Elders Limited · ASX:ELD
Elders — Macquarie Emerging Leaders Forum 2019
19 slides from Elders's conference presentation, Jun 19, 2019
Slide 1: Presentation to Macquarie Emerging Leaders Forum
For personal use only 19 June 2019 Presentation to Macquarie Emerging Leaders Forum Attached is a copy of the presentation given by Mark Allison to the Macquarie Emerging Leaders Forum today in Melbourne. Peter Hastings Company Secretary 1
Slide 2: Elders Limited - Macquarie Emerging Leaders Forum
Elders Limited For personal use only Macquarie Emerging Leaders Forum Melbourne 19 June 2019
Slide 3: Disclaimer and important information
Disclaimer and important information For personal use only Forward looking statements Non-IFRS information This presentation is prepared for informational purposes only. It contains This presentation refers to and discusses underlying profit to enable analysis forward looking statements that are sub
Slide 4: Agenda
Agenda For personal use only ▪ Business Model ▪ Financial Progress FY14 to FY19 ▪ Eight Point Plan to FY20 ▪ Digital and Technology Focus ▪ Balanced Growth to FY20 ▪ Strategic Gaps ▪ Industry Market and Outlook ▪ Summary
Slide 5: Business Model
Business Model For personal use only Digital and technical Feed and processing Retail products Agency services Real estate services Financial services services services Farm supplies Livestock Farmland Agri-finance Fee for service Killara Feedlot Fertiliser Wool Residential Insurance Auctions plus (
Slide 6: Points of Presence
Points of Presence For personal use only ▪ Over 450 points of presence in Australia and overseas including full service branches, real estate and insurance franchises ▪ Key produce areas covered through our footprint ▪ Targeted expansion of footprint through recruitment and acquisition 5
Slide 7: Elders Financial Progress FY14 to FY19F
Elders Financial Progress FY14 to FY19F Underlying EBIT ($m) 75 72-75 71 For personal use only 2H 1H 29 56 30 38-41 39 28 23 21 46 41 10 34 28 16 11 FY14 FY15 FY16 FY17 FY18 FY19F Contributed by: ▪ Resetting of operational strategy, focusing on running a pure-play agribusiness. ▪ Favourable livestoc
Slide 8: FY19 Half Year in Review
FY19 Half Year in Review On track to deliver on growth commitment For personal use only Challenging conditions skewing FY19 earnings to 2H: Outlook and guidance: 1. Wool volumes, with the Australian clip down, ▪ Return to average winter cropping season impacting Agency sales ▪ Offset by balanced gro
Slide 9: Trading Update – April & May
Trading Update – April & May Strong results in the third quarter so far For personal use only April and May results have exceeded last year: 1. Retail margin outperformed last year across all geographies, coupled with additional acquisition earnings from Titan through backward integration. 2. Agency
Slide 10: Strategic Priorities to 2020
Strategic Priorities to 2020 For personal use only 9
Slide 11: 19/06/2019
10 19/06/2019 For personal use only
Slide 12: Balanced growth plan to FY20
Balanced growth plan to FY20 For personal use only Organic Acquisition 50% Maintain Cost 50% ▪ Drive continuous business ▪ Continue to evaluate strategically ▪ Invest in resourcing to identify, improvement aligned opportunities to expand integrate and support both our business organic and acquisitio
Slide 13: Strategic Gaps
Strategic Gaps Stable platform geared for the next wave of growth, under the second Eight Point Plan, including 20 new branches by 2020 Key gaps in market, geographical, product and service areas to be For personal use only filled through organic growth and acquisition, with 20 new branches by 2020
Slide 14: Corporate Acquisition Principles
13 Corporate Acquisition Principles For personal use only • Australian Base and 100% Ownership (under Tax Umbrella) • Enhances Business Diversification • Brings Unique and Scale able IP • Low Integration Risk • Attractive Asset Price • Pre Synergies EPS Accretive • Maintain ROC above 15%
Slide 15: Eight Point Plan: years to FY20 goal
Eight Point Plan: 3 years to FY20 goal To deliver 5 – 10% quality growth through the cycles For personal use only EBIT FY17 to FY20 Livestock price Other market Organic (50%) Acquisition (50%) Cost (0%) FY20 FY17 normalisation movements ▪ Consistent with assumptions Livestock prices eased post FY17
Slide 16: Agricultural Production & Exports
Neutral Agricultural Production & Exports Gross value of Australian farm production Gross volume of Australian farm production For personal use only Billion dollars, nominal Crops Index reference year 1997-98 Livestock +1% 180 66 69 62 62 62 63 160 57 60 58 60 55 140 Crops 36 37 28 34 34 31 29 32 33
Slide 17: Industry market and outlook
Industry market and outlook Agricultural ▪ The value of Australian agricultural production has increased steadily over recent years. It is estimated to be $58 billion in 2018- production & 19, increasing to a forecast $69 billion in 2023-24. For personal use only exports ▪ Farm exports will grow by
Slide 18: FY19 Outlook
FY19 Outlook Winter cropping conditions expected to return to average in the second half Elders reiterates FY19 guidance and remains confident to deliver: ▪ Underlying EBIT in the range of $72 to $75 million For personal use only ▪ Underlying NPAT in the range of $61 to $64 million ▪ Continue to pur
Slide 19: Summary
Summary For personal use only ▪ Solid platform for growth ▪ Positive industry outlook ▪ Strong organic growth pipeline ▪ Digital and Technical Focus ▪ Strong bolt on pipeline ▪ Opportunities for step change growth ▪ On track for guidance