Good morning. I would like to welcome you to Linas Agro Group meeting with investors. I'm Emilia, an account manager at Nasdaq Vilnius, and I'm delighted to be the moderator for today's event. The agenda couldn't be simpler. We start with the presentation from the management, which will be followed by the Q&A session. As always, I encourage every one of you to ask questions during or after the presentation in the question box of your screen. With that said, I am pleased to introduce today's presenter, the finance director of Linas Agro Group, Mažvydas Šileika. Mr. Šileika, please, the floor is yours. Good morning there, investor community. Welcome to Linas Agro Group investor presentation for the first half of the financial year 2021, where we will overview the activities and financial results of the group for the first half of this financial year. My name is Mažvydas Šileika. I will guide you through this presentation today. Please don't hesitate to ask any questions. I would like to note that this presentation contains forward-looking statements, which are, of course, subject to risks, assumptions, and uncertainties. Please do not rely on these assumptions. I would like to start the presentation with an overview of the changes in the group. There were no significant changes in the structure of the group or how we operate during the first half of the year. The main highlights are an establishment of subsidiary in Estonia, Linas Agro OÜ, which will be a trading company based in that part of Baltics. We have also started a restructuring of two elevator companies, and they will be merged into one operating entity to drive efficiencies and save costs. These are the main highlights of the changes in structure which were reported in the interim report. The financial highlights of the first half of financial year 2020 are, of course, that we have record high sales, as well as trade of various commodities and inputs in terms of tons. We traded 1.7 million tons of various commodities and inputs, which is 55% more than previous years. We reported a EUR 13.4 million of EBITDA, which is also 46% more than previous years with the compared quarter. We have reported a net profit of EUR 3.9 million, which is bigger compared to last year's same period of EUR 1.7 million. I would like to move now to the more precise overview of each segment which we present to you. As you can see, the dynamics of the sales are very extreme this year. We have a very strong revenue base, which is primarily driven by our grain and feedstock handling and merchandising segment. Of course, this is supported by strong harvest in the Baltics as well as higher main cereal prices, which this year is around EUR 20-EUR 25 per ton higher than previous years. We have also very strong growth in our products and services for farming segment. The segment shows very good performance in terms of sales as well as profitability. Sales grew by almost 19%. The single segment, which of course shows negative trend this year, and this was also evident in the beginning of the year when we presented our first quarter results, is the food product segment. We saw a sales decline of 9% compared year-over-year. This is, of course, the segment which was mainly hit by the COVID pandemic and all the restrictions which were imposed in the Baltics as well as Europe. I would like to move to the profitability of our reporting segments. We can see that the dynamics are favorable this year for the group. We have especially strong result coming from agricultural production segment. Of course, this is mainly impacted by the result of EUR 1.9 million profit booked in the profit and loss statement due to the sale of landholding companies this year. Due to seasonality and cost booking rules, we have decrease in profitability of the grain and feedstock handling and merchandising segment. Towards the end of the year, this should equalize, and we still expect quite strong result from this segment. Food product segment, as you have noticed, has not contributed to the operating profit of the whole group due to, of course, the sharp sales decline as well as the sharp product price decline in the market. One of the most important products which we sell, of course, is chicken fillet, and the prices in the local market for this special product has decreased from 4%-4.5%, which is, of course, the main impact on the profitability of the segment. I would like to then move to our balance sheet composition, which hasn't changed a lot since the last quarter. We, of course, now are in the peak of our trading season, and this is, of course, represented by the highest point of our short-term borrowings as well as our current assets. Current assets, of course, comprise of inventory as well as receivables from farmers. This year, they are especially high in terms of inventories because, as mentioned previously, we have a record high harvest. We have traded much more of various grain, as well as the prices of the grain were higher. The overall, the current asset base for this year is higher. The group has secured funding for the whole year of around EUR 160 million in short-term borrowing or lending, sorry. We haven't had any increase in the lending part, even though the season actually was quite heavy in terms of revenues and traded volumes. The balance sheet part, the capital ratio of the group, and which shows the balance sheet strongness, is around 41%. We have a net debt level of 12x, which will decrease steadily towards the end of the year. We expect that the balance sheet will shrink accordingly to our trading seasonality and will be similar to the last year's position. I would like to then present you some highlights of every segment of our report, and I will start with products and services for farming. As you have noticed previously, this segment has delivered very strong results, both in terms of sales as well