Arborgen Holdings Limited · NZX:ARB
Arborgen — Investor Presentation (July 2021)
24 slides from Arborgen's investor presentation, July 2021
Slide 1: Positioned For Accelerated Growth
Positioned For Accelerated Growth July 2021
Slide 2: Disclaimer
Disclaimer This presentation has been prepared by ArborGen Holdings Limited (“ArborGen”), to provide an overview of the performance of ArborGen and its activities at the date of this presentation. It is not prepared for any other purpose and must not be provided to any person other than the intended
Slide 3: Agenda
Agenda • Business Highlights • Our leading positions • How we are transforming forest productivity • Financial performance • Poised for accelerated growth – macro drivers and outlook for FY22 and beyond Spokespeople • Andrew Baum, CEO • Kathy Parker, VP Finance & Accounting • Sharon Ludher-Chandra,
Slide 4: Business highlights
Business highlights We are the leading commercial provider of advanced FY22 Outlook and Guidance genetic tree seedling products • US-GAAP EBITDA guidance for FY22 of $13 - $14.5 million – a material • Global leader in tree improvement technology, transforming increase on FY21 US-GAAP EBITDA forestry
Slide 5: History of ArborGen
History of ArborGen Since its formation in 2000, ArborGen has been committed to meeting the human need for wood, fibre and fuel while protecting Taylor Nursery Record MCP harvest completed, ArborGen the world’s native forests. leased from South Carolina poised for growth Sugarcane SE ArborGen licens
Slide 6: Leader in three of the largest tree seedling markets in the world
Leader in three of the largest tree seedling markets in the world ArborGen Sales Volume 500 450 400 69 350 39 65 50 Million seedlings U.S. South Loblolly Pine 58 32 300 23 U.S. South Hardwood 19 250 200 329 150 280 294 Brazil Loblolly Pine 270 Brazil Eucalyptus Australia & New Zealand 100 Radiata Pi
Slide 7: Leader in three of the largest tree seedling markets in the world
Leader in three of the largest tree seedling markets in the world United States ANZ Brazil • Largest market representing ~75% of • Only NZ seedling provider with • One of the largest commercial ArborGen’s sales volume national presence suppliers of seedlings – sells proprietary and licensed genetics
Slide 8: Geographic split
Geographic split United States Australia / New Zealand Brazil US$6.0m US$9.9m Revenue (FY21) 70% 19% 11% US$36.8m US-GAAP EBITDA (FY21)1 US$11.3m Production capacity ~400m seedlings2 ~40m seedlings ~100m seedlings3 Seedling production 8 nurseries 7 nurseries 3 nurseries2 nurseries & 10 orchards 3 or
Slide 9: ArborGen: Transforming Forest Productivity
ArborGen: Transforming Forest Productivity We are world leaders in developing and selling advanced genetics tree seedlings that deliver significant value to landowners. 9
Slide 10: Leading technology platform
Leading technology platform We are the leading provider of proprietary advanced genetics operating across the entire technology spectrum Germplasm Tree Improvement Proprietary Genomics and Biotechnology Repository Expertise Production Bioinformatics Product Technologies Development Own one of the wo
Slide 11: Overview of pine products
Overview of pine products Seedlings are produced from seed produced through two different production processes: Open Pollinated Seedlings (OP) and Mass Control Pollinated (MCP or CP) Seedlings. ArborGen also sells varietals (or clones) in the US, New Zealand and Brazil Varietals Mass Control Pollina
Slide 12: Advanced genetics create substantial value for landowners
Advanced genetics create substantial value for landowners Faster growth rate with first thinning as early as 11 to 13 84% value accretion years Higher yield with more wood per acre 30 – 40% more sawtimber on final harvest vs OP for loblolly Greater uniformity and quality – straighter, reduce
Slide 13: Core growth strategy – MCP growth in the US
Core growth strategy – MCP® growth in the US Grow the supply and sales of proprietary advanced seedling genetics in the US ArborGen is now at an inflection point, poised to benefit from 20+ years of investment in developing best-in-class proprietary MCP products, expanding supply of proprietary gene
Slide 14: ArborGen advanced genetics are a game-changer for forest landowners
ArborGen advanced genetics are a game-changer for forest landowners "Landowners have one opportunity to influence the quality of the seedlings planted in a stand. If the wrong choices are made, the landowner will suffer the consequences of those decisions for 25 years or longer." Dr. Steve McKeand F
Slide 15: Adoption of advanced genetics is reaching tipping point
Adoption of advanced genetics is reaching tipping point Adoption of MCP is on the same trajectory as Hybrid Corn Hybrid Corn transformed agricultural productivity in the 20th Century MCP® and other advanced genetic products will drive forest productivity in the 21st 15
Slide 16: Our strategic position is translating into results
Our strategic position is translating into results 16
Slide 17: FY21 financial snapshot
FY21 financial snapshot USD $m FY21 FY20 % change • Solid year on year performance • Pleasing result despite headwinds and Revenue 52.7 56.9 -7% challenges in 2021 Operating Earnings (before other 2.6 2.4 +8% • Significant improvements in net significant items) earnings, operating cashflow, EBITDA N
Slide 18: FY21 revenue and seedling sales
FY21 revenue and seedling sales Sales Revenue US Loblolly pine sales US Loblolly pine sales By Region Revenue Volume Australasia South America USA MCP & Varietals Open Pollinated MCP & Varietals Open Pollinated 18
Slide 19: We are positioned for accelerated growth
We are positioned for accelerated growth 19
Slide 20: Macro trends are in our favour
Macro trends are in our favour • Strong US housing demand expected to grow over the next decade – • Prolonged period of underbuilding • Favourable demographics (average age of Americans ~30 years) • Ageing housing stock • Reforestation and forestation projects to reduce carbon emissions • Growing de
Slide 21: We are positioned for accelerated growth
We are positioned for accelerated growth Our advanced genetics are now proven at scale and the transformation to advanced genetics is at an inflection point No competitor can match our MCP program’s breadth or depth, and we are continuously developing more valuable products Our investments in
Slide 22: Regional outlook for FY22
Regional outlook for FY22 United States Australasia South America • Return to pre-COVID sales and • Underlying demand drivers for forestry • Orders to date are 70% higher than this operating processes remain strong time last year • Easing of migrant labour restrictions • Continue to focus on NZ hort
Slide 23: Outlook
Outlook Strong tailwinds for FY22 FY22 guidance • Increased availability of proprietary MCP seedlings in US Subject to any uncontrollable factors, we are targeting US-GAAP EBITDA for the • Improving market in all regions current year ending March 2022 to be in • Higher demand for proprietary genetic
Slide 24: Contact us
Contact us Andrew Baum Chief Executive Officer (US-based) T: +1 888 888 7158 E: ambaum@arborgen.com Sharon Ludher-Chandra Company Secretary & Performance Improvement Director (NZ-based) T: +64 21 898 624 E: info@arborgenholdings.com 24
ArborGen Holdings — Investor Presentation (July 2021) on 6ix