Australian Dairy Nutritionals Limited · ASX:AHF
Australian Dairy Nutritionals — Australian Dairy Farms Group — Investor Presentation (December 2014)
22 slides from Australian Dairy Nutritionals's investor presentation, Dec 22, 2014
Slide 1: Brucknell No.3 Acquisition Presentation
AUSTRALIAN DAIRY FARMS GROUP For personal use only ASX’s Only Listed Milk Producer ASX Code: AHF 22 DECEMBER 2014 BRUCKNELL No.3 ACQUISITION PRESENTATION
Slide 2: Disclaimer
Disclaimer For personal use only General Information This Presentation contains general information only. This document is not an invitation, offer or recommendation (express or implied) to apply for or purchase or take any other action in respect of securities and is not a prospectus, product discl
Slide 3: Australian Dairy Farms Group - Summary
Australian Dairy Farms Group - Summary The only ASX listed owner and operator of Australian dairy farms For personal use only • • Australian Dairy Farms Group (AHF or the Group) is actively implementing its stated strategy of corporate consolidation of dairy farms in Australia’s fragmented dairy sup
Slide 4: Corporate Overview
Corporate Overview For personal use only Capital Structure - post placement Share Price Chart Since Listing ASX Code AHF 0.40 7.00 Acquisition of Ignatios Brucknell 3 0.38 dairy farms Purchase purchase 6.00 0.36 Share Price – at close 17/12/2014 27.5c 0.34 20c Listing 5.00 Millions 0.32 Shares on Is
Slide 5: Farm Acquisition Summary
Farm Acquisition Summary For personal use only • Since listing in October 2014 with two farms, AHF has acquired two additional farms – Ignatios & Brucknell No. 3 • Potential annual milk production targeted to expand from approximately 7.7m litres to over 10.0m litres • AHF focussed on milk price inc
Slide 6: AHF – Brucknell No.3 Farm Acquisition
AHF – Brucknell No.3 Farm Acquisition For personal use only BRUCKNELL NO.3 KEY STATS • Secured conditional purchase of “Brucknell No. 3” dairy farm Hectares 139 • Farm adjoins existing Brucknell Farms in South West Acres 344 Victoria’s “Golden Triangle” of dairy Current milking herd 200 • Purchase p
Slide 7: AHF – Ignatios Farm Acquisition
AHF – Ignatios Farm Acquisition For personal use only IGNATIOS KEY STATS • On 12 Nov 2014 AHF contracted to acquire the “Ignatios” Hectares 244 support farm at mortgagee auction for $1.86m Acres 603 • Ignatios is closely located (10-15 minutes drive) to AHF’S Purchase price $1.86m three producing fa
Slide 8: Capital Raising
Capital Raising For personal use only • AHF has completed a $3.0m Placement to professional and sophisticated investors at $0.25 per stapled security • Strongly supported by institutional investors – particularly out of Asia • Completed at a modest 9% discount to the last closing price • Proceeds us
Slide 9: AHF Recent Milestones – Pre Listing
AHF Recent Milestones – Pre Listing For personal use only 20/08/2014 - Lodged Australian Dairy Farms Capital Raising Prospectus and PDS at ASIC 20/09/2014 - Secured forward contracts for summer hay and fodder at keen prices 25/09/2014 - Raised $9.3m in new capital with strong professional investor r
Slide 10: AHF Recent Milestones – Post Listing
AHF Recent Milestones – Post Listing For personal use only Oct – Dec - Traded consistently above issue and up to 85% premium 17 Nov 2014 - Announced acquisition of Ignatios Farm 22 Dec 2014 – Announced acquisition of Brucknell No. 3 Farm 8/12/2014 - Loyalty Options issued on 1 for 2 basis December 2
Slide 11: China & Australia Free Trade Agreement
China & Australia Free Trade Agreement For personal use only Dairy Farmers set to become the main beneficiaries of the FTA All Tariffs to be phased out by 2025 – New Zealand benefited from a similar agreement with its exports growing by $2.2Bn since 2007 Australian exports of liquid milk grown
Slide 12: Rationale for Consolidation of Milk Sector
Rationale for Consolidation of Milk Sector For personal use only Processors have excess capacity and actively seek security of milk supply Scale Will pay significant premiums / incentives for high volume and reliability of production (Revenue e.g. 1 owner producing 37.5 million litres p.a. rec
Slide 13: Corporatisation Strategy Rationale
Corporatisation Strategy Rationale For personal use only • Previous aggregations of farming operations have had mixed success in Australia – listed and unlisted. • AHF recognises key mistakes other aggregation entities have made: Mistake Australian Dairy Farms Response Acquisition Pricing Purchasi
Slide 14: Farm Selection Criteria
Farm Selection Criteria For personal use only AHF has a strict selection criteria for dairy farm acquisitions: REGIONS of VICTORIA Existing production - with immediate cashflow benefits Location – Proximity to regional centres and existing processing facilities Premier Regions – Invest only in
Slide 15: Initial Focus – South West Victoria
Initial Focus – South West Victoria For personal use only Page 15
Slide 16: Initial Focus – South West Victoria
Initial Focus – South West Victoria For personal use only AHF's first dairy farms are located “The Golden Triangle” is Australia’s premier dairy producing region in South West Victoria near Warrnambool. Largest Australian producing state by volume Consistent and favourable rainfall Close to ma
Slide 17: Implementation of Strategy
Implementation of Strategy For personal use only Establish initial production foothold in one of Australia’s premier dairy regions Step 1 – Acquisition Retain existing experienced operational and farm management and consultants Raise capital and list on ASX Improve existing production and li
Slide 18: Appendix
For personal use only APPENDIX Page 18
Slide 19: Corporate Structure
Corporate Structure For personal use only Australian Dairy Farms Limited (Operating Company) • Operates the farms – owns the livestock • Revenue from milk sales and livestock trading • Leases farms from the stapled property trust • Potential participation in surplus live heifer exports Australian Da
Slide 20: Board & Management
Board & Management For personal use only • AHF has assembled an experienced board with ASX and NZX experience • Initially all roles are non-executive, with board members overseeing all management responsibilities in order to keep costs down and maximise shareholder returns • Intention is to install
Slide 21: Farm Management
Farm Management For personal use only • Manager/family living on site – overseeing day to day operations and milking • On-site management have clear KPI’s and are incentivised on production levels and costs • AHF has assembled a “best of breed” team of consultants to ensure maximum productivity and
Slide 22: Australian Dairy Farms
Australian Dairy Farms For personal use only Company enquiries: Investor/Media Enquiries: Adrian Rowley Simon Hinsley Director Investor Relations Australian Dairy Farms Group NWR Communications adrianrowley@adfl.com.au simon@nwrcommunications.com.au +61 3 9629 9900 +61 401 809 653 Page 22
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