.b and 2.c to the basic financial statements).
Cresud Sociedad Anónima
Comercial, Inmobiliaria, Financiera y Agropecuaria
and Subsidiaries
Notes to the Consolidated Financial Statements (Continued)
NOTE 2: | (Continued) |
The Financial Statements of the Subsidiary Companies Inversiones Ganaderas S.A. and Futuros y Opciones.Com S.A. as of June 30, 2003 and 2002 have been used to determine the proportional equity value and carry out the consolidation. For purposes of comparability, reclassifications have been made on the information at June 30, 2002.
These Financial Statements and the corresponding notes and schedules are prepared in Argentine Pesos.
NOTE 3: | CORPORATE CONTROL |
The Companys interest in other companies is shown in the following table.
COMPANY |
PERCENTAGE OF VOTING SHARES OWNED | |
Inversiones Ganaderas S.A. |
99.99 | |
Futuros y Opciones.Com S.A. |
70.00 |
NOTE 4: | SIGNIFICANT ACCOUNTING POLICIES |
The Financial Statements of the Subsidiary Companies mentioned in Note 3 have been prepared based on accounting principles consistent with those followed by Cresud Sociedad Anónima Comercial, Inmobiliaria, Financiera y Agropecuaria for the preparation of its Financial Statements, as detailed in Note 3 of the individual financial statements.
The most significant valuation criteria used for the preparation of the Financial Statements of the Subsidiary Companies not detailed in the valuation criteria of the Parent Company were as follows:
Intangible Assets Development expenditures
These expenses include organizational and development costs of the web page incurred until March 31, 2001. These expenses were restated to year-end currency and were depreciated by the straight line method over thirty-six months as from April 1, 2001. For being less than five years, this depreciation term qualifies under the second option of the transitional rules provided in section 8.2.3. of Technical Resolution No. 17.
Cresud Sociedad Anónima
Comercial, Inmobiliaria, Financiera y Agropecuaria and Subsidiaries
Notes to the Consolidated Financial Statements (Continued)
NOTE 5: | Details of consolidated balance sheet and consolidated income statement accounts |
a. | Cash and banks |
June 30, | ||||
2003 Pesos |
2002 Pesos | |||
Cash |
43.967 | 108.977 | ||
Foreign currency (Schedule G) |
3.239.854 | 829.415 | ||
Lecop currency |
| 90.892 | ||
Local currency checking account |
645.182 | 4.104.639 | ||
Patacones currency checking account |
171.891 | 49.799 | ||
Lecop currency checking account |
62.532 | 38.272 | ||
Foreign currency checking account (Schedule G) |
12.370.530 | 38.153.908 | ||
Local currency saving account |
20.583 | 654.400 | ||
Checks to be deposited |
415.481 | 306.152 | ||
Patacones checks to be deposited |
25.783 | | ||
16.995.803 | 44.336.454 | |||
b. | Investments and Goodwill |
June 30, |
||||||
2003 Pesos |
2002 Pesos |
|||||
Short term investment |
||||||
Schedule C |
5.459.835 |
|
94.461 |
| ||
5.459.835 |
|
94.461 |
| |||
Investment from companies |
||||||
Investment from related companies (Schedule C) |
202.321.555 |
|
121.764.908 |
| ||
202.321.555 |
|
121.764.908 |
| |||
Other investments |
||||||
Schedule C |
139.160.243 |
|
20.717 |
| ||
139.160.243 |
|
20.717 |
| |||
Goodwill |
||||||
Schedule C |
(19.347.598) |
|
(13.370.988) |
| ||
(19.347.598 |
) |
(13.370.988 |
) |
Cresud Sociedad Anónima
Comercial, Inmobiliaria, Financiera y Agropecuaria and Subsidiaries
Notes to the Consolidated Financial Statements (Continued)
NOTE 5: | (Continued) |
c. | Trade accounts receivable |
June 30, |
||||||
2003 Pesos |
2002 Pesos |
|||||
Current |
||||||
Accounts receivable in local currency |
5.345.126 | 7.555.171 | ||||
Accounts receivable in foreign currency (Schedule G) |
2.020.242 | 12.179.875 | ||||
Subsidiaries and related companies Law 19,550 Article 33: |
||||||
Cactus Argentina S.A. |
13.709 | 158.524 | ||||
IRSA Inversiones y Representaciones Sociedad Anónima |
| 47.553 | ||||
Less: |
||||||
Allowances for defaulting debtors |
(479.125 | ) | (802.934 | ) | ||
6.899.952 | 19.138.189 | |||||
d. | Other receivables and prepaid expenses |
June 30, | ||||
2003 Pesos |
2002 Pesos | |||
Current |
||||
Other |
267.392 | 2.836.841 | ||
Prepaid leases |
1.894.560 | 2.660.795 | ||
Guarantee deposits (Schedule G) |
682.027 | 1.107.727 | ||
Secured by mortgage and under legal proceedings |
531.602 | 685.225 | ||
Prepaid expenses |
864.244 | 469.718 | ||
Surety bonds received |
| 421.513 | ||
Tax credits |
201.559 | 253.361 | ||
Subsidiaries and related companies Law 19,550 Article 33: |
||||
Cactus Argentina S.A. |
1.334.692 | 286.154 | ||
IRSA Inversiones y Representaciones Sociedad Anónima |
| 9.205 | ||
Shareholders |
455.583 | | ||
6.231.659 | 8.730.539 | |||
Non-current |
||||
Secured by mortgage |
504.192 | 1.537.013 | ||
Prepaid leases |
| 176.449 | ||
Tax on Minimum Hypothetical Income |
26.574 | 164.596 | ||
Other |
11.427 | 107.188 | ||
Subsidiaries and related companies Law 19,550 Article 33: |
||||
Cactus Argentina S.A. |
| 488.151 | ||
542.193 | 2.473.397 | |||
Cresud Sociedad Anónima
Comercial, Inmobiliaria, Financiera y Agropecuaria and Subsidiaries
Notes to the Consolidated Financial Statements (Continued)
NOTE 5: | (Continued) |
e. | Inventories |
June 30, | ||||
2003 Pesos |
2002 Pesos | |||
Current |
||||
Livestock |
13.116.997 | 7.498.259 | ||
Crops |
6.301.776 | 25.222.406 | ||
Unharvestedcrops |
1.112.230 | 835.288 | ||
Seedsand fodder |
171.486 | 406.468 | ||
Materialsand others |
1.501.686 | 3.124.842 | ||
Advancesto suppliers |
637.802 | 1.114.946 | ||
22.841.977 | 38.202.209 | |||
Non-Current |
||||
Livestock |
37.796.987 | 29.414.567 | ||
37.796.987 | 29.414.567 | |||
f. | Trade accounts payable |
June 30, | ||||
2003 Pesos |
2002 Pesos | |||
Current |
||||
Suppliers in local currency |
3.759.549 | 4.933.419 | ||
Suppliers in foreign currency (Schedule G) |
436.439 | 8.753.862 | ||
Subsidiaries and related companies Law 19,550 Article 33: |
||||
IRSA Inversiones y Representaciones Sociedad Anónima |
203.335 | 27.012 | ||
Notes (Schedule G) |
| 147.527 | ||
4.399.323 | 13.861.820 | |||
Cresud Sociedad Anónima
Comercial, Inmobiliaria, Financiera y Agropecuaria and Subsidiaries
Notes to the Consolidated Financial Statements (Continued)
NOTE 5: | (Continued) |
g. | Loans |
June 30, | |||||
2003 Pesos |
2002 Pesos | ||||
Current |
|||||
Local financial loans |
| 7.468.233 | |||
Convertible Bonds 2007 Interest payable (Schedule G) |
1.425.499 | | |||
1.425.499 | 7.468.233 | ||||
Non Current |
|||||
Convertible Bonds 2007 (Schedule G) |
139.450.965 | | |||
Convertible Bonds 2007 expenses |
(1.499.911 | ) | | ||
137.951.054 | | ||||
h. | Salaries and social security payable |
June 30, | ||||
2003 Pesos |
2002 Pesos | |||
Current |
||||
Vacation, statutory annual bonus and incentive allowance |
859.519 | | ||
Social security administration |
138.564 | 187.100 | ||
Salaries payable |
94.607 | 696.139 | ||
Health care scheme |
1.043 | 29.015 | ||
Other |
2.894 | 18.660 | ||
1.096.627 | 930.914 | |||
Cresud Sociedad Anónima
Comercial, Inmobiliaria, Financiera y Agropecuaria and Subsidiaries
Notes to the Consolidated Financial Statements (Continued)
NOTE 5: | (Continued) |
i. | Taxes payable |
June 30, |
||||||
2003 Pesos |
2002 Pesos |
|||||
Current |
||||||
Accrual for income tax |
6.304.357 | 7.676.984 | ||||
Advances to Income tax |
(4.669.379 | ) | | |||
Tax on Minimum Hypothetical Income |
(124.503 | ) | (2.294.127 | ) | ||
Value added tax |
45.164 | 1.281.673 | ||||
Property tax payable |
179.614 | 233.790 | ||||
Taxes withheld for income tax |
45.494 | 177.624 | ||||
Personal assets tax |
148.824 | 3.731 | ||||
Sales tax payable |
169.448 | 12.423 | ||||
Taxes withheld-Gross sales tax payable |
(83.328 | ) | 13 | |||
Taxes withheld-Value added tax payable |
(134.693 | ) | 37.154 | |||
Other |
6.455 | 4.314 | ||||
1.887.453 | 7.133.579 | |||||
Non-current |
||||||
Deferred tax |
22.749.374 | 21.033.814 | ||||
22.749.374 | 21.033.814 | |||||
j. | Other |
June 30, |
||||||
2003 Pesos |
2002 Pesos |
|||||
Current |
||||||
Accrual for other expenses (Schedule G) |
2.816.293 | 5.668.558 | ||||
Accrual for Directors´ Fees |
41.806 | 490.856 | ||||
Advances to Directors |
(37.968 | ) | (144.242 | ) | ||
Accrual for cereal expenses |
108.825 | 205.331 | ||||
Accrual for Management fees |
3.204.773 | 30.951 | ||||
Subsidiaries and related companies Law 19,550 Article 33: |
||||||
Loan to FYO minority shareholders |
134.196 | 150.729 | ||||
6.267.925 | 6.402.183 | |||||
Cresud Sociedad Anónima
Comercial, Inmobiliaria, Financiera y Agropecuaria and Subsidiaries
Notes to the Consolidated Financial Statements (Continued)
NOTE 5: | (Continued) |
k. | Financial results |
June 30, |
||||||
2003 Pesos |
2002 Pesos |
|||||
Generated by assets: |
||||||
Exchange differences and discounts |
(54.222.043 | ) | 6.621.107 | |||
Interest income |
886.510 | 2.186.717 | ||||
Bad debts |
(50.000 | ) | (260.946 | ) | ||
Reference stabilization index (CER) |
507.772 | 739.856 | ||||
Banks expenses |
(749 | ) | (3.603 | ) | ||
Tax on debts and credits |
(904.829 | ) | (868.392 | ) | ||
Holding results |
(2.640.590 | ) | (3.414.145 | ) | ||
Inflation adjustment |
(2.092.148 | ) | (8.146.264 | ) | ||
Holding results and operations of stocks and bonds |
||||||
Convertible Bonds purchase interest |
7.080.857 | | ||||
Others |
165.659 | (12.155.511 | ) | |||
(51.269.561 | ) | (15.301.181 | ) | |||
June 30, |
||||||
2003 Pesos |
2002 Pesos |
|||||
Generated by liabilities: |
||||||
Holding results |
1.286.969 | 13.725.917 | ||||
Inflation adjustment |
4.698.515 | 2.780.790 | ||||
Reference stabilization index (CER) |
(531.789 | ) | (1.772.124 | ) | ||
Interest expense |
(11.175 | ) | (804 | ) | ||
Subsidiaries and related companies Law 19,550 Article 33: |
||||||
IRSA Inversiones y Representaciones Sociedad Anónima |
| (460.695 | ) | |||
Financial expenses |
||||||
Convertible Bonds issued interest |
(6.965.029 | ) | | |||
Other |
(1.276.683 | ) | (2.149.416 | ) | ||
Exchange differences and discounts |
43.128.426 | (5.560.943 | ) | |||
40.329.234 | 6.562.725 | |||||
Cresud Sociedad Anónima
Comercial, Inmobiliaria, Financiera y Agropecuaria and Subsidiaries
Notes to the Consolidated Financial Statements (Continued)
NOTE 6:
ASSETS AND LIABILITIES, CLASSIFIED ACCORDING TO THEIR COLLECTION OR PAYMENT MATURITIES
a) | Based on their estimated collection or payment term ( in pesos) |
Based on their |
Current and non- current investment |
Trade accounts receivable |
Other receivables and prepaid expenses |
Trade payables |
Loans |
Salaries payable and social security payable |
Taxes payable |
Other liabilities | ||||||||||||||||||||||||
2003 |
2002 |
2003 |
2002 |
2003 |
2002 |
2003 |
2002 |
2003 |
2002 |
2003 |
2002 |
2003 |
2002 |
2003 |
2002 | |||||||||||||||||
1st quarter 2004/2003 financial year |
1.422.315 | | 6.874.952 | 19.138.189 | 2.471.562 | 4.859.197 | 4.352.500 | 13.857.841 | 1.425.499 | 7.468.233 | 1.083.306 | 930.914 | 1.664.184 | | 6.133.729 | 6.236.101 | ||||||||||||||||
2nd quarter 2004/2003 financial year |
| | | | 129.130 | 22.646 | | | | | 13 321 | | 204.794 | 7.121.436 | | | ||||||||||||||||
3rd quarter 2004/2003 financial year |
| | | | 505.786 | 53.746 | | | | | | | | | | 15.353 | ||||||||||||||||
4th quarter 2004/2003 financial year |
| | | | 250.925 | 490.543 | | | | | | | 2.795 | | | | ||||||||||||||||
1st quarter 2005/2004 financial year |
| | | | | 164.596 | | | | | | | | | | | ||||||||||||||||
2nd quarter 2005/2004 financial year |
| | | | | | | | | | | | | | | | ||||||||||||||||
3rd quarter 2005/2004 financial year |
| | | | 504.192 | 63.420 | | | | | | | | | | | ||||||||||||||||
4th quarter 2005/2004 financial year |
| | | | | 490.543 | | | | | | | | | | | ||||||||||||||||
1st quarter 2006/2005 financial year |
| | | | | | | | | | | | | | | |||||||||||||||||
2nd quarter 2006/2005 financial year |
| | | | | | | | | | | | | | | |||||||||||||||||
3rd quarter 2006/2005 financial year |
| | | | | 74.835 | | | | | | | | | | |||||||||||||||||
4th quarter 2006/2005 financial year |
| | | | | 490.543 | | | | | | | | | | |||||||||||||||||
1st quarter 2007/2006 financial year |
| | | | | | | | | | | | | | | |||||||||||||||||
2nd quarter 2007/2006 financial year |
| | | | | | | | | | | | | | | |||||||||||||||||
3rd quarter 2007/2006 financial year |
| | | | | 417.671 | | | | | | | | | | |||||||||||||||||
4th quarter 2007/2006 financial year |
| | | | | | | | | | | | | | ||||||||||||||||||
2nd quarter 2008/2007 financial year |
139.160.243 | | | | | | | | 137.951.054 | | | | | | | |||||||||||||||||
4th quarter 2012/2011 financial year |
| | | | | | | | | | | | | |||||||||||||||||||
Overdue |
| | 25.000 | | | | | | | | | | 15.680 | 12.143 | | | ||||||||||||||||
With no stated term |
4.037.520 | 94.461 | | 2.912.257 | 4.076.196 | 46.823 | 3.979 | | | | | 22.749.374 | 21.013.814 | 134.196 | 150.729 | |||||||||||||||||
Total |
144.620.078 | 94.461 | 6.899.952 | 19.138.189 | 6.773.852 | 11.203.936 | 4.399.323 | 13.861.820 | 139.376.553 | 7.468.233 | 1.096.627 | 930.914 | 24.636.827 | 28.147.393 | 6.267.925 | 6.402.183 | ||||||||||||||||
b) Assets and liabilities classified according to the interest rate that they accrued (in pesos) | ||||||||||||||||||||||||||||||||
Interest rate that |
Current and non- current investment |
Trade accounts receivable |
Other receivables and prepaid expenses |
Trade payables |
Loans |
Salaries payable and social security |
Taxes payable |
Other liabilities | ||||||||||||||||||||||||
2003 |
2002 |
2003 |
2002 |
2003 |
2002 |
2003 |
2002 |
2003 |
2002 |
2003 |
2002 |
2003 |
2002 |
2003 |
2002 | |||||||||||||||||
At fixed interest rate |
139.160.243 | | | 1.322.687 | 2.395.656 | | | 139.450.965 | 7.242.733 | | | | | | | |||||||||||||||||
At variable interest rate |
4.037.520 | 94.461 | | | 277.048 | 722.921 | | | | | | | | | | | ||||||||||||||||
Non-interest bearing |
1.422.315 | | 6.899.952 | 19.138.189 | 5.174.117 | 8.085.359 | 4.399.323 | 13.861.820 | 1.425.499 | 225.500 | 1.096.627 | 930.914 | 24.636.827 | 28.147.393 | 6.267.925 | 6.402.183 | ||||||||||||||||
Total |
144.620.078 | 94.461 | 6.899.952 | 19.138.189 | 6.773.852 | 11.203.936 | 4.399.323 | 13.861.820 | 140.876.464 | 7.468.233 | 1.096.627 | 930.914 | 24.636.827 | 28.147.393 | 6.267.925 | 6.402.183 | ||||||||||||||||
Cresud Sociedad Anónima
Comercial, Inmobiliaria, Financiera y Agropecuaria and Subsidiaries
Notes to the Consolidated Financial Statements (Continued)
NOTE 7: | EARNINGS PER SHARE |
BASIC Earnings per Share |
06-30-03 |
06-30-02 |
|||
Earnings |
65,053,191 | (41,684,580 | ) | ||
Number of shares |
121,388,429 | 119,756,371 | |||
Earnings per share |
0.54 | (0.35 | ) |
DILUTED Earnings per Share |
06-30-03 |
06-30-02 |
|||
Earnings |
48,053,080 | (41,684,580 | ) | ||
Number of shares |
244,280,962 | 119,756,371 | |||
Earnings per share |
0.19 | (0.35 | ) |
NOTE 8: | DATA PER SEGMENT |
As of June 30, 2003:
Description |
Crops |
Beef Cattle |
Milk |
Other |
Total | |||||
Sales |
51,424,261 | 17,311,212 | 2,414,992 | 799,374 | 71,949,839 | |||||
Assets |
89,235,541 | 137,170,463 | 9,352,966 | 332,024,119 | 567,783,089 | |||||
Liabilities |
3,297,335 | 1,042,222 | 22,564 | 171,415,134 | 175,777,255 | |||||
Fixed asset additions |
29,078,790 | 1,498,858 | 157,960 | 262,609 | 30,998,217 | |||||
Depreciation of fixed assets |
1,373,437 | 1,266,970 | 186,021 | 255,423 | 3,081,851 | |||||
Amortization of intangible assets |
| | | 472,016 | 472,016 | |||||
Income from related companies |
2,093,536 | 401,304 | 186,095 | 65,410,984 | 68,091,919 |
NOTE 9: | SUBSEQUENT EVENTS |
On July 29, 2003, Inversiones Ganaderas S.A. sold to Las Rejas S.A. three properties owned by it located in the district of Santo Domingo, department of La Paz, Province of Catamarca, with a total area of 5997 hectares, for an amount of US$ 430,000, fully paid as of the date of execution of the deed.
