Bunge Limited · NYSE:BG
Bunge — Q2 2017 Earnings Presentation
21 slides from Bunge's earnings presentation, Aug 2, 2017
Slide 1: Second Quarter 2017 Earnings Conference Call
Second Quarter 2017 Earnings Conference Call AUGUST 2, 2017 1 SECOND QUARTER 2017 EARNINGS CONFERENCE CALL
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 add
Slide 3: CEO's comments
CEO’s comments Challenging Q2 and 1H 2017 in Agribusiness • Slow farmer selling compressed margins • Limited forward distribution opportunities • Teams managed tough environment well Expect much improved 2H 2017; however, headwinds will persist • Brazil farmer selling has picked up, but likely to st
Slide 4: Bunge Limited earnings highlights
Bunge Limited earnings highlights Quarter Ended Jun 30, Six Months Ended Jun 30, $ in millions, except EPS data 2017 2016 2017 2016 Net income attributable to Bunge $81 $121 $128 $356 Net income (loss) per common share from $0.48 $0.81 $0.79 $2.43 continuing operations – diluted (1) Net income (loss
Slide 5: Bunge Limited cash flow highlights
Bunge Limited cash flow highlights Adjusted Funds From Operations (Adjusted FFO) (1) $ billions 1.5 1.4 1.3 1.2 1.2 (2) 2013 2014 2015 2016 Q2' 17 TTM (1) Adjusted Funds From Operations is a non US GAAP measure. Reconciliation to the most directly comparable U.S. GAAP measure is provided in the appe
Slide 6: Right balance: disciplined capital allocation
Right balance: disciplined capital allocation Balance sheet strength & flexibility • ~$4.1 billion of long term debt (1) (BBB rated) • Committed credit facilities of ~$5 billion, of which ~$4.1 billion was unused and available at 6/30/2017 Reinvest in the Asset portfolio Return capital business (Cap
Slide 7: Return on invested capital (ROIC)
Return on invested capital (ROIC) Trailing 4Q Average Adjusted for certain gains & charges Adjusted for certain gains & charges and excludes Sugar & Bioenergy segment 8.6% 7.4% WACC = 7% 6.1% 5.5% As of As of Dec 31, 2016 Jun 30, 2017 *See appendix for reconciliation 7 SECOND QUARTER 2017 EARNINGS C
Slide 8: 2017 Outlook
2017 Outlook Agribusiness Expect full-year EBIT of $550 to $650 million; adjusting range due to lower Q2 and delay in recovery of soy crush margins • Demand remains strong • Brazil farmers showing willingness to price • Expect soy margins to increase as South America slows bean exports • China crush
Slide 9: 2017 Outlook
2017 Outlook Sugar & Bioenergy Continue to expect adjusted EBIT of $100 to $120 million • Have hedged much of our 2017 sugar production at higher year-over-year prices • Our cane yields and sugar content developing well • Results to be Q4 weighted Fertilizer Expect EBIT of $25 million Other: Full-ye
Slide 10: Competitiveness Program targets SG&A
Competitiveness Program targets SG&A Addressable 2017 SG&A spend of ~$1.35 billion split between $US billion employee-related and indirect $1.45 (“non labor”) expenses $1.35 $125 million indirect spend reduction opportunity to be $1.1 realized through zero based budgeting and optimized procurement $
Slide 11: Q&A
Q&A 11 SECOND QUARTER 2017 EARNINGS CONFERENCE CALL
Slide 12: Agribusiness – Oilseeds & Grains definitions
Agribusiness – Oilseeds & Grains definitions Oilseeds Grains • Oilseed processing • Grain origination − Soybean: U.S., South America, Europe, − Grains (corn, wheat, barley, rice) Asia − Oilseeds (soybean, rapeseed/canola, − Rapeseed/Canola: Europe, Canada sunseed) − Sunseed: Eastern Europe, Argentin
Slide 13: Segment volume highlights
Segment volume highlights Quarter Ended Jun 30, Six Months Ended Jun 30, In thousands of metric tons 2017 2016 2017 2016 Agribusiness 36,173 33,944 71,196 66,697 Oilseeds 17,002 15,921 32,088 29,955 Grains 19,172 18,023 39,108 36,742 Edible Oil Products 1,947 1,742 3,736 3,344 Milling Products 1,099
Slide 14: Sugar & Bioenergy Highlights
Sugar & Bioenergy Highlights Quarter Ended Jun 30, Six Months Ended Jun 30, 2017 2016 2017 2016 Merchandising/Trading Volume (000 mt) 1,785 1,757 3,392 3,407 Milling Volume (mmt of cane) 6.9 6.7 7.3 7.0 Industrial Product Sales Volumes: Sugar (000 mt) 264 227 351 261 Ethanol (000 mt) (1) 328 407 554
Slide 15: Non-GAAP reconciliations
Non-GAAP reconciliations Non-GAAP measures Bunge uses total segment earnings before interest and taxes (“Total Segment EBIT”) and Total Segment EBIT, adjusted to evaluate Bunge’s operating performance. Total Segment EBIT is the aggregate of each of our five reportable segments’ earnings before inter
Slide 16: Non-GAAP reconciliation
Non-GAAP reconciliation Below is a reconciliation of Net income attributable to Bunge to Total Segment EBIT, adjusted: Quarter Ended Six Months Ended June 30, June 30, (US$ in millions) 2017 2016 2017 2016 Net income (loss) attributable to Bunge $ 81 $ 121 $ 128 $ 356 Interest income (8) (14) (20) (
Slide 17: Non-GAAP reconciliation notes
Non-GAAP reconciliation notes Below is a reconciliation of net income (loss) per common share-diluted adjusted (excl. certain gains & charges and discontinued operations) to net income (loss) per common share-diluted: Quarter Ended Six Months Ended June 30, June 30, 2017 2016 2017 2016 Continuing op
Slide 18: Non-GAAP reconciliation notes
Non-GAAP reconciliation notes Return on Invested Capital: Bunge Limited continuing operations excl. certain gains and charges Trailing 4 Trailing 4 Quarter Average Quarter Average June 30, Decem ber 31, (US$ in m illions) 2017 2016 Total Segm ent EBIT $ 822 $ 1,143 EBIT attributable to noncontrollin
Slide 19: Non-GAAP reconciliation notes
Non-GAAP reconciliation notes Return on Invested Capital: Bunge Limited continuing operations excl. certain gains & charges and Sugar and Bioenergy segment EBIT Trailing 4 Trailing 4 Quarter Average Quarter Average June 30, Decem ber 31, (US$ in m illions) 2017 2016 Total Segm ent EBIT $ 822 $ 1,143
Slide 20: Non-GAAP reconciliation
Non-GAAP reconciliation Income before income tax utilized for ROIC calculation Below is a reconciliation of Income from continuing operations before income tax to Return before income tax, adjusted: Trailing 4 Trailing 4 Quarter Average Quarter Average (US$ in m illions) June 30, 2017 Decem ber 31,
Slide 21: Non-GAAP reconciliation
Non-GAAP reconciliation Cash provided by (used for) operating activities to Adjusted FFO reconciliation 2013 2014 (1) 2015 2016 Q2’17 TTM(2) Cash provided by (used for) operating 2,225 1,399 610 1,904 2,111 activities Foreign exchange (loss) gain 48 215 213 (80) 71 on net debt Working capital change