Kernel Holding S.a. · GPW:KER
Kernel — FY2019 Earnings Presentation
30 slides from Kernel's earnings presentation, September 2019
Slide 1: Kernel Holding S.A. FY2019 results and company presentation
Kernel Holding S.A. FY2019 results and company presentation September 2019
Slide 2: Disclaimer
Disclaimer The information in this document has not been independently verified and no representation or warranty, expressed or implied, is made as to, and no reliance should be placed on, the fairness, accuracy, completeness or correctness of the information or opinions contained herein. Neither th
Slide 3: Content
Content 1. FY2019 results and FY2020 outlook 2. Kernel today 3. Balanced growth strategy 4. Financials Appendices Farming cluster “Druzhba-Nova” (Northern Ukraine) 184 thousand hectares of leasehold farmland under operations
Slide 4: 1.1 FY2019 highlights
FY2019 results results and FY2020 and FY2020 Balanced outlook outlook Kernel today growth strategy Financials 1.1 FY2019 highlights US$ million except EPS FY2018 FY2019 y-o-y ◼ Revenue at US$ 4.0bn, up 66% y-o-y driven by stronger sales of grain and Income statement highlights sunflower oil and Aver
Slide 5: 1.2 Segment results
FY2019 results results and FY2020 and FY2020 Balanced outlook outlook Kernel today growth strategy Financials 1.2 Segment results Segment volumes, m tons EBITDA margin EBITDA, US$ m ◼ Highest ever processing and sales volumes; 213 3.0 3.1 3.2 190 ◼ EBITDA margin recovery: Oilseed 2.7 2.5 Processing
Slide 6: 1.3 Segment results FY2019 – transition to three segments disclosure
FY2019 results results and FY2020 and FY2020 Balanced outlook outlook Kernel today growth strategy Financials 1.3 Segment results FY2019 – transition to three segments disclosure Segments results (new presentation layout) ◼ Since FY2019 company moved to three Revenue, US$ m EBITDA, US$ m Volume, k t
Slide 7: 1.4 Recent transactions highlights
FY2019 results results and FY2020 and FY2020 Balanced outlook outlook Kernel today growth strategy Financials 1.4 Recent transactions highlights Acquisitions Debt raising Acquisition of 100% interest in RTK-Ukraine (Feb 2019) Loan from European Investment Bank (Dec 2018) ◼ Assets acquired: 2,949 gra
Slide 8: 1.5 Outlook for FY2020
FY2019 results results and FY2020 and FY2020 Balanced outlook outlook Kernel today growth strategy Financials 1.5 Outlook for FY2020 ◼ FY2020 sunflower seed acreage remained relatively the same as y-o-y as temporary weakness in global sunflower oil prices observed throughout FY2019 discouraged farme
Slide 9: Content
Content 1. FY2019 results and FY2020 outlook 2. Kernel today 3. Balanced growth strategy 4. Financials Appendices Export terminal in the Chornomorsk Port 4.8 million tons annual transshipment capacity
Slide 10: 2.1 Kernel today
FY2019 results and FY2020 Balanced outlook Kernel Kernel today today growth strategy Financials 2.1 Kernel today Oilseed Processing segment Key financials FY2015 FY2016 FY2017 FY2018 FY2019 EBITDA 1, US$ million ◼ #1 sunflower oil producer (8% of global production) and Revenue US$ m 2,330 1,989 2,16
Slide 11: 2.2 What we do
FY2019 results and FY2020 Balanced outlook Kernel Kernel today today growth strategy Financials 2.2 What we do Volumes for FY2019 1 Own farming: Kernel 6 Grain export: Kernel exported 6.1 million tons of grains and operates 530 thousand ha of oilseeds from Ukraine, entering into forward contracts wi
Slide 12: 2.3 Efficient and well-invested asset base
FY2019 results and FY2020 Balanced outlook Kernel Kernel today today growth strategy Financials 2.3 Efficient and well-invested asset base Sunflower seed crushing capacity, thousand tons per year Poltava Grain transshipment capacity, thousand tons per year 462 Vovchansk 356 Starokostiantyniv Prykolo
Slide 13: 2.4 Kernel's key milestones
FY2019 results and FY2020 Balanced outlook Kernel Kernel today today growth strategy Financials 2.4 Kernel’s key milestones Asset-light Acquisition of IPO & listing on Extending oilseed • Entering the Russian market by Exit of highly Acquisition of • Active export platform sunflower oil brand the Wa
Slide 14: 2.5 Oilseed Processing segment performance
FY2019 results and FY2020 Balanced outlook Kernel Kernel today today growth strategy Financials 2.5 Oilseed Processing segment FY19 FY19 Sales EBITDA Sunflower oil sales EBITDA and EBITDA margin Key market factors million tons 3.2 determining segment performance 3.1 190 3.0 2.5 2.7 Sunflower oil pri
Slide 15: 2.6 Infrastructure and Trading segment performance
FY2019 results and FY2020 Balanced outlook Kernel Kernel today today growth strategy Financials 2.6 Infrastructure and Trading segment FY19 FY19 Sales EBITDA Segments volumes EBITDA and EBITDA margin Key market factors million tons 6.1 7% Other determining segment performance 5.1 26 4.7 14% Middle 2