Cresud Sociedad Anónima
Comercial, Inmobiliaria, Financiera y Agropecuaria and Subsidiaries
Consolidated Fixed Assets
For the years beginning on July lst, 2002 and 2001 and ended June 30, 2003 and 2002
(Notes 1,2,3 and 4)
Schedule A
Depreciation |
||||||||||||||||||||||
Principal Account |
Value at the beginning of the year Pesos |
Additions and/or transfers Pesos |
Deductions and/or transfers Pesos |
Value at the end of year Pesos |
Rate % |
Accumulated at the beginning of the year Pesos |
Decrease of the year Pesos |
Current year Amount Pesos |
Accumulated at the end of year Pesos |
Net carrying 2003 Pesos |
Net carrying 2002 Pesos | |||||||||||
Real estate |
101.683.376 | 29.401.490 | 6.751.980 | 124.332.894 | | | | | | 124.332.894 | 101.683.376 | |||||||||||
Wire fences |
5.549.228 | 19.637 | 81.400 | 5.487.465 | 3 | 1.198.686 | 81.390 | 173.304 | 1.290.600 | 4.196.865 | 4.350.542 | |||||||||||
Watering troughs |
3.695.094 | 3.005 | 20.859 | 3.677.240 | 3 | 694.049 | 20.859 | 178.966 | 852.156 | 2.825.084 | 3.001.045 | |||||||||||
Alfalfa fields and meadows |
2.964.707 | 394.117 | | 3.358.824 | 13-25-50 | 1.869.007 | | 499.745 | 2.368.752 | 990.072 | 1.095.700 | |||||||||||
Building and constructions |
5.816.197 | 50.786 | 292.988 | 5.573.995 | 2 | 1.849.158 | 64.079 | 96.509 | 1.881.588 | 3.692.407 | 3.967.039 | |||||||||||
Machinery |
11.337.850 | 61.214 | 2.262.436 | 9.136.628 | 10 | 6.206.029 | 1.494.958 | 836.626 | 5.547.697 | 3.588.931 | 5.131.821 | |||||||||||
Vehicles |
1.114.834 | 302.848 | 257.207 | 1.160.475 | 20 | 741.146 | 197.559 | 189.173 | 732.760 | 427.715 | 373.688 | |||||||||||
Tools |
187.883 | 4.274 | | 192.157 | 10 | 105.966 | | 14.972 | 120.938 | 71.219 | 81.917 | |||||||||||
Furniture and equipment |
1.085.600 | 15.157 | 1.678 | 1.099.079 | 10 | 614.213 | 848 | 88.357 | 701.722 | 397.357 | 471.387 | |||||||||||
Breading livestock |
398.797 | | 13.199 | 385.598 | 20 | 397.040 | 13.199 | 1.757 | 385.598 | | 1.757 | |||||||||||
Corral and leading lanes |
580.122 | 44.863 | | 624.985 | 3 | 89.615 | | 20.353 | 109.968 | 515.017 | 490.507 | |||||||||||
Roads |
1.358.228 | 6.721 | | 1.364.949 | 10 | 592.397 | | 124.925 | 717.322 | 647.627 | 765.831 | |||||||||||
Facilities |
5.755.862 | 266.832 | | 6.022.694 | 10-20-33 | 2.219.731 | | 628.794 | 2.848.525 | 3.174.169 | 3.536.131 | |||||||||||
Computer equipment |
1.131.275 | 178.380 | 18.845 | 1.290.810 | 10 | 816.031 | 14.923 | 165.441 | 966.549 | 324.261 | 315.244 | |||||||||||
Planes |
10.444 | | | 10.444 | 10 | 10.444 | | | 10.444 | | | |||||||||||
Silo plants |
1.050.811 | 115.339 | | 1.166.50 | 2 | 189.642 | | 62.929 | 252.571 | 913.579 | 861.169 | |||||||||||
Constructions in progress |
1.987.107 | 344.097 | | 2.331.204 | | | | | | 2.331.204 | 1.987.107 | |||||||||||
Advances to suppliers |
118.048 | | 35.603 | 82.445 | | | | | | 82.445 | 118.048 | |||||||||||
Total at June 30, 2003 |
145.825.463 | 31.208.768 | 9.736.195 | 167.298.036 | 17.593.154 | 1.887.815 | 3.081.851 | 18.787.190 | 148.510.846 | | ||||||||||||
Total at June 30, 2002 |
187.113.554 | 1.447.240 | 42.735.331 | 145.825.463 | 17.619.713 | 3.528.008 | 3.501.449 | 17.593.154 | 128.232.309 | |||||||||||||
Cresud Sociedad Anónima
Comercial, Inmobiliaria, Financiera y Agropecuaria and Subsidiaries
Consolidated Investments
For the years beginning on July 1st, 2002 and 2001 and ended June 30, 2003 and 2002
(Notes 1,2,3 and 4)
Schedule B
Amortization |
||||||||||||||||||
Current year |
||||||||||||||||||
Principal Account |
Value at the beginning of the year Pesos |
Additions Pesos |
Value at the end of year Pesos |
Accumulated at the beginning of year Pesos |
Rate % |
Amount (1) Pesos |
Accumulated at the end of Pesos |
Net carrying value at June 30, 2003 Pesos |
Net carrying value at June 30, 2002 Pesos | |||||||||
Development expenditures |
1.410.368 | | 1.410.368 | 587.653 | 33,33 | 470.122 | 1.057.775 | 352.593 | 822.715 | |||||||||
Brands and patents |
18.938 | | 18.938 | | 1.894 | 1.894 | 17.044 | 18.938 | ||||||||||
Total at June 30, 2003 |
1.429.306 | | 1.429.306 | 587.653 | 472.016 | 1.059.669 | 369.637 | | ||||||||||
Total at June 30, 2002 |
1.429.306 | | 1.429.306 | 117.531 | 470.122 | 587.653 | | 841.653 | ||||||||||
(1) | The destiny of the amortization of the year is included in the Consolidated Schedule H. |
Cresud Sociedad Anónima
Comercial, Inmobiliaria, Financiera y Agropecuaria and Subsidiaries
Consolidated Investments
For the years beginning on July lst, 2002 and 2001 and ended June 30,2003 and 2002
(Notes 1,2,3 and 4)
Schedule C
Type and characteristics of the securities |
Amount |
Value at June 30, 2003 |
Value at June 30, 2002 |
Market Value |
INFORMATION ON THE ISSUER | |||||||||||||
Principal activity |
Latest financial statements | |||||||||||||||||
Capital Pesos |
Income for the year Pesos |
Shareholders Pesos | ||||||||||||||||
Current Investments |
||||||||||||||||||
Mutual Funds |
||||||||||||||||||
ABN AMRO in pesos |
1.272.427 | 2.888.061 | | 2.26973 | ||||||||||||||
Fondo especial Banco Rio in pesos |
4.719.596 | 1.042.426 | | 0.22087 | ||||||||||||||
Fondo plazo fijo Banco Rio in dollars |
1.778 | 3.938 | 3.084 | 2.21485 | ||||||||||||||
Fondo Letes Banco Frances |
| 1.194 | ||||||||||||||||
Fondo Letes Banco Rio |
| 3.326 | ||||||||||||||||
3.934.425 | 7.604 | |||||||||||||||||
Notes and Convertible Bonds |
||||||||||||||||||
Convertible Bonds 2007 IRSA |
1.422.315 | | ||||||||||||||||
Bonos Global 2010 |
110.000 | 102.465 | 86.857 | 0.931500 | ||||||||||||||
Bocon Pro 1 |
157.647 | 630 | | 0.003993 | ||||||||||||||
1.525.410 | 86.857 | |||||||||||||||||
Total current investments |
5.459.835 | 94.461 | ||||||||||||||||
Non-current investments |
||||||||||||||||||
Related companies Law 19,550. Article 33 |
||||||||||||||||||
AGRO-URANGA S. A. |
unlisted | Agricultural and livestock | 2.500.000 | 6.658.452 | 14.289.525 | |||||||||||||
Shares |
893.069 | 4.971.181 | 4.303.616 | |||||||||||||||
Contribution on account of future subscriptions of shares |
7.865 | 7.865 | ||||||||||||||||
Higher value of property |
11.179.150 | 11.179.150 | ||||||||||||||||
16.158.196 | 15.490.631 | |||||||||||||||||
CACTUS ARGENTINA S.A. |
unlisted | Exploitation and administration of agricultural and beef cattle products |
1.300.000 | 605.357 | 5.755.547 | |||||||||||||
Shares |
650.000 | 742.155 | 439.473 | |||||||||||||||
Contribution on account of future subscriptions of shares |
2.135.618 | 2.135.618 | ||||||||||||||||
2.877.773 | 2.575.091 | |||||||||||||||||
IRSA lnversiones y Representaciones S.A. |
48.022.307 | 183.285.586 | 103.699.186 | listed | Real estate |
212.013.000 | 286.445.000 | 809.186.000 | ||||||||||
Shares |
183.285.586 | 103.699.186 | ||||||||||||||||
Subtotal | 202.321.555 | 121.764.908 | ||||||||||||||||
Other |
||||||||||||||||||
Convertible Bonds 2007 IRSA |
49.692.688 | 139.139.526 | | |||||||||||||||
Coprolan |
20.717 | 20.717 | unlisted | | | | ||||||||||||
Subtotal | 139.160.243 | 20.717 | ||||||||||||||||
Goodwill |
||||||||||||||||||
Goodwill |
1.319.353 | 1.979.030 | ||||||||||||||||
IRSA negative goodwill |
Subtotal | (20.666.951 | ) | (15.350.018 | ) | |||||||||||||
(19.347.598 | ) | (13.370.988 | ) | |||||||||||||||
Total non-current investments |
322.134.200 | 108.414.637 | ||||||||||||||||
Cresud Sociedad Anónima
Comercial, Inmobiliaria, Financiera y Agropecuaria and Subsidiaries
Consolidated Allowances and provisions
For the years beginning on July 1st, 2002 and 2001 and ended June 30, 2003 and 2002
(Notes 1,2,3 and 4)
Schedule E
Item |
Opening balances Pesos |
Increases (1) Pesos |
Decreases Pesos |
Inflation Adjustment Pesos |
Value at June 30, Pesos |
Value at June 30, Pesos | |||||||
Deducted from asset |
|||||||||||||
Defaulting debtors |
802.934 | 50.000 | 286.146 | (87.663 | ) | 479.125 | 802.934 | ||||||
Total at June 30, 2003 |
802.934 | 50.000 | 286.146 | (87.663 | ) | 479.125 | |||||||
Total at June 30, 2002 |
1.185.704 |
260.946 | | (643.716 | ) | | 802.934 | ||||||
(1) | The accounting appropriation is included in Note 5 k. |
Cresud Sociedad Anónima
Comercial, Inmobiliaria, Financiera y Agropecuaria and Subsidiaries
Consolidated Cost of sales
For the years beginning on July 1st, 2002 and 2001 and ended June 30, 2003 and 2002
(Notes 1,2,3 and 4)
Schedule F
Crops |
Beef cattle |
Milk |
Others |
Total |
||||||||||||||||||||||||||||||||
June 30, 2003 Pesos |
June 30, 2002 Pesos |
June 30, 2003 Pesos |
June 30, 2002 Pesos |
June 30, 2003 Pesos |
June 30, 2002 Pesos |
June 30, 2003 Pesos |
June 30, 2002 Pesos |
June 30, 2003 Pesos |
June 30, 2002 Pesos |
|||||||||||||||||||||||||||
Inventories at the beginning of the year |
||||||||||||||||||||||||||||||||||||
Beef cattle |
| | 35.445.265 | 62.440.727 | 1.467.561 | 4.296.269 | | | 36.912.826 | 66.736.996 | ||||||||||||||||||||||||||
Crops |
25.222.406 | 12.398.444 | | | | | | | 25.222.406 | 12.398.444 | ||||||||||||||||||||||||||
Unharvested crops |
835.288 | 1.543.168 | | | | | | | 835.288 | 1.543.168 | ||||||||||||||||||||||||||
Seeds and fodder |
| | 291.033 | 247.823 | 115.435 | 192.230 | | | 406.468 | 440.053 | ||||||||||||||||||||||||||
Materials |
2.749.377 | 2.330.989 | 30.356 | 12.319 | 51.731 | 15.600 | 293.378 | 469.160 | 3.124.842 | 2.828.068 | ||||||||||||||||||||||||||
28.807.071 | 16.272.601 | 35.766.654 | 62.700.869 | 1.634.727 | 4.504.099 | 293.378 | 469.160 | 66.501.830 | 83.946.729 | |||||||||||||||||||||||||||
Holding results |
| 754.326 | 11.240.614 | (18.201.808 | ) | 984.199 | (2.090.656 | ) | | (64.872 | ) | 12.224.813 | (19.603.010 | ) | ||||||||||||||||||||||
Commodities market results |
(290.717 | ) | (3.879.793 | ) | | | | | | | (290.717 | ) | (3.879.793 | ) | ||||||||||||||||||||||
Transfer of inventories to expenses |
(93.181 | ) | (125.528 | ) | (67.093 | ) | (27.554 | ) | | | | | (160.274 | ) | (153.082 | ) | ||||||||||||||||||||
Transfer of inventories to fixed assets |
(207.388 | ) | (478.742 | ) | | (9.075 | ) | | | (3.163 | ) | (25.875 | ) | (210.551 | ) | (513.692 | ) | |||||||||||||||||||
Transfer of Unharvested crops to expenses |
(13.762.016 | ) | (22.179.781 | ) | (379.693 | ) | (381.540 | ) | (183.214 | ) | (197.771 | ) | (502.491 | ) | (311.140 | ) | (14.827.414 | ) | (23.070.232 | ) | ||||||||||||||||
Recovery of inventories |
| | 254.651 | 762.022 | (254.651 | ) | (762.022 | ) | | | | | ||||||||||||||||||||||||
Purchases |
14.301.841 | 20.758.972 | 2.737.099 | 1.997.938 | 167.263 | 335.630 | 594.595 | 670.117 | 17.800.798 | 23.762.657 | ||||||||||||||||||||||||||
Operating expenses (Schedule H) |
19.306.202 | 31.502.022 | 7.925.599 | 11.703.911 | 1.521.863 | 3.407.278 | 1.251.160 | 1.678.461 | 30.004.824 | 48.291.672 | ||||||||||||||||||||||||||
Less: |
||||||||||||||||||||||||||||||||||||
Inventories at the end of the year |
||||||||||||||||||||||||||||||||||||
Beef cattle |
| | (48.619.300 | ) | (35.445.265 | ) | (2.294.684 | ) | (1.467.561 | ) | | | (50.913.984 | ) | (36.912.826 | ) | ||||||||||||||||||||
Crops |
(6.301.776 | ) | (25.222.406 | ) | | | | | | | (6.301.776 | ) | (25.222.406 | ) | ||||||||||||||||||||||
Unharvested crops |
(1.112.230 | ) | (835.288 | ) | | | | | | | (1.112.230 | ) | (835.288 | ) | ||||||||||||||||||||||
Seeds and fodder |
| | (112.517 | ) | (291.033 | ) | (58.969 | ) | (115.435 | ) | | | (171.486 | ) | (406.468 | ) | ||||||||||||||||||||
Materials |
(1.222.255 | ) | (2.749.377 | ) | | (30.355 | ) | (33.362 | ) | (51.732 | ) | (246.069 | ) | (293.378 | ) | (1.501.686 | ) | (60.001.162 | ) | (3.124.842 | ) | (66.501.830 | ) | |||||||||||||
Cost of Sales |
39.425.551 | 13.817.006 | 8.746.014 | 22.778.110 | 1.483.172 | 3.561.830 | 1.387.410 | 2.122.473 | 51.042.147 | 42.279.419 | ||||||||||||||||||||||||||
Cresud Sociedad Anónima
Comercial, Inmobiliaria, Financiera y Agropecuaria and Subsidiaries
Consolidated Foreign currency assets and liabilities
For the years benning on July 1st, 2002 and 2001 and ended June 30, 2003 and 2002
(Notes 1,2,3 and 4)
Schedule G
June 30, 2003 |
June 30, 2002 | |||||||||||
Item |
Type and amount of foreign currency |
Current exchange rate |
Amount in local currency |
Type and amount of foreign currency |
Amount in local currency Pesos | |||||||
Current Asset |
||||||||||||
Cash and banks |
US$ | 5.781.624 | 2,700 | 15.610.384 | US$ | 9.380.371 | 38.983.323 | |||||
Investments: |
||||||||||||
Mutual funds |
US$ | 1.459 | 2,700 | 3.938 | US$ | 1.777 | 3.084 | |||||
Convertible Bonds 2007 IRSA |
US$ | 507.970 | 2,800 | 1.422.315 | US$ | | | |||||
Trade accounts receivable |
||||||||||||
Accounts receivable |
US$ | 748.238 | 2,700 | 2.020.242 | US$ | 2.930.785 | 12.179.875 | |||||
Other receivables and prepaid expenses: |
||||||||||||
Secured by mortgages |
US$ | | | US$ | 4.469 | 18.571 | ||||||
Guarantee deposits |
US$ | 252.603 | 2,700 | 682.027 | US$ | 198.265 | 823.957 | |||||
Others |
US$ | | | 381.304 | 1.584.636 | |||||||
Non-Current Asset |
||||||||||||
Investments: |
||||||||||||
Convertible Bonds 2007 IRSA |
US$ | 49.692.688 | 2,800 | 139.139.526 | US$ | | | |||||
Total Asset |
US$ | 56.984.582 | 158.878.432 | US$ | 12.896.971 | 53.593.446 | ||||||
Current liabilities |
||||||||||||
Trade payables: |
||||||||||||
Suppliers |
US$ | 155.871 | 2,800 | 436.439 | US$ | 2.050.969 | 8.753.862 | |||||
Loans |
||||||||||||
Convertible Bonds 2007 |
US$ | 509.107 | 2,800 | 1.425.499 | US$ | | | |||||
Other liabilities |
