Murray Cod Australia Limited · ASX:MCA
Murray Cod Australia — Investor Presentation (November 2021)
45 slides from Murray Cod Australia's investor presentation, Nov 12, 2021
Slide 1: Murray Cod Australia Limited Capital Raising Presentation
MURRAY COD AUSTRALIA LIMITED CAPITAL RAISING PRESENTATION 12 NOVEMBER 2021 1
Slide 2: Important Notice and Disclaimer
IMPORTANT NOTICE AND DISCLAIMER NOT FOR RELEASE TO U.S. WIRE SERVICES OR DISTRIBUTION IN THE UNITED STATES IMPORTANT: You must read the following before continuing This presentation is dated 12 November 2021 and has been prepared by Murray Cod Australia Limited (MCA or Company) in connection with: •
Slide 3: Important Notice and Disclaimer (cont.)
IMPORTANT NOTICE AND DISCLAIMER (CONT.) No representation or warranty is given, and nothing in this presentation or any other information made available by the Company or any other party should be relied upon as a promise or representation, as to the future condition of the respective businesses and
Slide 4: Important Notice and Disclaimer (cont.)
IMPORTANT NOTICE AND DISCLAIMER (CONT.) Investment risk and other risks An investment in New Shares is subject to investment and other known and unknown risks, some of which are beyond the control of MCA and its directors, including possible loss of income and principal invested. MCA does not guaran
Slide 5: MCA is launching an equity raising via a placement
Murray Cod Australia Ltd (“MCA”) is launching an equity raising via a placement to raise approximately $30 million and a Share Purchase Plan targeting a further $3 million Demand for Murray Cod is currently outstripping supply and MCA is ideally placed to meet this demand as the leading scale produc
Slide 6: Murray Cod Australia at a Glance
01 MURRAY COD AUSTRALIA AT A GLANCE 6
Slide 7: Murray Cod Australia at a Glance
MURRAY COD AUSTRALIA AT A GLANCE • Murray Cod is one of the world’s largest freshwater fish, is unique to the Murray-Darling basin and is currently listed as a vulnerable species whose fishing is prohibited in Australia • Over the past 5 years we have established ourselves as the leading producer, w
Slide 8: The Murray Cod Opportunity
THE MURRAY COD OPPORTUNITY • Untapped and large addressable market, both domestic and global, with low current levels of penetration by Murray Cod (<1% domestically) • Leverages Australia’s reputation for high quality food products • Strong trends towards both premiumisation and healthier eating • E
Slide 9: An Established and Growing Brand
AN ESTABLISHED AND GROWING BRAND Strong demand growth driven by luxury positioning and ecologically sustainable approach to production Secured supply arrangements with both of Australia’s major supermarkets: • Woolworths recently increased the number of stores stocking Aquna Murray Cod • Coles expec
Slide 10: Attractive Unit Economics
ATTRACTIVE UNIT ECONOMICS Current Unit Target Economics Premium Murray $18.00 - $22.00 per Up to $25.00 per Cod Sale Price kg* kg* Growing Cost $7.70 per kg $7.70 per kg Processing & $1.50 per kg $1.50 per kg Selling Costs Gross Margin c.55% c.63 - 66% * Based on round pen equivalent to existing pen
Slide 11: Proven Track Record of Strong Growth
PROVEN TRACK RECORD OF STRONG GROWTH Fish added to ponds MCA 2030 GROWTH STRATEGY To t a l Re ve n u e o ve r 2 0 2 1 - 2 2 s u m m e r I n c l u d i n g G a i n o n B i o l o g i ca l 2m+ ( 2 4 – 3 6 m o n t h g ro w Assets out period) C u r re nt f i s h i n st o c k o f 2 . 2 m p ro v i d e s fo
Slide 12: Aquna Murray Cod – Runway for Growth
AQUNA MURRAY COD – RUNWAY FOR GROWTH MCA is the only vertically integrated scale producer of Murray Cod in the world We have approximately 2.2 million with capacity to add an additional c.2.0 – 2.5 million fish over the coming Australian summer This will see our existing ponds approach capacity The
Slide 13: Capital Raising to Capture Growth Opportunities
02 CAPITAL RAISING TO CAPTURE GROWTH OPPORTUNITIES 13
Slide 14: Launch of fully underwritten institutional placement
Murray Cod Australia today announced the launch of a fully underwritten institutional placement to raise approximately $30 million, and a non-underwritten Share Purchase Plan targeting a further $3 million, in order to accelerate growth in production, drive further production efficiencies and captur
Slide 15: Use of Proceeds and Financial Highlights
