Bunge Limited · NYSE:BG
Bunge — Bunge Global — Q1 2021 Earnings Presentation
30 slides from Bunge's earnings presentation, May 4, 2021
Slide 1: 1Q 2021 Earnings Results Review
1Q 2021 Earnings Results Review May 4, 2021
Slide 2: Forward-Looking Statements
Forward-Looking Statements • Today’s presentation includes forward-looking statements that reflect Bunge’s current views with respect to future events, financial performance and industry conditions. • These forward-looking statements are subject to various risks and uncertainties. Bunge has provided
Slide 3: Agenda
• CEO Comments • Financial Performance Agenda • Closing Remarks • Q&A 3
Slide 4: Q1 Highlights and Outlook
Q1 Highlights and Outlook • Outstanding results from strong execution and effective risk management in favorable market conditions • Agribusiness results driven by strong performance in Processing and Merchandising • Particular strength in softseed crush and global grain and oil value chains • Refin
Slide 5: Bunge Limited Earnings Highlights
Bunge Limited Earnings Highlights Three Months Ended March 31, US$ in millions, except per share data 2021 2020 Net income per common share-diluted $ 5.52 $ (1.46) Adjusted Net income per common share-diluted (a) $ 3.13 $ 0.91 Adjusted Core Segment EBIT (a) (d) $ 737 $ 354 Agribusiness (c) $ 601 $ 2
Slide 6: Positive Earnings Trend
Positive Earnings Trend 2,500 Bunge Performance 2017 – Q1 2021 TTM Timing Adjusted, Excluding Notables 2,185 $13.50 2,000 1,759 $11.50 $10.46 1,500 $9.50 ($ millions) $8.30 1,158 $7.50 1,000 877 671 $4.76 $5.50 500 $2.47 $2.70 $3.50 - $1.50 2017 2018 2019 2020 Q1-21 TTM Timing Adjusted EBIT, excl No
Slide 7: Focus on Cost Management
Focus on Cost Management Q1 Adjusted Addressable SG&A savings of $16M vs PY reflecting culture shift to continuous improvement 19 295 Notable items 3 • Q1 SG&A savings of $16M 16 − Organizational savings: ~20% 290 − Indirect spend: ~80% ($ millions) 271 • $3M net savings impact from specified items
Slide 8: Cash Flow Highlights
Cash Flow Highlights Increasingly durable balance sheet as retained cash flow is used to pay down debt Adjusted Funds From Operations (Adjusted FFO) (1) $2,166 $1,886 Retained cash of $1,387M used to reduce debt $100 $100 $316 $316 $365 $363 2020 Q1 2021 TTM Adjusted FFO Buybacks Dividends (2) Capex
Slide 9: Generating Cash Flow to Drive Shareholder Value
Generating Cash Flow to Drive Shareholder Value YTD Capital Allocation Capital Allocation Priorities 533 (32) (8) 493 BBB/Baa2 target credit ratings (71) (21) 401 Shareholder dividends ($ millions) Reinvestment opportunities Share buybacks Q1 YTD Sustaining Preferred Discretionary Dividends to Growt
Slide 10: Q1 2021 Cash Flow and Net Debt Evolution
Q1 2021 Cash Flow and Net Debt Evolution 14 12 Committed Availability Committed 10 Availability 5.8 4.1 8 (0.4) 0.7 (0.4) 6 ($ billions) 4 6.9 6.8 2 0 YE20 Net Debt Retained Cash Flow Change in Working Others (2) Q1-21 Net Debt (1) Capital Net Debt Commitment Availability (1) Before working capital
Slide 11: Net Debt Finances Vast Majority of RMI
Net Debt Finances Vast Majority of RMI Q1 2020 Q2 2020 Q3 2020 Q4 2020 Q1 2021 Net Debt ex RMI: $0.5 $0.9 $0.7 $0.6 ($0.6) At Q1 quarter end, Net Debt ex RMI / Net Debt (%): 10% 16% 11% 9% -9% 100% $7.4 $6.9 of Net Debt was $6.2 used to finance 91% $5.8 $4.8 of Readily ($ billions) $6.8 Marketable $
Slide 12: Strong Earnings Momentum Drives Higher Returns
Strong Earnings Momentum Drives Higher Returns AROIC captures benefits of earnings driven from utilization of additional working capital Bunge Limited (excluding Sugar & Bioenergy) 18.7% 15.9% 11.5% 10.4% 9.7% 13.4% 12.2% 7.9% 6.6% 9.1% 8.3% 8.1% 6.6% 6.5% 5.9% 2015 2016 2017 2018 2019 2020 Q1-21 TT
Slide 13: Increased Earnings Reflected in Discretionary Cash Flow
Increased Earnings Reflected in Discretionary Cash Flow 2,000 Bunge Performance 2017 – Q1 2021 TTM 1,883 40.0% 1,800 Discretionary Cash Flow (1) 1,598 35.0% 1,600 30.0% 1,400 28.9% 25.0% 1,200 25.7% 1,000 20.0% 800 749 721 15.0% 600 569 13.7% 13.4% ($ millions) 10.0% 400 8.7% 7% 5.0% 200 0 0.0% 2017
Slide 14: Full-Year 2021 Outlook
Full-Year 2021 Outlook FY2021 adjusted EPS of ~$7.50 per share based on the following expectations • Agribusiness: Down vs. 2020 • Increased forecast from previous outlook reflects strong 1Q21 performance, current market trends and forward curves • Refined and Specialty Oils: Up vs. 2020 • Increased
Slide 15: Closing Remarks