||||||||||||
Accrual for other expenses |
US$ | 168.608 | 2,800 | 472.102 | US$ | 267.863 | 1.143.283 | |||||
Non-current liabilities |
||||||||||||
Loans |
||||||||||||
Convertible Bonds 2007 |
US$ | 49.803.916 | 2,800 | 139.450.965 | US$ | | | |||||
Total Liabilities |
US$ | 50.637.502 | 141.785.005 | US$ | 2.318.832 | 9.897.145 | ||||||
Cresud Sociedad Anónima
Comercial, Inmobiliaria, Financiera y Agropecuaria and Subsidiaries
Consolidated Information submitted in compliance with Section 64, subsection B of Law No 19,550
For the years beginning on July lst, 2002 and 2001, and ended June 30, 2003 and 2002
(Notes 1,2,3 and 4)
Schedule H
Items |
Total June 30, 2003 Pesos |
Operating Expenses |
Expenses |
Total June 30, 2002 Pesos | ||||||||||||||
Total Pesos |
Crops Pesos |
Beef cattle Pesos |
Milk Pesos |
Others Pesos |
Selling Pesos |
Administrative Pesos |
||||||||||||
Directors fees |
41.718 | | | | | | | 41.718 | 678.734 | |||||||||
Fees and payments for services |
1.304.235 | 678.157 | 457.730 | 155.912 | 21.715 | 42.800 | | 626.078 | 3.882.998 | |||||||||
Salaries and wages |
4.382.007 | 2.204.110 | 572.594 | 1.192.411 | 170.206 | 268.899 | 22.122 | 2.155.775 | 9.165.241 | |||||||||
Social security contributions |
779.223 | 395.370 | 136.115 | 175.644 | 16.024 | 67.587 | 4.856 | 378.997 | 833.339 | |||||||||
Taxes, rates and contributions |
509.367 | 325.369 | 114.986 | 158.673 | 30.161 | 21.549 | | 183.998 | 712.622 | |||||||||
Gross sales taxes |
735.630 | | | | | | 735.630 | | 730.702 | |||||||||
Office and administrative expenses |
346.529 | 84.902 | | 12.660 | | 72.242 | | 261.627 | 146.254 | |||||||||
Bank commissions and expenses |
49.740 | 40.372 | 7.624 | 12.057 | 532 | 20.159 | | 9.368 | 48.516 | |||||||||
Depreciation of fixed assets |
3.081.851 | 2.781.832 | 1.294.759 | 1.188.874 | 178.136 | 120.063 | 112.648 | 187.371 | 3.501.449 | |||||||||
Vehicle and travelling expenses |
474.475 | 345.497 | 128.181 | 167.635 | 14.921 | 34.760 | 2.287 | 136.691 | 488.572 | |||||||||
Spare parts and repairs |
793.849 | 793.849 | 344.019 | 347.278 | 76.942 | 25.610 | | | 977.484 | |||||||||
Insurance |
346.733 | 43.640 | 19.222 | 20.011 | 1.746 | 2.661 | | 303.093 | 222.810 | |||||||||
Employees maintenance |
158.171 | 123.785 | 36.001 | 75.973 | 6.902 | 4.909 | | 34.386 | 304.993 | |||||||||
Amortization of intangible assets |
472.016 | 472.016 | | | | 472.016 | | | 470.122 | |||||||||
Livestock expenses |
5.355.588 | 4.248.653 | | 4.248.653 | | | 1.106.935 | | 7.698.660 | |||||||||
Dairy farm expenses |
993.744 | 993.744 | | | 993.744 | | | | 1.368.345 | |||||||||
Agricultural expenses |
19.911.110 | 15.909.122 | 15.909.122 | | | | 4.001.988 | | 30.157.620 | |||||||||
Silo expenses |
45.750 | 45.750 | 45.750 | | | | | | 497.320 | |||||||||
Coal expenses |
39.293 | 14.424 | | | | 14.424 | 24.869 | | 744.341 | |||||||||
Firewood expenses |
11.932 | 6.939 | | | | 6.939 | 4.993 | | 155.870 | |||||||||
FyO expenses |
84.810 | 55.829 | | | | 55.829 | 28.981 | | 27.682 | |||||||||
General expenses |
441.481 | 441.464 | 240.099 | 169.818 | 10.834 | 20.713 | | 17 | 4.094.507 | |||||||||
Total at June 30, 2003 |
40.359.252 | 30.004.824 | 19.306.202 | 7.925.599 | 1.521.863 | 1.251.160 | 6.045.309 | 4.309.119 | | |||||||||
Total at June 30, 2002 |
| 48.291.672 | 31.502.022 | 11.703.911 | 3.407.278 | 1.678.461 | 10.248.016 | 8.368.493 | 66.908.181 | |||||||||
Cresud Sociedad Anónima
Comercial, Inmobiliaria, Financiera y Agropecuaria
Balance Sheet at June 30, 2003 and 2002
June 30, 2003 (Notes 1, 2, and 3) Pesos |
June 30, 2002 (Notes 1, 2, and 3) Pesos |
June 30, 2003 (Notes 1, 2, and 3) Pesos |
June 30, 2002 (Notes 1, 2, and 3) Pesos | |||||||||
ASSETS |
LIABILITIES | |||||||||||
Current Assets |
Current Liabilities | |||||||||||
Cash and banks (Note 8.a) |
16.804.920 | 44.180.995 | Debts: | |||||||||
Short term investments (Note 8.b) |
5.459.835 | 94.461 | Trade accounts payable (Note 8.f and Schedule G) |
4.326.017 | 13.812.177 | |||||||
Trade accounts receivable (Note 8.c) |
6.216.651 | 18.781.952 | Loans (Note 8.g ) |
1.425.499 | 7.468.233 | |||||||
Other receivables and prepaid expenses (Note 8.d) |
6.132.962 | 8.490.441 | Salaries and social security payable (Note 8.h) |
1.052.445 | 900.551 | |||||||
Inventories (Note 8.e) |
22.086.691 | 37.768.519 | Taxes payable (Note 8.i ) |
1.769.547 | 7.082.975 | |||||||
Total Current Assets |
56.701.059 | 109.316.368 | Other (Note 8.j ) |
7.008.037 | 7.249.612 | |||||||
Non-Current Assets |
Total Debts |
15.581.545 | 36.513.548 | |||||||||
Other receivables and prepaid expenses (Note 8.d) |
504.192 | 2.308.800 | Total Current Liabilities |
15.581.545 | 36.513.548 | |||||||
Inventories (Note 8.e ) |
34.941.790 | 27.130.847 | ||||||||||
Investments from companies (Note 8.b and Schedule C) |
213.361.465 | 132.946.342 | Non-Current Liabilities | |||||||||
Other investments (Note 8.b and Schedule C) |
139.160.243 | 20.717 | Taxes payable (Note 8.i ) |
21.877.809 | 20.629.666 | |||||||
Fixed assets, net (Schedule A) |
141.882.382 | 121.408.246 | Loans (Note 8.g ) |
137.951.054 | | |||||||
Subtotal Non-Current Assets |
529.856.072 | 283.814.952 | Total Non-Current Liabilities |
159.828.863 | 20.629.666 | |||||||
Goodwill (Note 8.b and Schedule C) |
(19.347.598 | ) | (13.370.388 | ) | Total liabilities | 175.410.408 | 57.143.214 | |||||
Total Non-Current Assets |
510.508.474 | 270.443.964 | SHAREHOLDERS EQUITY (as per corresponding statement) | 391.799.125 | 322.617.118 | |||||||
Total Assets |
567.209.533 | 379.760.332 | Total Liabilities and Shareholders Equity | 567.209.533 | 379.760.332 | |||||||
The accompanying notes and schedules are an integral part of these financial statements
Cresud Sociedad Anónima
Comercial, Inmobiliaria, Financiera y Agropecuaria
Income Statement
For the years beginning on July 1st, 2002 and 2001 and ended June 30, 2003 and 2002
June 30, 2003 (Notes 1,2, and 3) Pesos |
June 30, 2002 Pesos |
|||||
Sales |
||||||
Crops |
51.424.261 | 48.515.035 | ||||
Beef cattle |
16.163.219 | 26.333.142 | ||||
Milk |
2.414.992 | 2.258.210 | ||||
Other |
112.388 | 11.418 | ||||
Total Sales |
70.114.860 | 77.117.805 | ||||
Cost of sales (Schedule F) |
||||||
Crops |
(39.425.551 | ) | (13.817.006 | ) | ||
Beef cattle |
(7.866.452 | ) | (21.652.770 | ) | ||
Milk |
(1.483.172 | ) | (3.561.830 | ) | ||
Other |
(97.555 | ) | (24.371 | ) | ||
Total cost of sale |
(48.872.730 | ) | (39.055.977 | ) | ||
Gross income |
21.242.130 | 38.061.828 | ||||
Selling expenses (Schedule H) |
(5.878.515 | ) | (9.446.791 | ) | ||
Administrative expenses (Schedule H) |
(4.207.388 | ) | (8.140.036 | ) | ||
Gains from fixed assets sales |
4.900.118 | 16.604.275 | ||||
Gain (loss) from inventory holdings (Schedule F) |
11.204.231 | (18.606.549 | ) | |||
Operating income |
27.260.576 | 18.472.727 | ||||
Financial Results (Note 8.k.) |
||||||
Financial loss generated by assets |
(51.143.806 | ) | (13.685.200 | ) | ||
Financial gain generated by liabilities |
40.252.439 | 5.771.833 | ||||
Other expenses: |
||||||
Donations |
(2.000.000 | ) | | |||
Others |
(207.721 | ) | 54.546 | |||
Gain (loss) from related companies |
67.936.634 | (43.766.513 | ) | |||
Management fees (Note 6) |
(7.224.996 | ) | | |||
Income (loss) before income tax |
74.873.126 | (33.152.607 | ) | |||
Income tax expense (Note 7) |
(9.848.165 | ) | (18.615.187 | ) | ||
Net income (loss) for the year |
65.024.961 | (51.767.794 | ) | |||
The accompanying notes and schedules are an integral part of these financial statements.
Cresud Sociedad Anónima
Comercial, Inmobiliaria, Financiera y Agropecuaria
Statement of Changes in Shareholders Equity
For the years beginning on July lst, 2002 and 2001 and ended June 30, 2003 and 2002
(Notes 1,2 and 3)
Items |
Shareholders contributions |
Legal reserve Pesos |
Retained earnings Pesos |
Total at June 30, |
Total at June 30, 2002 Pesos |
||||||||||||||||||
Common stock (Note 4) Pesos |
Treasury stock (Note 4) Pesos |
Inflation adjustment of Common stock Pesos |
Paid-in capital Pesos |
Total Pesos |
|||||||||||||||||||
Balances at the beginning of the year |
122.745.539 | 1.538.853 | 166.218.124 | 89.784.877 | 380.287.393 | 5.833.163 | (51.151.555 | ) | 334.969.001 | 394.121.140 | |||||||||||||
Transfer from Common stock to Treasury stock to be subscripted |
(2.593.437 | ) | 2.593.437 | | | | |||||||||||||||||
Previous results adjustment (Note 2) |
| (12.351.883 | ) | (12.351.883 | ) | (12.351.883 | ) | ||||||||||||||||
Balances at the beginning of the year changed |
120.152.102 | 4.132.290 | 166.218.124 | 89.784.877 | 380.287.393 | 5.833.163 | (63.503.438 | ) | 322.617.118 | 381.769.257 | |||||||||||||
Subscription of incentive plan (Note 13) |
3.559.853 | (3.559.853 | ) | | 3.564.008 | 3.564.008 | 616.239 | ||||||||||||||||
Conversion of bonds in common stock (Note 14) |
386.140 | 206.898 | 593.038 | | 593.038 | ||||||||||||||||||
Appropriation of profits resolved by Shareholders Meeting held on October 19, 2001 |
|||||||||||||||||||||||
Cash dividends |
| | (8.000.584 | ) | |||||||||||||||||||
Net income (loss) for the year |
65.024.961 | 65.024.961 | (51.767.794 | ) | |||||||||||||||||||
Balances at June 30, 2003 |
124.098.095 | 572.437 | 166.218.124 | 89.991.775 | 380.880.431 | 5.833.163 | 5.085.531 | 391.799.125 | |||||||||||||||
Balances at June 30, 2002 |
122.745.539 | 1.538.853 | 166.218.124 | 89.784.877 | 380.287.393 | 5.833.163 | (63.503.438 | ) | 322.617.118 | ||||||||||||||
The accompanying notes and schedules are an integral part of these financial statements
Cresud Sociedad Anónima
Comercial, Inmobiliaria, Financiera y Agropecuaria
Cash Flows Statement
For the years beginning on July 1st, 2002 and 2001 and ended June 30, 2003 and 2002
June 30, 2003 (Notes 1, 2 and 3) Pesos |
June 30, 2002 (Notes 1, 2 and 3) Pesos |
|||||
Changes in funds |
||||||
Funds at the beginning of the year |
44.184.079 | 3.379.110 | ||||
Funds at the end of the year |
20.735.407 | 44.184.079 | ||||
Net (decrease) increase in funds |
(23.448.672 | ) | 40.804.969 | |||
Causes of changes in funds |
||||||
Operations activities |
||||||
Income (loss) for the year |
65.024.961 | (51.767.794 | ) | |||
Liabilities interest |
8.399.579 | 3.640.890 | ||||
Income tax |
9.848.165 | 18.615.187 | ||||
Adjustments made to reach net cash flow from operations activities |
||||||
Results from interest in controlled and related companies |
(67.936.634 | ) | 43.766.513 | |||
Increase in allowances and reserves |
5.728.774 | 232.866 | ||||
Amortization and depreciation |
3.062.490 | 3.241.135 | ||||
Results from inventory holdings |
(11.204.231 | ) | 18.606.549 | |||
Financial results |
(9.789.714 | ) | 4.863.304 | |||
Result from sale of fixed assets |
(4.900.118 | ) | (16.604.275 | ) | ||
Changes in operating assets and liabilities |
||||||
Decrease in current investments |
5.697.620 | 8.013.333 | ||||
Decrease (increase) in trade accounts receivable |
10.527.377 | (9.468.935 | ) | |||
Decrease in other receivables |
438.672 | 2.032.185 | ||||
Decrease (increase) in inventories |
18.858.565 | (3.725.975 | ) | |||
(Decrease) increase in social securities. charges & taxes payable and advances to customers |
(10.696.436 | ) | 1.460.717 | |||
Decrease in trade accounts payable |
(8.026.200 | ) | (1.484.828 | ) | ||
Dividends collected |
1.478.533 | 1.708.820 | ||||
(Decrease) increase in other liabilities |
(5.160.559 | ) | 5.637.763 | |||
Net funds provided by operations |
11.350.844 | 28.767.455 | ||||
Investment activities |
||||||
Increase in permanent investments |
(176.627.072 | ) | | |||
Increase in interest in related companies |
(8.151.723 | ) | (21.863.150 | ) | ||
Acquisition and upgrading of fixed assets |
(30.948.283 | ) | (646.657 | ) | ||
Collection of receivables related to the sale of fixed assets |
2.543.257 | 776.176 | ||||
Sale of fixed assets |
12.739.929 | 55.560.990 | ||||
Net funds (applied to) provided by investment activities |
(200.443.892 | ) | 33.827.359 | |||
Financing activities |
||||||
Dividends paid |
| (8.000.584 | ) | |||
Exercise of rights offering on treasury stock |
3.564.008 | 616.239 | ||||
Increase in financial loans |
177.457.104 | 39.324.931 | ||||
Decrease in financial loans |
(13.659.222 | ) | (53.730.431 | ) | ||
Issuance expenses of Convertible Bonds |
(1.717.514 | ) | | |||
Net funds provided by (applied to) financing activities |
165.644.376 | (21.789.845 | ) | |||
Net (decrease) increase in funds |
(23.448.672 | ) | 40.804.969 | |||
Items not involving changes in funds |
||||||
Transfer of inventory to fixed assets |
210.551 | 504.617 | ||||
Increase in long term investments by decrease in other receivables |
| 391.435 | ||||
Repayment of financial loans through issue of stock by exercise of conversion right |
593.038 | | ||||
Increase in long term investments through reduction in non-cash current investments |
| 113.152.482 |
Cresud Sociedad Anónima Comercial,
Inmobiliaria, Financiera y Agropecuaria
Notes to the Financial Statements
For the years ended on June 30, 2003 and 2002
NOTE 1: |
MERGER OF CONTROLLED COMPANIES |
The merger definitive agreement was signed on December 6, 2002, pursuant to the provisions set forth in Section 83, subsection 1° of Law 19.550. It decided the merger of the companies Agro Riego San Luis S.A. and Colonizadora Argentina S.A. in CRESUD S.A.C.I.F. y A., effective as from July 1st, 2000.
