Alejandro Elsztain - CEO Carlos Blousson - CEO International Operations Matias Gaivironsky - CFO

Good afternoon, everyone, and welcome to Cresud’s First Quarter 2017 Results Conference Call. Today’s live webcast, both audio and slide show may be accessed through the Company’s Investor Relations website at www.cresud.com.ar/ir, by clicking on the banner Teleconference. The following presentation and the earnings release issued last week are also available for download on the Company’s website. After management’s remarks, there will be a question-and-answer session for analysts and investors. At that time, further instruction will be given. [Operator Instructions] 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 risks and uncertainties, and actual results may differ materially. Please refer to the detailed note in the Company’s earnings release regarding forward-looking statements. I'll now turn the call over to Mr. Alejandro Elsztain, Chief Executive Officer. Please go ahead, sir.

Thank you very much. Good afternoon everybody. We are beginning the highlights of first quarter of 2017 on page number two. If we talk about financial consolidated results, we see that that revenues of Cresud after consolidating the Israel and Argentina, we are achieving almost ARS20 billion of revenue from those 2 billion coming from agribusiness and Argentina urban business center and the rest from Israel business center. The breaking income in this quarter is ARS1.1 million and from this almost half 0.4 billion coming from Argentina and urban and agriculture business center and the rest from Israel. And in the net income, there is a loss accumulated up to now of almost ARS900 million from that the loss from Argentina is ARS55 million and the rest come from the Israel business center. And to the Cresud shareholder, the loss instead of the ARS873 million is ARS485 million, comparing to the loss of last year of ARS289 million. When we talk about the agribusiness segment in Argentina and in the region, we have good weather condition in the whole region and the prices are still sustained having very good campaigns in South America and in the States too, but still prices are better than in the worst moments of last year. We are growing and we're going to show you growth for next campaign in planting area. We are growing 9% comparing to a year years and we are growing again in developing hectares in the region for 2017. After many years, we are waiting and we decided to begin our capital activity in Brazil, and we began to buy surpass 5,000 hecs in Brazil. So, today we are now capital ratios in Argentina mainly, but in Brazil and in Paraguay too. We have sold a farm in Argentina for…

Thank you, Alejandro. Good afternoon everybody. Today, I'm going to talk about our production forecast and the growth of crops for the condition for 2017 campaign, commodity price and farmer, sugarcane milk and cattle production. But let me begin with a farmland sale in the Slide number 4. If you go to the page number 4, during the first quarter in 2017, we sold two farms El Invierno and La Esperanza in Argentina for $6 million. These represent six times the book value on internal rate of return U.S. dollars of 4%. It is not a high return, but it was a farm with four operating results and no opposition potential, that the reason why we decide to sell them. This will show that the market in Argentina is a little bit more liquid compared to recent years. If we move to the next Page number 5, farming production forecast and global stock. As you can see in the bar graph regarding farming production, Argentina forecast in the last campaign has reached about 57 billion tons, remaining stable as the last campaign, but the only difference is that in the last campaign also there is similar same percent more of the dilution came from wheat. Talking about the corn production, it has increased up to 37 million tons from the similar percent more than the previous campaign because of the new government make sure that in clear the 22% in export tax reduction, as we mentioned in the last call. Let me draw your attention to the Brazil situation. In terms of soybean production, it increased 5% as expected as there good weather conditions because they're active sustainable. And the corn production has increased 25% coming back to the normal prediction after the weather condition, they are positive. Bear in…

Thank you, Carlos. Going to Page 8, here we have the breakdown of our investment in near-term the Argentina business center of IRSA at Cresud control with 63.4%. So, you can see here the evolution of tenant sale that increased in the last quarter compared with the same quarter of the previous year 21% that is below inflation. So, we see in Argentina it's low down in consumption in the recent month. Regarding occupancy, very good levels we maintained our portfolio a 98.4%. The same in offices, excellent figures with we're reaching occupancy of 100%, maintaining the rent and exceeded our levels in the previous year. Page number 9, regarding our Israel business center, remember that IRSA controls through Dolphin 68.3% of IDBD. So, the latest developments were that subsidiary of IDBD, DIC accepted an offer from ChemChina to sell 40% stake in Adama for $230 million in excess of the total debt of IDBD had against Adama position. So, we expect to close the transaction in the coming days that will represent the net positive cash flow to DIC of around NIS800 million. Regarding Clal, remember that we consolidate IDBD and we are recognizing results over the evolution of the share of Clal at market value. So, prices of the shares increased by 4% during the quarter. So, we recognize it again of ARS181 million for that. Regarding the debt of IDBD, remember that we issued a bond last quarter for NIS325 million with area to pledge shares of Clal as a collateral. We went through the court for approval and unfortunately we were rejected on pulling shares of Clal as collateral. So, we had to cancel the debt issuance. So, we already cancelled from NIS325 million to NIS244 million. And the balance the 26% of the issuance is…

Just to close the conference, the first quarter that is not so active in general in the agriculture arena. We have good conditions from the soil for plantation, and we expect to have more liquidity on the real estate market because the impact happened to Argentina. So, let’s see next quarter at the end of the year. Thank you very much. And have a very good day. Thanks.

Thank you. This concludes today’s presentation. You may disconnect your line at this time. Have a nice day.