Olam Group Limited · SGX:VC2
Olam — Olam International — Q1 2018 Earnings Presentation
27 slides from Olam's earnings presentation, May 14, 2018
Slide 1: Q1 2018 Results Briefing
Q1 2018 Results Briefing May 14, 2018
Slide 2: Presenters
Presenters Sunny Verghese A. Shekhar N. Muthukumar Co-Founder Executive Director President and Group CEO and Group COO and Group CFO Olam International Limited Results for the 3 Months ended March 31, 2018 | May 14, 2018 2
Slide 3: Notice
Notice This presentation should be read in conjunction with Olam International Limited’s Financial Statements for the First Quarter (“Q1 2018”) ended March 31, 2018 (“Q1 2018”) and Management Discussion and Analysis lodged on SGXNet on May 14, 2018. Olam International Limited Results for the 3 Month
Slide 4: Cautionary note on forward-looking statements
Cautionary note on forward-looking statements This presentation may contain statements regarding the business of Olam International Limited and its subsidiaries (‘Group’) that are of a forward-looking nature and are therefore based on management’s assumptions about future developments. Such forward
Slide 5: Agenda
Agenda • Q1 2018 highlights • Segmental review • Key takeaways
Slide 6: Q1 2018 highlights
Q1 2018 highlights
Slide 7: Q1 2018 results at a glance
Q1 2018 results At a glance Volume EBITDA PATMI 7.0 M MT S$368 M S$158 M +56.1% -7.7% +9.8% Operational Free Cash Flow Gearing PATMI S$163 M FCFE from 1.98 S$466X to M +13.0% -S$409 M 1.49 X +28.1% Olam International Limited Results for the 3 Months ended March 31, 2018 | May 14, 2018 7
Slide 8: Volume grew 56.1%
Volume grew 56.1% Led by Food Staples & Packaged Foods Volume by segment, '000 MT +56.1% 2,499 39 6,965 4,462 -25 -10 Q1 2017 Edible Nuts, Spices Confectionery Food Staples & Industrial Raw Q1 2018 & Vegetable & Beverage Packaged Foods Materials, Ag Ingredients Ingredients Logistics & Infrastructure
Slide 9: EBITDA declined 7.7% vs a strong Q1 2017
EBITDA declined 7.7% vs a strong Q1 2017 EBITDA by segment, S$ million -7.7% 399 -2 4 368 -14 -18 -1 Q1 2017 Edible Nuts, Confectionery Food Staples & Industrial Raw Commodity Q1 2018 Spices & & Beverage Packaged Foods Materials, Ag Financial Services Vegetable Ingredients Logistics & Ingredients In
Slide 10: PATMI grew 9.8%
PATMI grew 9.8% Operational PATMI grew 13.0% PATMI and Operational PATMI, S$ million +9.4% +9.8% 52 4 157 144 -5 -31 -8 Q1 2017 EBITDA^ Depreciation & Net Finance Taxation^ Exceptional Q1 2018 Amortisation Costs^ Items Operational PATMI (S$ M) 144 +13.0% 163 ^ Excludes exceptional items Olam Interna
Slide 11: 4.7% reduction in invested capital
4.7% reduction in invested capital 10.6% reduction in working capital year-on-year S$ Million • Fixed Capital up with continued -4.7% 16,964 committed investments in upstream 16,649 16,167 15,832 and midstream assets, partly offset by 14,375 completion of planned divestments 8,853 7,705 9,045 8,090
Slide 12: Net gearing reduced to 1.49X
Net gearing reduced to 1.49X Net and adjusted debt / equity (basic) • Reduced net debt due to: • Lower working capital on 1.98 optimisation initiatives, also 1.49 supported by lower commodity 1.46 prices 0.79 • Lower gross Capex 0.51 0.47 • Cash release from divestments • Conversion of warrants into
Slide 13: Free cash flow
Free cash flow Negative FCFE due to higher working capital usage in Q1 2018 Free Cash Flow to Equity, S$ million -42 -28 74 215 -409 -612 -16 Q1 2017 Operating Cash Changes in Tax Paid Capex / Net Interest Paid Q1 2018 Flow (before Working Capital Investments Interest & Tax) FCFF (S$ M) 135 -442 -30
