Almarai Company · TADAWUL:2280
Almarai — Q2 2021 Earnings Presentation
44 slides from Almarai's earnings presentation, Jul 1, 2021
Slide 1: Almarai Company
— Uncholl Almarai Almarai® Company
Slide 2: Disclaimer
Disclaimer Information contained in this presentation is subject to change without further notice, its accuracy is not guaranteed, and it may not contain all material information concerning the company. We do not make any representation regarding, and assume no responsibility or liability for, the a
Slide 3: Market Dynamics, Business Performance, Appendix
Market “Business E i Appendix Dynamics Performance a yr ) \ ae = - Earnings Presentatiog! d>=aQat
Slide 4: Dynamics
Dynamics Earnings Presentation - Q2 2021
Slide 5: Almarai response to COVID-19 Pandemic
Almarai response to COVID-19 Pandemic Almarai to deliver “Quality you can trust” to its consumers whilst being integral to the nation’s foodsecurity. Minimize business disruption and execute plan for a post crisis globaleconomy. Protect our consumers and employees from any possible harm. Key actions
Slide 6: Speed of recovery from COVID-19
1 “Recovering Economy” GDP 3 “Resurgent Economy” GDP Virus contained but sector damage; lower LT trend growth Virus contained; strong growth rebound TIME TIME Economics Almarai Economics Almarai • Strong GDP Growth • Strong Growth in Revenue and Market Share • Moderate GDP growth • Resize Business •
Slide 7: Product
2021 Product
Slide 8: Leadership in KSA Food market share
Dec-19 Dec-20 May-21 Category Almarai Value | Almarai Value | Almarai Value Share % Share % Share % Laban 65 64 67 are Fresh milk 67 65 65 Leadership in UHT Milk 21 19 19 KSA Food 39 38 37 Juice 43 42 46 Bakery 54 53 54 Poultry (Fresh Chicken) 37 36 37 Earnings Presentation- Q2 2021 May-21 Almarai R
Slide 9: Business Performance
Slide 10: 4,500 0% 1,00 -10 00% 4,000 -20 00% -30 00% 50 0 3,500 60
4,500 0% 1,00 0 70 0 -10 00% 4,000 -20 00% 60 0 80 0 -30 00% 50 0 3,500 60 0 -40 00% 40 0 -50 00% 3,000 30 0 40 0 -60 00% 20 0 -70 00% 2,500 20 0 10 0 -80 00% 0 2,000 -90 00% 0 -10 0 -20 0 -20 0 -30 0 -40 0 3,40 0 0% 1,20 0 0% 30 0 12 0% -50 % 3,20 0 1,00 0 -10 0% 25 0 10 0% -50 00% 3,00 0 -15 0% 80
Slide 11: Q2 2021 Sales Bridge
Q2 2021 Sales Bridge | Reported Growth (2%) 4,082 (3%) (1%) 2% 4,006 0% 0% $ a = c Fs | Like-for-like growth (4%) Q2 2020 Volume Price Mix Currency Others Q2 2021 YoY % / (YOY%) Earnings Presentation - Q2 2021 1
Slide 12: Q2 2021 Revenue Growth
Q2 2021 Revenue Growth (SAR Million) KSA Others Total Revenue 2,597 611 4,006 % of Revenue 65% 15% 100% Growth (222) (35) 181 (76) Growth % (8%) (4%) 42% (2%) Ucholl Earnings Presentation - Q2 2021
Slide 13: Challenging market condition in GCC offset by Egypt, Jordan & Alfalfa
hallenging market condition in GCC offset by Egypt, Jordan & Alfalfa sales double digit growt Q2 2021 Total Revenue - SAR 4,006 Million Q2 2021 Total Growth- SAR (76M) or (2%) YoY %/(YOY%) (8%) (4%) ~—- 37% ~=— (4%) = (9%) 40% )=— 2% 56% 1 1 1 1 nee Bahrain H 1 Co I 39 55 gs (222) (13) (8) (16) 2 Om
