Graincorp Limited Class A · ASX:GNC
Graincorp Limited Class A — Octa Phillip Agribusiness Conference and UBS Australian Emerging Companies Conference 2012
20 slides from Graincorp Limited Class A's conference presentation, Mar 28, 2012
Slide 1: GrainCorp Presentation to Investor Conferences
Company announcement For personal use only GrainCorp Limited ABN 60 057 186 035 Date: 28 March, 2012 To: The Manager Announcements Company announcements office PUBLIC ANNOUNCEMENT GrainCorp Presentation to Investor Conferences Ms Alison Watkins, GrainCorp’s Managing Director and Chief Executive Offi
Slide 2: Investor Conferences March/April 2012
March/April 2012 Ms Alison Watkins For personal use only (Managing Director and CEO) INVESTOR CONFERENCES Octa O t Phillip Philli Agribusiness A ib i – 28 M March h UBS Australian Emerging Companies – 3 April
Slide 3: Focused strategy to drive growth
Focused strategy to drive growth For personal use only GrainCorp’s business... • Core grains → focus on wheat, barley and canola • Business model → add value to these grains with our integrated business and international presence GrainCorp’s objectives... • Improve I shareholder h h ld returns t th
Slide 4: Our business model
Our business model For personal use only 9 Assets and capabilities → Operating along the grain chain 9 Three interlinked grain businesses → Storage & Logistics, Marketing and Processing 9 Three core grains → Focus on wheat, barley and canola 9 Three grain export focused geographies → Operating in Au
Slide 5: Assets and capabilities along the grain chain
Assets and capabilities along the grain chain For personal use only Country Logistics Ports Processing • 280+ sites in • Manage 19+ trains • 7 bulk elevators → Flour eastern Australia → → 5mmt capacity 15mmt capacity • 8 mills → 0.8mmt Australia 20mmt storage • Manage M 1mmt+ 1 t+ • 2 container t i
Slide 6: Integrated grain activities
Integrated grain activities For personal use only Marketing g Driving grain through the network • Creates a market place at GrainCorp sites → links grower to local and overseas consumers • Captures value along the grain chain Storage & Logistics Processing Supply push through the network Demand pull
Slide 7: Focus on core grains
Focus on core grains For personal use only Australian Grain Exports(1) – Rest of World Grain Exports(1) – % by major grains % by major grains Canola Sorghum Canola 6% Barley 2% 2% Sorghum 3% 4% Corn 23% Barley 19% Wheat 30% Wheat Soybean 71% Other 32% 8% • GrainCorp participates in ‘drier climate’ g
Slide 8: International presence
International presence For personal use only • Malt business geographies → provides a platform in major grain exporting regions • Grain business with international linkages → provides competitive insight Europe Australia North America Marketing Storage & Logistics Storage & Logistics Hamburg offic
Slide 9: Strategy driven by three corporate objectives
Strategy driven by three corporate objectives For personal use only 1 Improve p Returns 2 Manage g Variability y 3 Growth Manage earnings through Scale through accretive Increase underlying the cycle and pay organic and acquisitive shareholder return consistent dividends growth Five strategic themes
Slide 10: Improve underlying shareholder return
Improve underlying shareholder return For personal use only • Broader grain business provides scale and diversified earnings • Strategic initiatives underway to increase underlying EBITDA → targeting ~$40M $ • Conservative balance sheet → strategy to maintain core debt gearing <25% Net(1) / Core(2)
Slide 11: Strong cash flow, capex and dividends
Strong cash flow, capex and dividends For personal use only • Strong operating cash flow → fund capex (maintenance and growth) and dividends • Growth capex (~$60M) includes strategic initiatives to increase underlying EBITDA • Dividend policy to pay 40-60% of NPAT through the business cycle • Target
Slide 12: Manage earnings variability
Manage earnings variability For personal use only • An integrated grain chain strategy enables GrainCorp to manage earnings: 9 Exposure to different agribusiness cycles → reduce ROE volatility 9 Complementary activities leverage competitive advantages → apply grain origination and logistics capabili
Slide 13: A history of growth
A history of growth For personal use only 1916 – NSW 1998 – listed 2000 – merged with 2009 – acquired 2011 – acquired Government Grain on ASX Victorian based Vicgrain United Malt Schill Malz and Elevators Holdings Kirin Australia 1990 1995 2000 2005 2010 1992 – acquired from 1996 – 2002 – 2003 – 200
Slide 14: Pursuing international growth
Pursuing international growth For personal use only • An international presence focused on three core grains improves GrainCorp’s ability to grow earnings and manage variability through: 9 ~35% of assets(1) and >50% sales located outside of Australia 9 Access to markets in overseas countries secures
Slide 15: Australia's global grain opportunity
Australia’s global grain opportunity For personal use only Drivers of Global Grain Demand Growth to 2050(1) ‐10% 30% 70% 110% 150% Asia (ex China) Middl East Middle E t & Nth Af Africa i Sub‐Saharan Africa Sub‐Continent Asia China World Popluation Increase Food Grain / Capita Feed Grain / Capita • G
Slide 16: Australia's global grain opportunity
Australia’s global grain opportunity For personal use only Global Wheat Trade to 2050(1) – mmt • Export trade wheat volumes to 250 double to >225mmt by 2050 2050, driven by demand growth in: 200 • Australia’s traditional markets in 150 A i Middl Asia, Middle EEastt & Nth Af Africa i → already import
Slide 17: Australian public policy priorities
Australian public policy priorities For personal use only • For Australia to best participate in global grain trade growth opportunities, the country’s country s grain supply chain must be free of regulation and bottlenecks: × Bottlenecks limit ability to service increased export demand × Supply cha
Slide 18: Strong FY12 earnings guidance
Strong FY12 earnings guidance For personal use only EBITDA(1) - $M Guidance $350-380M • Record carry-in, large receival and 400 350 export tasks and sound Malt 300 contribution 250 • Volume guidance: 200 150 • Country receivals 11.5-12.5mmt 100 • Grain exports 8.8-9.8mmt 50 • Malt sales ~1.3mmt $M0
Slide 19: FY12 strategic focus
FY12 strategic focus For personal use only 1 2 3 4/5 Maintain a Operate Increase activity Grow as an strong market along the grain in grain international presence chain processing agribusiness St Storage &L Logistics i ti M k ti Marketing P Processing i G i C GrainCorp 9 Handle record 9 Deliver stro
Slide 20: Disclaimer
Disclaimer For personal use only This presentation includes both information that is historical in character and information that consists of forward looking statements. Forward looking statements are not based on historical facts, but are based on current expectations of future results or events. T