Brait Plc · JSE:BAT
Brait — Premier FMCG — IPO Roadshow (February 2022)
21 slides from Brait's IPO roadshow presentation, Feb 17, 2022
Slide 1: Investor Presentation
INVESTOR PRESENTATION
Slide 2: Disclaimer
DISCLAIMER IMPORTANT: Please read the following before continuing. The following applies to this document, which has been prepared by Premier FMCG Proprietary Limited (“Premier” or the "Company"), strictly for discussion purposes in relation to Premier, the oral presentation of the information in th
Slide 3: Section 1 - Introduction
SECTION 1 - INTRODUCTION
Slide 4: Premier's Executive Leadership Team
PREMIER’S EXECUTIVE LEADERSHIP TEAM Management team comprised of experienced senior operational executives CEO CFO ENVIRONMENTAL, STRATEGY, SALES BAKERIES MILLING, GROCERIES HUMAN RESOURCES Kobus Gertenbach (50) Fritz Grobbelaar (43) SOCIAL AND MARKETING AND HPC Arnouw van der Schyf (50) Danie Simps
Slide 5: Premier is a highly attractive investment opportunity
PREMIER IS A HIGHLY ATTRACTIVE INVESTMENT OPPORTUNITY Premier’s approach: Resulting in: Technologically advanced facilities 1 Nature of Premier’s Invested in state of the art technology and business facilities One of the leading millbake platforms with capability and Competitive and scale to succeed
Slide 6: Premier has scale and excellence of execution
PREMIER HAS SCALE AND EXCELLENCE OF EXECUTION A leading baker in Southern Africa servicing both the formal and informal market (1) With an installed milling capacity Premier owns its manufacturing Operates 7 wheat mills and 3 Operating platform which is of c.1.1m tons of wheat and sites employing 8,
Slide 7: Bringing South Africa's leading consumer goods platform to market
BRINGING SOUTH AFRICA’S LEADING CONSUMER GOODS PLATFORM TO MARKET Premier has grown to become the largest unlisted consumer goods platform in South Africa ▪ Started as a humble bakery in 1824, Premier has grown to become a leading SA staple foods producer ✓ One of South Africa’s largest bakers ✓ Wit
Slide 8: Section 2 - Investment Highlights
SECTION 2 – INVESTMENT HIGHLIGHTS
Slide 9: South Africa's largest unlisted consumer goods platform
SOUTH AFRICA’S LARGEST UNLISTED CONSUMER GOODS PLATFORM Attractive industry fundamentals… 1 Scaled FMCG player 2 Defensive staple foods brands • Significant barriers to entry in the industry: large asset base, national distribution footprint and long-standing customer • Essential spending accounts f
Slide 10: The Millbake industry is a key food category in South Africa
1 THE MILLBAKE INDUSTRY IS A KEY FOOD CATEGORY IN SOUTH AFRICA Bread is expected to remain a material category in the food sector c.80% of bread value market share is concentrated in four provinces Bread as a % of total food spend (1) SA Population and Value Contribution to Bread Market 6.7% 6.9% 6.
Slide 11: The Millbake industry is a key food category in South Africa
1 THE MILLBAKE INDUSTRY IS A KEY FOOD CATEGORY IN SOUTH AFRICA Brown and white bread accounts for 99% of volume sold Bakery groups account for c.77% of the volume sold Volume Contribution by Bread Type Bread Volume Market Share by Producer 2% 1% 1% 1% 1% 1% 100% 5% 80% 6% 49% 49% 49% 49% 48% 49% 11%
Slide 12: South African bread market - large, defensive industry
2 SOUTH AFRICAN BREAD MARKET - LARGE, DEFENSIVE INDUSTRY WITH PROVEN ABILITY TO DIFFERENTIATE THROUGH PRODUCT QUALITY Key feature Reason Consequence Premier’s bread proposition Easy to consume Aspirational product for SA consumer • Bakeries in Western Cape, Eastern Cape, Durban Value for money offer
Slide 13: Environmental and social responsibility
3 ENVIRONMENTAL AND SOCIAL RESPONSIBILITY - PREMIER STRIVES TO EARN THE RIGHT TO OPERATE IN ITS COMMUNITIES Premier’s ESR Strategic Pillars Our people Our planet Our communities Safety and Wellbeing Energy Waste Nutrition Education compliance Skills Diversity Water Sourcing Community development ESR
Slide 14: Industry-leading facilities
4 INDUSTRY-LEADING FACILITIES Targeted investment over time resulting in fully integrated, sophisticated operations Under Brait ownership the business has invested R4.9bn in capex to ensure that its core facilities are fully invested and enabling Premier to be a low cost producer Kroonstad maize mil
Slide 15: Long-term track record and compelling return on invested capital
5 LONG-TERM TRACK RECORD AND COMPELLING RETURN ON INVESTED CAPITAL Period of significant growth defined by: Period of muted growth driven by: Performance rebound driven 1. Substantial investment into Millbake business, with all its coastal 1. Industrial action at Premier’s Cape Town by: bakeries (an
Slide 16: Resilience and growth - 9 months to December 2021
5 RESILIENCE AND GROWTH – 9 MONTHS TO DECEMBER 2021 Strong performance for the YTD 31 December (1), despite high commodity prices and the fourth wave of COVID-19 Revenue (1) Adjusted EBITDA (1)(2) EBIT (1) 9.3% 9.1% 10.3% 5.8% 5.7% 6.5% 11 500 1 200 800 10 859 1 123 10 500 750 1 100 9 436 706 9 500
Slide 17: Divisional performance highlights
5 DIVISIONAL PERFORMANCE HIGHLIGHTS – 9 MONTHS TO DECEMBER 2021 Millbake outperformed, successfully passing on inflationary increases in a tough trading environment Revenue (1) Adjusted EBITDA (1)(2) 11.4% 11.8% 13.0% 1 500 9 500 8 870 8 500 7 952 1 300 1 153 7 500 6 812 1 100 R'm R'm 6 500 942 5 50
Slide 18: Cash generative business with consistent returns to shareholders
5 CASH GENERATIVE BUSINESS WITH CONSISTENT RETURNS TO SHAREHOLDERS – 9 MONTHS TO DECEMBER 2021 Free cash flow conversion (1) Net Debt (2) Including expansionary capex 1.8x 1.6x Excluding expansionary capex 2 197 2 200 2 100 Free cash flow conversion (%) 78% 77% 2 027 2 000 R'm 1 900 1 800 54% 52% 1
Slide 19: Key strategic themes to grow the core business
KEY STRATEGIC THEMES TO GROW THE CORE BUSINESS 1 2 DRIVE PROFITABLE TOP 3 4 5 DRIVE BOTTOM LINE PEOPLE AT THE HEART LINE GROWTH GROWTH THROUGH OPTIMISE THE PRIVATE LABEL OF OUR BUSINESS THROUGH EXISTING AND EFFICIENCIES AND PORTFOLIO MIX PARTNERSHIPS NEW CUSTOMERS OPTIMISATION • Continue investment
Slide 20: Premier is well-positioned for growth
PREMIER IS WELL-POSITIONED FOR GROWTH Environmental factors Premier’s self-help levers: ✓ Focus on margin management during cyclically soft commodity price inflation environment Commodity inflation ✓ Recently announced price increases to maintain its targeted margins into FY23 ✓ Demand for staple fo
Slide 21: Q&A
Q&A Premier we ‘