Nufarm Limited · ASX:NUF
Nufarm — FY2011 Earnings Presentation
37 slides from Nufarm's earnings presentation, Sep 29, 2011
Slide 1: 2011 Full Year Results
For personal use only 2011 Full Year Results September, 2011
Slide 2: Doug Rathbone, Managing Director
For personal use only Doug Rathbone Managing Director
Slide 3: Strong recovery in underlying performance
2011 Full Year Results For personal use only Strong recovery in underlying performance 2011 2010 12 mths to 12 mths to July 31 July 31 Group revenues $2.08 billion $2.17 billion Reported net profit/ (loss) ($49.5 million) ($22.6 million) Operating net profit $98.3 million $58.6 million (pre material
Slide 4: Overview
2011 Full Year Results For personal use only Overview 2011 results show important progress on implementation of strategic growth plan Focus on additional discipline across all areas of the business Focus on innovation to drive growth in higher value, more defendable segments Repositioning of glyph
Slide 5: Portfolio transition is well underway
2011 Full Year Results For personal use only Portfolio transition is well underway Following 'commoditisation' of glyphosate, we are rebalancing our product portfolio Other herbicides 2008 2011 Insecticides Glyphosate Glyphosate 20% 40% at 15% average GM at 31% average GM Other Other Fungicides Prod
Slide 6: Gross margin by product segment
2011 Full Year Results For personal use only 2010: Average 2011: Average Gross Margin Gross Margin Glyphosate 12% 15% down 30% 32% Other herbicides 31% Driving accelerated up 1% growth into higher 34% Insecticides 38% value and more up 24% defendable product 31% Fungicides 33% and market segments up
Slide 7: Mark Keating, Interim CFO
For personal use only Mark Keating Interim CFO
Slide 8: Profit Analysis (net profit after tax)
2011 Full Year Results For personal use only Profit Analysis (net profit after tax) 2011 2010 $000 $000 Operating profit 98,279 58,566 Material items (148,130) (82,556) Attributable to shareholders (49,851) (23,990) Minority interest 322 1,338 Headline result (49,529) (22,652) 8
Slide 9: Profit Comparison (excluding material items)
2011 Full Year Results For personal use only Profit Comparison (excluding material items) 2011 2010 Movement $000 $000 Sales 2,083,589 2,168,630 (85,041) Gross profit 582,558 529,890 52,668 Expenses (406,183) (403,399) (2,784) Other income 13,033 8,641 4,392 Associates profit 2,377 47 2,330 Segment
Slide 10: Material items (net of tax)
2011 Full Year Results For personal use only Material items (net of tax) 2011 2010 $000 $000 Impairment loss/intangibles write off – Brazil 74,344 - Receivable write down 27,671 - Debt refinancing costs 17,238 - NSS loan revaluation 14,666 - Restructuring costs 5,903 11,034 Investment in associates
Slide 11: Working capital movement
2011 Full Year Results For personal use only Working capital movement 2011 2010 2009 $000 $000 $000 Receivables 666,124 852,986 787,760 Inventories 541,679 553,432 797,383 Payables (394,022) (393,868) (407,421) Net working capital 813,781 1,012,550 1,177,722 Movement (198,769) (165,172) 11
Slide 12: Net debt movement
2011 Full Year Results For personal use only Net debt movement 2011 2010 2009 $000 $000 $000 Borrowings – short term 711,552 794,164 620,361 Borrowings – long term 11,374 13,633 402,327 Cash (257,706) (188,741) (84,312) Net debt 465,220 619,056 938,376 Movement (153,836) (319,320) 12
Slide 13: Brian Benson, Group General Manager - Agriculture
For personal use only Brian Benson Group General Manager - Agriculture
Slide 14: Nufarm sales by geography
2011 Full Year Results For personal use only Nufarm sales by geography 2011 2010 North North Australia America Australia America 27% 22% 31% 26% South America South NZ – 2% 16% Europe NZ – 3% America Europe 16% Asia – 7% 21% 22% Asia – 8% Total sales - $2.08 billion Total sales - $2.17 billion 14
Slide 15: Australia / New Zealand
2011 Full Year Results For personal use only Australia / New Zealand Key drivers Australia 2011 2010 Summer cropping conditions generate strong sales Revenue $696m $655m WA very dry until late May Increased opportunities in cotton; Segment profit¹ $112.7m $68.6m horticulture; rice and sugarcan
Slide 16: Asia
2011 Full Year Results For personal use only Asia Key drivers 2011 2010 Increased market penetration Revenue $156m $144m Further portfolio diversification Segment profit¹ $21.7m $20.5m Strong performance in glyphosate ¹Segment earnings before interest and tax, excluding impact of material item
Slide 17: North America
2011 Full Year Results For personal use only North America Key drivers USA 2011 2010 A range of seasonal impacts across different regions and market segments Revenue $450m $554m Turf and specialty segment underperforms; IVM business strong Segment profit¹ $35.9m $33.2m Significant repositionin
Slide 18: South America
