RCL Foods Limited · JSE:RCL
RCL Foods — Corporate Update (September 2014)
43 slides from RCL Foods's corporate update, Sep 17, 2014
Slide 1: Investor site visit presentation - Malalane
TSB Investor site visit presentation - Malalane 17 September 2014 1
Slide 2: Agenda
Agenda Item Presenter Time Allocation Welcome Miles Dally 09:30 – 09:45 Introduction to TSB John du Plessis 09:45 – 10:45 Break 10:45 – 11:00 Site orientation Clinton Vermeulen 11:00 – 11:15 Mill Visit Clinton Vermeulen 11:15 – 12:45 - Mill Logan Govender - Packaging Mike Ngcobo / Prem Sahadeo - Mol
Slide 3: Overview of TSB and key investment highlights
Overview of TSB and key investment highlights 3
Slide 4: Operational overview (South Africa)
Operational overview (South Africa) • Market leader in sugar cane agriculture, production, marketing, sales and distribution • Strategically located in the "northern irrigated" region of the South African sugar industry − Head office is located at Malalane, ± 60 km east of Nelspruit − Main productio
Slide 5: Company history
Company history 1965 TSB is founded. Central Sugar Board allocates 11 518 hectares of land for cane cultivation 1966 Quality Sugars is formed to act as marketing distribution agents for TSB 1967 TSB's Malalane Mill receives its first cane and commences sugar production 1982 A transport fleet is esta
Slide 6: Group structure
Group structure RCL Foods 100% Akwandze 50% TSB RSA Financial Services 100% 51% TSB International Massingir Agro Industrial 27% 100% 75% Royal Swazi Sugar Agriculture 100% Shubombo Quality Sugars 25% Booker Tate Corporation Technical Services Cane Operations Agricultural Services Sugar Marketing Mhl
Slide 7: Key investment highlights
Key investment highlights 2 Produces approximately 30% 1 Selati is the of South Africa's total #1 sugar sugar output brand in 3 Operates three mills South Africa in South Africa, in close proximity to Mozambique with capacity to produce 700 000 tonnes of 6 sugar p.a. Significant growth potential int
Slide 8: High level overview of TSB's business
High level overview of TSB’s business Manufacturing & Cane Supply Marketing Supply Chain Outbound Distributor SSG’s • Cane Volume Molatek Supply Chain 300 000 (t) 0.4 m (t) • Cane Quality • Daily Supply Wholesale 160 000 (t) CGs Inbound Outbound Retail Raw Mill Refinery 3.2 m (t) Supply Chain Supply
Slide 9: Permanent staff headcount
Permanent staff headcount Staff headcount 3900 3807 3800 3694 3700 3600 3500 3400 3300 3229 3221 3200 3100 3000 2900 2011 2012 2013 2014 9
Slide 10: Market environment
tsb Market environment 10
Slide 11: Overview of the South African sugar market
Overview of the South African sugar market With the tariff • The South African Customs Union (“SACU”) provides the basis for the domestic imposed on market for the sale of sugar by South African sugar millers imports, the − Approximately 80% of sales are white refined sugar and the remainder is brow
Slide 12: South African sugar industry
South African sugar industry Location of key industry players Structure of industry Growers Millers • Tongaat Hulett (4 Mills) • Illovo (4 Mills) • TSB (3 Mills) 13 local growers • UCL Company (1 Mill) councils • Umfolozi Sugar Mill (1 Mill) • Gledhow Sugar (1 Mill) SA Cane Growers’ SA Sugar Millers
Slide 13: Divisions of proceeds – F2014 season
Divisions of proceeds – F2014 season Local market Export market Sugar sales Sugar sales Molasses sales Total industrial proceeds Deduct industrial costs and rebates Equals net divisible proceeds Fixed division Grower share Miller share 64.37% 35.63% Distributed by individual Price per ton millers ac
Slide 14: Imposition of import tariffs
Imposition of import tariffs Successful in mitigating the threat from imports Imports (Duty Paid) 2012/2013 & 2013/2014 462 081 Cumulative 433 149 418 500 480 000 460 000 440 000 420 000 337 612 400 000 380 000 360 000 340 000 255 993 320 000 300 000 224 788 280 000 204 151 260 000 183 070 173 417 T
Slide 15: Agriculture
tsb) Agriculture 15
Slide 16: Agriculture: Cane farming
Agriculture Cane farming • TSB supports approximately 1 800 commercial and small-scale growers who supply 80% of the sugar cane to its factories from 55 000 hectares of irrigated land • Collectively the total area under cane amounts to 69 000 hectares of which: − Malalane Mill area is 24 000 hectare
Slide 17: Cane farming – supporting local communities
Agriculture Cane farming – supporting local communities Farm management support Broad-based Black empowerment: • TSB offers Farm management support to the farming ventures Agricultural land reform created through the land restitution process Freehold Area under cane • TSB's involvement in these join
Slide 18: Akwandze Agricultural Finance (AAF)
