M.p. Evans Group Plc · LSE:MPE
M.p. Evans — H1 2023 Earnings Presentation
16 slides from M.p. Evans's earnings presentation, Sep 11, 2023
Slide 1: 2023 Interim Results
LEBRATING CE 2023 Interim 150 years LC M P. Results E P . VA P NS GROU Increasing CPO production from the Group’s six palm-oil mills, and more planted hectares acquired Monday 11th September 2023 A PRODUCER OF SUSTAINABLE INDONESIAN PALM OIL 1
Slide 2: Agenda
AGENDA • Group overview • Strategy pillars • 150-year celebrations • 2023 interim highlights • Palm-oil market • Sustainable palm oil • Group operations • 2023 interim results • Returns for investors • Outlook 2 2
Slide 3: Group Overview
GROUP OVERVIEW 150 years – A producer of 11,500+ celebrating a long sustainable Group employees history in tropical Indonesian palm oil agriculture 56,800 hectares of Agreement to Net zero - a plan planted oil palm acquire further for CO2 and other between Group’s 8,350 planted greenhouse gas six es
Slide 4: Strategy Pillars
STRATEGY M.P. Evans is a responsible producer of sustainable Indonesian PILLARS palm oil, striving for excellence in all its operations, with a focus on continuing growth and offering an increasing yield. RESPONSIBILITY EXCELLENCE GROWTH YIELD • RSPO members • Investing for the long term • Increasin
Slide 5: 150-Year Celebrations
150-YEAR CELEBRATIONS After tracing its origins back to the 1870’s, the Group held events to mark its 150-year anniversary this year, celebrating the significant contribution made by so many people in shaping the Group over many years. 5
Slide 6: 2023 Interim Highlights
2023 INTERIM HIGHLIGHTS 2% 3% INCREASE INCREASE IN TOTAL CROP IN TOTAL CPO PROCESSED PRODUCTION 26% 7% 27% INCREASE INCREASE DECREASE 61% IN COST OF GROUP IN CERTIFIED SUSTAINABLE IN AVERAGE CPO DECREASE PALM PRODUCT PRODUCTION MILL-GATE PRICE IN EARNINGS PER SHARE -% INCREASING INCREASING MAINTAINE
Slide 7: Palm-Oil Market
PALM-OIL • World vegetable-oil market continues to grow, with palm oil being the largest • Average mill-gate price US$755 in first half 2023, down 27%, but higher than MARKET individual component long-term average (20% higher than 20-year average) • Palm, as a permanent tree crop, the most productiv
Slide 8: Sustainable Palm Oil
RESPONSIBILITY SUSTAINABLE • Palm oil, when produced sustainably, provides a high-yield and low-cost PALM OIL supply of vegetable oil to a growing global market • The Group ensures that all its areas are developed and managed sustainably. This includes no deforestation and no burning • The Group is
Slide 9: Sustainability: A focus on carbon reduction
CARBON SUSTAINABILITY • The Group is publishing its first carbon report in accordance with the guidance A focus on of the TCFD (the Taskforce on Climate- related Financial Disclosures) carbon reduction • The Group is setting both nearer and longer-term carbon reduction targets to work towards net ze
Slide 10: Group Operations: Enhancing output
EXCELLENCE GROUP Independent suppliers OPERATIONS Enhancing output 188,100 t Group Group Group managed mills production 533,000 t 94% 23.1% 6% 159,100 t 4.8% External mills 33,100 t 7,100 t 1,500 t 10
Slide 11: Group Operations: Cost of Group palm product
EXCELLENCE GROUP Cost per tonne OPERATIONS Cost of Group $535 H1 2023 35% 23% 17% 25% palm product $387 H2 2022 27% 19% 20% 34% $425 H1 2022 38% 15% 19% 28% Labour Fertiliser Depreciation Other • Production cost from own crop US$535 per • Other costs, including labour, increased by tonne: total prod
Slide 12: 2023 Interim Results: Increasing yield
YIELD 2023 INTERIM RESULTS Increasing production with historically robust pricing REVENUE GROSS PROFIT EARNINGS PER SHARE US$134.5 million US$23.1 million 24.8 pence • Revenue US$134.5 million • Gross margin 17% • Group operations continue (2022 US$170.3 million) (2022 – 33%) to be profitable and ca
Slide 13: 2023 Interim Results: Balance sheet
BALANCE SHEET 2023 INTERIM RESULTS Balance sheet supports ongoing growth and shareholder CASH GENERATION BALANCE SHEET REMAINS GROUP DELIVERS ON BOTH returns CONTINUES ROBUST GROWTH AND YIELD • Operating cash before • Net assets at 30 June • US$25 million deployed to interest and tax US$480 million
Slide 14: Returns for Investors
RETURNS RETURNS FOR • Total normal dividend for 2022 of 42.5p INVESTORS • Interim dividend for 2023 maintained at 12.5p • Long-term (30 year+) track record of maintaining or increasing normal dividends for shareholders NORMAL DIVIDENDS (Pence per share) 45 40 35 30 25 20 15 10 5 0 2022 2021 2020 199
Slide 15: Outlook
OUTLOOK • First two months of H2 2023: CROP AND MILLING CAPACITY (Tonnes millions) o Increase in cropping levels 2.0 o Average monthly crop from Own crop Group-managed areas 1.8 Scheme-smallholder crop 119,900 tonnes, 35% higher Independent smallholder crop than monthly average in 1.6 Maximum millin
Slide 16: A Producer of Sustainable Indonesian Palm Oil
A PRODUCER OF SUSTAINABLE INDONESIAN PALM OIL 16