Alejandro Elsztain - CEO Carlos Blousson - General Manager of Argentina and Bolivia Matias Gaivironsky - CFO

Good afternoon everyone, and welcome to Cresud's Full Year 2015 Results Conference Call. Today's live webcast, both audio and slide show may be accessed through the company's Investor Relations website at www.cresud.com.ar/ir, by clicking on the banner Teleconference. The following presentation and the earnings release issued last week are also available for download on the company website. After managements' remarks, there will be a question-and-answer session for analysts and investors. At that time, further instruction will be given. [Operator Instructions]. You will also have the possibility of sending a question via webcast by clicking on the question to host tool. Before we begin, I would like to remind you that this call is being recorded and that the information discussed may include forward-looking statements regarding the company's financial and operating results. All projections are subject to risks and uncertainties, and actual results may differ materially. Please refer to the detailed note in the company's earnings release regarding forward-looking statements. I will now turn the call over to Mr. Alejandro Elsztain, Chief Executive Officer. Please go ahead, sir. Hello?

Good afternoon, everybody. We are beginning our results of fiscal year 2015 and we will be beginning with Page number 2 about the highlights for the whole year. We can see that our revenues grew 23% from during the last year achieving Ps. 5.6 billion. Our operating income almost Ps. 2.8 billion, it's 135% comparing to last year’s numbers. The net income for the company for the year was a gain of Ps. 750 million comparing to a loss of Ps. 1.4 billion last year in 2014. If we talk about the Cresud shareholder, the gain for the Cresud shareholder was Ps. 114 million comparing to a loss of almost Ps. 1 billion last year. If we talk about Agro-Uranga [ph] farming industry, we experienced a good year. We had a good year in harvest almost in the whole region. We planted 211,000 hectares and we had very good growth in fields in majority of our farms. But the prices of the world were very bad and that affected us a lot in the farming industry, so the effect of [indiscernible] was not compensated because of the drop in the prices and we had lower results in the farming that we are going show you later. In the other side, we had very good results on the development and in the sales of farms. We had a record of farm sales and we had a gain of Ps. 551 million that compensated that gain through the sales of last year -- that we didn’t have last year, so the full results in target is lower in comparing to last year, was more than compensated because of that gain in the farmlands sales. Development dropped comparing to last year, but still 11,000 [indiscernible] on the basis of development for that year. If we talk about the other things, the packing and the other companies that we have, we have [indiscernible] of the loss of Ps. 19 million comparing to last year that was much higher because the manufacturing [ph] plant added to some sales revenue regulators and the other company’s CEO and agriculture visits are having good results. In the [indiscernible] we have very positive results coming from investor [ph] rental segment and the sales of investment properties. The EBITDA grew 91%, reaching Ps. 2.8 billion last year. If we move to that page -- in Page 3, we see the evolution of planted areas, its 212 -- 211.7 to be precise, 1,000 hectors in the whole region. And the development we were reducing we are expecting the valuation that [indiscernible] to Brazil and the valuation coming to the country, so that’s why we are decreasing our speed of development. We have a lot of land bank on stock. We are going to seed it in the time that we expect [indiscernible]. So we are now planning what to do for next year. But that’s the reason we were decreasing our speed and really not because of the case we have left land, we have a lot of land bank on stock, so we are expecting to increase the speed for the future. If we move to Page 4, we see the re-appreciation and given the graphs that compares the world, that the highest slide is [indiscernible] United States and how to relate the price of the land of the world and the net conduct [ph] of Argentina and the prices of Brazil, Paraguay and Bolivia. So we saw a cycle of 10% to 15% or 20% growth -- compound growth for the last 10 years, price of purchasing, purchasing for the Argentina, purchase Bolivia and Paraguay, so we had a very good cycle. And if we move to next page, Page 5, we can see the price of soybeans, soybeans is going to 8 or 9, going through a 16 levels or 10 today, 9 today and the evolution of our sales. Our total sales in the past were almost $10 million, in average we grew from 20 in 2011, 26 in ’12, 61 in ’13, 21 in ’14, we have the record of $133 million of total sales having a gain of $72 million that is the Ps. 500 million of gain on the rent on this segment. And so the record -- having the record price of soybean so we decided to sell big portion of our portfolio. Here on this next page, on Page 6. The first one is the old [indiscernible] we did in Argentina, this is a crop price of La Adela, Luján [ph], we did no gain with [indiscernible] because suited to our Company IRSA the yields property at $24 million and without [indiscernible] recognition. But in the other side Bolivia, Paraguay and Brazil giving these Ps. 550 million recognition the one in Bolivia, sale of 7 million, giving a $3 million gain, with sale in Paraguay 15 giving 5 million gain and the 89 giving $54 million [ph] gain in Brazil. So rentals and appreciation of that of 20% in the state of Bolivia, 70% is of we’re playing those of debt [ph], the auction of Paraguay and in the case of [indiscernible] sale in Brazil, the sale of the last portion was almost 12% internal rate of return and with the combination of the plan had thought before, this is with the total sale of each one gave us a 13% in dollars almost 20% or 21% in Real. So big sales, highest of our history and so we -- was our record, was the price of the land, with very, very appreciation comparing to the past. In the next page you can see what we did in [indiscernible], this is one good example of the mission of the growth on the transformation of the land. This is the land we bought for BRL40 million at the beginning almost -- not developed, we began development, cleaning the land, putting the agriculture, fertilizing, correcting the land, giving the silo [ph], the houses for the employee, giving a lot of investment in direct and indirect employment, 120 new kilometers of roads. So after doing that we sold 100% of that farm, now we have on the company, like $100 million in total to make new purchase and pay dividend and buy back shares. So allow me to introduce Carlos Blousson, our Manager -- General Manager of Argentina and Bolivia to speak about the market of the countries of the region.