Slide 14: Decline in Longer Shelf Life Product Sales
Decline in ger Shelf Life Product Sales, driven by stock-up behavior last year Q2 2021 Total Revenue - SAR 4,006 Million Q2 2021 Total Growth- SAR (76M) or (2%) YoY %/(YoY%) outcaee 3% = (25%) (8%) (5%) 6% 8% 86% Fruit Juice 4% 47 66 169 23 22 29 , Zz 6) a) 3), oe g | c z oO Fresh Dairy Food Poultry
Slide 15: Rebound in Food Service channel
Rebound in Food Service channel, driven by post COVID-19 conditions..... Q2 2021 Total Revenue - SAR 4,006 Million Q2 2021 Total Growth- SAR (76M) or (2%) YoY %/(YoY%) (109%) (15%) 58% 93% (265) (154) || || Other / Exports. 9% Food Service 11% 1 1 1 1 1 1 1 1 1 1 H 8 ! = z a H F H Traditional | Trad
Slide 16: 16
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Slide 17: Financial Performance - Q2 2021
Financial P rmance - Q2 2021 Q2 2021 vs. Q2 2020 Revenue - Back to normal trading conditions... * __...after above normal purchases in Q2 2020 due to COVID-19 conditions * Core product revenue declined on average by 7% within GCC countries, mainly driven by: — + Lower food sales driven by base effec
Slide 18: Net Income Bridge - Q2
Net Income Bridge - Q2 2 644 (89) i) — (65) 34 27 20 482 / — H Dn Ee < Market Trend i & H = | Economical and External Factor 3 | Q2 2020 Volume decline Unfavorable mix Reduction in Commodity price Improvement in IDJ Funding cost Operational Q2 2021 driven by channel subsidy (poultry & andalfalfa per
Slide 19: Results by Segment - Q2 2021
Results by Segment - Q2 2021 Dairy &Juice Revenue by Segment (SAR Mijion} Stronger long life dairy sales in Egypt, Jordan & Export markets Dairy & + Weaker foods year on year due to base effect of higher food 96 Juice EEG purchases during COVID-19 in Q1 2020 = * Continued weakness in juice segment B
Slide 20: 3,40 0% -50 % 3,20 -10 0% 3,00 -15 0% -20 0% 2,80 -25
3,40 0 0% -50 % 3,20 0 -10 0% 3,00 0 -15 0% -20 0% 2,80 0 -25 0% 2,60 0 -30 0% -35 0% 2,40 0 -40 0% 2,20 0 -45 0% 2,00 0 -50 0% 30 0 12 0% 25 0 10 0% 20 0 80 % 15 0 60 % 10 0 40 % 50 20 % 0 0% 1,20 0 0% 1,00 0 -50 00% 80 0 -10 000 % 60 0 -15 000 % 40 0 -20 000 % 20 0 0 -25 000 %
Slide 21: Strategic Management of Working Capital
Strategic Management of Working Capital SAR Million 21% 20% 19% 21% -— 10% 9% 10% - —e— 1,383 2,689 2,668 2015 2016 2017 2018 2019 2020 Q2 2021 maWorking Capital -eWorking Capital as a % of Net Sales acho Almarai ,, Earnings Presentation -Q2 2021
Slide 22: CAPEX continuous to trend lower
CAPEX continuous to trend lower Capital Investment 2015 to TTM Q2 2021 SAR Million 2015 29% 3,986 30% 2016 maNet Cash Used in Investing Activities 20% 2,844 2017 14% 11% 6% 1,923 1,650 El 2018 2019 2020 -e-Investment as a % of Net Sales 6% TTM Q2 2021 Capex cash spend continues to decline in line wi
Slide 23: Cash flow TTM Q2 2021
(2.0) 0. F | ma Oo a | [| 5 Cash Cash 0.4 ‘(OperatingCashFlow — Working Capital Capex Net Payment for Dividend Others 0.5 Funding Cost and Debt SAR 0.1 Billion > TTM Q2 2021 Free Cash Flow = SAR 3.2B * OCF: SAR +4.6 Billion.......Stable business performance and improved working capital management re
