Singapore Exchange Ltd. · SGX:S68
Singapore Exchange — Japfa — SGX-DBS Vickers Consumer Corporate Day 2016
45 slides from Singapore Exchange's conference presentation, Jun 28, 2016
Slide 1: SGX-DBS Vickers Consumer Corporate Day
SGX-DBS Vickers Consumer Corporate Day 28 June 2016
Slide 2: Agenda
Agenda 1 Overview 2 Business Segments 3 Financial Performance 4 Growth Strategies 1
Slide 3: Overview
Overview Confidential
Slide 4: Leading Pan-Asian Industrialised Agri-Food Company
Leading Pan-Asian Industrialised Agri-Food Company WHAT WE DO WHERE WE ARE WHY WE DO IT We produce quality We employ over 3 billion people living protein staples, dairy, 30,000 people across in our target markets and packaged food Singapore, Indonesia, More than 40% of the that nourish millions Viet
Slide 5: Vertically Integrated Business Across Entire Value Chain
Vertically Integrated Business Across Entire Value Chain HOW WE DO IT UPSTREAM: Animal Feed & Breeding • Produce quality animal feed on an industrial scale • Use world class genetics supported by advanced farming technology to maximise efficiency in our breeding operations in dairy cattle, poultry,
Slide 6: Core Competencies Across All Business Segments
Core Competencies Across All Business Segments INDUSTRIALISED APPROACH TO FARMING AND FOOD PRODUCTION 1 Large Scale 2 Technology and Genetics Ability to manage mega-scale operations: JVs with and for > 10,000 poultry commercial farms superior breeding and genetics > 600 million day-old-chick
Slide 7: Our Business
Our Business Confidential
Slide 8: The right business in the right markets
The right business in the right markets A Large and growing shortfall in China Indonesian poultry (raw milk in million tons) 69.0 Per capita consumption Market share 63.7 58.6 52.3 54.8 49.0 #2 48.2 Japfa 46.7 25% 41.0 43.7 35.3 36.5 38.5 Others 34% 8.9 Charoen Pokphand 41% 2013E 2014F 2015F 2016F 2
Slide 9: Leading market positions in multiple protein staples
Leading market positions in multiple protein staples Leading market positions Leading downstream consumer brands that are a key driver for future growth Leading Consumer Brands In Indonesia Dairy(6) Frozen consumer food Ambient temperature consumer food #1 #2 Others #3 Heinz ABC 15% PT CP Others 16%
Slide 10: Animal Protein Segment
Animal Protein Segment Confidential
Slide 11: Poultry breeding operations
Poultry breeding operations 10
Slide 12: Poultry breeding operations
Poultry breeding operations 11
Slide 13: PT Japfa Comfeed Indonesia Tbk: Pillar of Animal Protein excellence
PT Japfa Comfeed Indonesia Tbk: Pillar of Animal Protein excellence Feed Fattening Economies of scale Proven farm management and technical know-how including geographical reach Poultry commercial farming operations mostly Ability to pass on raw through contract farming, and sold as live bird
Slide 14: Replicating Indonesian pillar in new markets and proteins
Replicating Indonesian pillar in new markets and proteins Vietnam Swine Poultry Swine breeding and distribution operations in 5 Swine & Poultry Feedmills 5 Swine & Poultry Vietnam Feedmills 1 Great Grandparent Farm, Produce premium-quality 5 Grandparent Farms, 16 10 Breeding Farms animal
Slide 15: Dairy Segment
Dairy Segment Confidential
Slide 16: Dairy Farm in Shandong: Breeding Hutches
Dairy Farm in Shandong: Breeding Hutches 15
Slide 17: Dairy Farm in Shandong
Dairy Farm in Shandong 16
Slide 18: Dairy Farm in Shandong: Feeding Barn
Dairy Farm in Shandong: Feeding Barn 17
Slide 19: Dairy Farm in Shandong: Rotary Milking Parlor
Dairy Farm in Shandong: Rotary Milking Parlor 18
Slide 20: Key drivers for profitability
