Rusagro planning capex of 5 bln rubles in 2014
MOSCOW. Dec 2 (Interfax) - Rusagro, a Russian agribusiness group, is planning "relatively low" capital expenditures of less than 5 billion rubles in 2014, CEO Maxim Basov said in a conference call on Friday.
Most of the money will be spent on building a slaughterhouse in Tambov Region that is scheduled to open in the second half of 2014, Basov said.
He said Rusagro is generating "fairly strong" free cash flow, which it might spend on dividend payments, new investment projects and mergers and acquisitions.
The company is studying "several major projects" and looking for opportunities for regional expansion in all four segments of its business - sugar, meat, farming and oils and fats.
Basov said the company is interested in buying an oil extraction plant in Voronezh at a reasonable price. The plant is not very profitable, but Rusagro expects there to be synergies with its farming and oils and fats businesses.
National daily Kommersant, citing sources, reported earlier that Rusagro might acquire a large oil extraction plant in Voronezh Region that was previously controlled by Masloprodukt, a company owned by former deputy agriculture minister Alexei Bazhanov. The plant has capacity of 1,000 tonnes per day.
Basov recalled that Rusagro's board of directors has approved a dividend policy under which the company will pay dividends equivalent to at least 25% of net profit. The issue of dividend payments is scheduled to be considered at a board meeting at the end of April, he said.
He said management is "fairly optimistic" about the company's financial results for 2013. "EBITDA in the fourth quarter should not be any lower, and may be even higher than in the fourth quarter of 2012," Basov said.
Rusagro released its IFRS financial results for the first nine months of 2013 on Thursday, showing revenue up 2% to 23.12 billion rubles, but EBITDA down 48% to 2.967 billion rubles and net profit down 65% to 1.877 billion rubles.
Rusagro's capex dropped 59% to 2.513 billion rubles in the nine months from 6.187 billion rubles a year earlier. The company's capex totalled 8.649 billion rubles in 2013.
