2020 Interim Report Contents Our Identity As a leading global We have done so for almost 170 years, 01 Our Identity helping to feed and clothe millions of merchant and processor people each year – safely, reliably 02 LDC at a Glance of agricultural goods, we and responsibly. rely on our expertise and We believe that what nature has to global network to source offer is our privilege to use, and that we Management Discussion & Analysis have a responsibility to use it with great products from where they respect, in fairness to all and toward a 06 Financial Highlights are grown, and transport sustainable tomorrow. and transform them for That is why we are guided by a clear 10 Income Statement Analysis customers and consumers mission, vision and purpose, and strong, shared values, in everything we undertake. around the world. 12 Balance Sheet Analysis Interim Condensed Consolidated Financial Statements Diversity 19 Auditor’s Report on Review of Interim Financial Information 20 Interim Consolidated Income Statement s e lu 21 Interim Consolidated Statement of Comprehensive Income a V Vision 22 Interim Consolidated Balance Sheet To work toward a safe and 24 Interim Consolidated Statement of Cash Flows sustainable future, contributing to the global effort of providing 25 Interim Consolidated Statement of Changes in Equity sustenance for a growing population. Notes to Interim Condensed Consolidated Financial Statements Commitment Humility 26 Mission Purpose 70 Corporate Governance To use our know-how To create fair and and global reach to bring sustainable value, the right product to the for the benefit of right location, at the current and future V right time. generations. a l u e s Entrepreneurship Unless otherwise indicated, “Louis Dreyfus Company”, “LDC”, “Group”, “Louis Dreyfus Company Group” and related terms such as “our”,“we”, etc. used in this Interim Report refers to the Louis Dreyfus Company B.V. Group. 01 LDC at a Glance Active in 100+ countries Approximately 18,000 EUROPE, employees MIDDLE EAST & AFRICA Moscow Calgary Yorkton Rotterdam Wittenberg Antwerpen Warsaw London Kiev Ghent NORTH Paris Grand Junction Geneva Ürümqi AMERICA Norfolk Milano Our Platforms Chicago Lyon Krasnodar Beijing Sofia Shymkent Claypool Kansas City Wilton Fresno Madrid Istanbul Cordova NORTH ASIA Coffee Map Key Lubbock Shanghai Port Wentworth Sugar Alexandria Gurgaon Land Platforms Dubai Karachi Kunming Cotton Grains & Oilseeds Rice Mexico D.F. Villanueva SOUTH & Coffee Dakar Bangalore Freight SOUTHEAST Cotton Ho Chi Minh ASIA Lagos Abidjan Sugar Bogotá Klang Kampala Global Markets Juice Tema NORTH Nairobi Assets LATIN AMERICA Mombasa Jakarta Grains & Oilseeds Farming Processing asset Lusaka Logistic asset – storage São Paulo Juice Logistic asset – transport Johannesburg SOUTH & WEST Asunción Santos Under construction LATIN AMERICA Brisbane Tolling agreement, off-take Rosario Rice contract, minority stake, Montevideo land lease, facility lease Buenos Aires 6 regions Melbourne Sugar Other Office LDC in the Value Chain 0 1 000 km We develop sustainable 1 2 3 4 5 solutions to bring agricultural goods from where they are grown to our customers’ doorstep. This involves a complex supply chain in which Originate & Produce Process & Refine Store & Transport Research & Merchandize Customize & Distribute our people and partners play a Sharing our expertise with farmers Processing and refining the finest Efficiently managing movements Relying on our market knowledge Supplying products to a range of vital role, ensuring a smooth and producers worldwide, be it through quality raw materials. across the value chain. to ensure responsive supply across customers, from multinationals to journey for our products. partnerships or our origination network. platforms and regions. local customers and consumers. 02 03 Management Discussion & Analysis 06 Financial Highlights Income Statement 10 Analysis 12 Balance Sheet Analysis 04 05 Volumes5 Net Income, Group Share down 2.9% Financial US$126 million year-on-year Highlights US$71 million over the same period in 2019 Period from January 1, 2020 to June 30, 2020 Return On Equity,6 Group Share: Net Sales Net Debt 6.2% US$16.3 billion US$6.7 billion 4.6% in full-year 2019 US$17.5 billion over the same period in 2019 US$6.9 billion as of December 31, 2019 Working Capital Usage Segment Operating Results1 Total Assets US$5.6 billion US$6.0 billion as of US$799 million US$19.5 billion December 31, 2019 US$19.5 billion as of December 31, 2019 US$495 million over the same period in 2019 EBITDA2 from Continuing Operations Adjusted Leverage3 Ratio Adjusted Net Gearing7 0.66 US$634 million 2.8x 0.54 as of December 31, 2019 US$423 million over the same period in 2019 3.1x as of December 31, 2019 Capital Expenditure8 US$119 million Income Before Tax 4 Liquidity Coverage US$191 million over the – Continuing Operations same period in 2019 1.7x current portion of debt US$306 million 1.9x as of December 31, 2019 US$85 million over the same period in 2019 1 Gross margin plus share of income in associates and joint ventures. 