Good morning, everyone. I'm Santiago Donato, Investor Relations Officer of Cresud, and I welcome you to the fiscal year 2023 results conference call. First of all, I would like to remind you that both audio and slideshow may be accessed through company's investor relations website at www.cresud.com.ar by clicking on the banner webcast link. The following presentation and the earnings release are also available for download on the company website. After management remarks, there will be a question and answer session for analysts and investors. If you want to make a question, please use the chat. Before we begin, I would like to remind you that this call is being recorded and that information discussed today may include forward-looking statements regarding the company's financial and operating performance. All projections are subject to risk and uncertainties, and actual results may differ materially.
Please refer to the detailed notes in the company's earnings release regarding forward-looking statements. I will now turn the call over to Mr. Alejandro Elsztain, CEO.
Good morning, everyone. We are finishing our balance sheet of 2023, and we can see in this first page what happened in the mixed results that we had, combining sustained commodity prices. After the second half, we began to see a drop on those and cost pressure that last year we suffered mainly in fertilizers and in inputs that's affected mainly the margins, the operational margins of the company. In the same time, there was some effects on climate that affected our production, mainly Argentina, but the rest of the region was affected too. Related to Argentina, everyone knows about the drought that affected the country, but thanks, the company had a big diversification in areas. Because of that, Cresud was not affected as Argentina was.
Argentina was mainly affected in the corn belt, but Cresud plants all over the country, so our yields were much less affected than the country. At the same time, there were agro-differentiated effects done by the government. The government was giving some of the taxes on exports through prices. Finally, the effect on Cresud was much lower than the rest of the country. Related to Brasilagro. Brasilagro this year had a record farm sales, so we are going to see for small pieces. We, we didn't sell the whole farm, so we're selling in pieces farms and having a very important result related to farmland sales. In Brazil we suffered lower productive result in there because of prices, costs and some weather conditions affecting the main corn, soybeans and sugarcane.
Related to acquisitions, this year we began to buy again in Argentina we had the chance of buying a new property, 1,200 hectares close to El Tigre farm. This is good news for Argentina. Related to our investment in IRSA, we grew 3% of our stake in IRSA, we went from 53.9 to close to 54 to close to 57%. Buying the shares of IRSA at the same time, IRSA was really growing a lot its EBITDA, its office sales and the leverage of the company. The company was really happy of buying more shares of a company that really was recovering, we are going to see the results in few pages later.
Related to dividends, we paid last year very good dividend yield, 9%, and 2.2% of the stock shares that we were buyback shares. Now we are offering a new dividend proposal that will be ARS 22 billion, and 3% of IRSA shares that we are going to be trading in the new shareholder meeting of the 5th of October of next year. We can now go to the next page and see here the evolution on prices of soybeans and corn and why we are speaking about the drop of the last second semester, that we are seeing this drop of not so relevant in the case of soybeans, 9%, but more relevant in the corn. This is forecasting a new campaign that will be tougher in prices in these two commodities.
At the same time, we are forecasting a drop in the costs that is going to have a I would say more normal margins for farmers. Last year they were affecting in the two higher prices by higher cost. We are now forecasting lower prices and much lower cost because of the drop of fertilizers and inputs mainly. This effect of soybeans is in the case of soybeans, it's being affected by some drought in U.S., but the prices are today the situation of America is more comfortable than it was. Between Argentina and Brazil, we are going to be harvesting more than 200 millions plus the 110 millions of the United States forecast.
We are seeing a big offer coming and demand is not clear if it's going to keep growing as it was. We can move now to next page and we can see the evolution on our planted area. We had this year a record from our history of 283,000 hectares for plantation. We are thinking of growing for next campaign that we're going to see next quarter, but the company is intending to keep growing, reducing our leased areas to third parties to not to be renting so much and to be planting more of those surfaces in our plantations. The company is intending that evolution of increasing the planted area through the whole region, the four countries.
We can now move to next page number 5, and we can see what happened in the yields for Cresud and comparing Cresud and Argentina. We can see in the map, we see what happened in the corn belt, and the whole country was really in red, meaning that the drought was really severe. Something that I, in the company 30 years, I didn't see nothing comparable to 30 years, but this is a drought that I think it's much more than the 30 years. It's more than 100 years, the most severe drought of the country. The country lost 50% of the soybeans and 35% of the corn that was budget, that was forecast at the beginning of the planted plantation area time.
