Zeder Investments Limited · JSE:ZED
Zeder Investments — Shareholder Meeting (June 2016)
23 slides from Zeder Investments's shareholder meeting presentation, Jun 24, 2016
Slide 1: Annual General Meeting
Annual General Meeting Presented by: Norman Celliers Chief executive officer 24 June 2016
Slide 2: go for growth
go for growth aan die groei i% _ CAPESPAN 5ROUP LIMITED
Slide 3: Business overview
Business overview Our corporate strategy and business definition remain unchanged. • An actively managed investment holding company listed on the JSE • Long term value investor with a primary focus on Agribusiness, specifically the food and beverage sectors • Key characteristics of investment consid
Slide 4: Strategic focus
Strategic focus We aim to invest in and grow large businesses – the past 36 months priority was “Project Internal Focus”. Before 2012 Since 2012 Industry: • Agribusiness • Agribusiness Sub‐sector: • Food and Beverages • Food and Beverages • Bio Fuels, Bio/Renewable energy* • Non‐food (i.e. Rubber, t
Slide 5: Full year results
Full year results Despite a challenging macro environment, Zeder delivered encouraging results. Feb Feb Feb Feb Y‐o‐Y CAGR 2013 2014 2015 2016 Change 3yrs Sum of the parts (R’bn) 4.25 5.16 13.24 12.25 ‐7% +42% Recurring headline earnings from investments (R’m) 332.9 366.4 540.1 804.6 +49% +34% Recur
Slide 6: Earnings from investments
Earnings from investments The improved trend in RHEPS growth from underlying investee companies has been maintained and “Project Internal Focus” has delivered satisfactory results. Recurring headline earnings from investments before funding and fees (cents per share) 60 54,0 50 46,1 40 37,4 34,0 30
Slide 7: Portfolio distribution
Portfolio distribution No change in the portfolio mix ‐ from a valuations point of view, most of the downward adjustment, at year‐end, was due to decrease in Pioneer share price during the period – there has been a substantial recovery since. R’m 10 000 9 533 • 6 Core investments 8 000 7 574 • Stron
Slide 8: Portfolio review
Portfolio review Pioneer reported strong growth for their full year and followed this up with credible interim results with adj. HEPS increasing by 6%.
Slide 9: Portfolio review
Portfolio review The continued growth in profitability has to be commended, particularly given the constrained environment. Adjusted headline earnings (cents per share) 900 832 800 700 678 600 500 456 479 451 406 400 352 300 219 231 200 100 H1 Full Year H1 Full Year H1 Full Year H1 Full Year H1 0 20
Slide 10: Portfolio review
Portfolio review … and operating margin improvement has also translated in market recognition.
Slide 11: Portfolio review
Portfolio review Investment in core brands and products have been maintained and share indicators remain positive.
Slide 12: Portfolio review
Portfolio review Capespan continues to realign its business, invest for growth and reported a modest increase of 8% in RHEPS. Summarised Income Statement Dec 13 Dec 14 Dec 15 R'm % growth R'm % growth R'm Revenue 7,149 3.4% 7,392 4.0% 7,688 EBITDA 228 (0.4%) 227 31.7% 299 EBITDA margin 3.2% 3.1% 3.9
Slide 13: Portfolio review
Portfolio review Capespan operates along three divisions namely Farms, Fruit and Logistics…
Slide 14: Portfolio review
Portfolio review … and more than R800m has been invested over the past 24 months in acquisitions and expansions to strengthen the group. China India South Africa Germany Hong Kong Mozambique
Slide 15: Portfolio review
Portfolio review Zaad delivered an increase of 36% in earnings that translated to 20% per share (diluted as a result of investment of R92m during the year). Zaad successfully acquired all of the remaining shares in Bakker Brothers (Netherlands) and entered the Agri‐Chemical sector with a 49% investm
Slide 16: Portfolio review
Portfolio review With a strong product portfolio, proprietary IP and established South African and international market presence, growth is underway.
Slide 17: Portfolio review
Portfolio review Kaap Agri reported solid results in 2015 and increased RHEPS by 18% during their first 6 months of FY16. Kaap Agri invested R350m over the past 3 years to maintain and expand its operating footprint and develop new divisional revenue streams
Slide 18: Portfolio review
Portfolio review With a strong footprint and historical base, opportunities exist to continue growing.
Slide 19: Portfolio review
Portfolio review Agrivision Africa remains in net J‐curve but underlying business performances encouraging despite challenges. Summarised Income Statement Dec 13 Dec 14 Dec 15 US$'000 % growth US$'000 % growth US$'000 Revenue 14,305 127.4% 32,532 (2.6%) 31,677 EBITDA 8,322 (7.2%) 7,726 47.5% 11,396
Slide 20: Portfolio review
Portfolio review Limited expansion was undertaken during the year with a focus on existing investments only. Farming & Development Milling & Processing Brands & Distribution • 4,500 ha (irrigated) • 50,000 tons (Maize) • Formal retail • 1,800 ha (dry‐land) • 24,000 tons (Wheat) • Distribution depots
Slide 21: Portfolio review
Portfolio review As expected, Quantum was not able to repeat the strong profits of 2015 but remains better positioned for the cycles.
Slide 22: Portfolio review
Portfolio review Quantum Foods will aim to navigate cyclical volatility while pushing forward in pursuing its strategic objectives. • Raw material prices at higher levels • Weak exchange rate environment • Consumer under pressure • New business model better aligned • Management to focus: - Efficienc
Slide 23: Conclusion
Conclusion We remain optimistic about the prospects of the group. • Drought and tough economic conditions likely to remain a challenge in the short term – but longer term the sector is resilient • Appropriately diversified portfolio likely to mitigate volatility • Strong existing portfolio companies