St. Martin''s profit fell 32% in

The strategy of concentrating the ethanol sales in the second half of the crop-coupled with good time in the sugar ethanol sector because of the recovery in the prices of sugar and biofuel-ethanol results received Saint Martin in the fourth quarter of the season 2015/16, ended in March.
In the period, the company earned a net profit of 68.9 million R$, 21.9% over the same period of the previous harvest. This result has contributed to the Saint Martin ended the cycle with net profit of 194.3 million R$. But the result was 32% lower than the previous harvest.
In an interview with Value, Fábio Venturelli, President of St. Martin, said that the decrease reflects a "normalization" of the results, since last harvest the company obtained a nonrecurring gain from selling its stake in Agriculture. "If you disregard it, the profit is in line with what we expected for the crop," said the Executive.
The recipe for last quarter reflected especially rising prices of sugar, jumping 23.3 percent to 438.8 million R$. Of this total, R$ 392.2 million was from sales of the product, a high of 13% compared to the same period of the previous harvest.
The strategy of holding ethanol for selling at the end of the crop was kept, although less intense than in the previous cycle, when the return of the Cide on gasoline generated strong optimism in the sector. "This time, we share [Sales] with the third quarter," said Felipe Vicchiato, CFO of St. Martin.
In 2015/16, the company''s net revenue grew 20%, reaching 2.8 billion R$. Sales of hydrated ethanol (which competes with gasoline) generated a turnover of 501.9 million R$, high of 16.5%.
Already the generation of electricity from biomass has not contributed positively to harvest revenue, affected by a measure of the Government at the beginning of 2015 which reduced the maximum price for the energy market in the short term, said Vicchiato.
With this result, the company''s focus now is to reduce leverage, which had slight decline in the last quarter. The relationship between the earnings before interest, taxes, depreciation and amortization (Ebitda) and adjusted net debt ended March at 2.1 times, compared to 2.2 times the same month from 2015. The goal, according to Van Dyk, is to take this relationship to 1.5 time.
The only investment that the company will do this harvest is in the expansion of Santa Cruz Plant, already announced in 2015. The company will complete this year''s contribution of 60 million R$ to raise the plant''s capacity of 4.5 million tons to 5.2 million tons of sugar cane. The change will be ready for the 2017/18.