Midway — FY2018 Earnings Presentation
21 slides from Midway's earnings presentation, September 2018
Slide 1: Full year result – FY18 Analyst and Investor Roadshow Presentation
Full year result – FY18 Analyst and Investor Roadshow Presentation Tony Price Managing Director & CEO, Midway Limited September 2018
Slide 2: Disclaimer
Disclaimer This presentation has been prepared by Midway Limited ACN 005 616 044 (Midway or the Company). The information contained in this presentation is current at the date of this presentation. The information is a summary overview of the current activities of the Company and does not purport to
Slide 3: Financials FY18
Financials FY18 Midway
Slide 4: Performance Overview – FY18
Performance Overview – FY18 FY18 results in line with consensus forecasts Revenue $231.9M +10.8% • The full year 2018 financial results were in line with consensus forecasts, achieving EBITDA before significant items of $28.7M (2017: $28.0M) • Acquisition of Plantation Management Partners (PMP) cont
Slide 5: Financial Performance – FY18
Financial Performance – FY18 $Am FY17 FY18 % Change Sales Revenue 209.2 231.9 10.8% Other Income 4.1 4.2 2.4% Equity Accounted Share of Profits 2.8 3.9 29.3% Operating Costs (188.1) (211.3) (12.3%) EBITDA before significant items 28.0 28.7 2.7% Significant items (3.1) 2.6 184.8% EBITDA 24.9 31.3 25.
Slide 6: Financial Performance – FY18 (Group EBITDA bridge)
Financial Performance – FY18 Midway Group EBITDA ($M) 40 35 30 1.0 25 3.0 4.2 0.4 6.4 2.1 20 3.8 9.4 15 28 28.7 10 5 0 2017 Volume Price FX PMP Acq Bone Dry % JV (SWF) Supply costs Other 2018 6
Slide 7: Increasingly diverse earnings
Increasingly diverse earnings EBITDA $'M by geographic location 2017 1.2 -2.4 Victoria Queensland 29.2 Eliminations EBITDA $'M by geographic location 2018 0.9 -3.3 0.4 Victoria 1.7 Tasmania 1.0 Northern Territory 28.0 South East Asia Queensland Eliminations 7
Slide 8: Contribution from new business activities
Contribution from new business activities • PMP contributed $2.1M EBITDA in FY18 (8 months) and is exploring a range of expansion opportunities. • Woodfibre trading business (marketing and shipping of third party woodfibre) contributed $1M EBITDA. • Establishment of joint venture marketing company i
Slide 9: Outlook and future opportunities
Outlook and future opportunities
Slide 10: Strategic priorities
Strategic priorities Increasing EBIT over time: Good progress continues to be made with our strategic priorities 1. EXPANSION OF EXISTING BUSINESS Midway continues to assess opportunities to better utilise existing facilities and acquire Growth of planation management and woodfibre processing
Slide 11: Growth opportunities FY19 and beyond
Growth opportunities FY19 and beyond Plantation management Expand Midway’s position in the supply chain to reduce operational and market risks and capture additional margins New and expanded areas of plantation management in South East Asia Other opportunities both domestically and internation
Slide 12: Benefiting from growing Asian demand
Benefiting from growing Asian demand Hardwood Chip Imports Volume, 2008-2017 (‘000 BDMT) • Woodfibre demand in Asia-Pacific expected to continue to 14,000 Japan China increase with most shipments bound for China and Japan 12,000 10,000 • China demand has exceeded Japan since 2017, while 8,000 Japan
Slide 13: Outlook for FY19
Outlook for FY19 Positive outlook •Management expect growth in revenues and earnings on FY18 •Significant FX cover for USD sales already locked away for FY19 at favourable rates to FY18 •Acquisitions and investments made in FY18 will contribute for a full year, including PMP and wood fibre trading •
Slide 14: Attachments
Attachments Midway
Slide 15: Midway’s key business activities
Midway’s key business activities Key areas of expertise Plantation and land Harvesting and logistics Processing and materials Marketing and shipping Management • Existing freehold estate • Extensive experience in • Management of woodfibre • Market most of own • Experienced plantation Contract manage
Slide 16: Strategically located port and processing facilities
Strategically located port and processing facilities Five Key Export Ports QCE Brisbane Only woodfibre exporter from Brisbane Port – provides geographic and market diversity 15 year lease on a four ha site with the Port of Brisbane for producing, storing & loading Graincorp provides toll ship
Slide 17: Changing production mix as new opportunities come on stream
Changing production mix as new opportunities come on stream Midway has a number of short and long term (1 year to 10 year) agreements in place with a number of large plantation managers in each of our operating regions Facility Volumes FY2017 FY2018 FY2019 FY2020 FY2021 (000’s GMT) Geelong 1,413 1
Slide 18: New accounting standards - impacts
New accounting standards - impacts Key impacts – AASB 15 Revenue from contracts with customers • The Strategy arrangement entered into (disclosed in Appendix 4E note 4.11) to repurchase hardwood trees previously sold is deemed a financing arrangement as a result of Midway’s obligation to repurchase
Slide 19: Board of Directors – overseen strong growth
Board of Directors – overseen strong growth Greg McCormack Founding Director of Midway in 1980 and has a long-term commitment to the Australian forest products industry, holding senior positions Non-Executive Chairman with both the National and Victorian Association of Forest industries (having serv
Slide 20: Senior management team – extensive experience
Senior management team – extensive experience Stephen Roffey Mr Roffey joined Midway in 1994 and holds forestry qualifications. He previously held the position of CEO between June 2012 and General Manager – Marketing and February 2013. He then commenced his duties and role as the General Manager – M
Slide 21: Questions ?
Questions ? Midway