Message From Our CFO

In 2022, LDC leveraged its strengths and capabilities to successfully manage risks and secure profitable and resilient operations in an uncertain business environment marked by the Russia-Ukraine crisis, inflationary pressure and other challenges. Our strong operational performance combined with prudent capital deployment further strengthened our position for growth.

Both of our business segments contributed to LDC’s improved financial performance in 2022, delivering Segment Operating Results (SOR) and EBITDA at US$2,611 million and US$2,347 million respectively. Value Chain SOR were driven by strong demand for Grains & Oilseeds products, higher processing margins, and Freight business expansion and innovation, while Merchandizing SOR was supported by our globally diversified Cotton origination capabilities and customer base expansion in Sugar and Rice.

2022 was an unusual year in many aspects, with the Russia-Ukraine crisis since late February 2022 fueling significant business disruptions that added to geographical imbalances and uncertainty on supply for some of the world’s most consumed agri-commodities. Combined with weather events, persistent logistics challenges, Covid-19 resurgence and concerns over potential global recession, this contributed to greater volatility.

Our global presence at both origin and destination, the diversity of our business portfolio, our risk management capabilities and our edge in core merchandizing activities were key to overcome challenges posed by this environment and meet customer needs. Thanks to the expertise, commitment and customer focus of our teams, we expanded our commercial reach and helped ensure supply chain continuity for essential products.

Our strong operational performance, cautious cost management in an inflationary context and cost-efficient financing, drove an 18.7% return on equity for the year.

In 2022, we continued to invest in the improvement and maintenance of existing facilities, new product flows and expansion into new business areas. For example, we acquired Emerald Grain in Australia, began the construction of Fuling Food Industrial Park joint venture in China and opened an R&D center in the US dedicated to our new Plant Proteins business.

We also adjusted our Group’s debt structure to reduce the subordination risk for bondholders. As a consequence, S&P Global Ratings announced on January 5, 2023 the rating upgrade of the bonds issued by LDC to BBB, now aligned with the Group’s rating.