Slide 24: Continues Improvement in Free Cash Flow
Continues Improvement in Free Cash Flow Free Cash Flow 2015 to TTM Q2 2021 21% 18% 18% 9% 10% & 4% & (3%) 523 1,304 1,332 2,602 (EX) 2015 2016 2017 2018 2019 2020 TTM Q2 2021 ma Free Cash Flow -e-Free Cash Flow as a % of Net Sales Ya acho Almarai ,, Earnings Presentation- Q2 2021
Slide 25: Net Debt and EBITDA/EBIT margins trend
Net Debt and EBITDA/ EBIT gins trend Net Debt Trend EBITDA and EBIT Margins 30% ~ 28% 26% 2596 —— 19% 13,558) 2018 2019 2020 TT Q2 2021 2018 2019 2020 TTM Q2 2021 met Debt (SAR M) Net Debt/Equity Ratio Net Debt / EBITDA mNet Sales (SAR M) EBITDA % to Net Sales <EBIT % to Net Sales Qe * Net of Time D
Slide 26: Debt Maturity Profile highlights average debt tenure at 3.61 Years
Debt Maturity Profile highlights average debt tenure at 3.61 Years (SAR Billion) Debt Maturity by Age and Type 1.1; :0.8: 0.2 0.4 rE ' 0.6 0.5 Upto 1Yr 1-2Yrs 2-3Yrs 3-4Yrs 4-5Yrs >SYrs mBanks mGovt/SemiGovt Inst. m Islamic Bonds @ Banks 16% @ Govt / Semi Govt Inst. a Islamic Bonds Earnings Presenta
Slide 27: Cash Dividend Since Listing
Cash Dividend Since Listing (sar minion SAR Million 43% 41% 42% 42% 45% 40% 40% 35% 36% 36% 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015 miCash Dividends Payout Ratio Earnings Presentation- Q2 2021 35% 720 2016 34% 750 2017 42% 850 2018 41% 850 2019 50% 2020 27
Slide 28: Question & Answer
Slide 29: Appendix
Slide 30: Revenue by Quarter
Revenue by Quarter (SAR in Million) YoY %/ (YoY%) 14,951 15,333 TTM Q2 2020 TTM Q2 2021 Q2 2020 Q3 2020 Q4 2020 Q1 2021 Q2 2021 Q2 -- 2 Year CAGR = 3% Earnings Presentation- Q2 2021 30
Slide 31: Revenue by Geography and by Category
evenue by Geography and by Catego Revenue By Geography - SAR Million Revenue By Category - SAR Million l : l Bahrain Others | Fruit Juice 88 152 1 392 Other Sales Jordan 2% 1 10% 143 135 I 4% 3% ae | Long Life Dairy | 366 | I 9% l Kuwait H Fresh Dairy 211 1 Bak 1,622 5% Q22020 Q22021 r] anery Q22020
Slide 32: 8,00 - 1,50 0%) 7,50 (2,00 0%) 1,30 7,00 (5 ) 1,20 0 (4,00
8,00 0 - 1,50 0 0%) 7,50 0 (2,00 0%) 1,30 0 7,00 0 (5 ) 1,20 0 (4,00 0%) 6,50 0 1,10 0 (6,00 0%) 1,00 0 6,00 0 (1 0) (8,00 0%) 80 0 5,50 0 90 0 (10 ,0 00%) 60 0 5,00 0 (1 5) 70 0 (12 ,0 00%) 4,50 0 40 0 (14 ,0 00%) 4,00 0 (2 0) 50 0 20 0 (16 ,0 00%) 3,50 0 0 3,00 0 (2 5) 30 0 (18 ,0 00%) -20 0 -40 0
Slide 33: Financial Performance - 1st Half 2021
Financial Performance - 1°t Half 2021 1st Half 2021 vs. 1st Half 2020 Revenue - Back to normal trading conditions... * —_ ...after above normal purchases in 1S half 2020 due to COVID-19 conditions * Core product revenue declined on average by 5% within GCC countries, mainly driven by: + Lower food s
Slide 34: Net Income Bridge - 1st Half 2021
Net Income Bridge - 1$' Half 2021 1,027 (106) a : 63 088 | a (82) H 56 : — — | — | 5 Market Trend Economical and External Factor = © : < i & : Volumedecline — Unfavorablemix Price / Discount Reduction in Commodity price ImprovementinIDJ Funding cost Operational YTD Q22020 driven by channel subsidy (
