Kerry Group Plc · EURONEXT:KRZ
Kerry — Merger or Acquisition (November 2024)
12 slides from Kerry's merger presentation, Nov 12, 2024
Slide 1: Proposed sale of Kerry Dairy Ireland to Kerry Co-Operative Creameries Limited
Proposed sale of KERRY DAIRY IRELAND to Kerry Co-Operative Creameries Limited 12 November 2024
Slide 2: Disclaimer
Disclaimer This presentation may contain forward looking statements with projections regarding, among other things, the Group’s strategy, revenues, earnings, EBITDA, EBITDA margin, finance costs, tax rate, capital expenditure, dividends, share buybacks, cash flow, net debt or other financial measure
Slide 3: Executive Summary: Becoming a Pure Play Taste and Nutrition Company
Executive Summary Becoming a Pure Play Taste and Nutrition Company • A significant strategic step in Kerry Group’s continued business development and portfolio evolution • Proposed sale for enterprise value of ~€500m in two phases (initial 70% disposal, followed by remaining 30%) • Represents 9.4x &
Slide 4: Transaction Structure
Transaction Structure Disposal of Kerry Dairy Ireland structured in 2 phases – Phase 1 (70% ~€350m) and Phase 2 (30% ~€150m)) • Phase 1 – expected to complete by the end of Jan 2025, post shareholder approvals • Phase 2 – consists of call-put options for transfer of remaining 30% in Kerry Dairy Irel
Slide 5: Transaction Detail and Future Arrangements
Transaction Detail and Future Arrangements • Transaction includes seven manufacturing facilities and 1,500+ employees • Kerry Dairy Ireland will continue to be led by Pat Murphy as Chief Executive Officer • Kerry Dairy Ireland will continue to be key supplier of Dairy Ingredients to Kerry Group plc
Slide 6: Significantly Enhances Group Financial Profile
Financials Significantly Enhances Group Financial Profile ✓ Volume Growth Accretive to Group of c. +30bps ✓ EBITDA Margin % Accretive to Group by c. +140bps ✓ Earnings Per Share Minimal net EPS dilution of ~2% given transaction structure ✓ Free Cash Flow Positive on cash conversion % ✓ ROACE Neutral
Slide 7: Timetables and Next Steps
Timetables and Next Steps Kerry Co-Operative EGM 16th December 2024 Kerry Group plc EGM 19th December 2024 Expected Closing By End of January 2025 © Kerry 2024 | 7
Slide 8: Appendix
APPENDIX © Kerry 2024 | 8
Slide 9: Kerry Dairy Ireland
Kerry Dairy Ireland BUSINESS PROFILE REVENUE PROFILE LEADING MARKET BRANDS Dairy Consumer Products 37% 56% Manufacture dairy products including leading brands found in chilled cabinets primarily across retailers in UK & Ireland 1.3bn REVENUE Dairy Ingredients Dairy processing activities in 7% Southw
Slide 10: Transaction Effect on Revenue and EBITDA Margin %
Transaction Effect on Revenue and EBITDA Margin % 2023 Reported Results 2024 Visible Alpha Consensus¹ Group Group Taste & Dairy Taste & Dairy Eliminations and Group Eliminations and Group Nutrition Ireland Nutrition Ireland Unallocated Unallocated Pre transaction: Pre transaction: Total revenue 6,97
Slide 11: Transaction Effect on Adjusted Earnings Per Share
Transaction Effect on Adjusted Earnings Per Share 2023 Reported Results 2024 Visible Alpha Consensus¹ Dairy Ireland Group V.A. Consensus V.A. Consensus Income Statement Extract Reported 2023 Reported 2023 Dairy Ireland 2024 Group 2024 EBITDA 53 1,165 66 1,251 Depreciation (net) (21) (220) (22) (224)
Slide 12: Financial Metrics Definitions
Financial Metrics Definitions Volume Growth Free Cash Flow This represents the sales growth period-on-period, excluding pass- Free cash flow is EBITDA plus movement in average working through pricing on input costs, currency impacts, acquisitions, capital, capital expenditure net (purchase of assets