40% in wheat, the combination of the on the winter and summer crops. The whole Argentina was affected 40%, 35%, 50%. Cresud was 30%-40% of the wheat, 18%-35% of the corn, 30%-50% of the soybeans, meaning diversification on regions works. We had a bad year if we can calculate these yields comparing to budget. Finally, with the compensation that the government gave, mainly in soybeans and finally in corn, the corn was later this balance sheet, but it's going to come in the next balance sheet because it was on July or August, so it didn't come on the numbers of June.
Because of the combination of the two, our campaign, the seasonal campaign, not the 30th of June, but the real campaign, was really very good comparing to the drought that the country suffered. Cresud kept majority of the soybean and the corn and was finally finishing selling much better prices, so compensating majority of the drought effect. Diversification worked in the operational, not having the Argentina drop, and the prices compensate that, some of them on the next balance sheet on the 30th of September. Here we see that in Cresud yields, the corn was not very affected, 3% year-to-year. In the soybean, yes.
This is a combination of the drought, plus a early frozen that we suffered in the 18th of February that made us majority of our soybean, second soybean and the first soybean to suffer. The 30% drop is because of the combination of the drought plus the early frozen. We can now may move to next page and see the evolution on the tons and the crop. Comparing year-to-year, we dropped 4% in the whole region. Argentina did close to 10% year-to-year, so last year was not good. Argentina is coming from three years of drought, and the good news are the El Niño is coming to Argentina slowly, and this is making rain for the winter. Now we have our winter more normal comparing to last year conditions.
We are now expecting the three years drought affecting the country to begin to correct, maybe this is a more normal year of yields. We can compare it, here the crop yields of the whole region. The corn was not really being affected in the whole region. The more affected was the soybean, mainly because of Argentine effect. In the meat, there was not a big change, almost the same number of heads, a little more production. A portion of that was made by the feedlots more than the production on farms. Farms were affected because of drought, so that made a lower productive cattle activity for this year because of more cost affecting, but not having less production.
In the sugarcane, we saw the effect of lower yields and less area in Brazil mainly. The operational business of this year was not as good. The best comparing to the forecast was Argentina, but in Brazil, Bolivia and Paraguay, operational was much more affected because of prices, cost and yields. The land, the real estate, was the portion of the business that was more active, mainly in Brazil, and I'm going to show you a little later. We can now move to page 7, and here we see that in the record year of selling farms, but at the same time we compare what we began at the beginning of the year with 750,000 hectares of owned lands and long-term concessions.
Because of the purchase of one farm in Mato Grosso, Brazil, and the recent purchase in Argentina, 11,000 and 1,000 hectares combination of purchases and the small portions of sales, 900, 2,000, 5,000, 4,000. Finally, we finish the year almost with the same level, but having $122 million of sales on our pockets. We can now move to next page, here we see these four sales. The first one is in Paraguay. The other three small sale in Paraguay, $1.5 million. The other three portions of farms in Brazil having internal rate of return of 28, 42, 10, 9. Very important. The internal rate of returns. Look at the majority of the yellow shows the gain. Cost on our book balance is close to...
is almost non-existent, but we see the majority is a gain that each of these sales brings. In each farm, we show here that we have remaining hectares. They are small sales comparing to what we have on our books. In next page, number 9, we see the track record of the sales of last years from 2014 to now, 2023. Every year selling two, three, four, five pieces per year. This year, this is $122 million, a little lower than $134 million record in the past in 2015. In that year, there was a combination of Argentina plus Brazil. This is mainly Brazil in this year. We look at the record level when the price of the land is really very appreciated at the day 1,000 value of Brazil.
In the right we can see why we are very active on selling because there was a big increase on the price of the land. In the right we see the price of the U.S. corn belt or the Brazilian. The Argentinian is not reflecting because of the effects done in Argentina because of the gaps between the two dollars and taxes on exports. We were very active selling farms in the part that we thought it was very smart to begin to sell and buy again. Again, the company is always the combination of three activities: operational, real estate, and now we can move to the next page, the service company. The service company through two companies, FyO and Agrofy. Remembering we have 50% of FyO and 17% of Agrofy.
In the case of FyO, that is our service company giving service to farmers outside the farm with inputs, outputs, brokerage, commercial advisory. In here, we see what this company is making, and the first graph shows what is the projection on tons the company is selling. This year we have dropped from the 6.6 million tons of last year to 5.3 of this year. Remember that Argentina almost lost half of their harvest. This 5.3 represents close to 8% of the market share of Argentine volume. Our record comparing the 2%, 3%, 4%, 5%, 6% market share we had in the past. This company is forecasting an EBITDA close to $25 million.
