Bunge Limited · NYSE:BG
Bunge — Shareholder Meeting (May 2014)
29 slides from Bunge's shareholder meeting presentation, May 23, 2014
Slide 1: Annual General Meeting
Annual General Meeting MAY 23, 2014 1 2014 ANNUAL GENERAL MEETING DRAFT FOR REVIEW ONLY
Slide 2: Forward-Looking Statements
Forward-Looking Statements ! Today’s presentation includes forward-looking statements that reflect Bunge’s current views with respect to future events, financial performance and industry conditions. ! These forward-looking statements are subject to various risks and uncertainties. Bunge has provided
Slide 3: Bunge Today
Bunge Today Average Net Operating Assets 1% NET SALES EMPLOYEES FACILITIES COUNTRIES 6% Agribusiness 15% Sugar Food & Ingredients $61 B 15% 63% ~35,000 ~400 40+ Fertilizer Other AGRIBUSINESS FOOD & INGREDIENTS SUGAR & BIOENERGY • A global leader in oilseed • Leading producer of oils, • Leader in glo
Slide 4: Supporting Global Food Security
Supporting Global Food Security 2.4 billion additional people in Asia, Middle East and Africa by 2050 4 2014 ANNUAL GENERAL MEETING
Slide 5: Fueling Economic Growth
Fueling Economic Growth Growth in ag is 2-4 times more effective at improving livelihoods than growth in other sectors 5 2014 ANNUAL GENERAL MEETING
Slide 6: Facilitating Global Trade
Facilitating Global Trade Trade reduces food price volatility & improves global environmental efficiency 6 2014 ANNUAL GENERAL MEETING
Slide 7: Supporting Trusted Brands
Supporting Trusted Brands 7 2014 ANNUAL GENERAL MEETING
Slide 8: Producing Quality Products for Consumers
Producing Quality Products for Consumers Canola, rapeseed, soy and sunflower oils are among the best sources of polyunsaturated fat 8 2014 ANNUAL GENERAL MEETING
Slide 9: 2013 Highlights
2013 Highlights ! Record EBIT in core businesses • $1.3 billion combined in agribusiness and food & ingredients ! Adjusted ROIC above WACC • 7.5% adjusted for gains & charges and excluding sugar & bioenergy ! $2.2 billion in operating cash flow • Enhanced focus on working capital optimization ! Impr
Slide 10: 2014 Outlook
2014 Outlook Targeting combined Agribusiness-Foods ROIC at WACC + 1.5 points Agribusiness Food & Ingredients Sugar & Bioenergy ! Demand expected ! Expect results to improve ! Running segment to to remain strong throughout the year be free cash flow neutral ! All major growing ! Continued emphasis !
Slide 11: Strategic Focus
Strategic Focus Stand for Safety Zero-incident culture Focus on HPEs Best in Class Right Balance Close performance gaps Targeted growth in core Enhance core Increase value-added capabilities Sugar milling review Invest in talent & learning Clarity & Accountability Enhanced operating model New perfor
Slide 12: Working Toward a Zero-Incident Culture
Working Toward a STAND FOR SAFETY Zero-Incident Culture Safety Frequency Lost-time accidents/200k hours worked 0.30 0.20 0.18 0.17 0.16 0.14 0.13 2007 2008 2009 2010 2011 2012 2013 12 2014 ANNUAL GENERAL MEETING
Slide 13: Eliminating High-Potential Exposures (HPEs)
STAND Eliminating High-Potential FOR SAFETY Exposures (HPEs) Five types of HPEs account for 90% of fatalities and serious injuries at Bunge Hoisted Mobile Mechanical Confined Working Loads Equipment & Electrical Spaces at Heights 13 2014 ANNUAL GENERAL MEETING
Slide 14: Focused on Improving Returns
Focused on Improving Returns Best in Class 2013 Return on Invested Capital 2014/2015 Return on Invested Capital 9+% 8.5% 7.5% WACC = 7% 5.8% 2013 2014e 2015f Adjusted for certain gains & charges Adjusted for certain gains & charges and excluding sugar & bioenergy segment 14 2014 ANNUAL GENERAL MEETI
Slide 15: Achieving Best in Class
Achieving Best in Class BEST IN CLASS Closing Performance Gaps Capacity utilization (%) ! Assessing Plant #1 performance of each plant worldwide Plant #1 Plant #2 ! Benchmarking Industrial efficiencies (%) against best internal and external performance Plant #2 Plant #1 Plant #2 ! Improved Quality &
Slide 16: Improving Commercial & Operational Performance in F&I