NOTE 2: |
PRESENTATION OF FINANCIAL STATEMENTS IN CONSTANT PESOS |
a. | Presentation standards |
These financial statements are stated in Argentine pesos, and have been prepared in accordance with the disclosure and valuation accounting standards contained in the Technical Resolutions issued by the Argentine Federation of Professional Councils in Economic Sciences, as approved, with certain amendments, by the Professional Council of Economic Sciences of the City of Buenos Aires and the Argentine Securities Commission.
b. | Accounting for inflation |
The Companys financial statements have been prepared in accordance with Resolution M.D. 3/02 of the Professional Council of Economic Sciences of the City of Buenos Aires, which has established the application of Technical Resolution No. 6, as amended by Technical Resolution No. 19 of the Argentine Federation of Professional Councils in Economic Sciences, as from fiscal years or interim periods ended on or after March 31, 2002.
On March 25, 2003, the National Executive Branch issued Decree No. 664 establishing that financial statements for fiscal years ended as from that date should be stated in nominal currency. Therefore, in accordance with Resolution No. 441 issued by the Argentine Securities and Exchange Commission on April 8, 2003, the Company discontinued restatement of its financial statements effective March 1, 2003. This criterion is not in compliance with the professional accounting standards in force. However, as of June 30, 2003, this deviation did not have a material effect on the Companys financial statements.
As a consequence of the above, the Companys financial statements are presented in constant currency as of February 28, 2003, having considered the accounting measurements restated by the changes in the purchasing power of the currency until interruption of the adjustment and those arising in the period of stability, restated into currency of December 2001.
The coefficients prepared based on the domestic wholesale price index have been applied for purposes of the abovementioned restatement.
Amounts corresponding to the year ended on June 30, 2002 have been restated at February 28, 2003 for purposes of presentation on a comparative basis.
In the income statement for this fiscal year, the result from exposure to changes in the currencys purchasing power and the financial results are both included in Financial Results.
Cresud Sociedad Anónima Comercial,
Inmobiliaria, Financiera y Agropecuaria
Notes to the Financial Statements (Continued)
NOTE 2: | (Continued) |
c. | New Accounting Standards |
The Professional Council of Economic Sciences of the City of Buenos Aires enacted the following technical resolutions: N° 16: Conceptual regime for professional accounting regulations; N° 17: Professional accounting regulations: development of matters of general application, N° 18: Professional accounting regulations: development of some matters of particular application and N° 19 Modifications to technical resolutions N° 4, 5, 6, 8, 9, 11 and 14 and 20 Derivative instruments and hedging transactions, through Resolutions C 238/01, C 243/01, C 261/01, C 262/01 and C 187/02, respectively; establishing that such technical resolutions and the modifications incorporated, will be in force for fiscal years initiated as from July 1, 2002 (other than Technical Resolution No. 20, which shall become effective for fiscal years beginning as from January 1, 2003).
The Argentine Securities and Exchange Commission, through Resolution N° 434/03 has adopted such technical resolutions with some exceptions and modifications, which will be in force for fiscal years initiated as from January 1, 2003.
The main modifications included by the above mentioned technical resolutions, which would imply significant adjustments on the companys accounting statements, are related with the registration of the income tax under the deferred taxing method. The main changes basically result from the registration of income tax under the deferred tax method, as concerns agreements involving derivative instruments and the valuation of receivables and payables with no stated rate at their current value. In addition, there are certain transitional rules that allow, and sometimes require, to apply prospectively the valuation and disclosure criteria introduced by the new accounting regulations, thus affecting comparability of the financial statements. The following table contains a breakdown of the Adjustments of Results of Previous Fiscal Years that result from applying the new accounting regulations:
Description |
Effect on Income (Loss) Pesos |
Effect on Pesos |
||||
Application of Deferred Tax (vs. Current Tax) method |
(10,528,207 | ) | (10,101,459 | ) | ||
Market value of premiums for forward transactions |
(1,458,801 | ) | 1,742,568 | |||
Registration in Long Term Investments of Adjustment of Results of Previous Fiscal Years in related companies |
(364,875 | ) | 1,020,764 | |||
Total |
(12,351,883 | ) | (7,338,127 | ) | ||
Cresud Sociedad Anónima Comercial,
Inmobiliaria, Financiera y Agropecuaria
Notes to the Financial Statements (Continued)
NOTE 3: |
SIGNIFICANT ACCOUNTING POLICIES |
The principal valuation and disclosure criteria for the preparation of the financial statements, applied on a basis consistent with respect to the last fiscal year, except as stated in note 2.c., which explains the changes in rules and adjustments of results of previous fiscal years.
a. | Use of estimates |
The preparation of the financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting years Estimates are used when accounting for the allowance for doubtful accounts, depreciation, amortization, impairment of long-lived assets, income taxes and contingencies and assets recoverable value. Actual results could differ from those estimates.
b. | Local currency assets and liabilities |
The local currency assets and liabilities are stated at year-end nominal currency.
c. | Foreign currency assets and liabilities |
Foreign currency assets and liabilities have been translated at the official rate of exchange in effect at June 30, 2003.
d. | Temporary investments |
Mutual funds and notes and convertible notes are carried at market value as of year-end. Temporary investments do not exceed their recoverable value estimated at fiscal year-end.
e. | Trade accounts receivable and payable |
Trade accounts receivable and payable have been valued at their cash price estimated at the time of the transaction, plus interest and implied financial components accrued on the basis of the internal rate of return determined at such time, provided they are significant.
f. | Credits and loans |
Credits and loans have been valued in accordance with the sum of money delivered and received, respectively, net of transaction costs, plus financial results accrued on the basis of the rate estimated at such time as of year-end.
g. | Futures and Options |
Futures and options relate to cereal commitments deliverable at a previously agreed price (see Note 5) and are carried at market value at fiscal year-end.
h. | Other receivables and payables |
Miscellaneous receivables and payables have been valued at agreed values plus interest accrued at fiscal year-end.
Cresud Sociedad Anónima Comercial,
Inmobiliaria, Financiera y Agropecuaria
Notes to the Financial Statements (Continued)
NOTE 3: |
(Continued) |
i. | Balances with related parties |
Receivables and payables with related parties have been valued in accordance with the conditions agreed between the parties involved.
j. | Inventories |
1. | Livestock for raising and grazing cattle have been stated at their market value at the end of the period, net of estimated selling expenses. The livestock for dairy production and other purposes not related to direct sale over the next 12 months were valued at replacement cost. |
2. | Crops: at their quoted market value at the end of the period, less estimated sale expenses. |
3. | The remaining inventories were valued at replacement value. |
The carrying values of inventories, which are determined as discussed above, do not exceed their estimated recoverable values at the end of the year.
k. | Long term investments in other companies |
1. | Investments in subsidiaries and affiliates |
The investments in subsidiaries and affiliates in which the Company has significant influence have been accounted for under the equity method, as required by Technical Pronouncement No. 5 of the Argentine Federation of Professional Councils in Economic Sciences.
Holdings at June 30, 2003 are as follows:
Subsidiaries and affiliates |
% Equity interest | |
Inversiones Ganaderas S.A. |
99.99 | |
Futuros y Opciones.Com S.A. |
70.00 | |
Cactus Argentina S.A. |
50.00 | |
Agro Uranga S.A. |
35.72 | |
IRSA Inversiones y Representaciones Sociedad Anónima |
22.65 |
Consolidated financial statements with Inversiones Ganaderas S.A. and Futuros y Opciones.com S.A. at June 30, 2003 and 2002 are presented as complementary information.
At June 30, 2002, our investment in IRSA was valued by the equity method of accounting as a result of a change of strategy according to which those shares are carried as a long-term investment. This decision was made as a result of the impact of the recent economic measures on the financial markets, which modified the original budget with respect to these types of investments.
Cresud Sociedad Anónima Comercial,
Inmobiliaria, Financiera y Agropecuaria
Notes to the Financial Statements (Continued)
NOTE 3: |
(Continued) |
Current valuations and economic conditions reduce the risks inherent to long-term investment opportunities and increase the possibility of obtaining significant return in the long term. In view of these circumstances: (i) the value of the investment was set at market value; (ii) the value of the investment was calculated by the equity method of accounting; and (iii) the difference between (i) and (ii) was recognized as negative goodwill to be amortized over 20 years.
2. | Other Investments |
| Investments in debt securities |
IRSAs Convertible Notes were valued taking into account the amount existing at year-end in dollars, at the sellers exchange rate plus interest accrued as of the closing date of these financial statements.
| Other investments |
The remaining investments correspond to non-listed securities, which were valued at their restated cost.
| Goodwill |
The goodwill relating to the purchase of the subsidiary Futuros y Opciones.Com S.A. has been valued at its restated cost, calculated as the difference between the price paid for such investment and its equity value calculated at the time of purchase, restated into year-end currency by applying the coefficients mentioned in Note. 2.b.
Depreciation is calculated in accordance with the estimated useful life, which is 5 years and has been classified under Result from interest in subsidiaries and related companies in the statement of income.
j. | Fixed assets |
| Purchase value: |
Valued at cost restated into period-end currency applying the coefficients mentioned in Note 2 b., based on the corresponding dates of origin.
| Depreciation |
Calculated by the straight-line method based on the estimated useful lives of the assets as from the period of addition.
| The carrying value |
The carrying value of fixed assets does not exceed their estimated recoverable value at the end of the year.
Cresud Sociedad Anónima Comercial,
Inmobiliaria, Financiera y Agropecuaria
Notes to the Financial Statements (Continued)
NOTE 3: |
(Continued) |
m. | Shareholders equity |
Initial balances and changes during the year have been restated into year-end currency following the criteria set forth in Note 2.b.
n. | Results for the year |
The results for the year were adjusted as follows:
Income accounts were restated by applying adjusting coefficients to historical amounts in accordance with Note 2.b.
The financial result was calculated at its actual value, net of the effect of inflation, and the result of exposure to inflation of net monetary positions is the counterpart of the adjustments made to all non-monetary balance sheet and income statement accounts, which were restated into year-end currency following the criteria set forth in Note 2.b.
The statement of income shows the financial results generated by assets and liabilities. Note 8.k. includes a breakdown of this information.
Financial results and the result of exposure to inflation were segregated into results generated by assets and those generated by liabilities in the notes to the financial statements.
o. | Income Tax |
The Company has recognized the income tax liability on the basis of the deferred tax liability method, thus considering temporary differences between registration of assets and liabilities for accounting and tax purposes. The principal temporary differences originate in the valuation of livestock and the sale and replacement of fixed assets.
In order to determine deferred assets and liabilities the tax rate expected to be in effect at the temporary of reversal or use has been applied on the temporary differences identified and tax loss carryforwards, considering the laws enacted as of the date of issuance of these financial statements (35%).
p. | Tax on minimum hypothetical income |
The Company determines the tax on minimum hypothetical income applying the prevailing rate of 1% on computable assets at fiscal year-end. This tax is supplementary to the income tax. The Companys tax liability for each year will be the higher of these two taxes. However, if the tax on minimum hypothetical income exceeds the income tax in any fiscal year, such excess may be computed as payment on account of the income tax that may be payable in any of the following ten fiscal years.
q. | Revenue recognition |
Revenue is recognized on sales of products when the customer receives title to the goods, generally upon delivery.
Cresud Sociedad Anónima Comercial,
Inmobiliaria, Financiera y Agropecuaria
Notes to the Financial Statements (Continued)
NOTE 4: |
COMMON AND TREASURY STOCK |
The activity in the Companys shares during the last three financial years was as follows:
Authorized Pesos |
Subscribed Pesos |
Paid in Pesos | ||||
Common and treasury stock at June 30, 2000 |
119,669,749 | 119,669,749 | 119,669,749 | |||
Preferred offering Fiscal year ended June 30, 2002 |
2,353 | 2,353 | 2,353 | |||
Incentive Plan Fiscal year 02 |
480,000 | 480,000 | 480,000 | |||
Incentive Plan Fiscal year 03 |
3,559,853 | 3,559,853 | 3,559,853 | |||
Conversion of bonds in common stock (Note 13) |
386,140 | 386,140 | 386,140 | |||
Common and treasury stock at June 30, 2003 |
124,098,095 | 124,098,095 | 124,098,095 | |||
At June 30, 2003 the common and treasury stock consisted of 124,098,095 ordinary book entry shares with a face value of Pesos 1 each entitled to one vote per share, which were available in the market.
NOTE 5: |
FUTURES |
At June 30, 2003 the Company had arranged futures and options on the futures market as follows:
OPTIONS C.B.O.T. SELL CALL SEASON 2003/2004
Cereal |
Tons |
Average price US$ (1) |
Premium US$ (2) |
||||
Wheat |
10,880 | 139.63 | (51,971 | ) | |||
OPTIONS C.B.O.T. PURCHASE CALL SEASON 2003/2004
Cereal |
Tons |
Average price US$ (1) |
Premium US$ (2) | |||
Wheat |
10,880 | 124.93 | 101,943 | |||
OPTIONS SELL CALL SEASON 2003/2004
Cereal |
Tons |
Average price US$ (1) |
Premium US$ (2) |
||||
Wheat |
1,000 | 112.00 | (4,000 | ) | |||
Cresud Sociedad Anónima Comercial,
Inmobiliaria, Financiera y Agropecuaria
Notes to the Financial Statements (Continued)
NOTE 5: |
(Continued) |
FUTURES SEASON 2003/2004
Cereal |
Tons |
Average price US$ (1) |
Total amount US$ |
||||
Wheat-sell |
1,900 | 105.14 | (199,766 | ) | |||
OPTIONS C.B.O.T. SELL CALL SEASON 2002/2003
Cereal |
Tons |
Average price US$ (1) |
Premium US$ (2) |
||||
Soybean |
16,320 | 227.81 | (96,945 | ) | |||
Corn |
8,890 | 105.73 | (36,448 | ) | |||
OPTIONS C.B.O.T. PURCHASE CALL SEASON 2002/2003
Cereal |
Tons |
Average price US$ (1) |
Premium US$ (2) | |||
Soybean |
10,880 | 198.42 | 161,909 | |||
Corn |
5,080 | 90.55 | 48,897 | |||
OPTIONS C.B.O.T. PURCHASE PUT SEASON 2002/2003
Cereal |
Tons |
Average price US$ (1) |
Premium US$ (2) | |||
Corn |
2,540 | 90.55 | 11,624 | |||
FUTURES SEASON 2002/2003
Cereal |
Tons |
Average price US$ (1) |
Total amount US$ | |||
Corn-purchase |
400 | 83.75 | 33,500 | |||
Soybean-purchase |
700 | 164.86 | 115,402 | |||
At June 30, 2002 the Company had arranged futures and options on the forward market as follows:
FUTURES SEASON 2002/2003
Cereal |
Tons |
Average price US$ (1) |
Total amount US$ | |||
Wheat-purchase |
3,200 | 89.92 | 287,744 | |||
FUTURES C.B.O.T. SEASON 2002/2003
Cereal |
Tons |
Average price US$ (1) |
Total amount US$ | |||
Wheat-purchase |
2,720 | 117.21 | 318,811 | |||
Cresud Sociedad Anónima Comercial,
Inmobiliaria, Financiera y Agropecuaria
Notes to the Financial Statements (Continued)
NOTE 5: | (Continued) |
FUTURES C.B.O.T. SEASON 2001/2002
Cereal |
Tons |
Average price US$ (1) |
Premium US$ (2) | |||
Soybean-purchase |
2,720 | 172.42 | 468,982 | |||
Soybean oil-purchase |
544 | 408.49 | 222,219 | |||
OPTIONS C.B.O.T. PURCHASE CALL SEASON 2001/2002
Cereal |
Tons |
Average price US$ (1) |
Premium US$ (2) | |||
Soybean |
6,800 | 198.42 | 24,956 | |||
OPTIONS C.B.O.T. SELL CALL SEASON 2001/2002
Cereal |
Tons |
Average price US$ (1) |
Premium US$ (2) |
||||
Soybean |
6,800 | 220.46 | (18,088 | ) | |||
(1) | Strike price without deducting expenses. |
(2) | Premiums paid (collected). |
NOTE 6: | MANAGEMENT AGREEMENT |
The Company signed a management agreement with Dolphin Fund Management S.A. (formerly called Consultores Asset Management S.A.), for consulting in relation to livestock and farming activities serving as an intermediary in transactions and investment consulting in relation to security investments.
