Select Harvests Limited · ASX:SHV
Select Harvests — Shareholder Meeting (November 2014)
36 slides from Select Harvests's shareholder meeting presentation, Nov 21, 2014
Slide 1: AGM – Chairman's Presentation
For personal use only Select Harvests Limited AGM – Chairman’s Presentation 21 November 2014
Slide 2: Disclaimer & Basis of Preparation
Disclaimer & Basis of Preparation For personal use only This presentation is provided for information purposes only and has been prepared using information provided by the company. The information contained in this presentation is not intended to be relied upon as advice to investors and does not ta
Slide 3: Select Harvests – Financial Performance
Select Harvests – Financial Performance For personal use only 3 3
Slide 4: Select Harvests - Strategy
Select Harvests - Strategy For personal use only 2018 Targets: 1. CONTROL CRITICAL MASS OF ALMONDS 2. IMPROVE YIELD & CROP VALUE 15% ROCE 3. BE BEST IN CLASS SUPPLY CHAIN 4. INVEST IN INDUSTRIAL & TRADING DIVISION EPS 7-10% pa 5. TURN AROUND PACKAGED FOOD BUSINESS 6. FIX OUR SYSTEMS & PROCESSES 10%
Slide 5: Select Harvests - Brands
Select Harvests - Brands For personal use only 5 5
Slide 6: Orchards
For personal use only Orchards 6 6
Slide 7: Carina West Processing Facility & Laterals
Carina West Processing Facility & Laterals For personal use only 7 7
Slide 8: Carina West Processing Facility – Hulling & Shelling
Carina West Processing Facility – Hulling & Shelling For personal use only 8 8
Slide 9: Acquisition Video
Acquisition Video For personal use only 2014/15 Acquisition video available on our website www.selectharvests.com.au 9 9
Slide 10: AGM – Managing Directors Presentation
For personal use only Select Harvests Limited AGM – Managing Directors Presentation 21 November 2014
Slide 11: Disclaimer & Basis of Preparation
Disclaimer & Basis of Preparation For personal use only This presentation is provided for information purposes only and has been prepared using information provided by the company. The information contained in this presentation is not intended to be relied upon as advice to investors and does not ta
Slide 12: Agenda
Agenda For personal use only Business Performance Almond Division Food Division Strategy Update Overview Acquisitions Biomass / Cogeneration Plant Almond Dryer Supply & Demand Drivers Global Update SHV, Crop & Price Update 12 12
Slide 13: FY14 Performance
FY14 Performance For personal use only Earnings Before Interest & Tax (“EBIT”) Reported FY14 EBIT $41.8M* - vs Reported FY13 EBIT $5.2M Underlying FY14 EBIT $41.8M* - up 11% vs Underlying FY13 EBIT $37.7M Net Profit after Tax (“NPAT”) Reported FY14 NPAT $29.0M* - vs Reported FY13 NPAT $2.9M
Slide 14: FY14 Performance
FY14 Performance For personal use only OHS & Environment OHS - Another improved safety result with group Lost Time Injuries (LTI) down 72.7%, year on year Zero major environment incidents Acquisitions Allinga & Mendook Other Achievements Consumer complaints down 20% Processing damage at Ca
Slide 15: Almond Division – Performance & Activities
Almond Division – Performance & Activities For personal use only Performance Price - A$8.50/kg (FY13 A$6.38/kg) - up 33% - offsetting for reduced volume & quality Costs - increased due to impact of wet harvest $6.0M revaluation of trees supported by higher almond price FY14 Acquisitions - Al
Slide 16: Food Division – Performance & Activities
Food Division – Performance & Activities For personal use only Performance Industrial delivers another record result - 24% up on FY13 Revenue reduction driven by loss of major retailer private label almond contracts Branded business remains strong Improved sales mix has driven margin improve
Slide 17: Strategy - Sunsol & Lucky Smart Snax Relaunch
Strategy - Sunsol & Lucky Smart Snax Relaunch For personal use only New Branding & Packaging, New Formulation, Improved Margins 17 17
Slide 18: Strategic Objectives & Activities
Strategic Objectives & Activities For personal use only FY13 INITIATIVES FY14 INITIATIVES FY15 INITIATIVES 1. CONTROL CRITICAL MASS Secure the critical mass of nuts • Acquired 1,286 acres almond orchard • Acquired 680 acres planted orchard • Acquired 2,481 acres planted orchard OF ALMONDS needed to
Slide 19: Acquisitions – Geographic Diversity, Scale & Future
Acquisitions – Geographic Diversity, Scale & Future. For personal use only Allinga – Loxton, SA (A$16.3M) 680 acres mature almond 948 acres suitable for planting to almonds (plant FY15) Gained SA water buyback/efficiency funding (Net $5m) - support new plantings Amaroo – Paringa, SA (A$52.5M)
Slide 20: Strategy - Carina West Biomass Boiler
Strategy - Carina West Biomass Boiler For personal use only Project: 1. To use almond prunings, hull & shell to generate steam to supply a turbine which will generate of electricity & steam for Carina West facility & neighbouring farms. 2. Replace existing low voltage infrastructure with high voltag
Slide 21: Strategy - Field Stock Drying at Carina West
