Ridley Corporation Limited · ASX:RIC
Ridley — H1 2006 Earnings Presentation
32 slides from Ridley's earnings presentation, February 2006
Slide 1: Ridley Corporation 2006 Half Year Results Presentation
RIDLEY CORPORATION 2006 HALF YEAR RESULTS PRESENTATION
Slide 2: Main Features
Main Features • Strong recovery in Ridley Inc • Continuing improvement in Australian Feed • Dry Creek acquisition performing well • Cheetham Salt – new CEO • Update Canadian legal claims
Slide 3: Results
Results A$ million Sales 636 +6% EBITDA 42 +18% EBIT 32 +23% Net Profit 15 +4% Dividends 3.5 cps* +8% * 50% franked Note: all prior year numbers restated for AIFRS
Slide 4: Sales By Division
Sales By Division A$ million 5 3 (8) 6 8 20 636 602 2005 Feed Australia RNS Salt Feed Canada Feed USA Currency 2006
Slide 5: Net Profit
Net Profit A$ million 0.4 0.9 1.9 1.0 1.8 2.6 1.9 4.7 3.4 14.1 14.7 2005 EBIT EBIT EBIT EBIT EBIT EBIT EBIT Tax & outside 2006 Feed Canada Feed USA Salt Feed RNS Other Legal costs Borrowings equity Australia
Slide 6: Feed - Australia
Feed - Australia A$ million Sales 246 +9% EBIT 8 +5% Features - Operating earnings up 21% - Improvement in dairy and poultry volumes - Bolt on acquisitions - Industry consolidation - Lower beef and supplements volume – good pasture conditions
Slide 7: Feed – Australia Sales Volumes
Feed – Australia Sales Volumes Tonnes 5 (4) (6) (7) 15 23 29 840 785 2005 Acquisitions Poultry Dairy Raws Swine Supplements Beef 2006
Slide 8: Feed – Australia EBIT
Feed – Australia EBIT A$ million 0.3 (1.0) 1.8 (0.9) 0.2 7.8 8.2 2005 Acquisitions Margins Volume Atherton JV Selling and 2006 Admin
Slide 9: Cheetham Salt
Cheetham Salt A$ million Sales 44 +23% EBIT 12 +19% Features - Dry Creek - Lower volumes to stockfeed sector - Energy / transport / packaging - Export – freight cost - New CEO – John Murray
Slide 10: Cheetham Salt EBIT
Cheetham Salt EBIT A$ million 0.2 0.2 (0.4) (0.4) (0.8) 3.1 11.8 9.9 2005 Dry Creek Bulk Retail Freight Other Qld 2006 Shipments Agriculture
Slide 11: Feed - USA
Feed - USA A$m US$m Sales 201 -1% 150 +2% EBIT 10 +37% 7 +40% Features - Broader environment stable - Volumes and margins steady - Cost reductions program fully implemented
Slide 12: Feed – USA EBIT
Feed – USA EBIT US$ million (0.3) 0.8 (0.7) 1.5 0.1 (0.4) 1.1 7.3 5.2 2005 Volume Margins Costs Ingredients Receivables Claims Other 2006 markets Settlement
Slide 13: Ridley Nutrition Solutions
Ridley Nutrition Solutions A$m US$m Sales 59 +14% 48 +16% EBIT 6 -13% 4 -11% Features - Volumes up - Sweetlix - Molasses availability / prices - Hurricanes – transport disruption - Energy costs
Slide 14: Ridley Nutrition Solutions EBIT
Ridley Nutrition Solutions EBIT US$ million 1.0 (1.3) (0.3) (0.1) 5.0 4.3 2005 Volume Molasses/ Equine Other 2006 Freight
Slide 15: Ridley Nutrition Solutions Hurricane Impact
Ridley Nutrition Solutions Hurricane Impact Whitewood, South Dakota Stockton, Worthington, Syracuse, California Minnesota Indiana Fort Worth, Montgomery, Texas Alabama Buffalo, X Molasses Terminals Texas Cane Molasses Refineries Area of severe to moderate damage to property Areas where molasses supp