In exchange for its services, such company will receive a payment equivalent to 10% of the net income resulting from the annual or the special financial statements.
The financial statements at June 30, 2003 include an accrual for an amount of Ps. 3,204,773 for this concept. The charge to results for this period is of Ps. 7,224,996.
Since certain directors of Cresud Sociedad Anónima Comercial, Inmobiliaria, Financiera y Agropecuaria are also executive directors of Consultores Asset Management S.A., the above-mentioned agreement was approved by the Extraordinary Shareholders Meeting held on October 25, 1994, in compliance with Article N° 271 of Law Nº 19,550.
Cresud Sociedad Anónima Comercial,
Inmobiliaria, Financiera y Agropecuaria
Notes to the Financial Statements (Continued)
NOTE : | INCOME TAX DEFERRED TAX |
The following tables show the development and composition of deferred tax Assets and Liabilities.
| Deferred assets: |
Cumulative tax loss carryforwards |
Provisions |
Fixed Assets Net Book Value Decrease |
Inventories |
Other |
TOTAL | ||||||||
Initial Balance |
| 91,613 | | | 1,191 | 92,804 | |||||||
Charge to income |
2,257,115 | (97,948 | ) | | | 249,611 | 2,408,778 | ||||||
Allocated to Shareholders Equity |
| | | | | | |||||||
Other |
| | | | | | |||||||
Closing Balance |
2,257,115 | (6,335 | ) | | | 250,802 | 2,501,582 |
| Deferred liabilities: |
Fixed Assets |
Inventories |
Investments |
Provisions |
Other |
TOTAL |
|||||||||||||
Initial Balance |
(11,454,459 | ) | (6,902,029 | ) | | (103,184 | ) | (2,262,798 | ) | (20,722,470 | ) | |||||||
Charge to income |
(1,564,584 | ) | (3,453,821 | ) | (2,706 | ) | (898,609 | ) | 2,262,798 | (3,656,922 | ) | |||||||
Allocated to Shareholders Equity |
| | | | | | ||||||||||||
Other |
| | | | | | ||||||||||||
Closing Balance |
(13,019,043 | ) | (10,355,850 | ) | (2,706 | ) | (1,001,793 | ) | | (24,379,391 | ) |
Net liabilities at year-end as per the information included in the preceding tables amount to $ 21,877,809.
Below is a conciliation between the Income Tax charged to Income and that which would result from applying the prevailing tax rate on the Income for accounting purposes:
Cresud Sociedad Anónima Comercial,
Inmobiliaria, Financiera y Agropecuaria
Notes to the Financial Statements (Continued)
NOTE 7: | (Continued) |
Description |
June 30, 2003 |
June 30, 2002 |
||||
Net income (before income tax) |
74,873,126 | (33,152,607 | ) | |||
Tax rate |
35 | % | 35 | % | ||
Net income at tax rates: |
26,205,594 | (11,603,412 | ) | |||
Permanent differences at tax rate: |
||||||
Restatement into constant currency |
(18,698,579 | ) | 31,851,351 | |||
Penalties |
39 | 224 | ||||
Donations |
573,423 | 15,853 | ||||
Amortization FYO Goodwill |
108,977 | 110,078 | ||||
Result from purchase and sale of stock |
1,785,678 | (1,176,920 | ) | |||
Miscellaneous permanent differences |
(126,967 | ) | (581,987 | ) | ||
9,848,165 | 18,615,187 | |||||
During this year the Income Tax rate was 35%.
Cumulative tax loss carryforwards recorded by the Company pending utilization at year-end amount to approximately Ps. 2,257,115 and may be offset against taxable income of future fiscal years, as follows:
Origination year |
Amount |
Expiration Year | ||
2003 |
2,257,115 | 2008 |
Cresud Sociedad Anónima Comercial,
Inmobiliaria, Financiera y Agropecuaria
Notes to the Financial Statements (Continued)
NOTE 8: | Details of balance sheet and income statement accounts |
a. | Cash and banks |
June 30, | ||||
2003 Pesos |
2002 Pesos | |||
Cash |
26.191 | 76.084 | ||
Foreign currency (Schedule G) |
3.239.854 | 829.415 | ||
Lecop currency |
| 90.892 | ||
Local currency checking account |
534.711 | 4.017.051 | ||
Patacones currency checking account |
171.891 | 49.799 | ||
Lecop currency checking account |
62.532 | 38.272 | ||
Foreign currency checking account (Schedule G) |
12.370.530 | 38.153.908 | ||
Local currency saving account |
6.181 | 630.134 | ||
Checks to be deposited |
367.247 | 295.440 | ||
Patacones checks to be deposited |
25.783 | | ||
16.804.920 | 44.180.995 | |||
b. | Investments and Goodwill |
June 30, |
||||||
2003 Pesos |
2002 Pesos |
|||||
Short term investment |
||||||
Schedule C |
5.459.835 | 94.461 | ||||
5.459.835 | 94.461 | |||||
Investment from companies |
||||||
Investment from related companies (Schedule C) |
213.361.465 | 132.946.342 | ||||
213.361.465 | 132.946.342 | |||||
Other investments |
||||||
Schedule C |
139.160.243 | 20.717 | ||||
139.160.243 | 20.717 | |||||
Goodwill |
||||||
Schedule C |
(19.347.598 | ) | (13.370.988 | ) | ||
(19.347.598 | ) | (13.370.988 | ) | |||
Cresud Sociedad Anónima Comercial,
Inmobiliaria, Financiera y Agropecuaria
Notes to the Financial Statements (Continued)
NOTE 8: | (Continued) |
c. | Trade accounts receivable |
June 30, |
||||||
2003 Pesos |
2002 Pesos |
|||||
Current |
||||||
Accounts receivable in local currency |
4.627.834 | 7.170.854 | ||||
Accounts receivable in foreign currency (Schedule G) |
2.011.421 | 12.179.875 | ||||
Less: |
||||||
Allowances for defaulting debtors |
(454.125 | ) | (774.854 | ) | ||
6.185.130 | 18.575.875 | |||||
Subsidiaries and related companies Law 19,550 Article 33: |
||||||
Inversiones Ganaderas S.A. |
17.812 | | ||||
Cactus Argentina S.A. |
13.709 | 158.524 | ||||
IRSA Inversiones y Representaciones Sociedad Anónima |
| 47.553 | ||||
6.216.651 | 18.781.952 | |||||
d. | Other receivables and prepaid expenses |
June 30, | ||||
2003 Pesos |
2002 Pesos | |||
Current |
||||
Other |
255.260 | 2.807.517 | ||
Prepaid leases |
1.894.560 | 2.660.795 | ||
Guarantee deposits (Schedule G) |
682.027 | 1.107.727 | ||
Secured by mortgage and under legal proceedings |
531.602 | 666.654 | ||
Prepaid expenses |
864.244 | 469.718 | ||
Surety bonds received |
| 421.513 | ||
Tax prepayments |
91.391 | 34.647 | ||
Subsidiaries and related companies Law 19,550 Article 33: |
||||
Cactus Argentina S.A. |
1.334.692 | 286.154 | ||
Futuros y Opciones.Com S.A. |
23.603 | 26.511 | ||
Inversiones Ganaderas S.A. |
||||
IRSA Inversiones y Representaciones S.A. |
| 9.205 | ||
Shareholders |
455.583 | | ||
6.132.962 | 8.490.441 | |||
Non-current |
||||
Secured by mortgage |
504.192 | 1.537.013 | ||
Prepaid leases |
| 176.449 | ||
Other |
| 107.187 | ||
Subsidiaries and related companies Law 19,550 Article 33: |
||||
Cactus Argentina S.A. |
| 488.151 | ||
504.192 | 2.308.800 | |||
Cresud Sociedad Anónima Comercial,
Inmobiliaria, Financiera y Agropecuaria
Notes to the Financial Statements (Continued)
NOTE 8: | (Continued) |
e. | Inventories |
June 30, | ||||
2003 Pesos |
2002 Pesos | |||
Current |
||||
Livestock |
12.444.817 | 7.225.932 | ||
Crops |
6.301.776 | 25.222.406 | ||
Unharvested crops |
1.112.230 | 835.288 | ||
Seeds and fodder |
165.355 | 402.858 | ||
Materials and others |
1.424.711 | 2.971.697 | ||
Advances to suppliers |
637.802 | 1.110.338 | ||
22.086.691 | 37.768.519 | |||
Non-Current |
||||
Livestock |
34.947.790 | 27.130.847 | ||
34.947.790 | 27.130.847 | |||
f. | Trade accounts payables |
June 30, | ||||
2003 Pesos |
2002 Pesos | |||
Current |
||||
Suppliers in local currency |
3.733.066 | 4.887.756 | ||
Suppliers in foreign currency (Schedule G) |
436.439 | 8.753.862 | ||
Subsidiaries and related companies Law 19,550 Article 33: |
||||
IRSA Inversiones y Representaciones Sociedad Anónima |
| 147.527 | ||
Cactus Argentina S.A. |
156.512 | 23.032 | ||
4.326.017 | 13.812.177 | |||
Cresud Sociedad Anónima Comercial,
Inmobiliaria, Financiera y Agropecuaria
Notes to the Financial Statements (Continued)
NOTE 8: | (Continued) |
g. | Loans |
June 30, | |||||
2003 Pesos |
2002 Pesos | ||||
Current |
|||||
Local financial loans |
| 7.468.233 | |||
Convertible Bonds 2007 Interest payable (Schedule G) |
1.425.499 | | |||
1.425.499 | 7.468.233 | ||||
Non-Current |
|||||
Convertible Bonds 2007 (Schedule G) |
139.450.965 | | |||
Convertible Bonds 2007 expenses |
(1.499.911 | ) | | ||
137.951.054 | | ||||
h. | Salaries and social security payable |
June 30, | ||||
2003 Pesos |
2002 Pesos | |||
Current |
||||
Vacation, statutory annual bonus and incentive allowance |
846.198 | | ||
Social security administration |
123.385 | 173.309 | ||
Salaries payable |
80.180 | 681.365 | ||
Health care scheme |
780 | 28.375 | ||
Other |
1.902 | 17.502 | ||
1.052.445 | 900.551 | |||
Cresud Sociedad Anónima Comercial,
Inmobiliaria, Financiera y Agropecuaria
Notes to the Financial Statements (Continued)
NOTE 8: | (Continued) |
i. | Taxes payable |
June 30, |
||||||
2003 Pesos |
2002 Pesos |
|||||
Current |
||||||
Accrual for income tax |
6.099.825 | 7.676.984 | ||||
Advances to Income tax |
(4.669.379 | ) | | |||
Tax on Minimum Hypothetical Income (Note 3.p.) |
| (2.299.132 | ) | |||
Value Added Tax |
45.164 | 1.261.913 | ||||
Property tax payable |
170.389 | 225.521 | ||||
Taxes withheld for income tax |
43.289 | 176.804 | ||||
Others |
148.824 | | ||||
Gross sales taxes |
149.468 | 37.154 | ||||
Taxes withheld-Gross sales taxes |
(83.340 | ) | 3.731 | |||
Taxes withheld-Value Added Tax |
(134.693 | ) | | |||
1.769.547 | 7.082.975 | |||||
Non-Current |
||||||
Deferred tax |
21.877.809 | 20.629.666 | ||||
21.877.809 | 20.629.666 | |||||
j. | Other |
June 30, |
||||||
2000 Pesos |
2002 Pesos |
|||||
Current |
||||||
Accrual for other expenses (Schedule G) |
2.786.535 | 5.615.160 | ||||
Accrual for Directors Fees |
41.806 | 460.902 | ||||
Advances to Directors |
(37.968 | ) | (129.641 | ) | ||
Accrual for cereal expenses |
108.825 | 205.334 | ||||
Accrual for Management fees (Note 6) |
3.204.773 | 30.951 | ||||
Subsidiaries and related companies Law 19,550 Article 33: |
||||||
Inversiones Ganaderas S.A. |
721.043 | 694.633 | ||||
Futuros y Opciones.Com S.A. |
183.023 | 372.273 | ||||
7.008.037 | 7.249.612 | |||||
Cresud Sociedad Anónima Comercial,
Inmobiliaria, Financiera y Agropecuaria
Notes to the Financial Statements (Continued)
NOTE 8: | (Continued) |
k. | Financial results |
June 30, |
||||||
2003 Pesos |
2002 Pesos |
|||||
Generated by assets: |
||||||
Exchange differences and discounts |
(54.118.298 | ) | 6.626.436 | |||
Interest income |
761.347 | 2.116.622 | ||||
Bad debts |
(50.000 | ) | (232.866 | ) | ||
Reference stabilization index (CER) |
507.772 | 732.188 | ||||
Tax on debts and credits |
(893.598 | ) | (848.054 | ) | ||
Holding results |
(2.640.590 | ) | (3.392.688 | ) | ||
Holding results and operations of stocks and bonds |
||||||
Convertible Bonds purchase interest |
7.080.857 | | ||||
Others |
165.659 | (12.019.622 | ) | |||
Inflation adjustment |
(1.956.955 | ) | (6.667.216 | ) | ||
(51.143.806 | ) | (13.685.200 | ) | |||
Generated by liabilities |
||||||
Holding results |
1.286.969 | 13.725.917 | ||||
Inflation adjustment |
4.610.799 | 1.989.096 | ||||
Reference stabilization index (CER) |
(531.789 | ) | (1.772.124 | ) | ||
Subsidiaries and related companies Law 19,550 Article 33: |
||||||
IRSA Inversiones y Representaciones Sociedad Anónima |
| (460.695 | ) | |||
Financial expenses |
||||||
Convertible Bonds issued interest |
(6.965.029 | ) | | |||
Others |
(1.276.683 | ) | (2.149.418 | ) | ||
Exchange differences and discounts |
43.128.172 | (5.560.943 | ) | |||
40.252.439 | 5.771.833 | |||||
Cresud Sociedad Anónima Comercial, Inmobiliaria, Financiera y Agropecuaria
Notes to the Financial Statements (Continued)
NOTE 9
ASSETS AND LIABILITIES, CLASSIFIED ACCORDING TO THEIR COLLECTION OR PAYMENT MATURITIES
a) Based on their estimated collection or payment term (in pesos) | ||||||||||||||||||||||||||||||||
Based on their estimated |
Current and non- current investment |
Trade accounts receivable |
Other receivables and prepaid expenses |
Trade payables |
Loans |
Salaries payable and social security payable |
Taxes payable |
Other liabilities | ||||||||||||||||||||||||
2003 |
2002 |
2003 |
2002 |
2003 |
2002 |
2003 |
2002 |
2003 |
2002 |
2003 |
2002 |
2003 |
2002 |
2003 |
2002 | |||||||||||||||||
1st quarter 2004/2003 financial year |
1.422.315 | | 6.216.651 | 18.781.952 | 2.123.058 | 4.793.481 | 4.326.017 | 13.812.177 | 1.425.499 | 7.468.233 | 1.052.445 | 900.551 | 1.769.547 | | 6.103.971 | 7.249.612 | ||||||||||||||||
2nd quarter 2004/2003 financial year |
| | | | | | | | | | | | | 7.082.975 | | | ||||||||||||||||
3rd quarter 2004/2003 financial year |
| | | | 504.192 | 53.746 | | | | | | | | | | | ||||||||||||||||
4th quarter 2004/2003 financial year |
| | | | | 490.543 | | | | | | | | | | | ||||||||||||||||
1st quarter 2005/2004 financial year |
| | | | | | | | | | | | | | | | ||||||||||||||||
2nd quarter 2005/2004 financial year |
| | | | | | | | | | | | | | | | ||||||||||||||||
3rd quarter 2005/2004 financial year |
| | | | 504.192 | 63.420 | | | | | | | | | | | ||||||||||||||||
4th quarter 2005/2004 financial year |
| | | | | 490.543 | | | | | | | | | | | ||||||||||||||||
lst quarter 2006/2005 financial year |
| | | | | | | | | | | | | | | | ||||||||||||||||
2nd quarter 2006/2005 financial year |
| | | | | | | | | | | | | | | | ||||||||||||||||
3rd quarter 2006/2005 financial year |
| | | | | 74,835 | | | | | | | | | | | ||||||||||||||||
4th quarter 2006/2005 financial year |
| | | | | 490.543 | | | | | | | | | | | ||||||||||||||||
1st quarter 2007/2006 financial year |
| | | | | | | | | | | | | | | | ||||||||||||||||
2nd quarter 2007/2006 financial year |
| | | | | | | | | | | | | | | | ||||||||||||||||
3rd quarter 2007/2006 financial year |
| | | | | 417.671 | | | | | | | | | | | ||||||||||||||||
4th quarter 2007/2006 financial year |
| | | | | | | | | | | | | | | | ||||||||||||||||
2nd quarter 2008/2007 financial year |
139.160.243 | | | | | | | | 137.951.054 | | | | | | | | ||||||||||||||||
Overdue |
| | | | | | | | | | | | | | | |||||||||||||||||
With no stated term |
4.037.520 | 94.461 | | | 3.505.712 | 3.924.459 | | | | | | 21.877.809 | 20.629.666 | 904.066 | | |||||||||||||||||
Total |
144.620.078 | 94.461 | 6.216.651 | 18.781.952 | 6.637.154 | 10.799.241 | 4.326.017 | 13.812.177 | 139.376.553 | 7.468.233 | 1.052.445 | 900.551 | 23.647.356 | 27.712.641 | 7.008.037 | 7.249.612 | ||||||||||||||||
b) Assets and liabilities classified according to the interest rate that they accrued ( in pesos) | ||||||||||||||||||||||||||||||||
Interest rate that they accrue |
Current and non- current investment |
Trade accounts receivable |
Other receivables and prepaid expenses |
Trade payables |
Loans |
Salaries payable and social security payable |
Taxes payable |
Other liabilities | ||||||||||||||||||||||||
2003 |
2002 |
2003 |
2002 |
2003 |
2002 |
2003 |
2002 |
2003 |
2002 |
2003 |
2002 |
2003 |
2002 |
2003 |
2002 | |||||||||||||||||
At fixed interest rate |
139.160.243 | | | | 1.304.932 | 2.377.085 | | | 137.951.054 | 7.242.733 | | | | | | | ||||||||||||||||
At variable interest rate |
4.037.520 | 94.461 | | | 277.048 | 722.921 | | | | | | | | | | | ||||||||||||||||
Non-interest bearing |
1.422.315 | | 6.216.651 | 18.781.952 | 5.055.174 | 7.699.235 | 4.326.017 | 13.812.177 | 1.425.499 | 225.500 | 1.052.445 | 900.551 | 23.647.356 | 27.712.641 | 7.008.037 | 7.249.612 | ||||||||||||||||
Total |
144.620.078 | 94.461 | 6.216.651 | 18.781.952 | 6.637.154 | 10.799.241 | 4.326.017 | 13.812.177 | 139.376.553 | 7.468.233 | 1.052.445 | 900.551 | 23.647.356 | 27.712.641 | 7.008.037 | 7.249.612 | ||||||||||||||||
Cresud Sociedad Anónima Comercial,
Inmobiliaria, Financiera y Agropecuaria
Notes to the Financial Statements (Continued)
NOTE 10: | RESTRICTIONS ON DISTRIBUTION OF PROFITS |
In accordance with the Argentine Corporations Law, the Companys by-laws and Resolution N° 368/2001 of the Argentine Securities and Exchange Commission, 5% of the net and realized profit for the year plus (less) prior year adjustments must be appropriated by resolution of shareholders to a legal reserve until such reserve equals 20% of the Companys outstanding capital.