Strategy - Field Stock Drying at Carina West For personal use only Project: 1. To allow field crop harvested to be green or wet then secured and stored with out quality deterioration Technology/Performance: Grain dryer which will reduce moisture by 5% per cycle 15 tonnes per hour of field or ker
Slide 22: Global Supply - US Drought
Global Supply - US Drought For personal use only Orange States = Severe Drought Red States = Extreme Drought Dark Brown States – Exceptional Drought SHV AGM 2013 – 0% Exceptional Drought, 11% Extreme Drought, 84% Severe Drought SHV AGM 2014 – 55% Exceptional Drought, 80% Extreme Drought, 94% Severe
Slide 23: Global Supply - Crop Outlook & Price Update
Global Supply - Crop Outlook & Price Update For personal use only US Crop Update (2013/14) - harvested Market estimate of USA 2013/14 Almond crop - now 1.7-1.8 billion pounds (Ref: Hilltop Ranch – 2 Nov 2014) Down 300-400 million pounds on original NASS Objective Estimate of 2.1 billion pounds F
Slide 24: Outlook – Business Focus
Outlook – Business Focus For personal use only Almond Division Maximise 2015 crop Integrate acquisitions Prepare for 2015 & 2016 greenfield plantings & funding options Development of orchard benchmarking Implement CAPEX: Dryer, Biomass etc Secure further mature orchards Food Division C
Slide 25: Thank you
For personal use only Thank you Please direct any queries to: Paul Thompson Paul Chambers Andrew Angus Managing Director Chief Financial Officer Investor Relations +61 3 9474 3544 +61 3 9474 3544 +61 402 823 757 25 25
Slide 26: Income Statement
Income Statement For personal use only FY13 FY14 FY14 EBIT $41.8m (FY13 $37.7m) Financial Result ($m) ($m) Almond Division EBIT $40.8m (FY13 $36.4m) Reported Result EBIT - Reported 5.2 41.8 • Strong performance Interest (5.0) (4.5) ─ 2014 crop yield below expectations NPBT 0.2 37.4 ─ Higher than
Slide 27: Balance Sheet
Balance Sheet For personal use only Jun-13 Jun-14 Banking refinance, increase & extension complete Year Ending Balance Sheet ($m) ($m) • NAB & Rabobank - $135m Current Assets excl. Cash 114.4 130.3 • $50m term expiring 2018 Cash 8.9 6.3 • $60m line - working capital & business projects • $25m acqu
Slide 28: Cash Flow
Cash Flow For personal use only FY13 FY14 The majority of the 2014 crop held at 30 June Cash Flow ($m) ($m) expected to convert to cash in 1HFY15 EBITDA – (FY13 Underlying) 42.5 45.6 Investing cash flows driven by: Change in Working Capital (34.2) (17.8) • Orchard acquisitions $16.3m (Allinga) T
Slide 29: Financial History
Financial History For personal use only SHV Historical Summary Units 2006 2007 2008 2009 2010 2011 2012 2013 2014 Total Sales (A$M) 217.9 229.5 224.7 248.6 238.4 248.3 251.3 191.1 188.3 EBIT (A$M) 38.4 40.5 27.1 26.8 26.0 22.6 19.6 37.7 41.8 EBIT Margin (EBIT/Sales - %) (%) 17.6% 17.6% 12.1% 10.8% 1
Slide 30: Orchard Profile – Young Orchards PLUS Longevity
Orchard Profile – Young Orchards PLUS Longevity For personal use only Land bank Planted acreage age profile 50.0% (% of total land holding) 45.0% 40.0% 35.0% 25% 67% 8% Planted orchards are Planted orchards in economic sweet spot - Planted orchards post 30.0% low capex & high cash generation economi
Slide 31: 2015 Orchard Profile
2015 Orchard Profile For personal use only Almond orchard Planted Orchard Planted Orchard Bearing Orchard Bearing Orchards portfolio Area (acres) Area (hectares) Area (acres) Area (hectares) Northern Region Owned 1,491 604 1,423 576 Leased 3,017 1,221 3,017 1,221 Total 4,508 1,825 4,440 1,798 Centra
Slide 32: 2015 Orchard Profile
2015 Orchard Profile For personal use only AREA BY TREE AGE Years 0-7 Years 8-26 Years 26+ TOTAL PLANTED AVAILABLE TO PLANT TOTAL (acres) (ha) (acres) (ha) (acres) (ha) (acres) (ha) (acres) (ha) (acres) (ha) Northern Region Company Owned 312 126 1,179 477 - - 1,491 604 - - 1,491 604 Leased 1,332 539
Slide 33: Significant Orchard Growth. Double plantings by 2018
Significant Orchard Growth. Double plantings by 2018 For personal use only 25,000 20,000 350 406 2,850 (1,072) 350 1,650 2,350 15,000 7,939 1,465 (42%) Acres 1,018 1,463 21,659 10,000 2,282 (21%) 10,871 5,000 8,547 (58%) Utilising current and (79%) acquisition land bank - Current Acquisitions FY15 F
Slide 34: Global Supply – US Reservoirs/Temp/Snowpack
Global Supply – US Reservoirs/Temp/Snowpack For personal use only Temperature Six Months In and Sizzling California Sets Record - Andrea Thompson, Climate Central, 16 July 2014 ─ California just finished the hottest first half year on record, a period going back 120 years, according to the nationa
Slide 35: Global Supply - US Groundwater Levels
Global Supply - US Groundwater Levels For personal use only This trio of images depicts satellite observations of declining water storage in California as seen by NASA's Gravity Recovery and Climate Experiment satellites in June 2002 (left), June 2008 (center) and June 2014 (right). Colors progressi
Slide 36: Global Demand – Diverse. High Growth
Global Demand – Diverse. High Growth For personal use only Almonds have held the No.1 position in global tree nut innovations since 2006 (35% market share 2013). Long term US per capita consumption of almond outpaces all other tree nuts (376% growth since 1980) 36 36
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