3 Adjusted net debt (net debt less RMI) to last twelve months EBITDA from continuing operations. 2 Earnings Before Interests, Taxes and Depreciation & Amortization. 4 Cash and cash equivalents, other current financial assets at fair value, readily marketable inventories (RMI) and undrawn committed bank lines. 5 Volumes shipped to destination. 6 Twelve months prior to period-end. 7 Adjusted net debt (net debt less RMI) to total stockholders’ equity and non-controlling interests. 8 Purchase of fixed assets and additional investments, net of cash acquired. 06 07 Management Discussion & Analysis Foreword Period from January 1, 2020 to June 30, 2020 Since the beginning of the Covid-19 pandemic, LDC has leveraged The Merchandizing Segment’s improved performance was The following discussion of the Group’s operating results and Impact of Covid-19 its global footprint to continue to bring agricultural products to supported by the Coffee, Sugar and Rice platforms, while the financial position should be read in conjunction with the Group’s As a leading global merchant and processor of agricultural customers and consumers around the world, operating almost Cotton Platform’s results remained resilient. Our Coffee Platform consolidated financial statements as of, and for, the six-month goods, LDC plays a key role across food and feed value chains, all its facilities throughout the first semester of 2020 to ensure capitalized on its global footprint and market position, as coffee period ended June 30, 2020, and the year ended December from farmers to end-consumers, ensuring safe, efficient and supply chain continuity from farmers to end-consumers. We did consumption patterns shifted from “out of home” to “at home” 31, 2019, prepared in accordance with International Financial reliable operations for all actors and stakeholders, including our so while adopting reinforced safety and hygiene measures at during lockdowns. Price volatility and growth in volumes shipped Reporting Standards (IFRS). customers, suppliers and employees. This role was all the more each site, designed to protect our people, ensure food safety drove the Sugar Platform’s performance, in addition to favorable relevant in the context of the Covid-19 pandemic, during which and prevent the spread of the pandemic. market conditions for our Imperial Sugar facilities in the US. The results presented include certain financial performance food security and safety proved a key concern for governments The Rice Platform secured profitable flows in a volatile market indicators, not defined by IFRS, that are used by LDC’s worldwide, with a focus on maintaining supply chain continuity. In this context, and amid continued global trade tensions and marked by uncertain global trade. Profitable hedging and management to assess the Group’s financial performance. induced price volatility, LDC delivered a strong operational sustained warehousing activities in the US offset the impacts A definition based on the consolidated financial statements of In this context, LDC continued to operate almost all its performance, with Segment Operating Results at US$799 of a difficult cotton market, in which the textile industry faced each of these indicators can be found in the footnotes to the facilities without significant business disruption attributable million for the semester, while securing its access to liquidity reduced demand. following discussion. The reconciliation of EBITDA with the to the pandemic, adapting in good time to health and safety through diligent cash management. interim consolidated financial statements, for both the six-month requirements imposed by local authorities to protect employees LDC also upheld its prudent approach to risk, carefully managing periods ended June 30, 2020 and June 30, 2019, is provided and subcontractors, and combat the spread of Covid-19. The Group profitably navigated volatile markets over the first market and liquidity risks as concerns over economic slowdown as an appendix at the end of the following discussion. Amid uncertainty over potential global supply chain disruptions half of 2020, in an environment of global trade uncertainty and began to arise. Among other steps, LDC built a solid cash and announced export restrictions in some areas, volatility arose turbulence, thanks to its diversified portfolio, global geographic position while maintaining access to large committed bank lines The allocation of the Group’s platforms (business lines)