Improving Commercial BEST IN CLASS & Operational Performance in F&I Commercial Operational Category Asset Leadership Optimization Account Process Management Optimization Pricing Supply Capability Optimization Innovation 16 2014 ANNUAL GENERAL MEETING
Slide 17: Performance Management Guiding Principles
CLARITY & Performance Management ACCOUNTABILITY Guiding Principles ! Value: focus on value creation above capital costs, measure operational value drivers with Performance Scorecard consistent scorecards Beyond “business ! Granularity: business unit emphasis as usual” ! Improvement: targets based on
Slide 18: Capital Allocation Priorities
Capital Allocation Priorities RIGHT BALANCE Balance Sheet Strength (Target BBB credit rating) ! Investment grade critical ! Commodity companies require capital buffer Reinvest in the M&A Return Capital Business (Capex) ! Filling gaps in to Shareholders agribusiness ! Maintenance ! Expanding food ! D
Slide 19: Returning Capital to Shareholders
Returning Capital to Shareholders RIGHT BALANCE US$ per share of common stock Share Repurchase History 1.17 1.06 GR: 11% 0.98 CA 0.90 $409M Divi dend 0.82 Available $501M 0.74 0.63 0.67 0.56 0.48 0.385 0.42 Used $474M $566M 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 Dec. 31, 2013 Ma
Slide 20: Improving our Integrated Agribusiness Chain & Global Footprint
Improving our Integrated Agribusiness RIGHT BALANCE Chain & Global Footprint Altona, MB Nikolayev, Ukraine Barcarena, PA Miritituba, PA Bunbury, WA Bunbury, WA Oilseed Processing Plant Port Terminal 20 2014 ANNUAL GENERAL MEETING
Slide 21: Managing Export Flows from Brazil's Northern Corridor
Managing Export Flows from RIGHT BALANCE Brazil’s Northern Corridor Barge ! New export route transshipment • Grains from interior trucked and barged station, to Terfron port terminal in Northeastern Miritituba Brazil ! Improved logistics efficiencies • Lower cost alternative to congested ports in Sa
Slide 22: Rebalancing the Portfolio Towards Value Added
Rebalancing the Portfolio RIGHT BALANCE Towards Value Added % Bunge EBIT Currently Future Value Value added added 30% 22% -35% ! Grain milling & processing Priorities ! Oils & fats 22 2014 ANNUAL GENERAL MEETING
Slide 23: Grupo Altex Mexico Wheat Milling Acquisition
Grupo Altex Mexico Wheat RIGHT BALANCE Milling Acquisition ! #2 player in Mexico wheat ! Strong operator; broad product milling portfolio, innovative R&D ! 6 mills with total capacity ! Complements our value stream of ~800 kmt and creates synergies with agribusiness ! Combination with La Espiga crea
Slide 24: Environmental Performance
Environmental Performance Environmental Footprint Reductions % 2008-2010 2011-2013 2014-2016 44 34 12 11 New 11 10 10 5 5 3 3 3 5 3 1 1 Goals Actual Goals Actual Goals CO2/mt H2O/mt Waste/mt GJ/mt 24 2014 ANNUAL GENERAL MEETING
Slide 25: The Nature Conservancy – Bunge Partnership
The Nature Conservancy – Bunge Partnership Five years PA Para, Mato Grosso and Bahia Definition of ‘go/no go’ zones MT BA for agriculture Best practice application on farm Legal registration via CAR system 25 2014 ANNUAL GENERAL MEETING
Slide 26: Culture, Values, Team Essential to Organization
Culture, Values, Team Essential to Organization 26 2014 ANNUAL GENERAL MEETING
Slide 27: Annual General Meeting
Annual General Meeting MAY 23, 2014 27 2014 ANNUAL GENERAL MEETING DRAFT FOR REVIEW ONLY
Slide 28: Backup: Non-GAAP Reconciliation Notes
Backup: Non-GAAP Reconciliation Notes Total segment earnings before interest and tax (EBIT) ! Total segment EBIT is consolidated net income attributable to Bunge excluding interest income and expense and income tax attributable to each segment. ! Total segment EBIT is a non-GAAP financial measure an
Slide 29: Backup: Non-GAAP Reconciliation Notes
Backup: Non-GAAP Reconciliation Notes Return on Invested Capital: • Bunge Limited continuing operations excluding certain gains and charges • Bunge Limited continuing operations excluding certain gains & charges and Sugar & Bioenergy segment EBIT December 31, December 31, (US$ in millions) 2013 2013