By Nayara Figueiredo
SAO PAULO (Reuters) – After positive results in 2021, biotechnology and agricultural inputs group Vittia projects competitiveness gains for special fertilizers, amidst the uncertainty scenario for the supply of conventional fertilizers caused by the conflict involving Russia, an important player sector overall.
The company recorded net income of 107.74 million reais last year, up 25.5% compared to 2020. Adjusted earnings before interest, taxes, depreciation and amortization (Ebitda) reached 176 million reais, 54% higher than the previous year, according to the financial statement released this Wednesday.
“We look forward to continuing to grow. We look at the scenario with more opportunities than risks and we can continue with an interesting pace of growth, not at the same level as last year, but still positive,” Vittia Group CFO Alexandre Del Nero Frizzo told Reuters.
He said the war between Russia and Ukraine has left farmers worried about the availability of nitrogen, phosphorus and potassium (NPK)-based inputs for the 2022/23 crop.
Brazil imports around 85% of its consumption in fertilizers, while Russia alone accounts for 23% of Brazilian imports. Belarus, ally of the Russians in the invasion of Ukraine, represents another 3% in the supply of input to Brazil.
With the greatest difficulty in the chain of basic fertilizers, the tendency is for the farmer to have a “more open mind” for the adoption of special inputs – soil and organomineral conditioners, foliar fertilizers, among others.
“For special fertilizers, it will be a great opportunity for the producer to be more open to understanding the technologies and how they can add to their production system”, said the executive.
“The farmer will have to look at other alternatives and at the same time he will have to control his cost, plant at a cost that leaves room for him.”
According to the CFO, the inputs in which the company operates, in general, do not feel the direct impact of the lack of raw materials due to the war. Only the organominerals line is partially affected, as it uses a “blend” of minerals with organic matter.
“On the other hand, it gains competitiveness at the cutting edge… by using organomineral we can reduce the use of NPK”, stated Frizzo.
The lines of special inputs already come from a scenario of ascension for the company.
In 2021, Vittia’s net revenue totaled 779 million reais, an increase of 46.8% year-on-year. The result was driven by jumps of 192% for soil conditioners and organominerals, 89% for biological pesticides and 31% for foliar fertilizers, the latter with the highest gross revenue of 333.6 million reais.
The CFO said that the company’s financial performance last year featured gains from a record harvest in the 2020/21 crop and the positive expectation that was had for 2021/22, before the impacts of the drought, considering that the purchase of inputs is carried out mostly before planting. “That benefited Vittia,” he said.
“And the second point is that we have inorganic growth, we made an acquisition in August 2020 and 2021 was the first year in which it contributed the 12 months to the result.”
In this sense, Frizzo said that the company continues to have an appetite to make investments, with a level of leverage considered comfortable, and is open to mergers and acquisitions opportunities.
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