Slide 16: 2.7 Farming segment performance
FY2019 results and FY2020 Balanced outlook Kernel Kernel today today growth strategy Financials 2.7 Farming segment FY19 FY19 Sales EBITDA Kernel’s key crop production EBITDA and EBITDA margin Key market factors 3.3 374 378 determining segment performance 2.5 344 2.1 Ukraine corn price, FOB-Black Se
Slide 17: 2.8 Credit highlights
FY2019 results and FY2020 Balanced outlook Kernel Kernel today today growth strategy Financials 2.8 Credit highlights Credit portfolio as of 30 June 2019, US$ m Kernel-2022 Eurobonds mid-YTM Amount outstanding 12% 10.6% as of 30 June 2019 Interest rate Maturity 10% 8.5% Eurobonds 496.1 8.75% Jan 202
Slide 18: Content
Content 1. FY2019 results and FY2020 outlook 2. Kernel today 3. Balanced growth strategy 4. Financials Appendices Silo in Balyn, Khmelnytskyi region One-time storage capacity: 142 thousand tons of grain
Slide 19: 3.1 Kernel's mid-term strategy
FY2019 results Balanced and FY2020 growth Balanced outlook Kernel today strategy growth strategy Financials 3.1 Kernel’s mid-term strategy We aim to profitably double export volumes by FY2021, providing comprehensive solutions to our clients (customers and suppliers), with balanced development of ou
Slide 20: 3.2 Strategy 2021 serves as a solid basis for future growth
FY2019 results Balanced and FY2020 growth Balanced outlook Kernel today strategy growth strategy Financials 3.2 Strategy 2021 serves as a solid basis for future growth across all business segments Strategy 2021 investments pipeline overview: Status Segment US$ million FY2017 FY2018 FY2019 FY2020 FY2
Slide 21: Content
Content 1. FY2019 results and FY2020 outlook 2. Kernel today 3. Balanced growth strategy 4. Financials Appendices Bandurka oil extraction plant Annual sunflower seed processing capacity: 558 thousand tons
Slide 22: 4.1 Consolidated statement of profit or loss
FY2019 results and FY2020 Balanced outlook Kernel today growth strategy Financials Financials 4.1 Consolidated statement of profit or loss US$ million, except ratios and EPS FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18 FY19 Revenue 215 350 663 1,047 1,020 1,899 2,072 2,797 2,393
Slide 23: 4.2 Balance sheet
FY2019 results and FY2020 Balanced outlook Kernel today growth strategy Financials Financials 4.2 Balance sheet Balance sheet highlights US$ million FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18 FY19 Cash & cash equivalents 6 25 89 129 59 116 83 79 65 129 60 143 132 77 Net trade a
Slide 24: 4.3 Cash flow statement
FY2019 results and FY2020 Balanced outlook Kernel today growth strategy Financials Financials 4.3 Cash flow statement US$ million FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18 FY19 EBITDA 17 46 123 190 190 310 319 288 223 397 346 319 223 346 Finance cost paid (9) (18) (28) (32) (2
Slide 25: IR contact and investor calendar
IR contact and investor calendar Michael Iavorskyi Investor Relations Manager ir@kernel.ua Tel.: +38 (044) 461 88 01, ex. 7275 3 Tarasa Shevchenka Lane, Kyiv Ukraine, 01001 Investor calendar ▪ Q1 FY2020 Operations Update 22 October 2019 ▪ Q1 FY2020 Financial Report 27 November 2019 ▪ Annual general
Slide 26: Content
Content 1. FY2019 results and FY2020 outlook 2. Kernel today 3. Balanced growth strategy 4. Financials Appendices Poltava sunflower oil refining and bottling facility 558 thousand tons per year processing capacity
Slide 27: A1. Key highlights
A1. Key highlights ◼ Kernel operates in globally competitive growing Ukrainian agri sector ◼ Integrated, resilient and simple business model built around scale & global reach ◼ Leader across all market segments supported by unparalleled world-class asset base with high barriers to entry ◼ Top standa
Slide 28: A2. Markets and business environment
A2. Markets and business environment Oilseed Processing Infrastructure and Trading Farming Global production of vegetable oils Global production and export of Global grain exports Top grain exporting countries Grain yields in MY2018/19 million tons sunflower oil million tons million tons t / ha mill
Slide 29: A3. Markets and business environment
A3. Markets and business environment Low cycle of soft commodity prices Index of soft commodity prices, US$-inflation adjusted 30 June 2004 = 100% 300% 250% 200% 150% 100% 50% Jun-04 Jun-05 Jun-06 Jun-07 Jun-08 Jun-09 Jun-10 1 Jun-11 2 Jun-12 Jun-13 Jun-14 3 Jun-15 Jun-16 Jun-17 Jun-18 Jun-19 Note W
Slide 30: A4. Environmental, social and corporate governance (ESG)
A4. Environmental, social and corporate governance (ESG) Kernel's global goal in the field of sustainable development and social responsibility is the development of society through the voluntary contribution of business to the social, economic and environmental spheres related to the activities and