NOTE 11: | SALE OF PROPERTIES |
a) | On April 21, 2003 a title deed was signed for the sale of San Luis farm, with a surface area of 706 hectares and located in Junín, in the Province of Buenos Aires. The sales price was fixed in US$ 2,240,000 million (US Dollars two million two hundred and forty thousand). This sale generated $ 581,271 (Pesos Five hundred and eighty one thousand, tow hundred and seventy one) in profits, stated in period-end currency. |
b) | On April 30, 2003 a title deed was signed for the sale of Los Maizales farm, with a surface area of 618 hectares, located in the Villa Cañás district, in the Province of Santa Fé. The sales price was fixed in US$ 1,854,000 (US Dollars one million eight hundred and fifty four thousand). This sale generated $ 4,288,213 (Pesos four million two hundred and eighty eight thousand two hundred and thirteen) stated in period-end currency. |
NOTE 12: | PURCHASE OF PROPERTIES |
On April 30, 2003 a title deed was signed for the purchase of El Tigre farm, with a surface area of 8,360 hectares, located in Trenel Department, Province of La Pampa for the amount of US$ 9,250,000.
NOTE 13: | STOCK OPTION PLAN |
As resolved upon at the General Extraordinary Shareholders Meeting at second call held on November 19, 2001 and in accordance with the resolutions adopted by the Board of Directors at its meeting dated December 7, 2001, the shareholders approved a Stock Option Plan (the Plan) relating to the shares that would remain after the shareholders exercised their pre-emptive rights to acquire treasury stock (the Shares), covering 4,614,643 shares.
The stock balance remaining after expiration of the preemptive and accretion periods is intended to be offered under the Incentive Plan approved at the above mentioned Shareholders Meeting, at Ps. 1 (one peso) par value, plus interest accrued as from actual exercise at a six-months LIBOR rate per annum. In accordance with the terms approved at the referred Shareholders Meeting, from a legal standpoint the implementation of the Plan is made by means of the transfer of the Shares in trust. From this balance, two thirds of the options relating to the Shares under the Plan were allocated for distribution by the Companys Board of Directors among certain executive officers. The remaining third was set aside for allotment by the Companys Board of Directors among any employees or executives at the time of allotment and 6 (six) months after the initial allotment, and up to 3 (three) months before the expiration of the exercise period.
Cresud Sociedad Anónima Comercial,
Inmobiliaria, Financiera y Agropecuaria
Notes to the Financial Statements (Continued)
NOTE 13: | (Continued) |
In January 2002 an aggregate of 2,353 shares of Ps. 1 par value each were issued under the preferred offering of treasury stock.
In April and June 2002, an aggregate of 480,000 shares of Ps. 1 par value each were issued to executive officers of the Company under the preferred offering of treasury stock.
During July 2002 and up to June 2003, an aggregate of 3,559,853 shares of Ps. 1 par value each were issued to directors and executive officers of the Company under the preferred offering of treasury stock.
The remaining balance as of June 30, 2003 is 572,437 shares.
NOTE 14: | ISSUANCE OF CONVERTIBLE BONDS |
The Shareholders meeting held on March 8, 2002 approved:
a) | The issue of simple convertible bonds, non-convertible into shares of the Company, for an amount of up to US$ 50,000,000 (or its equivalent in other currencies) for a maximum term of 5 years, accruing interest at a fixed rate not to exceed 12%; and/or, |
b) | the issuance of convertible bonds into companys common stock, for a total amount of US$ 50,000,000 (or its equivalent in other currency) with a maturity date in a term of 5 years or more according to the managements decision and a fix rate not exceeding 12% or floating rate with a reference rate such as LIBOR plus a spread not exceeding 10%. |
c) | the subscription option, for the holders of convertible bonds, with a premium determined by the management, between 20 and 30% over the conversion price of the convertible bond, with a value that will remain constant in terms of US currency. The exercise of the above mentioned will occur quarterly, only for the holders of the convertible bonds who have exercised their conversion rights. |
Authorization for the public offer and quotation of convertible bonds has been approved by Resolution N° 14.320 of the Argentine Securities and Exchange Commission dated October 1, 2002 and by the Buenos Aires Stock Exchange, authorizing the issue up to US$ 50,000,000 in securities composed by convertible bonds into common stock with an 8% annual interest rate due in the year 2007, granting the right at the moment of conversion to achieve 50,000,000 common stock subscription options. Likewise, the conversion price and the warrants price established are as follows:
a) | The conversion price is US$ 0.5078 stocks (US$ 5.0775 ADS), while the warrant price is US$ 0.6093 stocks (US$ 6.0930 ADS). |
b) | For each of Cresuds convertible bond the holder has the right to convert it to US$ 1.9695 stocks (US$ 0.1969 ADS) and has an option to purchase the same amount of stock at the price of the warrant. |
Cresud Sociedad Anónima Comercial,
Inmobiliaria, Financiera y Agropecuaria
Notes to the Financial Statements (Continued)
NOTE 14: | (Continued) |
Convertible bonds and options will be due on November 14, 2007.
Convertible bonds were paid in cash and the proceeds will be destined to the subscription of IRSAs Convertible Bonds and for the generation of working capital.
During February and March 2003, 184,084 Convertible Bonds were converted into 362,510 ordinary shares, which resulted in a Ps. 560,534 increase in the Companys net shareholders equity.
During May and June 2003, 12,000 Convertible Bonds were converted into 23,630 ordinary shares, which resulted in a Ps. 32,502 increase in the Companys net shareholders equity.
During July and August 2003, 58,163 Convertible Bonds were converted into 114,538 ordinary shares, which resulted in a Ps. 156,522 increase in the Companys net shareholders equity. During the same period, 150,003 warrants were exercised, resulting in the issuance of 295,396 ordinary shares for $ 484,157.
NOTE 15: | PURCHASE OF CONVERTIBLE BONDS |
During November and December 2002 49,692,688 convertible bonds issued by IRSA were purchased; these can be converted into common stock with an 8% annual interest rate and due in 2007, and grant the holder at the time of conversion to 49,692,688 options to subscribe common stock. The conversion price and the warrants price established are as follows:
a) | The conversion price is US$ 0.5571 stocks (US$ 5.5713 GDS), while the warrant price is US$ 0.6686 stocks (US$ 6.6856 GDS) |
b) | For each of IRSAs convertible bond the holder has the right to convert it to 1.7949 stocks (0.1795 GDS) and has an option to purchase the same amount of stock at the price of the warrant. |
Due to the distribution of 4,587,285 stocks of the companys portfolio, IRSA has re stated the conversion price of its convertible bonds according to the subscription clauses. The conversion price of the convertible bonds went from US$ 0.5571 to US$ 0.54505 and the warrants price went from US$ 0.6686 to US$ 0.6541. Such adjustment was effective as from December 20, 2002.
Convertible bonds and options are due on November 14, 2007.
Cresud Sociedad Anónima
Comercial, Inmobiliaria, Financiera y Agropecuaria
Fixed Assets
For the years beginning on July 1st, 2002 and 2001 and ended June 30, 2003 and 2002
(Notes 1,2, and 3)
Schedule A
Principal Account |
Value at the |
Additions and/or transfers Pesos |
Deductions and/or transfers Pesos |
Value at the end of Pesos |
Depreciation |
Net value at June 30, 2003 Pesos |
Net June 30, 2002 Pesos | |||||||||||||||
Rate % |
Accumulated at the beginnining Pesos |
Decrease of the |
Current year |
Accumulated Pesos |
||||||||||||||||||
Real estate |
97. 122.508 | 29.404.474 | 6.751.980 | 119.775.002 | | | | | | 119.775.002 | 97.122.508 | |||||||||||
Wire fences |
4.471.170 | 20.309 | 81.400 | 4.410.079 | 3 | 898.241 | 81.390 | 126.672 | 943.523 | 3.466.556 | 3.572.929 | |||||||||||
Watering troughs |
3. 121.429 | 3.005 | 20.859 | 3.103.575 | 3 | 597.995 | 20.859 | 158.404 | 735.540 | 2.368.035 | 2.523.434 | |||||||||||
Alfalfa fields and meadows |
2.481.598 | 394.117 | | 2.875.715 | 13-25-50 | 1.639.829 | | 445.267 | 2.085.096 | 790.619 | 841.769 | |||||||||||
Buildings and constructions |
5. 571.485 | 50.786 | 292.988 | 5.329.283 | 2 | 1.953.303 | 64.079 | 86.117 | 1.975.341 | 3.353.942 | 3.618.182 | |||||||||||
Machinery |
11.169.955 | 46.808 | 2.245.080 | 8.971.683 | 10 | 6.133.419 | 1.486.172 | 815.807 | 5.463.054 | 3.508.629 | 5.036.536 | |||||||||||
Vehicles |
1.039.344 | 302.848 | 257. 207 | 1.084 985 | 20 | 682.090 | 197.559 | 179.100 | 663.631 | 421.354 | 357.254 | |||||||||||
Tools |
187.885 | 4.274 | | 192.159 | 10 | 105.964 | | 14.972 | 120.936 | 71.223 | 81.921 | |||||||||||
Furniture and equipment |
1.037.127 | 15.157 | 1.678 | 1.050.606 | 10 | 599.306 | 848 | 83.420 | 681.878 | 368.728 | 437.821 | |||||||||||
Breeding livestock |
265.042 | | 13.199 | 251.843 | 20 | 263.285 | 13.199 | 1.757 | 251.843 | | 1.757 | |||||||||||
Corral and leading lanes |
535.874 | 44.863 | | 580.737 | 3 | 75.778 | | 17.575 | 93.353 | 487.384 | 460.096 | |||||||||||
Roads |
1. 260.415 | 6.721 | | 1.267.136 | 10 | 546.588 | | 115.141 | 661.729 | 605.407 | 713.827 | |||||||||||
Facilities |
5. 712.568 | 266.832 | | 5. 979.400 | 10-20-33 | 2.249.297 | | 610.627 | 2.859.924 | 3.119.476 | 3.463.271 | |||||||||||
Computer equipment |
952.494 | 162.397 | 18. 845 | 1.096.046 | 20 | 741.942 | 14.922 | 127.099 | 854.119 | 241.927 | 210.552 | |||||||||||
Planes |
10.444 | | | 10.444 | 10 | 10.444 | | | 10.444 | | | |||||||||||
Silo plants |
1.050.877 | 115.338 | | 1.166.215 | 2 | 189.643 | | 62.929 | 252.572 | 913.643 | 861.234 | |||||||||||
Constructions in progress |
1. 987.107 | 320.905 | | 2.308.012 | | | | | | 2.308.012 | 1.987.107 | |||||||||||
Advances to suppliers |
118.048 | | 35.603 | 82.445 | | | | | | 82.445 | 118.048 | |||||||||||
Total at June 30, 2003 |
138.095.370 | 31.158.834 | 9.718.839 | 159.535.365 | 16.687.124 | 1.879.028 | 2.844.887 | 17.652.983 | 141.882.382 | | ||||||||||||
Total at June 30, 2002 |
179.428.819 | 1.151.274 | 42.484.723 | 138.095.370 | 16.973.997 | 3.528.008 | 3.241.135 | 16.687.124 | | 121.408.246 | ||||||||||||
Cresud Sociedad Anónima
Comercial, Inmobiliaria, Financiera y Agropecuaria
Investments
For the years beginning on July lst, 2002 and 2001 and ended June 30, 2003 and 2002
(Notes 1,2, and 3)
Schedule C
Type and characteristics of the securities |
Amount |
Value at June 30, 2003 Pesos |
Value at June 30, 2002 Pesos |
Market value |
INFORMATION ON THE ISSUER | ||||||||||||||
Principal activity |
Latest financial statements | ||||||||||||||||||
Capital Pesos |
Income/loss for the year Pesos |
Shareholders Pesos | |||||||||||||||||
Current Investments |
|||||||||||||||||||
Mutual Funds |
|||||||||||||||||||
ABN AMRO in pesos |
1.272.427 | 2.888.061 | | 2.26973 | |||||||||||||||
Fondo especial Banco Rio in pesos |
4.719.596 | 1.042.426 | | 0.22087 | |||||||||||||||
Fondo plazo fijo Banco Rio in dollars |
1.778 | 3.938 | 3.084 | 2.21485 | |||||||||||||||
Fondo Letes Banco Francés |
| 1.194 | |||||||||||||||||
Fondo Letes Banco Rio |
| 3.326 | |||||||||||||||||
3.934.425 | 7.604 | ||||||||||||||||||
Notes and Convertible Bonds | |||||||||||||||||||
Convertible Bonds 2007IRSA |
1.422.315 | | |||||||||||||||||
Bonos Global 2010 |
110.000 | 102.465 | 86.857 | 0.931500 | |||||||||||||||
Bocon Pro 1 |
157.647 | 630 | | 0.003996 | |||||||||||||||
Certificado de crédito fiscal |
| ||||||||||||||||||
1.525.410 | 86.857 | ||||||||||||||||||
Total current investments | 5.459.835 | 94.461 | |||||||||||||||||
Non-current Investments |
|||||||||||||||||||
Related companies Law 19,550. Article 33 |
|||||||||||||||||||
AGRO-URANGA S.A. |
unlisted | Agricultural and livestock | 2.500.000 | 6.658.452 | 14.289.525 | ||||||||||||||
Shares |
893.069 | 4.971.181 | 4.303.616 | ||||||||||||||||
Contribution on account of future subscriptions of shares |
7.865 | 7.865 | |||||||||||||||||
Higher value of property |
11.179.150 | 11.179.150 | |||||||||||||||||
16.158.196 | 15.490.631 | ||||||||||||||||||
INVERSIONES GANADERAS S.A. |
unlisted | Raising and grazing cattle | 5.326.589 | 367.490 | 10.557.665 | ||||||||||||||
Shares |
5.326.588 | 9.828.057 | 9.446.806 | ||||||||||||||||
Contribution on account of future subscriptions of shares |
729.585 | 729.585 | |||||||||||||||||
10.557.642 | 10.176.391 | ||||||||||||||||||
CACTUS ARGENTINA S.A. |
unlisted | Exploitation and administration of agricultural and beef cattle products | 1.300.000 | 605.357 | 5.755.547 | ||||||||||||||
Shares |
650.000 | 742.155 | 439.473 | ||||||||||||||||
Contribution on account of future subscriptions of shares |
2.135.618 | 2.135.618 | |||||||||||||||||
2.877.773 | 2.575.091 | ||||||||||||||||||
FUTUROS Y OPCIONES.COM S.A. |
unlisted | Gives information about markets and services of economic and financial consulting through internet | 12.000 | (746.821 | ) | 688.954 | |||||||||||||
Shares |
8.400 | (2.244.525 | ) | (1.721.750 | ) | ||||||||||||||
