Quantum Foods Holdings Ltd · JSE:QFH
Quantum Foods — FY2022 Earnings Presentation
27 slides from Quantum Foods's earnings presentation, September 2022
Slide 1: Results Presentation
Results Presentation 1
Slide 2: Agenda
Agenda Business overview H Lourens Financial overview A Muller Operational overview H Lourens Management focus H Lourens 2
Slide 3: Salient features
Salient features Revenue • Record high raw material prices 11% • Avian influenza HEPS 73% • Kaalfontein labour unrest Cash flow from operating activities 2022 • Load shedding R78 million • Excessive energy costs (diesel, electricity) Total cash dividend for 2022 8 cents • Defensive broiler model suc
Slide 4: Financial overview
Financial overview 4 A Muller
Slide 5: Statement of income
Statement of income 2022 2021 % For the year ended 30 September Rm Rm change Revenue 6 020.6 5 401.1 11 Operating profit* 32.5 147.6 (78) (Loss)/income from associates (0.2) 1.8 Net finance cost (12.1) (7.1) Profit before tax 20.3 142.3 (86) Tax credit/(expense) 3.6 (36.5) Profit for the period 23.8
Slide 6: Revenue analysis
Revenue analysis Total: R5 401m (2020: R5 095m) Animal feeds Eggs Farming Other African Countries R2 688m R1 350m R1 588m R394m 45% 22% 26% 7% 2021: R2 441m | 45% 2021: R1 229m | 23% 2021: R1 412m | 26% 2021: R320m | 6% 6
Slide 7: Segment results
Segment results 2022 2021 Adjusted operating profit* for the year ended 30 September Rm Rm Eggs (42.1) (5.0) Farming (15.4) 34.3 Animal feeds 93.3 100.9 Other African countries 18.7 30.8 Head office costs (17.6) (16.7) Profit for the year 36.8 144.3 * Adjusted operating profit excludes items of a ca
Slide 8: Statement of financial position
Statement of financial position 2022 2021 As at 30 September Rm Rm Non-current assets 1 416.9 1 360.6 Net working capital (excluding lease liabilities) 1 042.7 949.8 Non-current liabilities (excluding lease liabilities) (266.1) (274.9) Net cash (11.1) 73.3 Total net assets 2 182.4 2 108.8 Lease liab
Slide 9: Statement of cash flow
Statement of cash flow 2022 2021 For the year ended 30 September Rm Rm Cash operating profit 170.6 295.3 Working capital outflow (87.1) (259.3) Cash effect of hedging activities 1.1 11.1 Income tax paid (6.9) (22.7) Cash generated by operations 77.8 24.3 Capital expenditure (125.2) (108.6) Proceeds
Slide 10: Capital expenditure
Capital expenditure 2022 Future Rm Rm RSA Expansion/efficiency 71.9 48.7 – Feed mills 5.9 16.2 – Broiler hatcheries 47.5 24.4 – Farms 6.5 1.8 – Energy 1.7 2.3 – ERP system 10.2 4.0 Replacement/compliance 38.0 68.0 Africa Expansion/efficiency – 2.1 – Uganda breeder farms – 2.1 Replacement 15.3 17.1 1
Slide 11: Operational overview
Operational overview H Lourens 11
Slide 12: Nova Feeds
Nova Feeds • Slight decline in volumes • Margins remained stable • Costs well managed • Increased efficiencies at feed mills • Improved distribution efficiencies • Business particularly hard hit with load shedding • Installation of generators for Malmesbury Mill approved 12
Slide 13: Broiler farm business
Broiler farm business • Last grandparents culled August 2022 • Increase in day old chick sales of 4.2% • Improvement in hatchability • Broiler performance slightly down from high levels • Hartbeespoort hatchery expansion on track • Defensive model worked well in rising raw material cost conditions 1
Slide 14: Layer farm business
Layer farm business • Breeder performance above breed standard • Operational indicators improved but not at targeted level • Avian influenza affected cost base and number of eggs produced • Kaalfontein farm labour unrest had significant impact on operations and costs • Cancellations of point-of-lay
Slide 15: Nulaid Eggs
Nulaid Eggs • Material cost increases could not be recovered in egg prices • East London packing facility closed due to profitability • Egg volumes increased by 0.7% • Price realisation increased by 8.4% • Costs in business well managed • Operational indicators remain on target 15
Slide 16: Rest of Africa
Rest of Africa • Very high maize prices in all jurisdictions • Operating Costs well controlled in all three countries • Operational efficiencies weak in Uganda • Excellent improvement in operation efficiencies in Mozambique • Disease challenges throughout Copperbelt • Solid financial performance in
Slide 17: Management focus
Management focus 17 H Lourens
Slide 18: Focus areas 2023
Focus areas 2023 High raw material costs to flow through income statement in first six months of FY2023 Down placement of South African layer flock should bring relief in second six months of FY2023 Investment in working capital will continue to impact cash flow Avian influenza remains a significant
Slide 19: Thank you
Thank you — FEEDS: VOERE A fresh egg is... QUANTUM CG FOODS <! Y Betievue Chix Quantum NEST EGGS _ C) BERGVLE] CHICKS TYDSTROOM POULTRY /
Slide 20: Appendix
20 Appendix
Slide 21: Safex yellow maize Rand per ton
Safex yellow maize Rand per ton R5,100 R4,800 4 113 R4,500 R4,200 3 372 R3,900 R3,600 R3,300 2 749 2 634 R3,000 R2,700 R2,400 2 099 R2,100 R1,800 Sep 17 Mar 18 Sep 18 Mar 19 Sep 19 Mar 20 Sep 20 Mar 21 Sep 21 Mar 22 Sep 22 Safex yellow maize Rand per ton Average for financial period 21
Slide 22: CBOT US Dollar soybean meal
CBOT US Dollar soybean meal $550 $525 425 $500 $475 390 $450 $425 341 $400 $375 $350 306 $325 297 $300 $275 $250 Sep 17 Mar 18 Sep 18 Mar 19 Sep 19 Mar 20 Sep 20 Mar 21 Sep 21 Mar 22 Sep 22 CBOT US Dollar soybean meal Average for financial period 22
Slide 23: Rand:US Dollar exchange rate
Rand:US Dollar exchange rate R20 R19 R18 16.22 R17 15.82 14.83 R16 14.34 R15 R14 13.07 R13 R12 R11 Sep 17 Mar 18 Sep 18 Mar 19 Sep 19 Mar 20 Sep 20 Mar 21 Sep 21 Mar 22 Sep 22 Rand:US Dollar exchange rate Average for financial period 23
Slide 24: Layer productivity index (completed flocks)
Layer productivity index (completed flocks) 150 140 130 120 110 100 90 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 24
Slide 25: Broiler productivity index (completed flocks)
Broiler productivity index (completed flocks) 150 140 130 120 110 100 90 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 25
Slide 26: South African layer day-old chick production
South African layer day-old chick production Source: South African Poultry Association 4th quarter report 2022 26
Slide 27: 27
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