Elders Limited · ASX:ELD
Elders — H1 2012 Earnings Presentation
21 slides from Elders's earnings presentation, May 21, 2012
Slide 1: 2012 Half-Year Results Presentation
12 21 May 201 2012 Half-Y Year Result R ts Pressentattion Attached iss a presentation to be made m at the b briefing toda ay on Elders Limited’s reesults for the e half-year ended 31 M March 2012 to be held at a 9.00am Ea astern Stand dard Time. The briefing g will be webcast via the e Company’’s we
Slide 2: H1 2012 Results for the six months to 31 March 2012
H1 2012 Results for the six months to 31 March 2012 21 May 2012
Slide 3: Key messages in H1 12 Results
Key messages in H1 12 Results H1 results in line with market conditions. Expect H2 to feature cash inflows, new auto contracts and, subject to season, winter cropping sales peak. ■ First half affected by flooding and cut-backs to Australian auto volumes ■ Non-flood-affected Rural Services network op
Slide 4: 2012 First half main features
2012 First half main features Statutory profit up, underlying earnings in line with market conditions ■ Statutory profit after tax of $40.5m compared to H1 11 loss of $(14.6)m ■ Discontinued and non-operating items totalling $34.4m after tax ■ Continuing sales revenue down 2% to $1,029.2m ■ Underlyi
Slide 5: Profit and loss
Profit and loss $ million H1 12 H1 11 Sales revenue from continuing operations 1,029.2 1,046.3 Underlying EBIT 21.3 22.1 Net underlying borrowing costs (12.7) (12.6) Underlying profit before tax 8.6 9.5 Tax on underlying profit (1.1) 0.0 Non-controlling interests (1.4) (2.0) Underlying profit/(loss)
Slide 6: Reconciliation of statutory and underlying profit
Reconciliation of statutory and underlying profit Reconciling items principally relate to Amended Tax Assessment and Forestry $ million H1 12 H1 11 Key items in H1 12 Statutory Profit/(loss) after tax 40.5 (14.6) Items excluded from underlying profit: Rural Services (1.5) 2.0 Discontinued operations
Slide 7: Underlying EBIT movement
Underlying EBIT movement Slight increase from Rural Services and Auto offset by Corporate Movement in underlying EBIT $m + 0.9 +0.7 -2.4 $ million H1 12 H1 11 Rural Services 21.1 20.2 22.1 21.3 Automotive 5.4 4.7 Corporate (5.2) (2.8) Total Underlying EBIT 21.3 22.1 H1 11 Rural Auto Corporate H1 12
Slide 8: Key balance sheet items
Key balance sheet items Inventory livestock and creditors reduced on pcp 2012 maturities reflected in current/non current classifications $ million H1 12 FY11 H1 11 Inventory & livestock 263.3 241.6 303.6 Farm supplies inventory reduced from pcp Trade debtors 520.4 540.8 504.7 Includes $38.5m receiv
Slide 9: Debt
Debt Gross debt increased on short term forestry finance. Transitioning to reduced term debt and increased seasonal finance structure $ million: H1 12 FY 11 H1 11 500 Term Debt 164.6 180.9 37.1 450 Other debt & 400 Trade debtor 10.2 13.5 136.8 USPP financing 350 Revolver 126.4 93.2 101.7 300 Revolve
Slide 10: Cash flow
Cash flow Positive cash generation prior to working capital movements Total ex- Rural $ million Total Forestry Auto Corporate Forestry Services Operating cash flow: before working capital 17.2 (11.6) 28.8 28.8 19.8 (19.8) working capital movement (57.1) (14.0) (43.1) (28.6) (20.7) 6.2 Total cash fro
Slide 11: Seasonal and market conditions
Seasonal and market conditions H1 12 featured good rains, but lower activity levels in some markets ■ Better-than-average to average rainfall in most regions in 6 months to March 12 good soil moisture and feed availability flooding in eastern Australia impacted activity levels horticulture, rice, co
Slide 12: Rural Services EBIT movement
Rural Services EBIT movement Farm Supplies, Trading and mark-to-market offset lower activity levels in Livestock and other agency business Contribution to underlying EBIT movement $ million 25 21.1 20.2 20 +1.1 15 - 5.2 0.0 - 0.5 + 6.3 -2.0 - 0.6 - 0.4 + 2.2 10 5 0 Underlying Farm Livestock Other Ne
Slide 13: Network performance
Network performance Stronger Farm Supplies results despite falling prices. Total result affected by lower activity levels in agency markets of livestock, wool and real estate. H1 12 vs H1 11 Sales Gross Margin AgChem - 3% + 6% Fertiliser - 6% + 8% Farm Supplies (total) +1% + 2% Livestock - 8% - 11%
Slide 14: Trading performance
Trading performance Growing live export business in both breeder and feeder markets ■ International live export sales and earnings increased, business model improved $ million H1 12 H1 11 – Increase in global long haul trade for dairy and beef cattle – Margin growth in short haul trade Sales revenue
Slide 15: Futuris Automotive
Futuris Automotive Results reflective of vehicle industry trends ■ Australian and Chinese markets demonstrating growth at modest rates in 2012 $ million H1 12 H1 11 – Australian passenger vehicle build up 2.6 % yoy Sales revenue 168.7 142.7 – China sales of light vehicles up, albeit with slower grow
Slide 16: Australian automotive market
Australian automotive market Australian large car production continues to face challenges ■ Large car production down, small car production up Vehicle production H1 12 H1 11 − Export market still not recovered (high AUD) GM Holden Commodore 25,700 32,600 GM Holden Cruze 17,900 900 − Addition of Hold
Slide 17: Futuris new contracts
Futuris new contracts Incremental contracts commencing production next 12 months Ford Ranger Ford Focus GM Trailblazer Various China Tesla Model S ■ Thailand ■ Thailand ■ Thailand ■ China ■ USA ■ Interior trim ■ Interior trim ■ Seating ■ Seating ■ Seating ■ SOP April 2012 ■ SOP May 2012 ■ SOP June 2
Slide 18: Forestry Capital Release Program
Forestry Capital Release Program Program results to date include sale, or contracts to sell, 65% of land holdings and other assets for anticipated cash proceeds of $90 million Forestry Assets and Operations Albany, Bunbury & Green Triangle Subject of sales agreement with GFP. Includes 12,400 ha of f
Slide 19: Second half Rural Services conditions
Second half Rural Services conditions Activity levels lifted in cropping and livestock; live export expected to hold trend ■ April wetter in the north, drier in the south ■ Livestock Sales activity up in April through catch-up of sales deferred by Q2 rain, drier conditions and cash management consid
Slide 20: Progress around FY12 priorities
Progress around FY12 priorities 6 Operational priorities have been set for 2012 1. Successful execution of Forestry divestment program • 65% of freehold land sold or subject to contract • cash of $22 million received in H1 12 and at least $45m anticipated from contracts to be settled in H2 • H2 ongo
Slide 21: H1 2012 Results for the six months to 31 March 2012
H1 2012 Results for the six months to 31 March 2012 21 May 2012