Midway — Shaw and Partners Investor Day, Melbourne 2019
17 slides from Midway's conference presentation, May 16, 2019
Slide 1: The Midway Growth Story
The Midway Growth Story Tony Price Chief Executive Officer Shaw and Partners Investor Day, Melbourne 16 May 2019
Slide 2: Disclaimer
Disclaimer This presentation has been prepared by Midway Limited ACN 005 616 044 (Midway or the Company). The information contained in this presentation is current at the date of this presentation. The information is a summary overview of the current activities of the Company and does not purport to
Slide 3: Agenda
Agenda • Historical performance • Core areas of expertise • Growth strategy • Outlook 3
Slide 4: A long history of export growth
A long history of export growth 3.35 Geelong Portland Brisbane Tasmania Tiwi 3.00 3.04 2.92 2.18 1.66 1.63 1.46 1.34 1.23 1.23 1.08 1.07 0.99 0.97 0.85 0.88 0.70 0.67 0.58 0.58 0.58 0.43 0.26 0.33 0.20 0.15 0.21 0.12 0.15 0.02 0.05 0.09 1986 1987 1988 1989 1990 1991 1992 1993 1994 1995 1996 1997 199
Slide 5: Solid performance since listing
Solid performance since listing 35 EBITDA-S $'M Midway has consistently met consensus 30 25 EBITDA forecasts. 20 Half year The Midway share price has improved on the 15 Full year 10 28 28.7 back of performance. 5 13.8 6.5 12.2 Consistent dividend payments – fully 0 2017 2018 2019 franked. EBIT
Slide 6: Strong first half 1H19
Strong first half 1H19 $Am 1H19 1H18 % Change Sales Revenue 124.2 85.2 45.8% Other Income 2.6 2.0 30.0% Equity Accounted Share of 2.2 1.2 83.3% Profits Operating Costs (116.8) (81.9) (42.6%) EBITDA – S(1) 12.2 6.5 87.7% Significant items(2) 2.7 - - Net fair value gain on 13.8 - - biological assets E
Slide 7: Midway's key business activities across the value chain
Midway’s key business activities across the value chain Key areas of expertise Plantation and land Harvesting and logistics Processing and materials Marketing and shipping Management • Existing freehold estate • Extensive experience in • Management of woodfibre • Market most of own (fee simple) Cont
Slide 8: Key value drivers
Key value drivers Metric Driver Export volume Number of tonnes exported through each facility and volume of resource available Woodfibre Price Woodfibre price – movement in the USD/BDMT Foreign Exchange Movement in the AUD/USD – active hedging strategy Dry Fibre Content How dry the woodfibre is when
Slide 9: Growing & managing our timber supply
Growing & managing our timber supply Facility Volumes FY2017 FY2018 FY2019 FY2020 FY2021 FY2022 (000’s GMT) Geelong 1,413 1,223 1,191 1,000 900 700 Portland 1,545 1,448 1,559 1,450 1,200 1,000 Brisbane 292 284 264 380 480 550 Melville Island 197 229 340 400 500 Tasmania1 135 270 450 600 800 Western
Slide 10: Clear growth strategy
Clear growth strategy Increasing EBITDA over time: 1. EXPANSION OF EXISTING BUSINESS Growth of plantation management and wood-fibre export businesses – Midway Tasmania Development of hardwood and softwood log exports – QCE & Tiwi Islands Increased utilisation and expansion of existing infrastr
Slide 11: Expanding our geographic footprint
Expanding our geographic footprint 11
Slide 12: Diversifying our earnings streams
Diversifying our earnings streams EBITDA $'M by geographic location 2017 EBITDA $'M by geographic location 2018 0 0.9 0.4 0 1.2 Victoria -2.4 0 1.7 -3.3 1.0 Tasmania Victoria Northern Territory 28.0 South East Asia Queensland 29.2 Queensland Eliminations Eliminations 12
Slide 13: Outlook for FY19
Outlook for FY19 Positive outlook • On track to meet the current analyst consensus EBITDA forecast range before significant items • Accounting changes with the introduction of AASB 15 will impact balance sheet and statutory NPAT (see attachments) however will not impact on EBITDA-S1 or cashflow Posi
Slide 14: Asian demand to exceed supply for next five years
Asian demand to exceed supply for next five years Outlook for Woodchip Supply and Demand in the Asia-Pacific Market - 2023 Thousand BDMT 30,000 Supply 25,000 Demand 20,000 15,000 10,000 5,000 0 Softwood Hardwood Source data: International Pulpwood Trade Review, RISI 2019 14
Slide 15: Positive five year price outlook
Positive five year price outlook Japan: Woodchip prices, 2012-2018, and price predictions, 2019F-2023F Nominal FOB Prices, Annual Average US Australian Australian South African Chilean Vietnamese Year Douglas-fir radiata E. globulus eucalyptus E. globulus acacia US dollars per BDU, FOB US dollars pe
Slide 16: Emerging Asian Biomass Market
Emerging Asian Biomass Market Japan: Wood Pellet Imports, 2013-2018 South Korea: Wood Pellet Imports, 2013-2018 Thousand Tonnes Thousand Tonnes 1,200 3,500 Other Other Vietnam 3,000 Thailand 1,000 China Indonesia 2,500 Canada Russia 800 Canada 2,000 600 Malaysia 1,500 Vietnam 400 1,000 200 500 0 0 2
Slide 17: In summary
In summary • Solid financial performance • Clear growth strategy • Positive outlook 17
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