Thank you, Alejandro. Good evening everyone. I’ll continue with Page 8. As expected the weather conditions were positive in the region, with good rains in quantity and also well in [indiscernible] in the area. Temperatures were normal for this season. [Indiscernible] generated good production accomplishments. As we see at the [indiscernible] results, in general global good yield in [indiscernible]. However [indiscernible] were normal in the last quarter are remained stable throughout the period. Grains in Bolivia and Paraguay also present normal value. Production, a forecast production in Bolivia of all the [indiscernible] from Argentina, soybean production for this campaign [ph] increased 12% reaching about 51 million tonnes, this is a record in soybean production. With regard to corn, it's stagnant at 26 million tonnes for this campaign. Remember it has a bit similar for the last three years, with the direct consequence of the high production cost and the lower price, making this crop unattractive to the farmers. Soybean production in the field continues its upward trend and it reached a 9% rise to the entire million tonnes. Corn production increased 5% reaching 54 million tonnes due to the positive weather conditions. Regarding the 2015-16 campaign in the [indiscernible] the soybean planting area is expected to increase slightly compared to corn because of the better soybean price. Both soybean and corn in the United States continue their higher production levels with the slight decrease in corn because all of corn replaced by soybean reaching a 130 million tonnes on [indiscernible] tonnes respectively. This positive increase in production will improve the relationship between supply and demand, thus continuing to affect commodity price. Moving to the next -- moving to Page 9, I’ve always talk on [indiscernible] of corn and soybean which is large soybean evolution and we start construction very soon of the soybean and corn United States and New York. Soybean’s exact consumption ratio has increased 6% year-to-year and this ratio in corn has maintained its positive good levels. Going to Page 10, the low commodity price level of the -- that are as you can see soybean and corn prices during last quarter maintained their low at the current level. This price levels are consequences of good production in North America. The original hedged level is 82% in soybean and 33% in corn. To Page 11, crop productions. The crop production levels in the four countries increased 32% more than the previous year reaching 627,000 tonnes, the growth was down 52% soybean and 4% corn, 4% sunflower, 3% wheat and others. Soybean and corn production increased their yields between lower [indiscernible] management. Sugarcane production also increased 40% year-to-year. Going to the Page 12, crop and cattle production. The cattle production in Argentina increased 13% to 7,900 tonnes between [indiscernible] consumer and good management decisions. The cattle export is 17,700 on price in our pesos increased 15% in the last year [indiscernible]. Milk production reached 70.5 million litters, daily milking cows reached 2,200 heads and milk production per cows per day increased to 21.5 liters. Milk price increased 30% due to inflation level. Thank you. Matias will continue with the presentations.