2011 Full Year Results For personal use only South America Key drivers Brazil 2011 2010 Slow start to season but generally positive market conditions Revenue $339m $342m Significant progress in portfolio diversification Segment profit¹ $17.9m ($14.6m) Strong contribution of Sumitomo products ¹
Slide 19: Europe
2011 Full Year Results For personal use only Europe Key drivers 2011 2010 Winter long and cold Hot and dry conditions in major markets Revenue $442m $475m during spring Segment profit¹ $35.9m $53.4m Reduced opportunities in higher value ¹Segment earnings before interest and tax, excluding impa
Slide 20: Major product segments review 2011
For personal use only Major product segments review 2011
Slide 21: Sales by key products
2011 Full Year Results For personal use only Sales by key products 2011 2010 Glyphosate - 20% Glyphosate - 28% Phenoxies - 23% Phenoxies - 22% Other herbicides - 22% Other herbicides - 21% Insecticides - 10% Insecticides - 8% Fungicides - 12% Fungicides - 10% *Seed - 3% *Seed - 2% **Other - 10% **Ot
Slide 22: Glyphosate
2011: Major product segments review For personal use only Glyphosate Pricing very competitive Increased stability in 'tech' costs 2011 sales 2011 Av GM% Significant repositioning in product portfolio $418m 15% Higher than expected level of imported formulated product in Australia 2010 sales
Slide 23: Phenoxies
2011: Major product segments review For personal use only Phenoxies 2,4-D sales increase on stronger demand and supply tightness MCPA demand lower due to seasonal impacts 2011 sales 2011 Av GM% Currency has adverse GM impact on Australian 2,4-D exports $479m 31% Phenoxy GM generated in Europ
Slide 24: Other herbicides
2011: Major product segments review For personal use only Other herbicides Trifluralin sales up strongly in Australia Excellent Australian sales of Hammer, Diuron and Avadex 2011 sales 2011 Av GM% Brazilian pasture market position continues to strengthen $460m 32% Poor seasonal conditions in
Slide 25: Insecticides
2011: Major product segments review For personal use only Insecticides Strong insect pressure in Australia Poor seasonal conditions in North America and Europe 2011 sales 2011 Av GM% Excellent growth across Imidacloprid portfolio $215m 38% Fipronil introduction in Brazil Phase out of older
Slide 26: Fungicides
2011: Major product segments review For personal use only Fungicides Seasonal conditions drive strong demand in Australia Poor seasonal conditions in Europe 2011 sales 2011 Av GM% Excellent contribution from Sumitomo sourced Procymidone $257m 33% Azoxystrobin strategy: early entry in Brazil;
Slide 27: Seed & Seed Treatment
2011: Major product segments review For personal use only Seed & Seed Treatment Positive growing conditions for canola in Eastern Australia, offset by dry conditions in West Challenging drought conditions in Southern USA 2011 sales 2011 Av GM% sorghum regions Increased demand for higher value
Slide 28: Doug Rathbone, Managing Director
For personal use only Doug Rathbone Managing Director
Slide 29: Outlook statement
For personal use only Outlook statement
Slide 30: Outlook
Outlook For personal use only Macro environment continues to look positive Strong demand pressures will support relatively high crop prices Farmers will have a strong economic incentive to seek yield gains …..but cropping activity and resulting sales opportunities (volume and product mix) remain d
Slide 31: Refinancing update
For personal use only Refinancing update
Slide 32: Refinancing of $600m debt facility
2011 Full Year Results For personal use only Excellent progress towards completing refinancing of $600m debt facility Credit approved proposals now in hand Further discussions to finalise composition and detailed arrangements/terms 32
Slide 33: Priorities
For personal use only Priorities
Slide 34: The STRATEGIC priority
2011 Full Year Results For personal use only The STRATEGIC priority To accelerate sales growth in higher value and more defendable product and market segments We are pursuing a range of actions Additional 'partnering' opportunities: Sumitomo and others Additional investment in high growth/high r
Slide 35: The OPERATIONAL priority
2011 Full Year Results For personal use only The OPERATIONAL priority To instil increased discipline; operational excellence; and greater efficiencies across the business We are pursuing a range of actions Appropriate management change and strengthening of key functions A comprehensive business
Slide 36: The FINANCIAL priority
2011 Full Year Results For personal use only The FINANCIAL priority To achieve improved returns; sustainable profit growth; and a strong balance sheet We are pursuing a range of actions Transitioning to a higher value / higher margin product mix Strong focus on maximising efficiency of working c
Slide 37: For personal use only
For personal use only