Agthia Group · ADX:AGTHIA
Agthia — Agthia Group PJSC — FY2017 Earnings Presentation
17 slides from Agthia's earnings presentation, Mar 1, 2018
Slide 1: Disclaimer – Forward-looking Statements
Agthia Group PJSC –ADX:AGTHIA Disclaimer – Forward-looking Statements: Agthia Group PJSC and its management may make certain statements that constitute “forward-looking statements” with respect to the financial condition, results of operations and business of the Group. These statements can be ident
Slide 2: Agthia Group Earnings Conference Call Full Year 2017
Agthia Group Earnings Conference Call Full Year 2017 Dubai, 1 March 2018 2
Slide 3: A Consumer Products Group
A CONSUMER PRODUCTS GROUP Consumer segment taking over Agri first-time ever Share in Group Revenues 2.05B 17% 36% 53% Consumer | Water, Beverages and Food 1.09B • First-time ever > 50% of Group revenues 83% • Higher growth potential 64% • Higher gross profit margin at 43 percent 47% Agri | Flour and
Slide 4: Consumer segment with higher margin and growth potential
GROUP’S GROWTH DRIVER Consumer segment with higher margin and growth potential Gross Profit Margin1, % 43.2 44.5 CONSUMER 40.0 38.8 39.1 36.0 36.0 34.8 34.1 33.5 32.2 28.8 27.8 25.5 24.4 22.1 21.7 21.6 20.7 16.2 15.6 AGRI 14.5 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 Share of Consumer
Slide 5: Water & Beverages: Solid growth driver
WATER & BEVERAGES Solid growth driver Revenue and Profit, AED Millions | Growth, quarter on quarter, % 241 230 224 220 • Total year revenue reaches AED 915 million, 187 +18% +25% yoy • Bottled Water in the UAE grows 8% +10% • 5-Gallon Water in the UAE grows 11% 52 45 37 38 40 • Delta Water in Saudi
Slide 6: Al Ain Water: Indisputable market leader in the UAE
AL AIN WATER Indisputable market leader in the UAE Bottled Water Volume Share, UAE, % | Source: AC Nielsen Retail Audit 28.0 Al Ain Total 26.9 • Total share of Al Ain Water 23.7 reaches 28% Al Ain Regular 23.2 • Premium priced Al Ain Zero Competitor A 18.5 captures 5%, marginally 15.2 cannibalizing
Slide 7: UAE Market Shares
UAE MARKET SHARES1 Other Agthia brands ON 2016 ON 2017 Bottled Water ALPIN 0.6% 1.6% AL BAYAN 0.8% 1.2% Juice Drinks Single Serve Capri Sun 10.0 % 11.2% Fruit Yogurt Yoplait 12.3% 14.4% Kids Yogurt Yoplait Kids 64.3% 65.2% 7 1 Source: AC Nielsen retail audit volume shares | All readings are exit sha
Slide 8: All segments except Flour and Animal Feed increased profits
PROFIT GROWTH All segments except Flour and Animal Feed increased profits Net Profit1 Change 2017 vs. 2016 | Percent Water & Beverages Food Agri Bottled Water +28 Dairy +36 Flour -52 +9 5 Gallon Water +32 TP & FV folds Animal Feed -44 Beverages +6 Bakery +14 SUBSIDY Trading Items +21 RATIONALIZATION
Slide 9: Loss-making businesses: reduction in net losses in two years
LOSS-MAKING BUSINESSES More than AED 28 million reduction in net losses in two years Net Loss | AED Millions 40 AED 28 AED'000 2015 2017 Change 29 million loss Bakery (13,215) (9,759) 3,456 reduction Dairy (11,953) (4,535) 7,418 Turkey (13,708) (288) 13,420 Egypt 19 1,334 1,315 TP (UAE) (1,255) 1,42
Slide 10: Regional Expansion
REGIONAL EXPANSION Inorganic growth via mergers and acquisitions Action Benefit Status Al Bayan 5G Water • #2 position in the market (#6 pre-acquisition) Completed acquisition • Value accretive • Footprint in Oman • Significant operational synergies • 26 million 5G water capacity Delta Water Saudi •
Slide 11: Financial Review
acubl ay dl! wan For Wholehearted Living FINANCIAL REVIEW
Slide 12: Group Revenues
GROUP REVENUES AED 2.05 billion, 1.8 percent growth over last year 28.1% AED 2.05B 0.96B 1.09B 6.2% 1.3% 20.2% Food excluding Bev. Egypt -3.6% Water Food 1.8% Flour Feed Agthia Agri Consumer -3.5 Feed excluding cancelled CP tender of last year -13.3% -11.7 -14.3 12
Slide 13: Group Profit
GROUP PROFIT Agri business on the back of subsidy cuts pulls Group profits down Net Income Variance Net Income 2017 v 2016 | AED Millions 2017 | AED Millions -48 Total Group 206.1 • Higher Water volume 39 W&B 175.0 • Better mix • Profit turnaround 10 Food -1.5 • Cost savings -118 Agri 119.4 • Lost s
Slide 14: Group Gross Margin
GROUP GROSS MARGIN Almost 1,500 basis points margin increase in ten years Gross Profit Margin, % Subsidy Commodity cost rationalization hikes. High 2nd High Speed vulnerability with Bottling line higher Agri 34.5 33.1 share in 32.0 AGTHIA business Low-margin Agri 26.2 27.1 28.0 1st High Speed busine
Slide 15: Group SG&A
GROUP SG&A Cost optimization helps – it will continue! Group SG&A | 2017 | AED Millions +49 +30 -14 +9 Impact of lower sales: + 120bps 2016 Cost Cost savings Re-class 2017 Ex- Saudi 2017 increases from MOH Saudi 15
Slide 16: 2018 Guideline Estimates
2018 GUIDELINE ESTIMATES 1 to 3 percent top line growth, flat bottom line Segment Revenue Growth Guidelines Water & Beverages Overall mid/high single digit. Saudi high GROUP teens over 12-month 2017. (Vs. 2017) Flour Flat excluding trading in 2017. Otherwise Net Revenue + 1-3% negative growth at mid
Slide 17: Agenda: Highlights, Financial Review, Q&A
Agenda │ Highlights │ Financial Review │ Q&A 17