Agriculture Akwandze Agricultural Finance (AAF) • A development finance organisation that provides TSB sugarcane growers with financial services: − Production finance and irrigation infrastructure for growers − Working capital for contractors • AAF sources, negotiates and manages development finance
Slide 19: Operational overview – Manufacturing & Supply Chain
Operational overview – Manufacturing & Supply Chain 19
Slide 20: Manufacturing
Manufacturing Nkomazi Mills Region Mill Established Tons sugar Notes produced per year Malalane 1968 189 000 Nkomazi produce approximately Nkomazi 490 000 tons of sugar per year. Komati 1993 250 000 Pongola produce approximately 135 000 tons of sugar per year. Pongola Pongola 1954 163 000 Adding Pon
Slide 21: Logistics
ts Logistics 21
Slide 22: Operational overview: TSB transport
Operational overview TSB transport • Overview • TSB transports sugar cane from TSB owned and managed estates and independent sugar cane growers (especially small scale and emerging cane farmers who have contracts with the company) to its mills • TSB's Transport division holds about 40% of the transp
Slide 23: Operational Review - Molatek
Operational Review - Molatek 23
Slide 24: Molatek animal feed
Molatek animal feed • Manufactures and markets an extensive range of animal feeds (energy feeds, fattening and dairy concentrates, lick supplements and molasses) • 2 manufacturing facilities: Komati (to move to Pongola) and Malalane • Established in 1985 and has grown over the past 26 years as a maj
Slide 25: Operational Review - Marketing
Operational Review - Marketing 25
Slide 26: Marketing Quality Sugars and the Selati brand
Marketing Quality Sugars and the Selati brand • Majority-owned subsidiary of TSB and is the logistics and marketing arm of the business • Quality Sugars adds value to the Selati brand through strategised and targeted advertising using national media. • Selati has become one of the top ten most recog
Slide 27: Market Shares As At July 2014
Market Shares As At July 2014 July 2013 July 2014 July 2013 July 2014 (12MMA) (12MMA) Total TSB 50.1 49.9 48.6 49.4 Selati 32.5 31.8 33.2 30.6 Huletts 29.9 27.1 32.5 29.0 Illovo 3.1 3.4 3.1 3.2 Savemore 1.9 1.4 2.2 1.1 House Brands *1 Spar 7.8 8.5 7.4 8.5 *2 No Name / PnP 6.8 6.2 5.6 7.2 *3 Rite Bra
Slide 28: Market shares as at July 2014
Market shares as at July 2014 tsb TOTAL SA - Value Share 12MM 12MM PREV CURR JUL 2013 AUG 2013 SEP 2013 OCT 2013 NOV 2013 DEC 2013 JAN 2014 FEB 2014 MAR 2014 APR 2014 MAY 2014 JUN 2014 JUL 2014 MALLOTHER MRITEBRAND @ SPAR BNONAME @ SAVEMORE GILLOVO BHULETT GB SELATI
Slide 29: Subsidiaries and associates
Subsidiaries and associates 29
Slide 30: Booker Tate
Booker Tate 30
Slide 31: Booker Tate overview
Booker Tate overview • Booker Tate provides development, management and technical services to sugar and agribusiness industries throughout the world • Founded in 1988 from the amalgamation of Booker Agriculture International (BAI) and Tate & Lyle Agribusiness (TLA) with a sugar history stretching ba
Slide 32: RSSC
RSSC 32
Slide 33: Royal Swaziland Sugar Corporation (RSSC)
Royal Swaziland Sugar Corporation (RSSC) • Located in the north-eastern Lowveld of Swaziland and is one of the largest companies in the country • Employs over 3 500 people and produces two-thirds of the country’s sugar and a significant quantity of ethanol • Listed on the Swaziland Stock Exchange, t
Slide 34: Mananga Sugar Packers
Mananga Sugar Packers 34
Slide 35: Mananga Sugar Packers (MSP)
Mananga Sugar Packers (MSP) Overview • MSP, a joint venture between RSSC and TSB, was established to pack sugar in Swaziland and, pursuant to a quota granted by the Swaziland Sugar Association, to sell packed sugar to the SACU • The plant packs about 96,000 tons of sugar in a season, making it the l
Slide 36: Massingir
Massingir 36
Slide 37: Massingir
Massingir High-level project overview Current Status • Best green field site in sub Saharan Africa • Incorporated MAI a newly established company. • Excellent natural resources TSB Sugar International holds 51% of the shares and the balance is held by SIAL • 8 hours average sunshine per day • Invest
Slide 38: TSB Summary
TSB Summary 38
Slide 39: TSB Summary
TSB Summary 1 Market Leading Positions 2 Strong operating assets – lowest cost producer 3 Growth supported by fundamentals and well considered expansion 4 Vertically integrated platform 5 Well run assets with strong and experienced management teams 39
Slide 40: Site Orientation
Site Orientation 40
Slide 41: What happens in a sugar mill?
What happens in a sugar mill? 41
Slide 42: What happens in a sugar mill?
What happens in a sugar mill? 42
Slide 43: Thank You
Thank You TSB Sugar RSA (Pty) Ltd PO Box 47 Malalane 1320 T +27 13 791 1000 www.tsb.co.za 43