Thank you Carlos. Good evening everybody. Going to Page 13. Here we include the description of our investment in IRSA, remember that we control 64.8% of IRSA and here we include different results from IRSA segment, so in shopping center we increased by 29%, reaching Ps. 1.8 billion in shopping sales and Ps. 1.327 billion in EBITDA of shopping center, that is a 31% increase. The rest of the segment we have very good results. In offices, an increase of 23% in revenues and 18% in EBITDA. In hotel 20% in revenues and 13% in EBITDA and important increase in sales and development IRSA disposed some investment properties and also building in Manhattan, Madison building. So we increased significantly result from the sales and development business line. EBITDA margin of shopping centers 74.6% against 73.1% in the previous year and the offices on a consolidated basis 71.4% against 69.6. So shopping center is still the most important segment for IRSA which amounted 50% of their consolidated results of IRSA and excluding the site and development 75%. Going to Page 14, the main explanation of our operating income on a consolidated basis at grass root level [ph], we have this year a very important increase in results from farmland sales as Alexandro explained this year was a record in our story of this [indiscernible] farms mainly in Brazil and in Bolivia and some in Paraguay so the results increased from Ps. 78 million in the previous fiscal year to Ps. 551 million in this fiscal year. We sold last year 2,000 hectares and this year 54,000 hectare, that is the main explanation of this increase. In the farming segment here we divide between Newcastle grains and sugarcane and we have lower results from Ps. 131.1 million of loss in the previous fiscal year to a loss of Ps. 224.1 million, the main explanation here came from the grain segment where we have lower results, lower prices in the -- of the commodities. So that affected mainly the results in Argentina, although we have very good deals for the campaign, the lower results and increasing costs generate a lower loss -- a higher loss for this fiscal year. The rest of the segment were more or less in line from the previous fiscal year and that other segments that includes our industrial, we sold the rentals and the services, and the results from field -- our brokerage field [ph], we have lower results than the previous year. The previous year we reached a gain of Ps. 15.7 million against a loss of Ps. 19 million in this fiscal year, this is mainly explained by our the results from our end and our [indiscernible] facility that generates lower results that is mainly because of the increase in the cost of the head of cattle that was not transferred to the sales price on the mix and that generated a lower result. The exports going down as well so we can transfer the increasing cost to the prices of their product. In the [indiscernible] segment you said that the results that I shall explain from IRSA, we have a very good result that is 103% more than the previous fiscal year, explained mainly from the rental segments and the investment property side. Going to Page 15, the main difference between the different lines I just explained operating income. The net financial results in the previous year we had a loss of Ps. 2.574 billion against a loss of Ps. 1.295 billion this fiscal year or it’s a reduction in the loss mainly explained by FX losses -- lower FX losses. In the previous fiscal year we have a devaluation in Argentina of 51%, that effected mainly our dollar denominated debt. So the total -- the exchange rate went from 5.39 to 8.13 in the previous fiscal year and in this fiscal year we had a devaluation of 12% from 8.13 to 9.09. So this reduction or lower devaluation generates lower FX losses by Ps. 1.367 million. Then the other important difference between this year and the previous fiscal year was income tax, in the previous fiscal year we generated a credit of Ps. 389 million against a loss of Ps. 303 million in this fiscal year. Here it's mainly explained by IRSA, which sold the Madison Building in Manhattan that generated taxes, also the farms that we sold in Brasilagro and also part of the investment properties that IRSA sold generated increasing taxes. With all these explanation we finish this fiscal year with a net result of Ps. 756.8 million against 1.4 -- sorry Ps. 756 million of gain against our loss of Ps. 1.4 billion attributable to our shareholders at Cresud is Ps. 114 million against a loss in the previous fiscal year of almost Ps. 1 billion. Going to Page 16, here we have the breakdown of our debt the total consolidated debt of the group is $803 million [ph] is the net debt at Cresud alone we have a total debt of $329.5 million and the rest came from IRSA and Brasilagro. So the relation between net debt to asset to book value is 45.9%. Remember that here we account all the asset at booked value at acquisition cost plus CapEx less amortization, so we here did not represent that is our fair value of the property. So this ratio at fair value is much lower. Debt amortization scale, this is as of June 30 after that we issued a new bond on Cresud level through refinanced part of the amortization that we have this calendar year Ps. 68.9 million. So we almost refinanced most parts of that to a longer term. So with this we finished the presentation and now turn for your questions. Operator?

Perfect. So closing the year, we closed a very good year at the real estate level, real estate and agriculture, very good on farm and productivity. We expect normal conditions for the climate, the conditions of the farm are good today. We are expecting a good campaign, somethings are changing on the environment, in micro on the region, Brazil had a lot of changes during this period and so we expect to have normal conditions for next year and keep doing our job of developing and selling [indiscernible]. So thank you very much and have a very good day.

Thank you. This does conclude today’s presentation. You may disconnect your line at this time and have a nice day.