as profitability. We see actually healthy growth in both agro inputs as well as machinery sales, which shows that farmers are investing not only into the upcoming harvest and its profitability efficiency, however, towards capital investments, as we had also very strong pickup of sales of agro machinery, around 46% compared year to year. This shows that the financial situation of the farmers is really better after this grain season, and they are doing and moving to capital investments as well. Regarding the highlights from this segment in terms of group activity, we acquired a startup, GeoFace, which started operating this spring. The seed warehouse construction kicked off in the beginning of the calendar year. This is an efficiency and a growth investment in terms of the sales of seed, because this is an important segment for the group. We have, sales-wise, an upward trend in all the positions as noted in the bottom middle part of the slide, except of fertilizers. We sold more tons of fertilizers compared year to year, except the prices were smaller, though the sales are flat. We are quite happy with the developments of the margins in the fertilizer trade as well. Overall, to sum up, materially higher profitability of this segment, both in terms of margins. The margin of the operating profit is 5.2 compared to 2.6 last year. We have also very steady growth of overall operating result. Management sees this segment growing for this year compared to last year around 20%. We haven't changed this expectation, however, because quite a lot of part of still of the spring sowings and spring input trading is here to come. We see that the trend so far is very positive. I would like to move to agricultural production segment, which also performed above our expectations for the first half of the year. As mentioned in the last webinar, we can confirm that now that the year is really successful due to both higher production of crops in terms of tons, which are around 30%-40%, as well as higher selling prices, which are around 10% higher compared year-on-year. We also have a favorable uptick in milk purchase prices around 2.2% compared to last year. This actually makes the milk part business more sustainable and gives extra benefit and extra profit to the segment. We have sown around 10,000 ha of land for the upcoming season, which is quite a high amount of our 18,000 managed hectares. The reported condition of the crops is very good or good, and this is more or less all around the country. There are, of course, still quite a lot of risks coming for the spring season. We will see what will be the humidity and what will be the other conditions. However, so far, the conditions are quite favorable and the starting point is more or less fine. This segment, as I mentioned previously, is mostly impacted in terms of profitability of EUR 1.91 of profit booking related with the sale of landholding companies which we sold in November. This will be the full result of this sale, and management expectations have increased for this segment, and we see that the full year results should be 25% higher compared to last year. We have increased the expectation due to the fact that the majority of the crops which were taken during the season have been already sold, and more or less, the prices have been already fixed and received. I would like to move to our grain and feedstock handling and merchandising segment, which is the biggest sales contributor for the first half of the financial year. This is, of course, driven by very strong harvest in the Baltics as well as quite high prices of main cereals and soft commodities. However, as you probably noticed in our report, the higher sales did not result in higher profitability. It even has decreased quarter-on-quarter. This is mainly due to some sort of seasonality fluctuations. We have some costs in advance and haven't had the sales yet this quarter. The sales will come up the next quarters, and the full result will be more or less equalized. The management expects the segment to perform better than last year by around 10%. We have decreased expectation mainly due to more or higher volatility in the market in terms of prices of main commodities. The prices of the main commodities have increased rapidly throughout the year. It's not only about main grains as milling wheat or rapeseed, but as well as maize and others which are used more for feedstock production or directly to feedstock. These are, of course, driven by several reasons, and they are driven mainly by quite high consumption of both sides, food as well as feedstock, and some very strong demand of feedstock from China. This is one of the main factors which are driving the prices in this region around the Baltics, Russia, Belarus, Ukraine, and this is something new and volatile in the market. We will see if the trend of Chinese purchases will continue, but this, however, currently is the main factor of the price uptick. I would like to move now to the food product segment, which of course is mostly hit by the pandemic and all the quarantine as well as closures in the market. The restrictions, of course, of the COVID pandemic hit the most the HORECA sector, which is a large consumer of poultry products. One of our main markets for export, Sweden, was of course also significantly hit when the HORECA sector was closed. Our sales, this export market is also quite shallow this year and does not perform in line of our expectations. Overall, the prices have decreased in all European Union due to resulting overproduction in the Union. We see from the statistics that the overproduction is around 14%, meaning the supply has overturned the demand by 14%. This is the main driver for the price decrease, one other main reason why we have even bigger hit for the Baltic market is that our neighboring country, Poland, is a very big poultry producer. It has been hit in