Key drivers for profitability Milk yield X Milk price = Profitability Japfa’s yield continues to surpass listed China competitors Est. China average = 18.4kg/day Source: Rabobank Yield Comparison Chart, based on data for calendar year 2014 or FY2014/2015 from various listed companies including Austa
Slide 21: Key milestones
Key milestones 1997 2000 2004 Indonesia - Farm Indonesia - Downstream China – Joint Venture Commenced operations at dairy Launched our Greenfields brand Approached by Mengniu to farm in Malang, East Java, of milk establish and manage a joint Indonesia venture 10,000-head dairy farm in Inner Mo
Slide 22: Key success factors for our high milk yields
Key success factors for our high milk yields Forage Farm design Farm management Understanding and developing Proven Asian 10,000-head dairy Retention of experienced localised forage supply in an farm blue-print management over last twenty Asian context years Infrastructure and standardised
Slide 23: Consumer Food Segment
Consumer Food Segment Confidential
Slide 24: Scaled consumer food production and distribution platform in Indonesia; replicating in Vietnam
Scaled consumer food production and distribution platform in Indonesia; replicating in Vietnam Indonesia Vietnam 5 meat processing plants 1 meat processing plant producing ambient temperature sausages 5 poultry slaughterhouses Internal marketing, sales & distribution department that plans new produc
Slide 25: Financial Performance
Financial Performance Confidential
Slide 26: Japfa's Growth Pillars and Diversification Strategy
Japfa’s Growth Pillars and Diversification Strategy China China China Dairy Dairy Dairy Animal Animal Protein Animal Protein Other Protein Other Other PT Japfa TBK PT Japfa PT Japfa TBK TBK Size of circles represent Core PATMI w/o Forex 2013 2014 2015 PT Japfa Tbk has gone through a rough patch in
Slide 27: Pre-IPO Till Today: Strong Growth Across All Indicators
Pre-IPO Till Today : Strong Growth Across All Indicators For the period 12 months ended 31 March Revenue Operating Profit EBITDA PAT US$ million US$ million US$ million US$ million +4.3% 324.2 2,829.1 +35.7% +37.6% +59.9% 2,711.6 240.3 235.6 123.9 177.1 77.5 12M ended 12M ended 12M ended 12M ended 1
Slide 28: Pre-IPO Till Today: Developing Three Core Pillars
Pre-IPO Till Today : Developing Three Core Pillars For the period 12 months ended 31 March Revenue EBITDA PAT Core PATMI w/o Forex US$ million US$ million US$ million US$ million 12M Animal feed business ended 1,872.7 203.2 is one of our core 31/3/2016 77.1 42.5 PT stable strengths Japfa -6.5% +15.8
Slide 29: Group Revenue and Earnings Profile
Group Revenue and Earnings Profile FY2015 Revenue Composition FY2014 Revenue Composition FY2015 Operating Profit Composition FY2014 Operating Profit Composition Operational segments shown above excludes central purchasing subsidiary, headquarter costs and elimination adjustments between segments 28
Slide 30: Segmental Highlights
Segmental Highlights • Turnaround in poultry business in 2H 2015 • Improved poultry market in Indonesia with better selling prices of feed, DOCs and broilers in 2H 2015 PT Japfa Tbk • Strong PAT despite foreign exchange loss • Notwithstanding challenging and volatile conditions in Indonesia, PT Japf
Slide 31: Diversification strategy across three pillars
Diversification strategy across three pillars Core PATMI Breakdown Core PATMI w/o Forex Breakdown Balance contribution from the Group’s three pillars – PT Japfa Tbk, Animal Protein Other and Dairy Operational segments shown above excludes central purchasing subsidiary, headquarter costs and elimin
Slide 32: PT Japfa Tbk (Poultry): 3-Year Segmental Trends
