Good afternoon, everyone. Thank you for joining the call. We would like to go through the presentation quickly at the beginning of it and then go for the Q&A session. We would like to ask everyone to be on mute after connecting, and it would be much easier if you send us questions in the Q&A box so that we can read it out. I'm going now into the main part of our presentation. Here is the overview of our P&L for the first six months compared to the previous year. One can see significant growth in the revenues on account of two business segments, sugar production and cattle farming.
Although the soft commodity prices were going down this year, we still see a quite respectable EBITDA margin and net profit margin. Looking at our balance sheet, it remains very conservative with net debt to EBITDA below one. And we continue to focus on our operating cash flows, which totaled EUR 116 million . And that was also alone our increased investments. In the first half of this year, the key CapEx was spent in agricultural and sugar production business segments. Agriculture, the results were affected by lower soft commodity prices and adverse weather conditions, which not only affected spring crops, but also continued to play out for our late crops.
We have already reported our yields for winter crops such as wheat and rapeseeds. We are in the process of sowing for the next season, but corn, soybeans, and sugar beets remain work in progress. The weather is extremely dry at the end of summer, and such crops as sugar beet and corn, more certainty will come in the next months to come. According to the official forecast of the local agricultural ministry, the harvest could be down between 15% and 30%, depending on prevailing market, sorry, weather conditions in the autumn. Generally, Ukraine performed well on exports of its produce during last marketing season, and the logistics routes, which are currently available through Odesa, reached pre-war levels.
And, we expect the cost of exports in terms of transportation costs and transshipment costs to go down because of the lower harvest, which is expected in Ukraine this year. The global grain prices continue to decline, but we saw some rebound for wheat prices in Ukraine. In sugar, we are starting our sugar production season as we speak. The first plant has been launched, and we are in the process of launching the remaining plants. Until the quota to the EU markets was imposed in June this year, Ukrainian producers of sugar, including Astarta, were actively exporting to European market.
We managed to export nearly 120,000 tons, majority of which was placed in southern European countries such as Romania, Italy, et cetera. Profitability is lower on account of lower sugar prices globally, but it remains at good levels on a gross margin basis. This year, the acreage on the sugar beet is slightly higher than last year, but the harvest forecasts are still uncertain. Various forecasts anticipate the range of the sugar production between 1.65 million tons-1.75 million tons. Ukraine will have another opportunity to export to EU markets from first of January with a new quota above 100,000 tons. Until then, everyone, including ourselves, is focusing on exporting to other markets outside the European Union.
Soybean processing is very resilient in terms of the margins at the growth and EBITDA level, despite meal and oil prices going down compared to last year. Production volumes are steady and crush margin and our margins are steady. There is a record area under soybeans in Ukraine this year at 2.6 million hectares. However, the weather conditions are not very favorable, and the expected harvest range varies between 4.6 million tons- 6 million tons, depending on the source. Cattle farming is the segment which contributed to our revenues increase in the first half of this year. We continue to grow our herd and the yields per headcount. In livestock sector, the prices remain quite strong for premium milk, which is a specialty of Astarta.
The company is the largest producer of raw milk in so-called industrial production segment of the market. The smaller farmers continue to reduce production of the headcount, but this creates an opportunity for the bigger players such as Astarta, to increase production and the margin, which can be seen in our first six months P&L. This remains the main update. There are a few other updates in the appendices of our presentation. But in terms of interim results, while we are in the middle of autumn harvesting, these are the main developments. So we would like to go into the Q&A session now. The first question: How much of export-oriented deals were contracted for sugar for second half 2024?
We will not give the precise number, but these are tens of thousand of tons of sugar at the pace which is similar to the last marketing year. But of course, the biggest part during the last marketing year was the EU market. Now we are focusing on MENA markets. Next question: Considering the company's very strong financial position, does the company intend to pay in advance on the dividend? I would like to- Mm-mm. Well, we, we, I'm, I'm just received the remarks from our CEO. We are focusing on stability of our operations, and we also strive to stable and predictable dividend policy, which is still in place.
Missed a couple of questions.
Huh?
Missed a couple of questions.
Where?
From Martin.
Ah, okay. Sorry.
Could you please comment on drivers for second quarter agriculture, EBIT, and how much crops sold externally contributed, how much crops sold internally? I believe it is best to comment on the marketing year overall. This is how the seasonality is viewed by the management. So during the last marketing year, we sold about seven hundred thousand tons of grains and oilseeds, of which one third was third-party volumes. So I believe it is more meaningful to look at the overall ratio on top of our own produce, rather than specifically second quarter, because second quarter was the end of the marketing season, and Ukraine already ran out of grain and oilseed stocks. Drivers for agricultural EBITDA in the second half of 2024, we...
When we book our remeasurement and fair value gain from remeasurement in our results of the first half of this year, we look at the change in prices, in yields, in our costs. In terms of the prices, the situation is clear that the prices were down for soybeans. There was price stability for corn and sunflower. For sugar beet prices significantly down, but winter wheat is up. In terms of our yields, we already reported yields for the early crops, and they were 16%-17% down.
Currently, we see still our yields for very late crops such as sugar beet and corn at the level not significantly lower than last year, but there is a big uncertainty because there are still couple months ahead of us. So in such situation, we mostly focus on costs, and we managed to reduce our costs of production by at least 10% across the board. This is why we see our gain from remeasurement at respectable levels for our key crops such as wheat, sugar beet, and soybeans. I think I answered the next question on remeasurement of agricultural produce.