Shows the strength of this company that is not only doing this job in Argentina, now expanding its branches to the rest of the region, including Chile and Bolivia, Paraguay. Now FyO is going to launch its branch in Brazil too, called BeyondG. To show the strength of this company, went to the capital market, raised a bond at a zero interest rate for three years. This company has two bonds and the whole all this financing of this company is at zero. This expansion is very well re-recognized on the market. From the other side, Agrofy. This is the e-commerce of the agriculture in the region. This company is still expanding on the region and burning money, still not achieving the goal of not burning money, but decreasing the burning money a lot.
The company has cash in its pocket. It's decreasing the burn rate up to the level because the financing of these companies is much tougher in the market. This company is adjusting the size of the company, adjusting the payroll mainly. Today, the company is with the less employees that it had. It's finding the business to using the cash the company raised in the past to survive and to be leading this industry that is delaying more than we expected the use of the digitalization for the selling of the inputs of agriculture. The company understanding that is delaying its burn rate to wait because this we think it's going to happen, but not as fast as expected. Saying that, I will now introduce Mr. Santiago Donato.
Thank you, Alejandro. Well, moving to this page here, we can see the ESG progress for these years. We made a lot of efforts and progress in our commitments that we assume in environmental, social, and governments fronts. We obtained the RTR S certification at El Tigre farm located in La Pampa, Argentina. This year, we certified more than 4,000 hectares, 7,000 tons of soybean production for a period of five years. This is a very renowned certification in the agricultural sector and also very valued by the international market. It recognizes the company's commitment to comply with laws and good agricultural practices, the respect and relationship with local communities, and mainly the care for the environment on the production.
certifications in Argentina, a wool certification in a farm, Ocho de Julio, in the south of the country. Brasilagro as well is working a lot on ESG and certified its current production this year. On the social side, on the social front that we have it directly and through Fundación IRSA, we have done multiple initiatives, donations and volunteer with a focus on quality education on rural education. We work with more than 25 educational institutions throughout all the country. We invested directly and through Fundación, around ARS 260 million this year, with more than 100 social actions benefiting more than 100,000 people. We are putting a lot of efforts on this
We'll keep working to make more progress on ESG following our vision of feeding the world from Latin America, meeting the world higher demand, coming from the increase of population and the world food needs, as well. I will now give Matías for the financial investments in IRSA and the financial chapter.
Thank you, Santiago. Good morning, everybody. Moving to page 12, we can see our investment in IRSA. During the year, we increased our stake to 57% from 54% in the previous year. We saw a good opportunity to invest in IRSA shares. We can see some of the results of IRSA during the year. There was a very strong financial and operational performance, mainly in malls and in hotels. The tenant sales in our malls keep growing and keep increasing our occupancy. We reach 100% occupancy in the Della Paolera building, and the rentals in the office segment. We are very happy with that. The hotels also shows a very good performance, surpassing the segment of offices. For first time, the hotels is more representative than the office in terms of EBITDA.
There was an increase in occupancy and performance. The IRSA were very active in the real estate, selling a lot, selling a lot of office floors for up to $163 million and acquiring as well some buildings for $7.8 million. All the refinancing process were concluded during the year. There was a significant deleverage of up to 67% since 2020. IRSA applied most of the disposals of offices to reduce debt. IRSA also was very active in the capital structure, buying back shares for up to ARS 5 billion. It's a new program where IRSA invested around 40% of that during the year and also distributed a significant amount of dividends during the fiscal year for. It was a dividend yield of 17%.
IRSA proposed to the next shareholders meeting to distribute a significant dividend of ARS 64 billion that will represent around a dividend yield of 15%, according to the current prices. On the right side, we can see the evolution of the rental EBITDA. We surpassed pre-pandemic levels from ARS 131 to ARS 167. We can see here the evolution of the malls. That is the most significant, the hotels is the other. Moving to our financial statement. Here we have different drivers that affected the results during the year. First of all, I would like to mention on the macroeconomic side what happened with inflation and the valuation that has an impact on our financial statement.
The inflation during this year accelerated, reaching levels of 116% compared with 64% in the previous year. When we analyze what happened with the FX devolution during the year, there was a valuation of 105% on the official exchange rate and 31% last year. That means that during the year, the peso appreciated against the dollar 5%. In the previous year was 20%. On the blue chip swap, the Dólar MEP, also there was an appreciation of 10% during the year and 8% last year. That has an impact when we compare figures in $ terms. If we translate those dollars of the previous year into pesos and then express again adjusted by inflation, that will increase the numbers of the last years in $ terms.