Closing Remarks • Favorable market and demand trends in the back half of the year • Continuing our disciplined approach to investment • Focus remains on execution and optimizing our asset base to meet evolving customer demand 15 15
Slide 16: Joss
Joss
Slide 17: Agribusiness: Processing and Merchandising Definitions
Agribusiness: Processing and Merchandising Definitions Processing Merchandising • Oilseed origination • Grain origination ‒ Oilseed purchasing, cleaning, drying, ‒ Grains (corn, wheat, barley, rice) purchasing, storing and handling cleaning, drying, storing and handling • Oilseed processing • Grain
Slide 18: Core Segment Volume Highlights
Core Segment Volume Highlights Three Months Ended March 31, In thousands of metric tons 2021 2020 Agribusiness #2 36,356 32,681 Processing 24,013 23,345 Merchandising 12,343 9,336 Refined and Specialty Oils 2,205 2,354 Milling 1,739 1,938 18 18
Slide 19: Non-GAAP Reconciliation
Non-GAAP Reconciliation This presentation contains certain "non-GAAP financial measures" as defined in Regulation G of the Securities Exchange Act of 1934. Bunge has reconciled these non-GAAP financial measures to the most directly comparable U.S. GAAP measures in the following slides. These measure
Slide 20: Non-GAAP Reconciliation
Non-GAAP Reconciliation Adjusted Core Segment EBIT, Adjusted Non-Core Segment EBIT, and Adjusted Total Segment EBIT, are calculated by excluding certain gains and (charges), as described in "Additional Financial Information“ of Bunge’s accompanying quarterly earnings press release, as well as certai
Slide 21: Non-GAAP Reconciliation
Non-GAAP Reconciliation Cash Flows To facilitate a comparison of Bunge’s historical cash flow generation and related trends, Bunge uses the following non-GAAP financial measures: • Adjusted Funds from Operations (Adjusted FFO) • Discretionary Cash Flow • Cash Flow Yield Adjusted FFO is calculated by
Slide 22: Non-GAAP Reconciliation
Non-GAAP Reconciliation Returns on Capital To facilitate a comparison of Bunge’s historical returns on capital and related trends, Bunge uses the following non-GAAP financial measures: • Return on Invested Capital (ROIC) • Adjusted Return on Invested Capital (AROIC) Bunge calculates ROIC by dividing
Slide 23: Non-GAAP Reconciliation
Non-GAAP Reconciliation Net income (loss) attributable to Bunge to Adjusted Net income (loss) Three Months Ended March 31, (US$ in millions) 2021 2020 Net income (loss) attributable to Bunge $831 $(184) Adjustment for Mark-to-market timing difference (195) 320 Adjusted for certain (gains) and charge
Slide 24: Non-GAAP Reconciliation
Non-GAAP Reconciliation Net income (loss) attributable to Bunge to Total Segment EBIT and Adjusted Total Segment EBIT Three Months Ended March 31, (US$ in millions) 2021 2020 Net income (loss) attributable to Bunge $831 ($184) Interest income (9) (7) Interest expense 73 77 Income tax expense (benefi
Slide 25: Non-GAAP Reconciliation
Non-GAAP Reconciliation Cash provided by (used for) operating activities to Adjusted FFO and Discretionary Cash Flow US$ in millions 2021 Q1 YTD 2021 Q1 TTM (1) 2020 2019 2018 2017 Cash provided by (used for) operating activities ($987) ($4,081) ($3,535) ($808) ($1,264) ($1,975) Foreign exchange (lo
Slide 26: Non-GAAP Reconciliation
Non-GAAP Reconciliation Return on Invested Capital excluding certain gains and charges, mark-to-market timing differences and Sugar & Bioenergy Segment Trailing 4 Trailing 4 Trailing 4 Trailing 4 Trailing 4 Trailing 4 Trailing 4 Quarters Quarters Quarters Quarters Quarters Quarters Quarters March 31
Slide 27: Non-GAAP Reconciliation
Non-GAAP Reconciliation Return on Invested Capital excluding certain gains and charges, mark-to-market timing differences, RMI attributable to merchandising, and Sugar & Bioenergy Segment Trailing 4 Trailing 4 Trailing 4 Trailing 4 Trailing 4 Trailing 4 Trailing 4 Quarters Quarters Quarters Quarters
Slide 28: Non-GAAP Reconciliation
Non-GAAP Reconciliation Below is a reconciliation of Income (loss) from continuing operations before income tax to Return before income tax, adjusted, as utilized to calculate ROIC and AROIC in the preceding slides: Trailing 4 Trailing 4 Trailing 4 Trailing 4 Trailing 4 Trailing 4 Trailing 4 Quarter
Slide 29: Non-GAAP Reconciliation
Non-GAAP Reconciliation Below is a reconciliation of Total Equity to Book Equity March 31, December 31, December 31, December 31, December 31, (US$ in millions) 2021 2020 2019 2018 2017 Total equity $6,780 $6,206 $6,031 $6,377 $7,357 Convertible preference (690) (690) (690) (690) (690) Noncontrollin
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