Ending stocks for sugar at the end of June are around 55,000 tons, but majority of these stocks have already been contracted out since thirtieth of June. We. In position, right of use asset land, amount increase from EUR 100 million- EUR 113 million, has the size of land in Astarta increased or just value of land? And also due to that, we have increased cost of lease prepayment, cost of lands company using. I will divide the answer to these questions in two parts. The first part is regarding the actual cash flows. If we go into agriculture P&L. One second, we're just switching the screen. Agriculture. One can see that our actual cash outflows on land lease liability is very steady.
It was around EUR 30 million for 2021, 2022, and 2023. In the first half of this year, the increase was not that much significant either. So in terms of the value of land on the balance sheet, this is largely an accounting treatment. And that relates to extension of the land leases, for which we renew our land lease contracts, as well as our discount rate has been lowered from 19%- 16%. And with a lower discount rate, the accounting value of land liabilities increases. What was the difference in profitability of sales of sugar locally and internationally, including total sales cost on Astarta side in the second quarter? There was a rebound in sugar prices locally, which is seasonal.
Sugar prices typically increase during summer months in Ukraine for two reasons. One is the end of the marketing year, but also population general households still can their own jams and produce. So there was a rebound in the local sugar prices, one can observe. That was contrary to the global trend, when the sugar prices were going down. The volatility of the local sugar price will depend on the harvest of sugar beet in Ukraine and also prevailing global market prices, because Ukraine will start again exporting sugar to the EU markets from January. What plans company has relation in investing cash and cash equivalents, EUR 22 million ?
I think one observation here is that as of thirtieth of June, we had a dividend announced, but not still paid out physically. So that was an accrual within this EUR 72 million . Yes. Mm-hmm. Also, we during our annual results call, we provided our guidance for increased CapEx this year. CapEx is expected to double to around EUR 40 million . Our SPC project CapEx started last year. In the first half of this year, majority of CapEx was spent in agriculture and sugar segment, especially given our active involvement into the EU market. We are investing into higher quality and packaging of sugar for European customers.
And in the second half of this year, we are expected to continue our chunky CapEx into the SPC project. This is why these plans largely cover expected CapEx and also the dividend, which was announced this year. "Is the company considering a share buyback program? What are the plans with already acquired shares?" We are paying a dividend, and since we started paying a dividend, we curtailed the buyback program. The treasury shares, which are on our balance sheet, is really small percentage, and we are still considering our options since migrating from the Netherlands to Cyprus. "In the past, Astarta showed profit from asset revaluation in second quarter. Has this changed?
Will this profit be shown in third quarter?" No, we don't expect it to be shown in the third quarter. "Can company reveal what exactly CapEx has gone on for sugar processing and agriculture? Is it for new plants or something else?" I provided the partial answer to this question already. In sugar processing, this is mostly to storage and packaging equipment, which allows us to supply to European clients better. In agriculture, these are also efforts in sugar beet growing and cultivating equipment, which also allows us to upgrade our process to European standards. "Since company invested in sugar production, is company going to increase current levels of volumes of sugar sales next year?
What company strategy in case sugar prices go below profitability? Yuri, thank you for your question. You can see the acreage on the sugar beet has remained unchanged since last year, so this has been steady operations for our in-house production. Sometimes we increase purchases of sugar beet from independent farmers for processing in our plants, but that was at the level of 20%-25% of total production in the previous years. In case there was a particularly bad weather and the sugar beet harvest was low in Ukraine several years ago, we even imported raw cane sugar for processing. Generally, this business segment is well-established and steady. The sugar prices went below profitability.
That was the case during two thousand seventeen and eighteen. That was mostly related to the restructuring of the sugar segment in the EU. That was a once-in-a-lifetime event, which already happened, so we do not expect such dramatic developments in terms of the sugar industry in Europe, which is Ukraine's largest export markets, and given that, Ukraine is an associate member and now would like to be integrated fully into the EU markets. "Is there third quarter local sugar price spike seasonality? Hence, Astarta sold high volumes of sugar in second quarter, instead trying to accommodate price spike on local market." Third quarter.
Well, there is definitely spike during summer months, but our volumes of placements in the local market are generally steady because we focus on industrial consumers of our sugar. These are beverage and food processing companies, and their consumption is steady on the current regulatory conditions. Is the purchase of land in Ukraine become possible for foreign companies? Does Astarta intend to buy land? Unfortunately not. The law in Ukraine with regards to farmland trade remains the same. It is only possible for legal entities to purchase land if they have no foreign ultimate beneficial owners, and there is a cap of 10,000 hectares. Considering that the CEO is present at the meeting, do you intend to continue buying shares?
And the second question, can you assure that Astarta will remain a publicly traded company? [Foreign language] I become engaged in buyback activity when I see that the share price becomes unfairly below its fair value. And by doing these purchases, I'm signaling to our other stakeholders and the business partners, the confidence and the undervalued nature of shares of Astarta, even under current circumstances. That probably also answers the second question. The company remains a publicly traded company, and this is why the CEO confidence and transactions with shares is another confident boost. Thank you very much for your questions. I believe we managed to do this call within half an hour.
If you have any further questions, please do contact us via email, and we will answer it or arrange for separate calls if there is such an interest. Thank you very much. Bye-bye.
Thank you.