Slide 16: Feed - Canada
Feed - Canada A$m C$m Sales 86 +2% 76 -2% EBIT 5 +100% 5 +100% Features - Improved margins and volumes - Cost reduction programme - Border re-opened
Slide 17: Feed – Canada EBIT
Feed – Canada EBIT C$ million 0.6 1.4 4.5 0.7 0.1 0.6 0.4 0.7 2005 Volume Margins Costs Ingredients Receivables Other 2006
Slide 18: Corporate & Unallocated Costs
Corporate & Unallocated Costs A$ Million Dec 2005 Dec 2004 Corporate Costs 6 6 Canadian Legal Costs 2 - US Professional Fees 1 - Total 9 6
Slide 19: Ridley Corporation Financial Performance
RIDLEY CORPORATION 2006 FINANCIAL PERFORMANCE
Slide 20: AIFRS Impact
AIFRS Impact A$ Million December 2004 AGAAP 12.4 Goodwill – including Associates 2.6 Share-based payments (0.3) Tax (0.1) Minority interest (0.5) December 2004 AIFRS 14.1
Slide 21: AIFRS Impact December 2004 EBIT
AIFRS Impact December 2004 EBIT A$ Million AGAAP Impact AIFRS Feed Australia 7.3 0.5 7.8 Cheetham Salt 9.4 0.5 9.9 Feed USA 6.6 0.6 7.2 RNS 6.0 0.7 6.7 Feed Canada 0.0 0.4 0.4
Slide 22: Cashflow
Cashflow A$ Million Dec 2005 Dec 2004 EBITDA 42 36 Capex (8) (10) Borrowing costs (7) (5) Tax (2) (3) Dividends (6) (6) Working capital & other (8) 2 Cash generated 11 14 Acquisitions (10) (25) Net 1 (11)
Slide 23: EBITDA
EBITDA A$ Million Dec 2005 Dec 2004 Feed Australia 12 11 Cheetham Salt 14 11 Feed USA 12 10 Feed Canada 6 2 RNS 7 8 Other (9) (6) TOTAL 42 36
Slide 24: Debt Movement
Debt Movement A$ Million Net Debt - June 2005 164 Acquisition funding 10 Repayments (11) Currency translation 4 AIFRS – borrowing costs (2) Net Debt – December 2005 165
Slide 25: Gearing
Gearing Dec 2005 Jun 2005 Dec 2004 Net Debt 165 164 129 Equity 373 351 323 Ratio 0.44:1 0.47:1 0.40:1
Slide 26: Net Debt
Net Debt A$ Million Dec 2005 Jun 2005 Dec 2004 Australia 147 113 74 Ridley Inc 20 51 55 AIFRS – borrowing costs (2) - - Total 165 164 129
Slide 27: Working Capital
Working Capital A$ Million Dec 2005 Dec 2004 Dec 2003 Receivables 124 107 106 Inventory 127 109 106 Accounts Payable (153) (118) (114) Other & Provisions (6) (2) (1) Total 92 96 97 Days Sales Outstanding 31 28 28
Slide 28: Key Ratios
Key Ratios Dec 2005 Dec 2004 Dec 2003 Net Debt/EBITDA* 1.9 1.8 1.7 EBITDA/Net Interest 6.0 7.9 8.2 EBIT/Net Interest 4.6 4.8 5.1 ROSF* 8.0% 7.8% 8.0% ROFE* 11.0% 9.0% 10.6% EPS (fully diluted) 5.4 5.2 4.7 * Annualised
Slide 29: Currency Impact
Currency Impact Dec 2005 Dec 2004 Average Exchange Rate .7471 .7294
Slide 30: Canadian Legal Claims Update
CANADIAN LEGAL CLAIMS UPDATE
Slide 31: Legal Claims
Legal Claims • Claims against Ridley Corporation struck out in Ontario in January 2006 • Claims against Canadian Federal Government and Ridley Inc continue • Both Canadian Federal Government and Ridley Inc have sought leave to appeal against the decision dismissing their motions to strike the claims
Slide 32: Ridley
~~ RIDLEY