Slide 35: Results by Segment - Half 2021
Results by Segment - 15 Half 2021 Dairy &Juice Revenue by Segment (SAR Mifion} Stronger long life dairy sales in Egypt, Jordan & Export markets + Weaker foods year on year due to base effect of higher food Dairy & purchases during COVID-19 in Q1 2020 Juice * Continued weakness in juice segment HZ +
Slide 36: Revenue by Geography by Category 1st Half 2021
evenue by Geograph by Catego st Half 2021 Revenue By Geography - SAR Million ' Revenue By Category - SAR Million 1 Bahrain Others | Fruit Juice 166 285 I 689 Other Sales Jordan 2% H 9% 263 246 I 3% 3% ! | Long Life Dairy 7,674 I 780 7,674 H 10% Kuwait | Fresh Dairy 396 | 2,823 5% YTD.Q22020 YTD.Q220
Slide 37: Sales Bridge - 1st Half 2021
Sales Bridge - 1** Half 2021 Reported Growth (0%) | 7,674 (2%) 1% (1%) 0% 1% 7.651 SAR Million Like-for-like growth (2%) 1st Half 2020 Volume Price Mix Currency Others YoY % / (YOY%) Earnings Presentation - Q2 2021 37
Slide 38: Growth by Geography - 1st Half 2021
wth by Geography - 1‘ Half 2021 1st Half 2021 Total Revenue - SAR 7,651 Million 1st Half 2021 Total Growth- SAR (24M) or (0%) YoY %/(YOY%) (5%) (8%) 34% (4%) (11%) 41% 0% 73% SAR Million KSA UAE Egypt Kuwait Oman Jordan Bahrain Others Total Q2 2020 11% (2%) 13% 10% (15%) 38% (5%) 10% 8% Q3 2020 5% 6
Slide 39: Growth by Product Category - 1st Half 2021
- 1st Half 2021 wth by Product Catego 1st Half 2021 Total Revenue - SAR 7,651 Million 1st Half 2021 Total Growth- SAR (24M) or (0%) YoY %/(YOY%) Other Sales 1 1 H Prultidies 3% H 3% (13%) (5%) ~— (8%) = 8% HH 1 1 ! 86 58 106 § Bon o 6 go 24 5 — I a 1 H Fresh Dairy Food Poultry Bakery LLD Fruit Juice
Slide 40: Growth by Channel - 1st Half 2021
rowth by Channel - 1° Half 2021 1st Half 2021 Total Revenue - SAR 7,651 Million 1st Half 2021 Total Growth- SAR (24M) or (0%) YoY %/(YOY%) Other / Exports (6%) (12%) 27% 64% i o 271 Food Service 201 a om fi fo I I 1 I I 1 1 I 1 I 12% § ! : | |_| 1 < I G Traditional ! Traditional Trade Modern Trade F
Slide 41: Profit & Loss - Q2 and Half 2021
Profit & Half 2021 ss State ae 2nd Quarter 1st Half SAR Million 2021 2020 Change 2021 2020 Change Revenue 4,006 100.0% 4,082 100.0% (1.9%) 7,651 100.0% 7,674 100.0% (0.3%) Cost of sales (2,650) (66.296) (2,547) (62.4%) (4.1%) (5,060) (66.1%) (4,886) (63.796) (3.6%) Gross Profit 1,356 33.8% 1,535 37.
Slide 42: Results by Segment
sults by Segmen Al ai SAR Million Dairy & Jui kery Poultry oO Consolidated 1st Half 2021 Revenue 5,477 792 1,118 263 7,651 Profit Attributable to Shareholders 677 73 124 (6) 868 Percent to Revenue of Profit Attributable to Shareholders 124% 9.3% 11.1% na 11.3% Growth versus 1st Half 2020 - Revenue -
Slide 43: Key Statistics and Share Price Trend
Key eDa Key Statistics for Almarai (30 June 2021) Share Price (SAR) 63.40 Current P/E Ratio (ttm) 34.76 Earnings Per Share (SAR) (ttm) 1.82 Market Cap (SAR Million) 63,400 ee Shares Outstanding (Million) 1,000 Dividend Yield 1.58% m Savola Year to date total shareholder's return since listing m HH P
Slide 44: Thank you
Thank you Earnings Presentation – Q2 2021