Cresud Inc (NASDAQ: CRESY)

Cresud Sociedad Anónima Comercial, Inmobiliaria, Financiera y Agropecuaria is a leading Latin American agricultural company engaged in the production of basic agricultural commodities with a growing presence in the agricultural sector of Argentina and Brazil as well as in other Latin American countries through its investment in BrasilAgro. The company is currently involved in several farming activities including grains, sugarcane production and cattle raising. Its business model focuses on the acquisition, development and exploitation of agricultural properties having attractive prospects for agricultural production and/or value appreciation and the selective sale of such properties where appreciation has been realized. In addition, the company leases land to third parties and performs agency and agro-industrial services. Its shares are listed on the NASDAQ and the ByMA.

The company generates revenue through the sale of agricultural commodities such as corn, soybeans, wheat, sunflower, sorghum, cotton and sugarcane, as well as cattle for slaughterhouses and local livestock auction markets. Revenue is also derived from leasing farms to third parties for agricultural production, providing agricultural services such as irrigation, and conducting brokerage, marketing and storage services through its subsidiary FyO. The company’s urban properties and investment business, operated through its subsidiary IRSA, generates revenue from lease and service revenue from tenants in shopping malls, premium offices and luxury hotels, as well as from the development, maintenance and sales of undeveloped parcels of land and trading properties.

The company operates through the following segments: agricultural business and urban properties and investment business.

• Agricultural business: This segment consists of planting, harvesting and sale of crops as wheat, corn, soybeans, cotton and sunflowers; breeding, purchasing and/or fattening of free-range cattle for sale to slaughterhouses and local livestock auction markets; leasing of the company's farms to third parties; and planting, harvesting and sale of sugarcane. The agricultural business includes the crops activity which focuses on long-term land performance through crop rotation and technology use. The cattle activity involves breeding, purchasing and/or fattening of free-range cattle for sale to meat processors and local livestock auction markets. The sugarcane activity consists of planting, harvesting and sale of sugarcane. The agricultural rentals and services activity consists of agricultural services such as irrigation and leasing of the company's farms to third parties. The land transformation and sales segment comprises gains from the development and disposal of farmlands. The other segments include brokerage activities and agro-industrial services. The corporate segment includes principally corporate expenses related to the agricultural business. FyO is an Argentine company that provides high-quality agricultural services, including specialized agricultural products to feed the world in a responsible and sustainable way, and owns 96.37% of Amauta Agro S. A. and 96.37% of Fyo Acopio S. A.

• Urban properties and investment business: This segment includes the operating results from the portfolio of shopping malls principally comprising lease and service revenue from tenants. The shopping malls segment includes assets such as Alto Palermo Shopping, Abasto Shopping, Alto Avellaneda, Alcorta Shopping, Patio Bullrich, Dot Baires Shopping, Soleil Premium Outlet, Distrito Arcos, Terrazas de Mayo, Alto Noa Shopping, Alto Rosario Shopping, Mendoza Plaza Shopping, Córdoba Shopping Villa Cabrera, La Ribera Shopping and Alto Comahue. The offices segment includes operating results from lease revenues of offices, other rental spaces and other service revenues related to office activities. The sales and developments segment includes operating results of the development, maintenance and sales of undeveloped parcels of land and/or trading properties, including real estate sales results. The hotels segment includes operating results of hotels mainly comprised of room, catering and restaurant revenues. The others segment primarily includes entertainment activity through La Arena S. A., La Rural S. A. and Buenos Aires Convention Center, as well as financial activities carried out through BHSA / BACS and other investments in associates.

The company is a leading producer in Argentina and the region, with a leading position that improves its bargaining power with suppliers and customers. In the shopping malls sector, IRSA is the largest owner and operator of shopping malls, offices and other commercial properties in Argentina in terms of GLA and number of rental properties. The principal competitor is Cencosud S. A. which owns and operates Unicenter Shopping and the Jumbo hypermarket chain, among others. The company’s competitive advantages include its ability to acquire large areas of land with high potential for appreciation, apply state-of-the-art technology to improve agricultural yields, and centralize policy making in an Executive Committee that meets weekly in Buenos Aires.

The company serves a diverse customer base including slaughterhouses, supermarkets, grain exporters, meat processors, and tenants in shopping malls, offices and hotels. Specific customers include Cargill, FASA, Bunge Alimentos S. A., ACA, GLENCORE, Quilmes, COFCO, Grobocopatel, Molinos Río de la Plata, Boomalt and Viterra for agricultural sales. For urban properties, tenants include Zara, Nike, Adidas, McDonald’s and Puma in shopping malls, and Total Austral, Banco Supervielle and Starbucks Coffee in office buildings.