Contribution on account of future subscriptions of shares |
2.726.793 | 2.726.793 | |||||||||||||||||
482.268 | 1.005.043 | ||||||||||||||||||
IRSA Inversiones y Representaciones S.A. |
|||||||||||||||||||
Shares |
48.022.307 | 183.285.586 | 103.699.186 | listed | Real state | 212.013.000 | 286.445.000 | 809.186.000 | |||||||||||
183.285.586 | 103.699.186 | ||||||||||||||||||
Subtotal | 213.361.465 | 132.946.342 | |||||||||||||||||
Others |
|||||||||||||||||||
Convertible Bonds 2007IRSA |
49.692.688 | 139.139.526 | | ||||||||||||||||
Coprolán |
20.717 | 20.717 | unlisted | | | | |||||||||||||
Subtotal | 139.160.243 | 20.717 | |||||||||||||||||
Goodwill |
|||||||||||||||||||
Goodwill |
1.319.353 | 1.979.030 | |||||||||||||||||
IRSA negative goodwill |
(20.666.951 | ) | (15.350.018 | ) | |||||||||||||||
Subtotal | (19.347.598 | ) | (13.370.966 | ) | |||||||||||||||
Total non-current investments |
333.174.110 | 119.596.071 | |||||||||||||||||
Cresud Sociedad Anónima
Comercial, Inmobiliaria, Financiera y Agropecuaria
Allowances and provisions
For the years beginning on July 1st, 2002 and 2001 and ended June 30, 2003 and 2002 (Notes 1,2, and 3)
Schedule E
Item |
Opening balances Pesos |
Increases (1) Pesos |
Deductions Pesos |
Inflation adjustment Pesos |
Value at June 30, 2003 Pesos |
Value at June 30, 2002 Pesos | |||||||
Deducted from assets |
|||||||||||||
Defaulting debtors |
774.854 | 50.000 | 286.146 | (84.583 | ) | 454.125 | 774.854 | ||||||
Total at June 30, 2003 |
774.854 | 50.000 | 286.146 | (84.583 | ) | 454.125 | | ||||||
Total at June 30, 2002 |
1.185.704 | 232.866 | | (643.716 | ) | | 774.854 | ||||||
(1) | The accounting appropiation is included in Note 8 k |
Cresud Sociedad Anónima
Comercial, Inmobiliaria, Financiera y Agropecuaria
Cost of sales
For the years beginning on July 1st, 2002 and 2001 and ended June 30,2003 and 2002
(Notes 1,2, and 3)
Schedule F
Crops |
Beef cattle |
Milk |
Others |
Total |
||||||||||||||||||||||||||||||||
June 30, 2003 |
June 30, 2002 |
June 30, 2003 |
June 30, 2002 |
June 30, 2003 |
June 30, 2002 |
June 30, 2003 |
June 30, 2002 |
June 30, 2003 |
June 30, 2002 |
|||||||||||||||||||||||||||
Pesos |
Pesos |
Pesos |
Pesos |
Pesos |
Pesos |
Pesos |
Pesos |
Pesos |
Pesos |
|||||||||||||||||||||||||||
Inventories at the beginning of the year |
||||||||||||||||||||||||||||||||||||
Beef cattle |
| | 32.889.218 | 58.953.661 | 1.467.561 | 4.296.269 | | | 34.356.779 | 63.249.930 | ||||||||||||||||||||||||||
Crops |
25.222.406 | 12.398.444 | | | | | | | 25.222.406 | 12.398.444 | ||||||||||||||||||||||||||
Unharvested crops |
835.288 | 1.543.168 | | | | | | | 835.288 | 1.543.168 | ||||||||||||||||||||||||||
Seeds and fodder |
| | 287.423 | 232.962 | 115.435 | 192.230 | | | 402.858 | 425.192 | ||||||||||||||||||||||||||
Materials |
2.749. 377 |
|
2.330.989 | | | 51.732 | 15.600 | 170.588 | 240.968 | 2.971.697 | 2.587.557 | |||||||||||||||||||||||||
28.807.071 |
|
16.272.601 | 33.176.641 | 59.186.623 | 1.634.728 | 4.504.099 | 170.588 | 240.968 | 63.789.028 | 80.204.291 | ||||||||||||||||||||||||||
Holding results |
| 754.325 | 10.220.032 | (17.205.346 | ) | 984.199 | (2.090.656 | ) | | (64.872 | ) | 11 204.231 | (18.606.549 | ) | ||||||||||||||||||||||
Commodities market results |
(290.717 | ) | (3.879.793 | ) | | | | | | | (290.717 | ) | (3.879.793 | ) | ||||||||||||||||||||||
Transfer of Inventories to expenses |
(93.181 | ) | (125.528 | ) | | | | | | | (93.181 | ) | (125.528 | ) | ||||||||||||||||||||||
Transfer of Inventories to fixed assets |
(207.388 | ) | (478.742 | ) | | | | | (3.163 | ) | (25.875 | ) | (210.551 | ) | (504.617 | ) | ||||||||||||||||||||
Transfer of Unharvested crops to expenses |
(13.762.016 | ) | (22.179.781 | ) | (379.693 | ) | (381.540 | ) | (183.214 | ) | (197.771 | ) | (502.491 | ) | (311.140 | ) | (14.827.414 | ) | (23.070.322 | ) | ||||||||||||||||
Recovery of Inventories |
| | 254.651 | 762.022 | (254.651 | ) | (762.022 | ) | | | | | ||||||||||||||||||||||||
Purchases |
14.301.841 | 20.758.973 | 2.694.733 | 1.313.039 | 167.262 | 335.629 | 540.986 | 355.878 | 17.704.822 | 22.763.519 | ||||||||||||||||||||||||||
Operating expenses (Schedule H) |
19.306.202 | 31.502.022 | 7.104.397 | 11.154.614 | 1.521.863 | 3.407.278 | 60.729 | | 27.993.191 | 46.063.914 | ||||||||||||||||||||||||||
Less: |
||||||||||||||||||||||||||||||||||||
Inventories at the end of the year |
||||||||||||||||||||||||||||||||||||
Beef cattle |
| | (45.097.923 | ) | (32.889.218 | ) | (2.294.684 | ) | (1.467.561 | ) | | | (47.392.607 | ) | (34.356.779 | ) | ||||||||||||||||||||
Crops |
(6.301.776 | ) | (25.222.406 | ) | | | | | | | (6.301.776 | ) | (25.222.406 | ) | ||||||||||||||||||||||
Unharvested crops |
(1.112.230 | ) | (835.288 | ) | | | | | | | (1.112.230 | ) | (835.288 | ) | ||||||||||||||||||||||
Seeds and fodder |
| | (106.386 | ) | (287.424 | ) | (58.969 | ) | (115.434 | ) | | | (166.355 | ) | (402.858 | ) | ||||||||||||||||||||
Materials |
(1.222.255 | ) | (2.749.377 | ) | | | (33.362 | ) | (51.732 | ) | (169.094 | ) | (170.588 | ) | (1.424.711 | ) | (56.396.679 | ) | (2.971.697 | ) | (63.789.028 | ) | ||||||||||||||
Cost of Sales |
39.425.551 | 13.817.006 | 7.866.452 | 21.652.770 | 1.483.172 | 3.561.830 | 97.555 | 24.371 | 48.872.730 | 39.055.977 | ||||||||||||||||||||||||||
Cresud Sociedad Anónima
Comercial, Inmobiliaria, Financiera y Agropecuaria
Foreign currency assets and liabilities
For the years beginning on July 1st, 2002 and 2001 and ended June 30, 2003 and 2002
(Notes 1,2, and 3)
Schedule G
June 30, 2003 |
June 30, 2002 | |||||||||||
Item |
Type and amount currency |
Current exchange rate Pesos |
Amount in local currency Pesos |
Type and amount of foreign currency |
Amount of local currency Pesos | |||||||
Current Asset |
||||||||||||
Cash and banks |
US$ | 5.781.624 | 2,700 | 15.610.384 | US$ | 9.380.371 | 38.983.322 | |||||
Investments: |
||||||||||||
Mutual funds |
US$ | 1.459 | 2,700 | 3.938 | US$ | 1.777 | 3.084 | |||||
Convertible Bonds 2007 IRSA |
US$ | 507.970 | 2,800 | 1.422.315 | US$ | | | |||||
Trade accounts receivable |
||||||||||||
Accounts receivable |
US$ | 744.971 | 2,700 | 2.011.421 | US$ | 2.930.785 | 12.179.875 | |||||
Other receivables and prepaid expenses: |
||||||||||||
Guarantee deposits |
US$ | 252.603 | 2,700 | 682.027 | US$ | 198.265 | 823.957 | |||||
Others |
US$ | | US$ | 381.304 | 1.584.636 | |||||||
Non-Current Asset |
||||||||||||
Investments: |
||||||||||||
Convertible Bonds 2007 IRSA |
US$ | 49.692.688 | 2,800 | 139.139.526 | US$ | | | |||||
Total Asset |
US$ | 56.981.315 | 158.869.611 | US$ | 12.892.502 | 53.574.874 | ||||||
Current liabilities |
||||||||||||
Trade payables: |
||||||||||||
Suppliers |
US$ | 155.871 | 2,800 | 436.439 | US$ | 2.050.969 | 8.753.862 | |||||
Loans: |
||||||||||||
Convertible Bonds 2007 |
US$ | 509.107 | 2,800 | 1.425.499 | US$ | | | |||||
Other |
||||||||||||
Accrual for other expenses |
US$ | 168.608 | 2,800 | 472.102 | US$ | 267.863 | 1.143.283 | |||||
Non-current liabilities |
||||||||||||
Loans: |
||||||||||||
Convertible Bonds 2007 |
US$ | 49.803.916 | 2,800 | 139.450.965 | US$ | | | |||||
Total Liabilities |
US$ | 50.637.502 | 141.785.005 | US$ | 2.318.832 | 9.897.145 | ||||||
Cresud Sociedad Anónima
Comercial, Inmobiliaria, Financiera y Agropecuaria
Information submitted in compliance with Section 64, subsection B of Law No 19,550
For the years beginning on July 1st, 2002 and 2001 and ended June 30, 2003 and 2002
(Notes 1,2, and 3)
Schedule H
Items |
Total June 30, 2003 Pesos |
Operating Expenses |
Expenses |
Total June 30, 2002 Pesos | ||||||||||||||
Total Pesos |
Crops Pesos |
Beef cattle Pesos |
Milk Pesos |
Others Pesos |
Selling Pesos |
Administrative Pesos |
||||||||||||
Directors fees |
41.718 | | | | | | | 41.718 | 600.161 | |||||||||
Fees and payments for services |
1.205.908 | 635.606 | 457.730 | 155.372 | 21.715 | 789 | | 570.302 | 3.734.639 | |||||||||
Salaries and wages |
3.999.844 | 1.869.046 | 572.594 | 1.115.037 | 170.206 | 11.209 | | 2.130.798 | 8.376.985 | |||||||||
Social security contributions |
693.275 | 319.355 | 136.115 | 162.024 | 16.024 | 5.192 | | 373.920 | 779.532 | |||||||||
Taxes, rates and contributions |
481.927 | 297.929 | 114.986 | 149.127 | 30.161 | 3.655 | | 183.990 | 684.459 | |||||||||
Gross sales taxes |
704.895 | | | | | | 704.895 | | 693.967 | |||||||||
Office and administrative expenses |
258.532 | | | | | | | 258.532 | 61.472 | |||||||||
Bank commissions and expenses |
20.302 | 20.302 | 7.624 | 12.057 | 532 | 89 | | | 33.218 | |||||||||
Depreciation of fixed assets |
2.844.887 | 2.544.868 | 1.294.759 | 1.046.972 | 178.136 | 25.001 | 112.648 | 187.371 | 3.241.135 | |||||||||
Vehicle and travelling expenses |
425.517 | 299.384 | 128.181 | 153.303 | 14.921 | 2.979 | | 126.133 | 454.430 | |||||||||
Spare parts and repairs |
745.051 | 745.051 | 344.019 | 322.072 | 76.942 | 2.018 | | | 911.798 | |||||||||
Insurance |
342.492 | 42.262 | 19.222 | 19.963 | 1.746 | 1.331 | | 300.230 | 219.832 | |||||||||
Employees maintenance |
153.959 | 119.573 | 36.001 | 75.973 | 6.902 | 697 | | 34.386 | 300.530 | |||||||||
Livestock expenses |
4.783.074 | 3.724.090 | | 3.724.090 | | | 1.058.984 | | 7.472.554 | |||||||||
Dairy farm expenses |
993.744 | 993.744 | | | 993.744 | | | | 1.368.345 | |||||||||
Agricultural expenses |
19.911.110 | 15.909.122 | 15.909.122 | | | | 4.001.988 | | 30.157.620 | |||||||||
Silo expenses |
45.750 | 45.750 | 45.750 | | | | | | 497.319 | |||||||||
General expenses |
427.109 | 427.109 | 240.099 | 168.407 | 10.834 | 7.769 | | | 4.062.745 | |||||||||
Total at June 30, 2003 |
38.079.094 | 27.993.191 | 19.306.202 | 7.104.397 | 1.521.863 | 60.729 | 5.878.515 | 4.207.388 | | |||||||||
Total at June 30, 2002 |
| 46.063.914 | 31.502.022 | 11.154.614 | 3.407.278 | | 9.446.791 | 8.140.036 | 63.650.741 | |||||||||
Cresud Sociedad Anónima Comercial,
Inmobiliaria, Financiera y Agropecuaria
Additional Information to the Notes to the Financial Statements
for the year ended June 30, 2003
1. | LEGAL FRAMEWORK |
There are no specific significant legal regimes that would imply contingent suspension or application of the benefits included in these regulations.
2. | RELEVANT MODIFICATONS IN THE COMPANY´S ACTIVITIES |
They are detailed in the Annual Report, which is attached to the present financial statements.
3. | CLASSIFICATION OF OUTSTANDING ACCOUNTS RECEIVABLE AND OTHER RECEIVABLES ACCORDING TO THEIR MATURITY |
a. | Other Receivables without a due date at June 30, 2003. |
Intercompany receivables Article 33 Law 19,550 | ||||||
Other Receivables Pesos |
FUTUROS Y OPCIONES |
CACTUS | ||||
Other Receivables Pesos |
Other Receivables Pesos | |||||
Current |
2,441,534 | 23,603 | 1,040,575 | |||
b. | Accounts Receivable and other receivables to fall due at June 30, 2003 |
Accounts Receivable Pesos |
Intercompany receivables Article 33 Law 19,550 |
Other Receivables Pesos |
Intercompany Article 33 Law | |||||||
IGSA |
CACTUS |
CACTUS | ||||||||
Accounts Receivable Pesos |
Accounts Receivable Pesos |
Other Receivables Pesos | ||||||||
09.30.03 |
6,185,130 | 17,812 | 13,709 | 1,828,941 | 294,117 | |||||
03.31.04 |
| | | 504,192 | | |||||
03.31.05 |
| | | 504,192 | | |||||
4. | CLASSIFICATION OF OUTSTANDING DEBTS ACCORDING TO THEIR MATURITY |
a. | There are no past due debts at June 30, 2003. |
b. | Debts without a due date at June 30, 2003 amount to Ps. 22,781,875, of which Ps. 721,043 correspond to Intercompany liabilities IGSA and Ps. 183,023 correspond to Intercompany liabilities FYO and Ps. 21,877,809 correspond to Deferred Tax. |
c. | Debts to fall due at June 30, 2003 |
Accounts Payable Pesos |
Intercompany Law 19,550 |
Loans Pesos |
Salaries and Social Security Charges Pesos |
Tax Payable Pesos |
Other Liabilities Pesos | |||||||
CACTUS |
||||||||||||
Accounts Payable |
||||||||||||
Pesos |
||||||||||||
09.30.03 |
4,169,505 | 156,512 | 1,425,499 | 1,052,445 | 1,769,547 | 6,103,971 | ||||||
12.31.07 |
| | 139,450,965 | | | | ||||||
Cresud Sociedad Anónima Comercial,
Inmobiliaria, Financiera y Agropecuaria
Additional Information to the Notes to the Financial Statements
(Continued)
5. | CLASSIFICATION OF OUTSTANDING ACCOUNTS RECEIVABLE AND OTHER RECEIVABLES ACCORDING TO THEIR FINANCIAL EFFECTS |
a.
Accounts Receivable Pesos |
Intercompany receivables Article 33 Law 19,550 |
Other Receivables Pesos |
Intercompany receivables Article 33 Law 19,550 | |||||||||
CACTUS |
IGSA |
CACTUS |
FUTUROS Y OPCIONES | |||||||||
Accounts Receivable Pesos |
Accounts Receivable Pesos |
Other Receivables Pesos |
Other Receivables Pesos | |||||||||
In pesos |
4,173,709 | 13,709 | 17,812 | 4,596,832 | 1,334,692 | 23,603 | ||||||
In US Dollars |
2,011,421 | | | 682,027 | | | ||||||
b. | All accounts receivable and other receivables are not subject to adjustment provisions. |
c.
Accounts Receivable Pesos |
Intercompany Article 33 Law 19,550 |
Other Receivables Pesos |
Intercompany receivables Article 33 Law 19,550 | |||||||||
IGSA |
CACTUS |
CACTUS |
FUTUROS Y OPCIONES | |||||||||
Accounts Pesos |
Accounts Pesos |
Other Pesos |
Other Pesos | |||||||||
Outstanding balances accruing interests |
| | | 1,288,863 | 294,117 | | ||||||
Outstanding Balances not accruing interests |
6,185,130 | 17,812 | 13,709 | 3,989,996 | 1,040,575 | 23,603 | ||||||
6. | CLASSIFICATION OF DEBTS ACCORDING TO THEIR FINANCIAL EFFECTS |
a.