USE OF PROCEEDS AND FINANCIAL HIGHLIGHTS What we are aiming to achieve 1 • Purchase of land and construction of greenfield hatchery • Increase 2022 pond capacity by c.1m adult fish • Construction and installation of c.12 new ponds in 2022 and growing exponentially thereafter Accelerating c.$19m c.14
Slide 16: Accelerating Production
1 Hatchery Expansion ACCELERATING • Construction of a new hatchery will provide greater capacity for fingerling production PRODUCTION • Brings total numbers of hatcheries to 3 • Assists the fulfilment of government re-stocking orders Expecting to exceed existing Grow Out Expansion target of 10k tonn
Slide 17: Grow Revenue per kg
2 GROW REVENUE PER KG % of total Component weight Current Fillet 44% product Fat 15% Heads 14% • MCA currently yields just 44% of each fish farmed, representing the fillet Frames 8% • Revenue opportunities exist from other meaningful components of the fish, including both the Offal 8% head and fat,
Slide 18: Improve Gross Margins
2 IMPROVE Processing Plant • New state of the art processing plant including smoking and other value-adding capabilities GROSS • Robotic fillet processing technology will increase product yield and quality, and reduce labour costs MARGINS Feed Technology • Investment in trials and testing to drive c
Slide 19: Expansion Opportunities
3 EXPANSION OPPORTUNITIES • Aquna brand has been successfully launched into premium HORECA markets domestically and internationally • Capital raising will allow further investment in marketing Capitalising on the excess demand for premium and promotion across our key target markets Aquna Murray Cod
Slide 20: Capital Raising Details
03 CAPITAL RAISING DETAILS 20
Slide 21: Capital Raising Details
CAPITAL RAISING DETAILS Placement • MCA is undertaking a fully underwritten institutional placement to raise approximately $30 million (“Placement”) Structure & Size • ~90 million New Shares to be issued under the Placement (representing 15.5% of the total shares of the Company prior to the issue of
Slide 22: Sources and Uses
SOURCES AND USES Uses of Funds $m Growth Initiatives 33.9 Accelerating Production 19.4 Driving Production Efficiencies 12.5 Expansion Opportunities 2.0 Transaction Costs 1.1 Total 35.0 Sources of Funds $m Institutional Placement 30.0 Proposed exercise of options1 5.0 Total 35.0 Note: (1) Refer page
Slide 23: Capital Raising Timetable
CAPITAL RAISING TIMETABLE Event Date Placement Trading halt and announcement of Placement Friday, 12 November 2021 Placement Bookbuild opens Friday, 12 November 2021 Placement Bookbuild closes Friday, 12 November 2021 Announcement of completion of Placement and trading halt lifted Monday, 15 Novembe
Slide 24: 1: Our Business Model
APPENDIX 1: OUR BUSINESS MODEL 24
Slide 25: Business Model
BUSINESS MODEL Hatchery 35mm Nursery Stock is kept in recirculated tanks with environment controlled Cages Sold to Contract Growers Fingerlings Fingerlings to sold to Contract MCA ponds for In 18 Mths 1.5-2Kg Growers for grow-out Murray Cod is grow-out est. harvested by MCA @ $4 each Distributor 25
Slide 26: View of Our Operations
VIEW OF OUR OPERATIONS Overhead view of our Bilbul Site Land based sustainable production model 26
Slide 27: A View of Our Pen Systems in Action
A VIEW OF OUR PEN SYSTEMS IN ACTION Our Operations 27
Slide 28: 2: Expansion Opportunities
APPENDIX 2: EXPANSION OPPORTUNITIES 28
Slide 29: Highly Attractive Export Opportunities
HIGHLY ATTRACTIVE EXPORT OPPORTUNITIES AUSTRALIA JAPAN USA EURO & UK • Signed agreements • Signed agreements with • Distribution • Accelerating distribution national distributors into Supermarket with 3 distributors arrangements in place channel • Anticipating • 2 dedicated MCA sales covering the UK
Slide 30: Smoked Fish Product Launch
SMOKED FISH PRODUCT Attractive opportunity to product a luxury smoked product LAUNCH due to high fat content of Murray Cod Assists in growing the Aquna brand outside of fresh and facilitates greater margin capture Smoked product launch in Perfectly suited to meet global shortage of high quality, 202
Slide 31: 3: Key Risks
APPENDIX 3: KEY RISKS 31
Slide 32: 3: Key Risks
APPENDIX 3: KEY RISKS Reduction in demand for Murray Cod There is a risk that a change in economic conditions could cause consumers to reduce their consumption of Murray Cod as they "trade down" to cheaper sources of seafood and proteins. Changes in consumer dietary preferences or sentiment towards
Slide 33: 3: Key Risks (cont.)