its main export markets, they have turned their majority of, or not the majority, but at least some of their exports to the Baltic markets. They have produced very fierce competition to the local producers, which of course then made a very hard, big push for the local prices. As mentioned previously, one of the main indicators and one of the main products in the market, chicken fillet, has decreased quite significantly in both Latvia and Lithuania recently. However, other markets in the European Union have suffered less, and mainly due to the reason that local producers or local buyers have prioritized the shorter supply chains, which of course then resulted in higher internal consumption. On the other hand, what I have told you in the previous slide, we have also a push from the cost side on raw materials, which we use for feedstock for chicken as the main feedstock components as corn, wheat, soybean, and vegetable oil has shown a very sharp price increase. We have a squeezing profitability from both sides, coming from the selling price as well as increasing costs from the feedstock. This is something we are dealing with some cost adjustments in our operating part and the operating expenses. However, so far, the price decrease and increase of feedstock is much higher. Due to the negative trends in the market, and we have decreased the expectation of operational profit for this financial year compared to last quarter, and we see that operational profit in terms with relation of last year will be lower by at least 20%, due to the negative trends in the market. We hope that due to the relaxation of the quarantine in the Baltics as well in the European Union, there will be positive trends and increases for this segment. However, it will be probably more towards only the end of this financial year. I would like to, of course, sum up my presentation with the main drivers of the coming second half of the year, as well as the developments after the reporting period. The group is continuously working with the acquisition of KG Group. We are now working with the competition council authorizations in Russia and Lithuania. We have submitted the application, and now it's being considered. We have received other competition councils' approval in Latvia, Estonia, and Poland, and this is quite an important milestone for the deal to go through. Due to the investment or the acquisition of Commonwealth and the volatility in the market, we have decreased our investment plan for this year. We have reported an investment plan of EUR 13.8 million for 2021 financial year, and we are planning to execute approximately 50% of the planned budget. For the first half of the year, we already have done investments of around EUR 6 million, half of that went to investments to agro machinery, both in our agricultural companies as well as our machinery sales company, Dotnuva, which are planning to increase their lease business of machinery to farmers. We have now already considered how we will finance the upcoming acquisition, and it will be a combination of debt and our own funds. Our own funds will contribute around 30% of the overall portfolio. GeoFace, as mentioned previously, has started its activity, and they are now live for the farmers for the spring season. This is one of our steps. We're going more towards new growth horizons and startups in the farming industry. I will stop here, then we'll take your questions. Thank you, Mr. Šileika, for the comprehensive presentation. Now we will proceed with the questions. Before that, I would like to remind you that you can send in your questions in the question box of your screen. Let's begin. The first question is as following: Would you please give an indication on how this winter has been on the crops? What are your expectations for the harvest? Thank you. Thank you for the question. In terms of our farms, we can say that the crop condition is good or very good. We see that in terms of our farming companies, we are quite in the same position as last year, in terms of the harvest expectations. In terms of the Baltic market or at least Lithuania, the situation is quite similar. Of course, there are some risks regarding the amount of water the crops will get during the spring, or as well as the situation with the temperature changes currently, because we have some negative temperatures during the night and positive during the days. This is also a risk to the crops. However, as far as now, the situation looks really well, and the starting position for the spring is quite good. Thank you for your comment. Another question would be: Is grain forwards the main reason behind Q2 decreased margins? Any plans to make changes in the forward making process? Thank you. It's a very good question. Thank you very much. In part, it is. We have a element of this in our, of course, cost structure. However, the main impact for the profitability at this point is that we have booked some of the costs with our connected with the trading activity for this quarter. However, the sales in connection with this cost will show up in the second quarters. As I mentioned previously, we see that the profitability will be restored of this segment going forward for the third quarter and of course, full year result. Thank you, Mr. Šileika. The third question is as following: poultry segment, what is the cost management in current environment? Thank you. Thank you very much for the question. As I mentioned previously, we have quite a huge squeeze of the profitability coming from both sides, from the sale prices as well as from the input prices, meaning feedstock. We have implemented some cost saving activities in that segment regarding our operational expenses, and we will continue that as long as the situation will require. We are trying to operate at full capacity in terms of production to have as low as possible our marginal production cost. We