Australian Agricultural Company Limited · ASX:AAC
Australian Agricultural — H1 2023 Earnings Presentation
26 slides from Australian Agricultural's earnings presentation, Nov 17, 2022
Slide 1: H1 FY23 Interim Results Presentation
For personal use only H1 FY23 Interim Results Presentation 17 November 2022
Slide 2: Important Information
Important Information Summary information only This presentation contains general information about the Australian Agricultural Company Limited and its consolidated entities (“AACo”) and its activities current as at the date of this presentation. It is For personal use only information provided in s
Slide 3: Important Information
Important Information Any and all forecasts and financial information in this presentation are provided as a general guide only, and are not, and shall not be relied upon as, a promise or representation as to future matters. Some of the important factors that could cause AACo’s actual results, perfo
Slide 4: Contents
Contents For personal use only 5 Executive Summary Page 5 7 Progress Against Strategy Page 7 8 Regional Performance Page 8 Sustainability Update 13 Page 13 Financial Performance 14 Page 14 20 Operating Environment Page 20 4
Slide 5: Executive Summary
Executive Summary For personal use only • Operating Profit of $38.3M up vs pcp $30.0M Higher meat sales margins as average Wagyu meat sales price per Kg CW increased by ~25.9% (20.1% constant currency basis) • Statutory Net Profit after tax of $51.6M vs pcp $83.2M • Growth in NTA with an increase
Slide 6: We're evolving together to benefit future generations
For personal use only We’re evolving together to benefit future generations 6
Slide 7: Progress Against Strategy
Progress Against Strategy For personal use only Delivering full potential +25.9% 88% +25% from our brands Wagyu Meat sales Branded Meat Sales1 Branded Meat Sales1 $/Kg CW increase Westholme and Darling Downs Growth North America Solar Bore transition Executing on our Released third progressing well
Slide 8: Regional Performance
For personal use only Regional Performance 8
Slide 9: North America
For personal use only North America Proportion Total Meat Sales 29% 29% H1 FY22 H1 FY23 Meat Sales Meat sales relative to total meat sales flat vs pcp supported by higher pricing and increased volumes of branded sales1, offsetting lower commoditised sales volume • Focus on growing Westholme in this
Slide 10: Asia
For personal use only Asia Proportion Total Meat Sales 53% 47% H1 FY22 H1 FY23 Meat Sales Achieved good average price uplifts vs pcp, despite reduced volume as higher valued primal cuts allocated away into food service markets • Enhanced Darling Downs in-store experience supporting average price gro
Slide 11: Australia
For personal use only Australia Proportion Total Meat Sales 9% 7% H1 FY22 H1 FY23 Meat Sales Focus on optimising value across the carcass, reallocating cuts away from Australia to enhance returns globally in line with our overall strategy • Continued to build brand presence with activations executed
Slide 12: Europe/Middle East
For personal use only Europe/Middle East Proportion Total Meat Sales 9% 17% H1 FY22 H1 FY23 Meat Sales Predominantly food service focused, this region saw robust volume increases as part of post-COVID recovery • On premises brand activations continued in H1 FY23 supporting our brand building and adv
Slide 13: Sustainability Update
Sustainability Update For personal use only Continued progress against commitments • Released our third Sustainability Report mapping out actions we are taking to become more sustainable. • Transition of bore network to solar progressing well and on target to be complete by 2024. • Reached halfway p
Slide 14: Financial Performance
Financial Performance For personal use only 14
Slide 15: Highlights
Highlights Cash Flow / Net For personal use only Growth Profit Assets Meat Operating Operating Sales Profit Cash Flow $122.3M $38.3M $3.4M + 18.9% vs pcp + 28% vs pcp (80%) vs pcp Wagyu Meat Operating Net Tangible Sales Price Profit Margin Assets $22.06/kg 23.4% $2.33/Share + 25.9%1 vs pcp + 2.5 ppt
Slide 16: Revenue
Revenue Higher meat sales pricing driving improved overall revenue despite lower sale volumes For personal use only Meat Sales Revenue: +$19.4M Cattle Sales Revenue: +$0.9M ($5.2M) ($2.3M) $163.7M $3.2M Kg LW Kg CW $/Kg (6%) (5%) + 8% $24.6M $/Kg + 25.9% $143.5M Total Revenue Price/Mix Volume Price/
Slide 17: Profit & Loss Summary
Profit & Loss Summary Stronger sales margins driving operating profit of For personal use only $38.3M vs $30.0M pcp Profit and Loss Summary ($M) H1FY23 H1FY22 Var Meat Sales 122.3 102.9 19.4 Increase in gross margin to $63.6M vs $46.5M pcp. Cattle Sales 41.4 40.5 0.9 Total Sales Revenue 163.7 143.5
Slide 18: Cash Flow Summary
Cash Flow Summary For personal use only Positive operating cash flow generation of $3.4M vs $17.3M pcp Consolidated Statement of Cash Flows ($M) H1FY23 H1FY22 Var Reduced net operating cash flow vs pcp driven primarily by: Receipts from Customers 170.4 151.6 18.8 • Increased working capital movement
Slide 19: Balance Sheet Summary
Balance Sheet Summary 30 Sep 31 Mar Consolidated Statement of Financial Position ($M) Net assets increase to $1.4B supporting strong 2022 2022 For personal use only financial position Livestock 807.2 736.2 PPE & Intangibles 1,247.8 1,245.4 • Increased value of herd of $71M largely off the back of hi
Slide 20: Operating Environment
For personal use only Operating Environment 20
Slide 21: Operating Outlook
Operating Outlook For personal use only Global economic uncertainty • IMF forecasting lowest global economic growth rate in 2022 and 2023 since Global Financial Crisis. Inflation at highest levels in several decades. Cost-of-living pressure and tightening financial conditions. • National biosecu
Slide 22: Closing Remarks
For personal use only Closing Remarks 22
Slide 23: Questions
For personal use only Questions
Slide 24: Appendix
For personal use only Appendix
Slide 25: Definitions
Definitions Term Definition For personal use only Cost of Goods Sold (COGS) valued “at cost” Represents the actual production cost the Company incurred over the multi-year timeline required to produce the meat and cattle that was sold during the period. This is in contrast to Cost of Goods Sold as p
Slide 26: The Art of Australian Beef
For personal use only co THE ART OF AUSTRALIAN BEEF
Australian Agricultural Company — H1 2023 Earnings Presentation on 6ix