Adecoagro (NYSE:AGRO) reported a sharp increase in first-quarter 2026 adjusted EBITDA as the company presented its first quarterly results under a new three-segment structure following the acquisition of a controlling stake in Profertil.
Chief Executive Officer Mariano Bosch said the quarter reflected the “new Adecoagro,” now organized around Sugar, Ethanol & Energy; Fertilizers; and Food & Agriculture. The company generated $86 million in adjusted EBITDA in the quarter, more than double the prior-year level, while gross sales rose 22% year over year to $394 million.
Bosch said the results showed “the change in scale and earnings potential” of the expanded platform, with further upside expected from higher urea prices, stronger sugarcane crushing volumes in Brazil and improved margins in Argentina and Uruguay.
Fertilizer Business Drives Earnings Recovery
Chief Financial Officer Emilio Gnecco said the Fertilizers segment, which reflects Profertil’s results, was a key contributor to the quarter’s performance. Adjusted EBITDA in the segment reached $53 million, supported by higher urea production, improved prices and lower natural gas sourcing costs.
Gnecco said urea production increased year over year because the plant had more operational days than in the same period last year. In the first quarter of 2025, the fertilizer plant had 19 days of downtime, mainly because adverse weather disrupted gas supply. In the latest quarter, downtime fell to 10 days as operations ramped up following a major maintenance turnaround at year-end.
“As of today, the plant is operating continuously at full capacity,” Gnecco said.
Sales in the Fertilizers segment rose 68% year over year, mainly due to a 16% improvement in urea prices. Gnecco said prices began rising sharply in early March after the escalation of conflict in the Middle East, a region that accounts for about 30% of global urea trade. He said only a partial impact from those higher prices was reflected in first-quarter results.
Looking ahead, Gnecco said the company expects 2026 adjusted EBITDA in Fertilizers to be stronger than previously anticipated and potentially above prior-year levels, supported by a favorable market price outlook.
Sugar, Ethanol & Energy Benefits From Ethanol Flexibility
In the Sugar, Ethanol & Energy segment, Adecoagro posted adjusted EBITDA of $41 million, exceeding the prior-year quarter. The company crushed 2.2 million tons of cane in the first quarter, a 49% increase year over year and a record for the period.
Gnecco said the increase was driven by higher productivity despite harvesting a smaller area. Rainfall late in 2025 helped unharvested cane recover in yield, and the company collected it during the first quarter under its continuous harvest model.
Adecoagro produced a 96% ethanol mix during the quarter as ethanol prices traded well above global sugar prices, offering better margins. Gnecco said the mix demonstrated the flexibility of the company’s industrial assets, even while maintenance work was underway.
Production costs were negatively affected by appreciation of the Brazilian real and the acceleration of certain agricultural expenses typically concentrated later in the year. Those factors more than offset cost dilution from higher crushing during the quarter.
During the question-and-answer session, Renato Pereira, vice president of Sugar, Ethanol & Energy, said Adecoagro expects cost reductions in Brazilian reais of 10% to 15% for the year, helped by higher volumes, operating efficiencies and a lower Consecana price. He said some first-quarter costs reflected early agricultural work, including weed and pest control, made possible by favorable weather.
Pereira also said the company took advantage of high ethanol prices early in the year to sell nearly all first-quarter production and carryover volumes through the end of April at prices close to $0.20 per pound equivalent. After ethanol prices fell about 20% with the start of the new sugarcane season, Adecoagro stopped selling ethanol and began filling tanks for sales later in the year. He said the company still expects to maximize ethanol production, potentially for the full year.
Food & Agriculture Weighed Down by Lower Commodity Prices
The Food & Agriculture segment was affected by lower commodity prices, particularly peanuts and rice, and higher costs in U.S. dollar terms as the company sold carryover inventories from the previous harvest season.
Gnecco said the 2025/2026 harvest is underway and expected to be completed over the coming months. More than half of the planted area had been harvested at the time of the call, producing more than 700,000 tons of agricultural products.
In dairy, processing volumes increased year over year because of higher raw milk production at free-stall facilities, reflecting improved cow productivity. Gnecco said margins should improve in coming quarters as the new crop is harvested and commercialized, while dairy volumes should benefit from new products under the company’s retail brands.
Asked about the medium- and long-term outlook for Food & Agriculture, Bosch said the prior year had been “probably the more difficult year” for the segment because of lower prices across several commodities and higher-cost inventories from the previous crop cycle. He said Adecoagro expects the segment to generate more relevant results in coming quarters and remains confident in the businesses because the company believes it is a low-cost producer in each area.
Debt Reduction Remains a Priority
Adecoagro paid the final installment for its acquisition of a 90% equity stake in Profertil during the quarter. Gnecco said the $1.1 billion transaction was financed with $400 million in cash on hand, $400 million in new long-term debt facilities and $300 million in equity proceeds.
Net debt rose to $1.6 billion in the first quarter, reflecting seasonal working capital needs tied to planting and harvesting in Food & Agriculture. Gnecco said net debt would have declined versus the fourth quarter of 2025 excluding that seasonal effect. Pro forma net leverage stood at 3.2 times.
Gnecco said the company expects leverage to continue declining due to higher adjusted EBITDA generation, primarily from Fertilizers. In response to an analyst question, he said the company now expects to reach about 2 times EBITDA by the end of 2026, sooner than the prior expectation of one to two years.
Bosch said deleveraging remains the company’s first focus. He added that Adecoagro continues to evaluate growth projects across its businesses, including a possible long-term expansion of the fertilizer plant, but said building a urea plant generally requires several years and current high urea prices are not expected to drive a near-term decision.
The company also approved a $35 million cash dividend, with a first installment of $17.5 million scheduled for May 19 and a second equal installment payable in November.
About Adecoagro (NYSE:AGRO)
Adecoagro (NYSE: AGRO) is a leading agricultural and renewable energy company with core operations in South America. Founded in 2002 by Argentine entrepreneur Alejandro Bulgheroni, the company has grown into a vertically integrated platform covering crop production, sugar and ethanol manufacturing, and dairy operations. Adecoagro’s business model spans the full value chain, from seed selection and planting through harvesting, processing and distribution of commodities.
The company manages over 700,000 hectares of farmland across Argentina, Brazil and Uruguay.
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