Accounts Pesos |
Intercompany Article 33 Law 19,550 |
Loans Pesos |
Salaries and Social Security Charges Pesos |
Taxes Payable Pesos |
Other Liabilities Pesos |
Intercompany Article 33 Law 19,550 | ||||||||||
CACTUS |
IGSA |
FYO | ||||||||||||||
Accounts Payable |
Other Liabilities | |||||||||||||||
Pesos |
Pesos |
Pesos | ||||||||||||||
In pesos |
3,733,066 | 156,512 | | 1,052,445 | 23,647,356 | 5,631,869 | 721,043 | 183,023 | ||||||||
In US Dollars |
436,439 | | 140,876,464 | | | 472,102 | | | ||||||||
Cresud Sociedad Anónima Comercial,
Inmobiliaria, Financiera y Agropecuaria
Additional Information to the Notes to the Financial Statements
(Continued)
b. All debts outstanding are not subject to adjustment provisions.
c.
Accounts Pesos |
Intercompany Article 33 Law 19,550 |
Loans Pesos |
Salaries and Social Security Charges Pesos |
Taxes Payable Pesos |
Other Liabilities Pesos |
Intercompany Liabilities Article 33 Law 19,550 | ||||||||||
CACTUS |
IGSA |
FYO | ||||||||||||||
Accounts Payable |
Other Liabilities | |||||||||||||||
Pesos |
Pesos |
Pesos | ||||||||||||||
Outstanding debts accruing Interests |
| | 139,450,965 | | | | | | ||||||||
Outstanding debts not accruing interests |
4,169,505 | 156,512 | 1,425,499 | 1,052,445 | 23,647,356 | 6,103,971 | 721,043 | 183,023 | ||||||||
7. | INTEREST IN OTHER COMPANIES (Article 33 LAW 19,550) |
Interests in other companies capital and the number of votes held in those companies governed by Article 33 of Law 19,550 are explained in Note 3 to the consolidated financial statements and intercompany balances as of June 30, 2003 are described in Notes 4 and 5 above.
8. | RECEIVABLES FROM OR LOANS TO DIRECTORS AND SUPERVISORY COMMITTEE MEMBERS |
At June 30, 2003 there were advance payments to directors for Ps. 37,968, and there were no receivables due from or loans to syndics and relatives up to and including second degree, of directors and syndics.
9. | PHYSICAL INVENTORIES |
The company conducts physical inventories once a period in each property, covering all the assets under such account. There is no relevant immobilization of inventory.
10. | VALUATION OF INVENTORIES |
We further inform the sources for the information used to calculate the current value:
a. Cattle for fattening, valued at the market value net of estimated sale expenses: quotation in the Liniers Livestock Market (Mercado de Hacienda de Liniers). published in the Cattle Bulletin of the Organización Víctor DApice (Víctor D´Apice Organization).
b. Cattle for raising and daily production valued at its replacement cost: according to specific appraisals made by renowned experts.
c. Crops: official quotation of the Cámara Arbitral de Cereales for the port closest to the warehouse, published by media of wide circulation (La Nación Newspaper) net of estimated sale expenses.
d. The remaining inventory stated at its replacement cost: seeds, forage and materials: replacement cost published by a well-known magazine (Revista Agromercado).
Cresud Sociedad Anónima Comercial,
Inmobiliaria, Financiera y Agropecuaria
Additional Information to the Notes to the Financial Statements
(Continued)
11. | TECHNICAL REVALUATION OF FIXED ASSETS |
There are no fixed assets subject to technical revaluation.
12. | OBSOLETE FIXED ASSETS |
There are no obsolete fixed assets with accounting value.
13. | MINORITY INTEREST |
There are no minority interests in other companies in excess of the provisions of Article 31 of Law Nñ 19.550.
14. | RECOVERABLE VALUES |
The recoverable value of the inventory under consideration is the net realizable value (selling price at the end of the year less estimated selling expenses). The recoverable value of fixed assets under consideration is the economic use value determined by the possibility of absorbing the amortizations with the income of the Company.
15. | INSURANCES |
The types of insurance used by the company are the following:
Insured property |
Risk covered |
Amount insured Pesos |
Amount insured US$ |
Account Pesos | ||||
Buildings, machinery and silos |
Fire | 3,598,000 | | 7,776,214 | ||||
Vehicles |
Theft. fire and civil and third parties liability | 85,205,339 | | 421,354 | ||||
Furniture, office and electronic equipment | Theft. fire and technical insurance | 262,440 | | 610,655 |
16. | PROVISIONS |
There are no provisions in excess of 2% of the shareholders´ equity.
17. | CONTINGENCIES |
At June 30, 2003 there are no contingent situations that have not been accounted for.
18. | IRREVOCABLE CONTRIBUTIONS TO CAPITAL ON ACCOUNT OF FUTURE SUBSCRIPTIONS |
None.
19. | DIVIDENDS ON PREFERED STOCK |
There are no cumulative dividends not paid on preferred stock.
20. | LIMITATIONS OF PROFIT DISTRIBUTIONS |
See Note 10 to the financial statements.
Cresud Sociedad Anónima Comercial,
Inmobiliaria, Financiera y Agropecuaria
BUSINESS HIGHLIGHTS
Comparative Shareholders Equity Structure
At June 30, 2003 Pesos |
At June 30, 2002 Pesos |
At June 30, 2001 Pesos |
At June 30, 2000 Pesos |
At June 30, 1999 Pesos | ||||||
Current Assets |
58,429,226 | 110,501,852 | 199,036,680 | 127,018,104 | 157,704,260 | |||||
Non Current Assets |
509,353,863 | 269,376,563 | 248,624,949 | 275,781,974 | 270,288,994 | |||||
Total Assets |
567,783,089 | 379,878,415 | 447,661,629 | 402,800,078 | 427,993,254 | |||||
Current Liabilities |
15,076,827 | 35,796,729 | 53,917,813 | 13,616,873 | 17,778,331 | |||||
Non Current Liabilities |
160,700,428 | 21,033,814 | 21,849,030 | 21,764,480 | 20,464,104 | |||||
Total Liabilities |
175,777,255 | 56,830,543 | 75,766,843 | 35,381,353 | 38,242,435 | |||||
Minority interest |
206,709 | 430,751 | 533,696 | 130,509 | 6 | |||||
ShareholdersEquity |
391,799,125 | 322,617,121 | 371,361,090 | 367,288,216 | 389,750,813 | |||||
567,783,089 | 379,878,415 | 447,661,629 | 402,800,078 | 427,993,254 | ||||||
Comparative Income Structure
At June 30, 2003 Pesos |
At June 30, 2002 Pesos |
At June 30, 2001 Pesos |
At June 30, 2000 Pesos |
At June 30, 1999 Pesos |
|||||||||||
Operating income (loss) |
27,680,295 | 16,359,517 | 433,807 | (6,374,449 | ) | (12,200,052 | ) | ||||||||
Financial an holding result |
(10,940,327 | ) | (8,738,456 | ) | 12,389,299 | 9,973,490 | 13,086,055 | ||||||||
Other income and expenses and results from related companies |
65,884,198 | (41,083,277 | ) | (813,161 | ) | (328,427 | ) | 1,693,486 | |||||||
Management fees |
(7,224,996 | ) | | (935,742 | ) | (330,540 | ) | (253,996 | ) | ||||||
Operating net income (loss) |
75,399,170 | (33,462,216 | ) | 11,074,203 | 2,940,074 | 2,325,493 | |||||||||
Income tax |
(10,598,255 | ) | (18,654,461 | ) | (4,572,741 | ) | (1,245,053 | ) | (20,080,981 | ) | |||||
Minority interest |
224,046 | 348,883 | 397,526 | 83,917 | | ||||||||||
Net income (loss) |
65,024,961 | (51,767,794 | ) | 6,898,988 | 1,778,938 | (17,755,488 | ) | ||||||||
Cresud Sociedad Anónima Comercial,
Inmobiliaria, Financiera y Agropecuaria
BUSINESS HIGHLIGHTS (continued)
Production volume
4Q June 30, |
Accumulated July 1, 2002 to June 30, 2003 |
4Q June 30, |
Accumulated July 1, 2001 to June 30, 2002 |
4Q June 30, |
Accumulated July 1, 2000 to June 30, 2001 |
4Q June 30, |
Accumulated July 1, 1999 to June 30, 2000 |
4Q June 30, |
Accumulated July 1, 1998 to June 30, 1999 | |||||||||||
Beef Cattle (in Kgs.) |
1,903,963 | 9,121,456 | 969,928 | 10,493,012 | 2,611,847 | 12,717,373 | 2,391,052 | 12,902,899 | 1,888,804 | 15,109,412 | ||||||||||
Butyraceous (in Kgs.) |
52,107 | 209,909 | 47,591 | 237,416 | 67,337 | 253,227 | 69,823 | 382,671 | 133,818 | 627,408 | ||||||||||
Crops (in quintals)* |
348,138 | 703,692 | 871,227 | 1,424,780 | 673,498 | 1,017,590 | 898,591 | 1,599,920 | 815,182 | 1,363,640 | ||||||||||
* | One quintal equals one hundred kilograms |
Sales volume
4Q June 30, |
Accumulated July 1, 2002 to June 30, 2003 |
4Q June 30, |
Accumulated July 1, 2001 to June 30, 2002 |
4Q June 30, |
Accumulated July 1, 2000 to June 30, 2001 |
4Q June 30, |
Accumulated July 1, 1999 to June 30, 2000 |
4Q June 30, |
Accumulated July 1, 1998 to June 30, 1999 | |||||||||||
Beef Cattle (in Kgs.) |
3,119,328 | 9,550,368 | 5,008,406 | 18,200,935 | 5,240,405 | 17,455,002 | 4,377,058 | 18,520,203 | 4,860,628 | 20,418,938 | ||||||||||
Butyraceous (in Kgs.) |
52,107 | 209,909 | 47,591 | 237,416 | 67,337 | 253,227 | 69,823 | 382,671 | 133,818 | 627,408 | ||||||||||
Crops (in quintals)* |
329,271 | 1,214,253 | 370,651 | 1,206,237 | 504,775 | 1,726,002 | 448,123 | 1,260,676 | 560,629 | 1,205,375 | ||||||||||
* | One quintal equals one hundred kilograms |
Cresud Sociedad Anónima Comercial,
Inmobiliaria, Financiera y Agropecuaria
BUSINESS HIGHLIGHTS (continued)
Local Market
4Q June
30, |
Accumulated July 1, 2002 to June 30, 2003 |
4Q June
30, |
Accumulated July 1, 2001 to June 30, 2002 |
4Q June
30, |
Accumulated July 1, 2000 to June 30, 2001 |
4Q June
30, |
Accumulated July 1, 1999 to June 30, 2000 |
4Q June
30, |
Accumulated July 1, 1998 to June 30, 1999 | |||||||||||
Beef Cattle (in Kgs.) |
3,426,258 | 9,550,368 | 5,008,406 | 18,200,935 | 5,240,405 | 17,455,002 | 4,377,058 | 18,520,203 | 4,860,628 | 20,418,938 | ||||||||||
Butyraceous (in Kgs.) |
52,107 | 209,909 | 47,591 | 237,416 | 67,337 | 253,227 | 69,823 | 382,671 | 133,818 | 627,408 | ||||||||||
Crops (in quintals)* |
329,271 | 1,214,253 | 370,651 | 1,206,237 | 504,775 | 1,726,002 | 448,123 | 1,248,880 | 550,754 | 1,193,279 | ||||||||||
* | One quintal equals one hundred kilograms |
Exports
4Q June 30, 2003 |
Accumulated July 1, 2002 to June 30, 2003 |
4Q June 30, |
Accumulated July 1, 2001 to June 30, 2002 |
4Q June 30, 2001 |
Accumulated July 1, 2000 to June 30, |
4Q June 30, 2000 |
Accumulated July 1, 1999 to June 30, 2000 |
4Q June 30, 1999 |
Accumulated July 1, 1998 to June 30, 1999 | |||||||||||
Beef Cattle (in Kgs.) |
| | | | | | | | | | ||||||||||
Butyraceous (in Kgs.) |
| | | | | | | | | | ||||||||||
Crops (in quintals)* | | | | | | | | 11,796 | 9,875 | 12,096 | ||||||||||
* | One quintal equals one hundred kilograms |
Ratios
At June 30, Pesos |
At June 30, 2002 Pesos |
At June 30, 2001 Pesos |
At June 30, 2000 Pesos |
At June 30, 1999 Pesos | |||||||
Liquidity |
3.875 | 3.087 | 3.691 | 9.328 | 8.871 | ||||||
Solvency |
2.229 | 5.677 | 4.901 | 10.381 | 10.192 | ||||||
Fixed assets |
0.897 | 0.709 | 0.555 | 0.685 | 0.632 | ||||||
Return on Equity |
0.231 | (0.089 | ) | 0.030 | 0.008 | 0.006 | |||||
REPORT OF INDEPENDENT AUDITORS
To the President and Directors of
Cresud Sociedad Anónima Comercial,
Inmobiliaria, Financiera y Agropecuaria
1. | We have audited the accompanying balance sheets of Cresud Sociedad Anónima Comercial, Inmobiliaria, Financiera y Agropecuaria at June 30, 2003 and 2002, and the related statements of income, changes in shareholders equity and cash flows for the years then ended, and the complementary Notes 1 to 15 and exhibits A, C, D, E, F, G and H. Furthermore, we have examined the consolidated financial statements of Cresud Sociedad Anónima Comercial, Inmobiliaria, Financiera y Agropecuaria with its subsidiaries for the years then ended, Notes 1 to 9 and exhibits A, B, C, E, F, G and H, which are presented as complementary information. These financial statements are the responsibility of the Companys management. Our responsibility is to express an opinion on these financial statements based on our audits. |
2. | We conducted our audits in accordance with auditing standards generally accepted in Argentina, which require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement and to form an opinion on the reasonableness of relevant information contained in the financial statements. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, and evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion. |
3. | As mentioned in Note 2 to the basic financial statements, as from the current year the Company has applied new valuation and disclosure standards approved by the Professional Council in Economic Sciences of the Autonomous City of Buenos Aires and the National Securities Commission, implying the recognition of adjustments to prior years results, reclassifications and adaptation of the comparative information. Furthermore, there are certain transition rules that permit and in certain cases require prospective application of the valuation and disclosure criteria incorporated to the new accounting standards, which affect comparability of the financial statements, as mentioned in that note. |
4. | Our report dated September 9, 2002 on the financial statements at June 30, 2002 included a qualification referred to the fact that the report of independent accountants of IRSA Inversiones y Representaciones Sociedad Anónima, in which the Company holds an investment, included a qualification referred to the future evolution of its operations. As detailed in Note 1 to the consolidated financial statements, that situation had been resolved at the date of issue of this report. Consequently, our opinion on the financial statements at June 30, 2002 differs from our original opinion. |
5. | In our opinion: |
a) | the financial statements of Cresud Sociedad Anónima Comercial, Inmobiliaria, Financiera y Agropecuaria present fairly, in all material respects, its financial position at June 30, 2003 and 2002 and the results of its operations, the changes in its shareholders equity and its cash flows for the years then ended, in accordance with professional accounting standards in effect in the Autonomous City of Buenos Aires. Those standards have been applied consistently with respect to the previous year, except for application of the transition rules mentioned in point 3. |
b) | the consolidated financial statements of Cresud Sociedad Anónima Comercial, Inmobiliaria, Financiera y Agropecuaria with its subsidiaries present fairly, in all material respects, its consolidated financial position at June 30, 2003 and 2002 and the consolidated results of its operations and the consolidated cash flows for the years then ended, in accordance with professional accounting standards in effect in the Autonomous City of Buenos Aires. Those standards have been applied consistently with respect to the previous year, except for application of the transition rules mentioned in point 3. |
6. | In accordance with current regulations we report that: |
a) | the financial statements of Cresud Sociedad Anónima Comercial, Inmobiliaria, Financiera y Agropecuaria and its consolidated financial statements have been transcribed to the Inventory and Balance Sheet Book and comply with the Corporations Law and pertinent resolutions of the National Securities Commission; |
b) | the financial statements of Cresud Sociedad Anónima Comercial, Inmobiliaria, Financiera y Agropecuaria arise from official accounting records carried in all formal respects in accordance with legal requirements that maintain the security and integrity conditions based on which they were authorized by the National Securities Commission; |
c) | we have read the business highlights and the additional information to the notes to the financial statements required by sect. 68 of the Buenos Aires Stock Exchange Regulations, on which, as regards those matters that are within our competence, we have no observations to make other than those mentioned in point 3; |
d) | at June 30, 2003, the debt of Cresud Sociedad Anónima Comercial, Inmobiliaria, Financiera y Agropecuaria accrued in favor of the Integrated Pension and Survivors Benefit System according to the accounting records amounted to $ 90,483.45, none of which was claimable at that date. |
Autonomous City of Buenos Aires, September 8, 2003
PRICE WATERHOUSE & CO
SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized, in the city of Buenos Aires, Argentina.
CRESUD SOCIEDAD ANONIMA COMERCIAL INMOBILIARIA
FINANCIERA Y AGROPECUARIA
By: |
/s/ SAÚL ZANG | |
Name: |
Saúl Zang | |
Title: |
Second Vice Chairman of the Board of Directors |
Dated: September 12, 2003