Nufarm Limited · ASX:NUF
Nufarm — H1 FY21 Earnings Presentation
30 slides from Nufarm's earnings presentation, May 20, 2021
Slide 1: ASX cover letter: half-year results market release and investor presentation
20 May 2021 Nufarm Limited ACN 091 323 312 103-105 Pipe Road Laverton North Vic 3026 The Manager Australia Market Announcements Office Australian Securities Exchange +61 3 9282 1000 4th Floor, 20 Bridge Street nufarm.com SYDNEY NSW 2000 ELECTRONIC LODGEMENT Dear Sir or Madam Nufarm Limited - Financi
Slide 2: Nufarm reports strong lift in revenues and earnings for first half of FY21
Nufarm Limited ACN 091 323 312 20 May 2021 103-105 Pipe Road Laverton North VIC 3026 Australia ASX Release – Company Announcement +61 3 9282 1000 nufarm.com Nufarm reports strong lift in revenues and earnings for first half of FY21 Overview • Revenue and EBITDA growth in all regions and Seed Technol
Slide 3: Authorised for lodgement and investor contact
Authorised for lodgement by: Fiona Smith Company Secretary Investor and media contact: Nerida Mossop nerida.mossop@nufarm.com +61 437 361 433
Slide 4: FY21 Half Year Results
FY21 Half Year Results 20 May 2021
Slide 5: Disclaimer
Disclaimer General This presentation has been prepared by Nufarm Limited. The information contained in this presentation is for informational purposes only as at the date of this presentation. The information contained in this presentation is not investment or financial product advice and is not int
Slide 6: Overview
Overview CEO Greg Hunt
Slide 7: Safety – a critical priority
Safety & COVID-19 Safety – a critical priority • Continued focus on occupational and process safety improvement • Developed new approaches to sustain safety focus in face of prolonged Sustaining our COVID-19 & supply chain disruptions safety focus • 5-year non-conditional Major Hazard Facility opera
Slide 8: Improved revenues, margins & cash generation
1H21 overview Improved revenues, margins & cash generation Europe recovery & • Europe uEBITDA up 135% • Share gains in focus crops and Revenue up 20% segments Group PIP on track • Group PIP target on track with $10m benefit in 1H21 including ~$7m in Europe • Higher volumes, improved uEBITDA up 118%
Slide 9: Earnings growth in all regions & seed technologies
1H21 earnings overview Earnings growth in all regions & seed technologies Revenue up 20% uEBITDA up 118% AUD m AUD m • APAC volumes lifted by good seasonal conditions in Aust & • Higher volumes & improved margins drive APAC earnings Indonesia growth • Improved market conditions and higher crop price
Slide 10: 1H21 financial performance
1H21 financial performance CFO Paul Townsend 7
Slide 11: Improved earnings & cash flow, strong balance sheet
1H21 overview Improved earnings & cash flow, strong balance sheet Proforma Summary financial results 6 months ended 6 months ended Change 31 Mar 2021 31 Mar 2020 31 Mar 2021 vs $000 $000 31 Mar 2020 Revenue 1,649,647 1,374,280 20 % Underlying EBITDA 233,623 107,267 118 % Underlying EBIT 130,387 7,71
Slide 12: Performance improvement program
SG&A expenses Performance improvement program 31 Mar 2021 31 Mar 2020 Change underlying underlying $’000 • PIP delivered ~$10m in 1H21 $’000 $’000 • reduced salary, occupancy & warehousing SG&A Selling & Distrib’n (237,825) (248,186) 10,361 with ~$7m in Europe; balance in Corporate expenses Gen & Ad
Slide 13: Improving cashflow
Free cash generation Improving cashflow Underlying free cashflow 1H21 (AUD m) Average net working capital/sales (%) AUD m 47% 46% 45% 40% 37% Jul-18 Jul-19 Jul-20 Sep-20 Mar-21 • Stronger operating cash flow benefiting from improved earnings & better NWC management • NWC movement consistent with sea
Slide 14: A strong balance sheet & disciplined capital management
Net debt, leverage & liquidity A strong balance sheet & disciplined capital management Net debt, leverage* & liquidity • Significant reduction in net debt following sale of South American businesses 1400 3.5 3.0 1200 3.0 • Continued focus on cash generation to 1247 2.5 584 sustain conservative lever
Slide 15: Operational performance
Operational performance CEO Greg Hunt
Slide 16: APAC (AUD)
APAC (AUD) Higher volumes & improved product mix deliver strong first half Revenue up 24% 1H21 Overview AUD m 2H 406 1H • Improved conditions, strong commodity prices & tight supply driving high 297 early demand and restocking of supply channels 434 • Improved product mix and margins in ANZ 333 348
Slide 17: Europe (Euro)
Europe (Euro) Increased differentiated product volumes, lower COGS & reduced cost base lift earnings Revenue up 18% 1H21 Overview EUR m 2H 1H 277 224 • Continued growth in differentiated product sales & stronger sales performance in Germany, UK & Eastern Europe 299 • Higher gross margins 231 253 • i
Slide 18: North America (USD)
North America (USD) Revenue & earnings growth across all regional segments Revenue up 14% 1H21 Overview USD m 2H 1H 370 364 • Improved market conditions and strong corn and soy prices driving volume growth 389 • Improved product mix offsetting impact of increased competition in 330 340 broadacre seg
Slide 19: Seed Technologies
Seed Technologies Group Executive, Nuseed, Brent Zacharias
Slide 20: Seed Technologies (AUD)
Seed Technologies (AUD) Revenue & margin growth with strong performance from core seeds portfolio Revenue up 37% AUD m 2H Core seeds portfolio 1H • Growth in canola sales & increased endpoint royalties in Australia 93 • Increased sales of higher margin sorghum & sunflower hybrids in USA 79 & South A
Slide 21: Omega-3 canola oil
Omega-3 canola oil COVID-19 related short-term market impacts • COVID-19 has had significant impact on salmon demand and producer margins COVID-19 • Chilean salmon market expected to recover 2022 – 2023 impacts short term market • Sufficient inventory of Aquaterra ® oil on hand - 2021 commercial pla
Slide 22: Outlook
Outlook CEO Greg Hunt
Slide 23: Continued focus on cash generation & returns
Strategy remains unchanged Continued focus on cash generation & returns • Securing market share gains in crops • Focusing on products and markets & markets where we have strong where we can generate stronger cash relevance returns Growing Cash • Consolidating working capital volumes to • Ensuring su
Slide 24: FY21 earnings significantly weighted to first half
Outlook – full year expectations unchanged FY21 earnings significantly weighted to first half • Rising grain prices, increased plantings • Average NWC/Sales expected to remain within targeted range • Robust spending on crop inputs despite rising input costs and tight global supply • Full year CAPEX
Slide 25: Questions
Grow a better tomorrow
Slide 26: Supplementary information
Supplementary information
Slide 27: Non IFRS disclosures and definitions
Non IFRS disclosures and definitions 24
Slide 28: Cash flow
Cash flow Material items impacting cash flows are as follows: 6 months ended 31 March 2021 Material Total Underlying items group $000 $000 $000 Cash flows from operating activities Net operating cash flows 62,511 (8,640) 53,871 Cash flows from investing activities Net investing cash flows (53,969) -
Slide 29: Financial summary (continuing operations)
Financial summary (continuing operations) 26
Slide 30: Constant currency results
Constant currency results Notes: 1. 2021 reported results converted at 2020 foreign currency exchange rates 27