are reviewing every cost line in terms of our operating expenses, back office expenses. The impact is not that huge compared to energy prices and feedstock prices. Energy prices, for example, did not help as well because we had quite cold winter, so we had a higher energy consumption compared to last year, as an example. Thank you. Thank you very much for your answer. We are still receiving questions. Let's continue. The next question is as follows: when acquisition of KG Group is expected to be finished? Main outcome of this transaction for shareholders? Thank you. That's a very precise and a good question, and I think the main outcome for the shareholders is a exponential growth of the group in the first place. The second thing is that the group now will be more situated as a integrated agricultural and food company, which will have less dependency on more cyclical business as trade. We will have a bigger part of food production, which in turn is less cyclical business and more added value business. This will bring and will add to the group profitability, which in turn, of course, brings more value for the investors. Thank you for the question. Thank you for your answer. The next question is as following. The investor says, "Good morning. What is the source of operating loss of EUR 1.2 million and not attributed to any specific segment for first half a year for 2021?" Thank you. Thank you for the question. This is related to our operating expenses, which is not attributed to any segments. The cost line under there contains various part of OpEx. I probably won't specialize very much of them because there are quite a lot of them. We have an increase of particular costs which are related to the acquisition, meaning we are having, of course, more costs to go through the acquisition to finish it in terms of advisory, legal fees and so on. Thank you for your answer. Another question is again related with the KG Group. The question is as following: assuming rest of competition authorities allow the merger with KG Group, when should investor expect price and financing details of the deal? Thank you. That's a very good question. Thank you very much. We expect to finish the Competition Council approvals by the beginning of the summer. We will indicate the full financing structure, as detailed as we can. Of course, we are subject to quite a lot of confidentiality agreements under the share, sale and purchase agreement. We will disclose that accordingly. We cannot do that other way because due to the confidentiality clauses and the agreement. By the closing part, I think we will announce the details of the financing structure. Thank you for your answer. We are still receiving questions, so let's continue. The next question is quite detailed, so please bear with me. The investor writes, "Revenue from trade in the grain increased by 73% over the year to EUR 351 million and operating profit amounted to EUR 0.9 million, being 55% lower. In the first quarter, operating profit from the segment was EUR 3.3 million. That means that quarter two was unprofitable. Operating profit was mainly affected by seasonality of trading activities, the impact of which shall decrease towards the closing of the full financial year. Please explain how it could happen that quarter two was one of the best from grain trading perspective. Grain market price increased at least 10%." Thank you. Thank you for the question. It's a long one. I will try to answer it as specifically as possible. As I previously mentioned in my presentation, the decrease or the loss which we contained in this segment for the second quarter of this financial year is connected with additional costs, which we have incurred during that period, which is related to the trading activity. The costs do not match the sales for this quarter, and technically, we received a loss. As I indicated, this effect will be minimized or will decrease during the next quarter, and then, of course, the profitability will return for the full year result. Maybe to mention you as well is that our trading activity or the revenues are quite high. This is, of course, driven by several factors. One of them are high grain prices as well as our trading strategies. We build our trading book in a very different or various ways depending on the market conditions. We buy grain from farmers. We buy grain in the ports. If we see trading opportunities, which maybe will bring the result for the full year, not completely this quarter, we do them because trading activity is really seasonal, and the full result is evident only when the full year closes and when the majority of the sales have been booked. Thank you for the question. Thank you for your answer. Another question is as following: Profits related with the sale of land holding companies in November is EUR 1.9 million. Linas Agro has sold about 2,000 ha, and profit from one hectare was about EUR 1,000. Sale price was about EUR 6,800 per ha. Can we conclude that self cost of land was EUR 5,800 per hectare? Is EUR 5,800 per ha average price of all Linas Agro owned land portfolio? Thank you. Thank you for the question. Yes. The booking of the profit from this transaction is EUR 1.9 million in our profit and loss statement. The note number three in our half year interim report has more details on the way we have accounted this transaction. We have accounted this transaction as sale and leaseback transaction, which means that we don't book this result as purely sale and cost transaction. We take into the account that we will lease this land for a coming period, which we have, of course, also announced and revealed. To give you an indication that we had an inflow of EUR 13.6 million for this transaction, meaning cash based to the group. The cost of this land, which was booked in our balance sheet, was around EUR 5 million. The math goes that if we book it as cost, the net