APPENDIX 3: KEY RISKS (CONT.) In addition, the Company must renew the appropriate permits and licences required to operate its business. The Company is subject to regular inspections, examinations and audits by governmental authorities to renew the various licences and permits. The Company is also s
Slide 34: 3: Key Risks (cont.)
APPENDIX 3: KEY RISKS (CONT.) Fresh water supply Fresh and high quality water is critical for the Company's operations particularly in the ponds and hatchery. There is a risk to the Company that if access to fresh water supply was significantly limited or restricted, this could have a material impac
Slide 35: 3: Key Risks (cont.)
APPENDIX 3: KEY RISKS (CONT.) Major factors that can influence demand and supply in the Murray Cod market and, therefore, the price of Murray Cod, include: • consumption trends and preferences amongst domestic and international target markets for meat and seafood, including Murray Cod; • an increase
Slide 36: 3: Key Risks (cont.)
APPENDIX 3: KEY RISKS (CONT.) Security of supply chain The Company's operations are located in western New South Wales, approximately 6.5 hours from Sydney, Australia. There is a risk that the supply chain for the Murray Cod could be materially disrupted with the result that sufficient quantities of
Slide 37: 3: Key Risks (cont.)
APPENDIX 3: KEY RISKS (CONT.) Reliance on key personnel The Company is reliant on a number of key personnel and consultants, including members of the Board. The loss of one or more of these key contributors could have an adverse impact on the business of the Company. It may be particularly difficult
Slide 38: 3: Key Risks (cont.)
APPENDIX 3: KEY RISKS (CONT.) Underwriting risk The Company has entered into a placement agreement in respect of the Placement with the Lead Manager. Subject to the terms and conditions of the placement agreement, the key terms of which are summarised at Appendix 4 (Placement Agreement), the Lead Ma
Slide 39: 4: Summary of Placement Agreement
APPENDIX 4: SUMMARY OF PLACEMENT AGREEMENT 39
Slide 40: 4: Summary of Placement Agreement
APPENDIX 4: SUMMARY OF PLACEMENT AGREEMENT The Company has entered into the placement agreement with Barrenjoey Markets Pty Limited (ABN 66 636 976 059) (the Lead Manager) pursuant to which it has appointed the Lead Manager as the lead manager and underwriter of the Placement (Placement Agreement).
Slide 41: 4: Summary of Placement Agreement (cont.)
APPENDIX 4: SUMMARY OF PLACEMENT AGREEMENT (CONT.) • ASX does not, or states that it will not, grant official quotation of all the New Shares on an unconditional basis (or on a conditional basis provided such condition would not, in the opinion of the Lead Manager, have a material adverse effect on
Slide 42: 4: Summary of Placement Agreement (cont.)
APPENDIX 4: SUMMARY OF PLACEMENT AGREEMENT (CONT.) The Lead Manager may also terminate the Placement Agreement and be released from its obligations under it on the occurrence of certain events where the Lead Manager has reasonable grounds to believe that their occurrence has, or is likely to have, a
Slide 43: 5: Foreign Selling Restrictions
APPENDIX 5: FOREIGN SELLING RESTRICTIONS 43
Slide 44: 5: Foreign Selling Restrictions
APPENDIX 5: FOREIGN SELLING RESTRICTIONS This presentation does not constitute an offer of Shares of the Company in any jurisdiction in which it would be unlawful. In particular, this document may not be distributed to any person, and the Shares may not be offered or sold, in any country outside Aus
Slide 45: For More Information
FOR MORE INFORMATION Ross Anderson Chairman - Murray Cod Australia Phone +61 269 625 470 Email ross@aquna.com Website aquna.com
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