SEC Comment Letter for Adecoagro S.A. (AGRO) — Dec 1, 2017
Adecoagro S.A.
Date: Dec. 1, 2017 · CIK: 0001499505 · Accession: 0000000000-17-042224
AI Filing Summary & Sentiment
Letter
December 1, 2017 Carlos A. Boero Hughes Chief Financial Officer Adecoagro S.A. Vertigo Naos Building, 6, Rue Eugène Ruppert L - 2453 Luxembourg
Re: Adecoagro S.A. Form 20-F for the Year Ended December 31, 2016 Filed April 28, 2017 File No. 001 -35052
Dear Mr. Hughes :
We have limited our review of your filing to the financial statements and related disclosures and have the following comments. In some of our comments, we may ask you to provide us with information so we may better understand your disclosure.
Please respond to these comments within ten busine ss days by providing the requested information or advis e us as soon as possible when you will respond. If you do n ot believe our comments apply to your facts and circumstances, please tell us why in your response.
After reviewing your response to these comments, we may have additional comments.
Form 20 -F for the Year Ended December 31, 2016
Selected Financial Data, page 1
1. We note from pages 4 through 8 that your presentation of the non -IFRS measure s Adjusted Segment EBIT and Adjusted Segment EBITDA are reconciled to operating profit rather than net income. Please revise to reconcile the se measure s to net income pursuant to the guidance outlined in Question 103.02 of the Compliance and Disclosure Interpretations issued by the Division of Corporation Finance regarding Non -GAAP Financial Measures.
2. We note your reconciliations of Adjusted Free Cash F low and Adjusted Free Cash from Operations at the bottom of page 9. Please explain the purpose of the reconciliations to the change in cash and cash equivalents. Additionally, to the extent you retain these reconciliations, p lease revise them, as well as your reconciliation of Net Debt, to begin with IFRS measure s rather than non -IFRS measure s. See Question 102.10 of the updated Non-GAAP Compliance and Disclosure Interpretations issued on October 17, 201 7.
Carlos A. Boero Hughes Adecoagro S.A. December 1, 2017 Page 2
3. Additionally, we note your Adjusted Free Cash Flow and Adjusted Free Cash from Operations measures include interest received (included in net cash used in investing activities), interest paid, p roceeds from the sale of non -controlling interest in subsidiaries , and Expansion Capital expenditures. Ple ase substantiate why these amounts are included in these non -IFRS measures and revise your usefulness disclosures accordingly to explain what these measures are intended to represent.
Financial Statements
Consolidated Statements of Changes in Sharehold ers’ Equity, page F -7
4. Please explain further your application of the changes to IAS 16 and IAS 41 regarding bearer plants. In this regard, we note from page F -69 that you adopted the transitional rule that allowed you to apply the fair value of bearer pl ants as their deemed cost at January 1, 2014. However, paragraph 81M of the June 2014 Amendments to IAS 16 and IAS 41 issued by the IASB states that the differences resulting from its application should be recognized in opening retained earnings in the ea rliest year presented. Please explain why there is no such adjustment in your statement of changes in shareholders’ equity.
Notes to the Consolidated Financial Statements
12. Property, plant and equipment, page F -38
5. We refer to your statement on page F -40 that depreciation charges are capitalized in property, plant, and equipment. Please tell us the nature of the depreciation charges that you capitalize and the authoritative accounting literature that supports the ba sis for your conclusions.
We remind you that the company and its management are responsible for the accuracy and adequacy of their disclosures, notwithstanding any review, comments, action or absence of action by the staff.
You may contact Heather Cl ark at 202 -551-3624 or me at 202 -551-3379 if you have questions regarding comments on the financial statements and related matters. Please contact John Stickel at 202 -551-3324 or Dana Brown at 202 -551-3859 with any other questions.
Sincerely,
/s/ Melissa Raminpour
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December 1, 2017 Carlos A. Boero Hughes Chief Financial Officer Adecoagro S.A. Vertigo Naos Building, 6, Rue Eugène Ruppert L - 2453 Luxembourg Re: Adecoagro S.A. Form 20-F for the Year Ended December 31, 2016 Filed April 28, 2017 File No. 001 -35052 Dear Mr. Hughes : We have limited our review of your filing to the financial statements and related disclosures and have the following comments. In some of our comments, we may ask you to provide us with information so we may better understand your disclosure. Please respond to these comments within ten busine ss days by providing the requested information or advis e us as soon as possible when you will respond. If you do n ot believe our comments apply to your facts and circumstances, please tell us why in your response. After reviewing your response to these comments, we may have additional comments. Form 20 -F for the Year Ended December 31, 2016 Selected Financial Data, page 1 1. We note from pages 4 through 8 that your presentation of the non -IFRS measure s Adjusted Segment EBIT and Adjusted Segment EBITDA are reconciled to operating profit rather than net income. Please revise to reconcile the se measure s to net income pursuant to the guidance outlined in Question 103.02 of the Compliance and Disclosure Interpretations issued by the Division of Corporation Finance regarding Non -GAAP Financial Measures. 2. We note your reconciliations of Adjusted Free Cash F low and Adjusted Free Cash from Operations at the bottom of page 9. Please explain the purpose of the reconciliations to the change in cash and cash equivalents. Additionally, to the extent you retain these reconciliations, p lease revise them, as well as your reconciliation of Net Debt, to begin with IFRS measure s rather than non -IFRS measure s. See Question 102.10 of the updated Non-GAAP Compliance and Disclosure Interpretations issued on October 17, 201 7. Carlos A. Boero Hughes Adecoagro S.A. December 1, 2017 Page 2 3. Additionally, we note your Adjusted Free Cash Flow and Adjusted Free Cash from Operations measures include interest received (included in net cash used in investing activities), interest paid, p roceeds from the sale of non -controlling interest in subsidiaries , and Expansion Capital expenditures. Ple ase substantiate why these amounts are included in these non -IFRS measures and revise your usefulness disclosures accordingly to explain what these measures are intended to represent. Financial Statements Consolidated Statements of Changes in Sharehold ers’ Equity, page F -7 4. Please explain further your application of the changes to IAS 16 and IAS 41 regarding bearer plants. In this regard, we note from page F -69 that you adopted the transitional rule that allowed you to apply the fair value of bearer pl ants as their deemed cost at January 1, 2014. However, paragraph 81M of the June 2014 Amendments to IAS 16 and IAS 41 issued by the IASB states that the differences resulting from its application should be recognized in opening retained earnings in the ea rliest year presented. Please explain why there is no such adjustment in your statement of changes in shareholders’ equity. Notes to the Consolidated Financial Statements 12. Property, plant and equipment, page F -38 5. We refer to your statement on page F -40 that depreciation charges are capitalized in property, plant, and equipment. Please tell us the nature of the depreciation charges that you capitalize and the authoritative accounting literature that supports the ba sis for your conclusions. We remind you that the company and its management are responsible for the accuracy and adequacy of their disclosures, notwithstanding any review, comments, action or absence of action by the staff. You may contact Heather Cl ark at 202 -551-3624 or me at 202 -551-3379 if you have questions regarding comments on the financial statements and related matters. Please contact John Stickel at 202 -551-3324 or Dana Brown at 202 -551-3859 with any other questions. Sincerely, /s/ Melissa Raminpour Melissa Raminpour Branch Chief Office of Transportation and Leisure