That has an impact on the time to compare figures of the previous year with the current year. If we see the agriculture operational results, we see here a reduction of 85.9%. Some effects are not yet recognized in this year. For instance, the new dollar that the government put for the corn is not reflected yet in our results. That will reflect it in the next quarter. That will increase a little, the grain segment. When we analyze, we can see a drop in most of the numbers starting with the grains. Or in the farming, we see a reduction from a gain of ARS 23 billion to a loss of ARS 7.8 billion during this fiscal year.
If we see the grains, last year was an excellent campaign. Excellent prices, lower cost, very good yields during this fiscal year. As Alejandro mentioned, we have the drought in Argentina that affected significant our yields. That was partially compensated by prices, not on the commodity side, but on the FX side, that they're gonna put new effects for corn and soybean. So part is reflected already on our numbers. Part will come in the next quarter. The yields are lower this year, the costs are higher this year, and the price of commodities were lower than the previous year. That is the reason of the drop. In the sugarcane also, we are comparing with a record year in 2022. This year the prices were lower.
Remember that the last year the prices of all the prices were record because of the war in Ukraine. This year there was a reduction. Also in Brazil, the government put a lot of effort to reduce prices of fuel, that affected also the segment of ethanol. In terms of surface was stable compare the surface of sugarcane last year with this year. In terms of yield was a little drop, but mainly the results were affected by the higher cost and lower prices, as I just mentioned.
The cattle segment, we see a positive result in terms of production, but when we compare, when we analyze in pesos term, in real pesos terms, since the increasing prices were much lower than the inflation, in real terms, we recognize or we see this decline. In terms of production was positive. The other important effect during the year is the reduction in the farming sales segment. We see a drop of 47% from ARS 19 billion last year to ARS 10 billion this year. Although this year was record in terms of farm sales, we see this drop that is related to a decline in the receivable accounts that we have for all the past disposals since the price of the soybean declined and we have bag of soybeans to collect.
We see a drop on that, and then the lower results on some of the farms that we sold during the year. Going to next page. Because of all these drivers and on top of that, higher costs on some of the years segments, basically in sales and development and in the other segment where we have an increase on two drivers, one in salaries on board member fees, and in the other is related to a claim that we have in Israel, where you saw make a provision of around $23 million. That is the drop on top of what Shari's claim on the farming side. This is leaving aside the fair value of investment properties.
If we analyze the itself, what happened with the investment properties, we see a drop. This is more related to the macroeconomic drivers. If we measure our properties in dollar terms, the prices are stable, so should be no negative results. Since we are showing our results in pesos adjusted by inflation, we have this drop of 50 or loss of ARS 51 billion . Finally, on page 17, we have what happened on the net financial results, where we have a gain during the year of ARS 24.2 billion , compared with a higher gain last year of ARS 47.3 billion . Here we have two main effects. The first one is this in the line one on the table below the graph.
The net FX results, where last year we have a gain of ARS 63.5 billion against ARS 20 billion this year. Remember that the appreciation of the peso was much higher last year. All our dollar-denominated debt was affected by that or benefits by that. The net interest went down to ARS 18.9 billion compared with ARS 27 billion last year. This is because of the deleverage of the group. Also the fair value of the financial assets. This is the investment of our liquidity generated gains during the year of 18.7. Another significant effect during the fiscal year was the positive results on the income tax.
During the year, there was a resolution from the Supreme Court allowing one company to adjust by inflation, the tax credits and the tax financial statement is something that our financial statement, and during the year, we decided to recognize when the company saw on to do what we are doing. We are recognizing that gain. Finally, with all these results, the company is finishing the fiscal year with a net result positive of ARS 75.3 billion compared with ARS 135 billion last year. About our debt, the net debt, we finished the fiscal year with a net debt of $396 million. The last quarter, remember, that was $420 million, so we reduced a little our leverage.
The next amortizations are distributed in the coming years, we finance the upcoming maturities without a major issue. The credit rating was updated by FIX SCR, that is a subsidiary of Fitch Ratings from AA to AA+. About the capital structure, we have been acquiring shares in the market. The board meeting approved a program of shares repurchase for ARS 4 billion. We just updated the maximum price to $9 per ADR or ARS 720 per share. The program, we already invested ARS 3.1 billion, we can complete the program. That is around ARS 900 million more. Also, we submit for approval to our shareholders' meeting a distribution of up to 5.8 million shares.