PT Japfa Tbk (Poultry): 3-Year Segmental Trends Revenue Operating Profit PT Japfa Tbk is one of the core US$ million US$ million pillars of the Group’s business 2,347.1 2,387.4 Revenue trend was mainly 2,119.2 186.0 impacted by the weakening of 127.6 141.5 Rupiah and lower volumes Profitability
Slide 33: Animal Protein Other: 3-Year Segmental Trends
Animal Protein Other: 3-Year Segmental Trends Diversification strategy is coming Revenue Operating Profit through US$ million US$ million With our expertise and track record 37.4 38.2 in the poultry business, we are 527.5 replicating the same success model 506.7 in Vietnam, Myanmar and India 367.1
Slide 34: Dairy: 3-Year Segmental Trends
Dairy: 3-Year Segmental Trends Revenue Operating Profit Dairy business is poised to be a US$ million US$ million strong third pillar for the Group 259.4 52.7 Revenue growth for our dairy business has been driven by 227.7 45.1 China 25.8 Profit generation is similarly 148.1 driven by China, while
Slide 35: Growth Strategies
Growth Strategies Confidential
Slide 36: Growth Strategies
Growth Strategies Focus on Mitigating Market Maximising Returns Industrialisation and Challenges from Our Assets Diversification Continue to enhance Long term fundamentals for Leverage our track record in efficiency and profitability of the Group remain favorable replicating our industrialised our o
Slide 37: Appendix
Appendix Confidential
Slide 38: Quarterly Segment Information – 1Q 2016
Quarterly Segment Information – 1Q 2016 Notes: • Animal Protein - where PT.Japfa Comfeed 1Q 2016 Indonesia Tbk (TBK) is shown separately from Animal Protein Other (AP Other). ANIMAL PROTEIN DAIRY CONSUMER Others TOTAL • Animal Protein Other (AP Other) – refers to the TBK AP Other Total FOOD animal p
Slide 39: Quarterly Segment Information – 4Q 2015
Quarterly Segment Information – 4Q 2015 Notes: 4Q 2015 • Animal Protein - where PT.Japfa Comfeed Indonesia Tbk (TBK) is shown separately from ANIMAL PROTEIN DAIRY CONSUMER Others TOTAL Animal Protein Other (AP Other). TBK AP Other Total FOOD • Animal Protein Other (AP Other) – refers to the animal p
Slide 40: Quarterly Segment Information – 3Q 2015
Quarterly Segment Information – 3Q 2015 Notes: • Animal Protein - where PT.Japfa Comfeed 3Q 2015 Indonesia Tbk (TBK) is shown separately from CONSUME Animal Protein Other (AP Other). ANIMAL PROTEIN DAIRY R Others TOTAL • Animal Protein Other (AP Other) – refers to the TBK AP Other Total FOOD animal
Slide 41: Quarterly Segment Information – 2Q 2015
Quarterly Segment Information – 2Q 2015 Notes: 2Q 2015 • Animal Protein - where PT.Japfa Comfeed Indonesia Tbk (TBK) is shown separately from ANIMAL PROTEIN DAIRY CONSUMER Others TOTAL Animal Protein Other (AP Other). TBK AP Other Total FOOD • Animal Protein Other (AP Other) – refers to the animal p
Slide 42: Quarterly Segment Information – 1Q 2015
Quarterly Segment Information – 1Q 2015 Notes: • Animal Protein - where PT.Japfa Comfeed 1Q 2015 Indonesia Tbk (TBK) is shown separately from ANIMAL PROTEIN DAIRY CONSUMER Others TOTAL Animal Protein Other (AP Other). TBK AP Other Total FOOD • Animal Protein Other (AP Other) – refers to the animal p
Slide 43: Segment Information – FY2015
Segment Information – FY2015 Notes: • Animal Protein - where PT.Japfa Comfeed Indonesia Tbk (TBK) is shown separately from Animal Protein Other (AP Other). YTD DEC 2015 • Animal Protein Other (AP Other) – refers to the ANIMAL PROTEIN DAIRY CONSUMER Others TOTAL animal protein operations in Vietnam,
Slide 44: Disclaimer
Disclaimer This presentation has been prepared by Japfa Ltd. (the “Company”) solely for use at a presentation to potential investors. By attending the meeting where the presentation is made, or by reading the presentation slides, you agree to the following limitations and notifications and represent
Slide 45: Thank You
Thank You Confidential