According to the information released on company’s official website, IMC acquired 40% stake in AgroKIM LLC agricultural company with 16 thousand hectares of leased land and 195 thousand tons of oilseed crops storage facilties. The cost of acquisition, announced by IMC was set at USD 18 million. IMC currently owns and controls 100% of assets of AgroKIM LLC. Total land bank of IMC is currently estimated at 136.7 thousand hectares and storage capacity of 554 thousand tons.

As noted by financial analyst of UkrAgroConsult, Alex Morgun, many large Ukrainian agrarian companies stated that they would be shifting focus from growing volume of their assets to managing assets acquired and increasing effectiveness of their operations. Such decisions were mainly attributed to the combination of rising costs, including sales costs, operating costs and financial costs as well as lack of external financing. IMC faced similar issues with reported 33% sales revenue growth over 9 months ended 30 September, 2013 to USD 72.5 million, while its cost of sales grew by 43% to USD 79.1 million. Company ended the period with gross profit growth of 62% at USD 53.4 million, mainly due to significant increase of gain from changes in biological assets, which constituted USD 60 million, 76% higher compared to 9 months of 2012. Company continues to follow its assets growth strategy in 2014, aiming to maximize economy of scale benefits.

Author: Alex Morgun, Financial analyst, UkrAgroConsult