Adama Ltd. Class A · SZSE:000553
Adama Ltd. Class A — ADAMA Agricultural Solutions — Q2 2017 Earnings Presentation
22 slides from Adama Ltd. Class A's earnings presentation, Aug 16, 2017
Slide 1: Business Update Q2 and H1 2017
Business Update Q2 and H1 2017 August 16, 2017
Slide 2: Legal notice
Legal notice This presentation is for marketing and information purposes only. By this presentation, ADAMA Agricultural Solutions Ltd. (the “Company”) does not intend to give, and the presentation does not constitute, professional or business advice or an offer or recommendation to perform any trans
Slide 3: Record second quarter for Adama
Record second quarter for Adama Net income up 20%, positioning it for another strong year Robust volume growth leads to best ever profits and profitability in both the second quarter and half year, in face of tough market Q2 Sales $830m Record Q2 Gross Profit $300m +2.8% +10.9% H1 Sales +0.7% Q2 gro
Slide 4: Financial highlights
Financial highlights Adjusted, ($ million) Q2 2017 Q2 2016 % Change H1 2017 H1 2016 % Change Sales 830 808 +2.8% 1,673 1,661 +0.7% Gross Profit 300 271 +10.9% 612 567 +7.9% As % of Sales 36.2% 33.5% 36.5% 34.1% Operating Expenses 185 172 360 339 Operating Income (EBIT) 115 99 +16.6% 252 228 +10.4% A
Slide 5: Record second quarter drives another strong year
Record second quarter drives another strong year Sales Record Gross Profit Record EBITDA Net Income +2.8% USD Gross profit +10.9% EBITDA +11.8% Net income +19.8% Gross margin +2.7pp EBITDA margin +1.6pp Net margin +1.1pp 830 808 Q2 2017 Q2 2016 300 271 36.2% 159 33.5% 143 19.2% 68 17.6% 57 8.2% 7.1%
Slide 6: Record H1 2017: Significant increases across all profit and profitability metrics
Record H1 2017: Significant increases across all profit and profitability metrics Sales Record Gross Profit Record EBITDA Record Net Income +0.7% Gross profit +7.9% EBITDA +7.8% Net income +15.6% 1,673 Gross margin +2.4pp EBITDA margin +1.4pp Net margin +1.4pp 1,661 H1 2017 H1 2016 612 567 36.5% 339
Slide 7: Significantly improved working capital, robust cash flow, reduced leverage
Significantly improved working capital, robust cash flow, reduced leverage Significant reduction in Drives strong LTM free cash Sharply reduced leverage working capital levels flow generation -$151m Q2: +$91m -$310m 1,666 LTM: +$368m 55.4% 1,515 1,078 2017 49.2% 2016 2.2x 768 386 1.4x 230 138 19 Jun
Slide 8: Regional Update
A Regional Update ADAMA
Slide 9: Full year regional sales performance Q2 2017 vs. Q2 2016
Full year regional sales performance Q2 2017 vs. Q2 2016 Sales change by region Constant currency terms Region USD terms Europe 4.4% 2.8% North America 2.1% 2.1% Latin America (10.8%) (7.7%) Asia Pacific 6.6% 7.2% India, Middle East & Africa 13.2% 17.1% Total 2.2% 2.8% -10% -5% 0% 5% 10% 9
Slide 10: Regional highlights Europe
Regional highlights Europe • Sales increase driven by strong volume growth of an increasingly differentiated portfolio, despite low disease and insect pressure and lingering high levels of inventory in the distribution channels • Continue to capitalize on increased sugar beet acreage across the cont
Slide 11: Regional highlights North America
Regional highlights North America • US crop protection business grew strongly in Q2, with volume-led revenue expansion, as well as an improvement in portfolio mix and improved pricing driving markedly improved profitability • Continue to grow sales of key backward-integrated products sourced from Sa
Slide 12: Regional highlights Latin America
Regional highlights Latin America • Despite the overall decline in the Brazilian agrochemical market, sales in the country in H1 remained stable, with volume growth complemented by an improved portfolio, a particularly noteworthy performance • We are working with our customers in Brazil to navigate
Slide 13: Regional highlights Asia Pacific
Regional highlights Asia Pacific • Significant volume growth, primarily in the Pacific and parts of South East Asia, supported by new product launches, improvement of portfolio mix and positive weather conditions • Strong growth and increasing profitability led by continued portfolio improvement, wi
Slide 14: Regional highlights India, Middle East & Africa
Regional highlights India, Middle East & Africa • India: - Outstanding performance in India driven by significant volume growth of an increasingly differentiated portfolio, while benefiting from the early start of the monsoon season - Establishing leading positions in products based on molecules sou
Slide 15: Bridge Analysis
A Bridge Analysis ADAMA
Slide 16: Q2 sales bridge analysis
Q2 sales bridge analysis 59 42 5 830 808 +7.3% Q2 2016 Quantity Price FX Q2 2017 Variance Variance NOTE: Price variance inflated due to India CGT change 16
Slide 17: Q2 gross profit bridge analysis
Q2 gross profit bridge analysis 27 42 8 300 36 271 36.2% 33.5% Q2 2016 Quantity Price Cost FX Q2 2017 Variance Variance Variance NOTE: Price variance inflated due to India CGT change 17
Slide 18: Q2 EBITDA bridge analysis
Q2 EBITDA bridge analysis 27 42 37 159 12 6 143 19.2% 17.6% Q2 2016 Quantity Price Cost Operating FX Q2 2017 Variance Variance Variance Expenses NOTE: Price variance inflated due to India CGT change 18
Slide 19: H1 sales bridge analysis
H1 sales bridge analysis 91 78 1,661 0 1,673 +5.5% H1 2016 Quantity Price FX H1 2017 Variance Variance NOTE: Price variance inflated due to India CGT change 19
Slide 20: H1 gross profit bridge analysis
H1 gross profit bridge analysis 52 4 612 78 67 567 36.5% 34.1% H1 2016 Quantity Price Cost FX and H1 2017 Variance Variance Variance Hedging Gap NOTE: Price variance inflated due to India CGT change 20
Slide 21: H1 EBITDA bridge analysis
H1 EBITDA bridge analysis 52 78 67 18 1 339 315 20.3% 18.9% H1 2016 Quantity Price Cost Operating FX H1 2017 Variance Variance Variance Expenses NOTE: Price variance inflated due to India CGT change 21
Slide 22: Slide 22
ADAMA Agricultural Solutions — Q2 2017 Earnings Presentation on 6ix