result of the transaction is around EUR 8 million. The land of the group, on average, are booked based on the acquisition cost, and it is around EUR 2.3, 000 on average. I hope I answered your question, but more or less it looks like this. If you or anyone has more questions regarding this transaction, please don't hesitate to contact. However, note number three has some explanation how it was accounted. Thank you. Thank you very much for your answer. Another investor is asking if you could comment on early signs in winter crop condition for current fiscal year. Thank you. Thank you for the question. I probably will shorten this one, as I touched upon it previously. The crop condition throughout the country is probably good to very good. There are some risks, and they will be there through all the spring season, until the harvest of course. So far now, we don't see that the position of the upcoming season or the crop position is worse than last year. However, the temperature changes during especially March, quite a lot of snow and humidity is also a challenge. So far, we think that the start is good. Thank you very much for your answer. Another investor would like to know, what threats do you see from avian influenza to your poultry business, especially in the light of the acquisition? Thank you. Thank you very much. This is a very good question, and this is also a threat which does not allow us to be more optimistic regarding this segment. So far, the Baltics, or especially Lithuania and Latvia, was not that much affected regarding the influenza. However, we had some spots reported, and if that would continue to spread, it of course would be a challenge due to the export prohibitions from the specific countries or regions. We take very big precautions regarding this in terms of the well-being and quality and sanitary of the birds. And our standards are really very high. However, no one is really safe from that. We hope that we will continue on the same note and the Baltics will not be that much affected. Of course, if this would spread, it's a big force majeure in the market, and we would see how it would be dealt with. There are some compensation mechanisms in each of the countries regarding the extreme events like this. It's quite hard, would be to speculate what would be the result of the segment or result or impact for the group after this event. Thank you. Thank you for your answer. As we have reached 10-question milestone, I would like to remind every one of you that you can ask your question in your question box of your screen. Your questions are very welcome. Let's continue. The other investor is wondering, "What exactly is meant by seasonality effect on lower profitability for grain and feedstuff segment?" Thank you. I will probably only shortly repeat myself that seasonality effect, which we called it like this, is connected with the seasonality of the costs, which we incurred during the second quarter of this financial year, which will then diminish or change around during the third and fourth quarter of the financial year 2021. The costs are directly related with the trading activity. Unfortunately, we booked them this quarter, and we didn't have the connected sales. There is no, how to say, bigger influence than that for the segment result. I can only assure that, for example, elevator or the handling segment or the grain handling activity in the segment was really successful this year due to very high harvest. As you can imagine, we had more grains going through our elevators, and the increase is quite significant. That's why we see that the full-year result will be really in line with our expectations. This effect of the grain handling and elevator activity gave a very big boost to the first quarter results because the main profitability and main activity comes in the first quarter. That's why we even have a bigger discrepancy as the base has increased quarter on quarter. Thank you for your question. Go ahead. Thank you, Mr. Šileika, for your answer. Another question is as following: "What are the plans regarding own share buyback?" Thank you. Thank you for the question. We haven't decided on share buybacks. The previous program has expired, and we did not prolong it. So far as now, at least during the acquisition of KG Group, for the upcoming period, we are not planning to establish a new program of share buybacks. Thank you for your answer. The last question so far is as following: "Should investors expect more group-owned land sales this year?" Thank you. Thank you for the question. Far as now, we have no plans of land sales for the upcoming financial year. Thank you. We have just received one more question. The investor is asking, "Do you see a need to report adjusted net debt to EBITDA ratio by the amount of your inventories?" Thank you. Thank you. That's a very good question. One of the slides where we show the composition of our balance sheet, we give you an indication of the ratio between short-term debt and our readily marketable inventories. You probably more or less have a glimpse, what is the ratio and that we have quite a lot of inventories of our books which are quite liquid. For the full year result, we are hoping to go through our reporting managerial ratios. We probably will add additional ratios for the investors to better understand the Linas Agro Group and analyze it. This is one of the ratio we are considering to introduce. Thank you for your answer. It looks like we have covered all of the questions. As all of the interests were answered, on behalf of Nasdaq Vilnius, thank you, everyone. It was my pleasure being with you today. Recording of the presentation will be available in the Nasdaq Baltic YouTube channel. Thank you, Mr. Šileika, for the presentation, and thank you, the investors, for your questions. Have a great day, everyone, and goodbye. Thank you very much, everyone. Goodbye.