Slide 14: Available liquidity
Available liquidity Sufficient to cover all repayment and Capex obligations Total borrowings and available liquidity, S$ Million as at March 31, 2018 8,373 17,064 +5,218 11,846 1,592 4,175 5,235 7,671 1,864 Cash and RMI* Secured Unutilised Available Liquidity Total Borrowings Short-term Receivables
Slide 15: Segmental review
Segmental review
Slide 16: Edible Nuts, Spices & Vegetable Ingredients
Edible Nuts, Spices & Vegetable Ingredients EBITDA, S$ Million Invested capital, S$ Million 438 +9.2% 394 332 4,040 3,463 3,643 3,604 3,701 -1.6% 1,421 1,608 1,436 1,980 1,415 138 136 2,048 2,222 1,996 2,265 2,060 2015 2016 2017 Q1 2017 Q1 2018 restated Dec-15 Dec-16 Dec-17 Mar-17 Mar-18 restated Wo
Slide 17: Confectionery & Beverage Ingredients
Confectionery & Beverage Ingredients EBITDA, S$ Million Invested capital, S$ Million 407 -17.7% 328 284 6,110 6,397 5,681 5,347 5,268 -18.4% 4,330 4,569 4,940 3,819 3,773 75 61 1,351 1,541 1,528 1,457 1,495 2015 2016 2017 Q1 2017 Q1 2018 restated Dec-15 Dec-16 Dec-17 Mar-17 Mar-18 restated • EBITDA
Slide 18: Food Staples & Packaged Foods
Food Staples & Packaged Foods EBITDA, S$ Million Invested capital, S$ Million +4.1% 360 330 4,678 4,660 4,849 4,522 1,131 1,450 1,317 212 3,231 1,498 -15.1% 915 118 100 3,547 3,210 3,532 3,024 2,316 2015 2016 2017 Q1 2017 Q1 2018 Dec-15 Dec-16 Dec-17 Mar-17 Mar-18 restated restated Working Capital F
Slide 19: Industrial Raw Materials, Ag Logistics & Infrastructure
Industrial Raw Materials, Ag Logistics & Infrastructure EBITDA, S$ Million Invested capital, S$ Million -10.1% 197 2,221 185 2,105 2,091 1,918 1,879 135 1,213 1,050 912 1,106 891 +6.4% 62 66 1,006 1,008 1,055 985 989 2015 2016 2017 Q1 2017 Q1 2018 Dec-15 Dec-16 Dec-17 Mar-17 Mar-18 restated restated
Slide 20: Key takeaways
Key takeaways
Slide 21: Key takeaways
Key takeaways • Steady financial performance versus strong Q1 2017: PATMI and Operational PATMI up 9.8% and 13.0% respectively in Q1 2018 • Enlarged share capital and stronger balance sheet • Continue to execute on 2016-2018 Strategic Plan in 2018 by pursuing growth in prioritised platforms, turning
Slide 22: Appendix
Appendix
Slide 23: P&L statement
P&L statement S$ million Q1 2018 Q1 2017 % Change Volume ('000 MT) 6,965.2 4,461.7 56.1 Revenue 6,295.4 5,804.2 8.5 Net gain/(loss) in fair value of biological (4.1) (2.0) 106.8 assets EBITDA 368.1 398.6 (7.7) Depreciation & (95.7) (88.6) 8.0 Amortisation Net Finance costs (87.4) (139.6) (37.4) Taxa
Slide 24: Exceptional items
Exceptional items S$ million Q1 2018 Q1 2017 Sale of SVI asset (land) in US 13.6 - Sale of PT ACE 5.7 - Sale of 50% stake in Nauvu (24.0) - Exceptional Items (4.7) - Olam International Limited Results for the 3 Months ended March 31, 2018 | May 14, 2018 24
Slide 25: Balance sheet
Balance sheet Change Change S$ million 31-Mar-18 31-Dec-17 vs Dec 17 31-Mar-17 vs Mar 17 Uses of Capital Fixed Capital 8,534.6 8,633.2 (98.6) 8,315.2 219.4 Working Capital 7,926.5 7,280.3 646.2 8,559.0 (632.5) Cash 1,863.5 1,986.4 (122.9) 2,643.7 (780.2) Others 210.1 309.0 (98.9) 336.0 (125.9) Total
Slide 26: Cash flow statement
Cash flow statement S$ million Q1 2018 Q1 2017 YoY Operating Cash flow (before Interest & Tax) 373.8 401.8 (28.0) Changes in Working Capital (687.0) (74.7) (612.3) Net Operating Cash Flow (313.1) 327.1 (640.2) Net interest paid (102.4) (176.4) 74.0 Tax paid (23.2) (7.0) (16.2) Cash from divestments
Slide 27: Q1 2018 Results Briefing
Q1 2018 Results Briefing olamgroup.com/investor-relations/ ir@olamnet.com