That is around 1% of our capital stock, that will be distributed together with the dividend. About the dividend, the proposal during the year we paid was like ARS 12.6 billion . That was a dividend yield of around 9%. We submitted to the shareholders' meeting a new disposal for up to ARS 22 billion in cash, + 3% of the shares of IRSA. If the shareholders' meeting approve, we will distribute around October or November this amount of money and shares. With this, we finish the formal presentation. Now we open the line to receive your questions. Now it's time for the Q&A session. If you have a question, please use the chat. We are gonna take the questions in the order we receive them. Here we have the first question.
What is the reason for distributing IRSA shares? Well, every time that we analyze the dividends, we analyze our capital structure, the liquidity, and upcoming amortization of debt, and the upcoming capital expenditures that we have. If we analyze what IRSA will distribute, IRSA, for Cresud will distribute around ARS 37 billion , and we prefer during the year, since Cresud acquire shares of IRSA for this... I mentioned that we increased this 3% during the year. It's like we use cash for this 3%, and now we will receive from IRSA this ARS 37 billion . It's like we are leaving the amount of money that Cresud invested for IRSA in cash, and we will use that cash to reduce debt.
Since there was this increase in shares, we will distribute those shares for our investors. That is the risk. Next question. If you can give me some prospects on the future campaign in terms of size, prices, costs. We are planning to increase. We are talking about 6%-7% growth on area, decreasing the area that we are giving to third parties and increasing that for our own plantation. We are going to look for a bigger campaign related to tons.
In the whole region. Related to prices, we are expecting a drop on prices compared to last year. It's because of what we spoke about, the more normalization on the regional production, and that is affecting prices. But a big decrease on the costs, this is mainly fertilizers and inputs, not in seeds. We are expecting a more normal margins than last year. Better operational when we think, when we speak about next year will be a better operational than last year because we are forecasting that if the weather is normal. No? Having said that, prices on drop, costs in drop, yields recovering mainly in Argentina, this is what we are expecting on the operational for the four countries.
Good. Next question. What is management's current expectation on the time when Cresud will exercise its IRSA warrants?
Well, the expiration of those warrants are in 2026. We don't anticipate any reason why we will exercise those warrants before expiration. No, we are not planning to exercise before that 2026.
Next question, if we can provide more details on the provision or legal proceedings in Israel?
Well, there was, during our investment in Israel, IRSA signed a commitment subject to different conditions, and an inception of around two installments of $20 million that were subject to different conditions. The company or IRSA understood that those conditions were not fulfilled and there was no guarantees at all to inject that money. On the other side, the claim is they think that we should invest that money, and that is the claim. Although the lawyers of IRSA feel comfortable about the claim, the board of directors decided to be conservative and generate the provision of the half of the claim for $20 million, and the claim is related to that.
That is, it's all explained in our 20-F or in the documents of IRSA if you want to see higher details or deeper details of the claim.
One more question. Do you plan to purchase further Argentine farmland?
Yes, we did some purchase, and we are in the objective of rebalancing our portfolio in Argentina for land. Yes, it's our intention to keep buying in Argentina if we find the opportunities.
We give some minutes more for any additional question that you may have.
We, this year instead of, we were able to buy something and, we are going to keep doing those swaps of the land. This is what is our mission. No? It's to rebalance always our portfolio. Yes, for sure, we're going to try to do this in the four countries that we are. If there are no more questions. One more.
Will the cash dividend be distributed as a lump sum?
It's not defined yet. The shareholders meeting will decide all the details about the dividend. The proposal is to distribute up to ARS 22 billion. That will be decided by the shareholders meeting on the 5th of October.
With this, we conclude the presentation on the Q&A session. We thank you very much for having participated, and I will now turn back to Mr. Alejandro Elsztain, CEO, for his closing remarks.
We are closing a mixed year, I would say, but facing what we think a very good year for next in growing area. I think the expertise on the operation is maturing year to year. In some cases, we are seeing so good yields having drought affecting. That makes us to be very optimistic in that operational maturity of the company and increasing the size. Meantime, the real estate portfolio and the activity shows this fever the company likes to have, where to the day we are ready for selling and buying again in another region. We are expecting a very good and active new year related to real estate in the region and in the service too, because the expansion on the service is going to rest of South America.
Yes, we are very optimistic facing the next new year, having a lot of uncertainty related to Argentina. This is a year of changes, of election and, probably a change, big change on the rules and the economy. For sure, this is going to affect our business in Argentina. That today is a portion, but it's not all the activity of Cresud on the region. Thank you everyone for this year that is finishing, and let's see, and let's keep thinking and working a lot. The next year is going to be better than this. Thank you very much and have a very good day.