Inghams Group Ltd. · ASX:ING
Inghams — FY2019 Earnings Presentation
23 slides from Inghams's earnings presentation, Aug 27, 2019
Slide 1: Inghams Group Limited FY2019 Results Presentation
Inghams Group Limited FY2019 Results Presentation 27 AUGUST 2019
Slide 2: Important notice and disclaimer
Important notice and disclaimer Disclaimer The material in this presentation is general background information about the activities of Inghams Group Limited (Ingham’s) and its subsidiaries (Ingham’s Group), current at the date of this presentation, unless otherwise noted. It is information given in
Slide 3: Group Highlights
Broiler Farm South Australia 01 Group Highlights
Slide 4: Group highlights
Group highlights Strong core poultry volumes driving growth in a challenging environment 4.3% core volume growth as chicken remains the competitive protein across all channels Contractual arrangements and market position delivered intended outcomes to partially offset higher input costs Solid
Slide 5: Financial highlights – FY19 vs FY18
Financial highlights – FY19 vs FY18 Core Underlying Underlying Underlying Cash Underlying Final Poultry Gross Gross EBITDA EBITDA NPAT NPAT Conv EPS EPS Dividend Volume Profit Profit Ratio 414.9kt $483.8m $480.2m $242.2m $208.6m $126.2m $103.2m 112.7% 34.0 cps 27.8 cps 10.5 cps ↑ 4.3% ↑ 1.4% ↑ 3.0%
Slide 6: Profit & Loss – Statutory
Profit & Loss – Statutory $ millions Jun-19 Jun-18 Variance % Volume Poultry volumes (kt) 517.5 505.3 12.2 2.4 Feed volume decline attributable to the cycling of customer Feed volumes (kt) 432.5 504.7 (72.2) (14.3) loss in March 2018 and the sale of Mitavite in October 2018 Revenue 2,489.8 2,373.9
Slide 7: Profit & Loss – Underlying
Profit & Loss – Underlying $ millions Jun-19 Jun-18 Variance % Volume & Revenue Poultry volumes (kt) 517.5 505.3 12.2 2.4 Continued growth in core poultry volume and revenue of Feed volumes (kt) 419.8 466.7 (46.9) (10.0) 4.3% and 6.7% respectively Revenue 2,478.8 2,341.4 137.4 5.9 Feed volume de
Slide 8: EBITDA and NPAT reconciliation
EBITDA and NPAT reconciliation $ millions Jun-19 Jun-18 Variance % Profit on Sale of Assets EBITDA 242.2 212.0 30.2 14.2 Current year relates to sale of Mitavite, Cardiff and Mile Profit on sale of assets (53.1) (19.4) (33.7) 173.7 End, prior year relates to Wanneroo and Leppington Impairment of a
Slide 9: Cash Flow and Balance Sheet
Cash Flow and Balance Sheet $ millions Jun-19 Jun-18 Variance Cashflow EBITDA 242.2 212.0 30.2 Non-cash items predominantly relate to the profit on sale of Non-cash items (45.6) (17.5) (28.1) Mitavite and Cardiff offset by other minor items, including LTIP EBITDA excluding non-cash items 196.6 194
Slide 10: Changes to Lease Accounting
Changes to Lease Accounting AASB16 will be adopted from FY20 using the modified retrospective transition approach with no restatement of prior years The implementation of AASB16 will significantly change the reported results, but there will be no economic impact to the group, its cash flows, deb
Slide 11: Segment Results
Further Processing Plant Edinburgh Parks, South Australia 02 Segment Results
Slide 12: Segment Information – Australia
Segment Information – Australia $ millions (AUD) Jun-19 Jun-18 Variance % Summary: Australia Australia Core poultry volume and revenue growth excluding Core Poultry volumes (kt) 351.3 334.5 16.8 5.0 ingredients of 5.0% and 7.1% respectively Feed volumes (kt) 302.2 367.4 (65.2) (17.7) Price incre
Slide 13: Segment Information – New Zealand
Segment Information – New Zealand $ millions (AUD) Jun-19 Jun-18 Variance % Summary: New Zealand New Zealand Volume for core poultry in line with prior year, with some Core Poultry volumes (kt) 63.6 63.2 0.4 0.6 growth in 2H Feed volumes (kt) 130.3 137.3 (7.0) (5.1) Free-Range segment continues
Slide 14: Team and Business Update
Feed mill Berrima, New South Wales 03 Team and Business Update
Slide 15: Team and business update
Team and business update Leadership team rebuild complete. Structured for operations excellence to deliver reliable growth – key appointments in operations and technical services with critical alignment across the supply chain – primary focus on delivering the latent capacity in the network Team –
Slide 16: Feed cost update
Feed cost update Feed prices have continued to remain at close Wheat price (as observed by Ingham’s) $A per tonne to historically high levels, driven by continued dry conditions in Australia during FY2019 450 400 Outlook for FY2020 feed prices has moderated 350 somewhat however limited market li
Slide 17: Outlook
04 Outlook
Slide 18: Outlook
Outlook Poultry demand continues to grow as consumers are attracted by the relative affordability of chicken as a healthy protein Current feed costs remain close to historic highs, impacting the outlook into 2H FY2020 dependent upon the next domestic grain harvest Australian margins are being
Slide 19: Appendix
Heart of the Table — Appendix
Slide 20: Profit on Sale of Assets / Restructuring costs
Profit on Sale of Assets / Restructuring costs $ millions Jun-19 Jun-18 Variance % Profit on Sale Profit on sale of assets (49.7) (19.4) 30.3 156.2 Current year relates to sale of Mitavite, Cardiff and Mile End, prior year relates to Wanneroo and Mitavite (51.1) Leppington Cardiff (2.5) Mile End 0
Slide 21: Mitavite trading results
Mitavite trading results $ millions Jun-19 Jun-18 Variance % Trading period Weeks 15.0 52.0 Completion of sale of Mitavite to Adamantem Capital was 12 October 2018 Feed volumes (kt) 12.7 38.0 (25.3) (66.6) FY2019 includes 15 weeks of trading results Trading Results These trading results for Mi
Slide 22: Definitions
Definitions Certain non-IFRS information is referred to in this presentation. Defined below is what is included in each non-IFRS measure used throughout this presentation. EBITDA: Earnings before Interest, Tax, Depreciation and Amortisation EBIT: Earnings before Interest and Tax Net Debt: Debt
Slide 23: Risks Summary (per Financial Statements)
Risks Summary (per Financial Statements) Material business risks faced by the Group that may have a significant effect on the financial prospects of the Group include: Import restrictions: Changes to import quarantine conditions in Australia and/or New Zealand that would allow additional forms of