Bunge Limited · NYSE:BG
Bunge — Q4 2019 Earnings Presentation
26 slides from Bunge's earnings presentation, Feb 12, 2020
Slide 1: Q4 2019 Results Review
Q4 2019 RESULTS REVIEW February 12, 2020
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: Today's agenda
Today’s agenda CEO comments • 2019 key priorities update • Q4 highlights Financial performance 2020 outlook Q&A 3 | Q4 2019 RESULTS REVIEW
Slide 4: Operational Performance
Operational Performance Highest total oilseed crush volume and capacity utilization rates in 5 years Lowest soy and sunseed crushing industrial unit costs in 5 years Moved from regional structure to global operating model HQ move to St. Louis to be complete by the end of Q2 Working as one team to dr
Slide 5: Portfolio
Portfolio Expect to communicate remaining portfolio actions by end of Q2 Completed sugar and bioenergy 50/50 JV with BP in Brazil Announced agreement to sell margarine and mayonnaise assets in Brazil Other portfolio actions: • Sold Bunge stake in U.S. ethanol producer SIRE • Divested idled grain fac
Slide 6: Financial Discipline
Financial Discipline Achieved ~$50 million of additional savings from GCP in 2019 Elevated risk management discipline and rigor Implemented highly focused approach to capital allocation 6 | Q4 2019 RESULTS REVIEW
Slide 7: 2020 Outlook
2020 Outlook BUNGE
Slide 8: Bunge Limited earnings highlights
Bunge Limited earnings highlights Quarter Ended Year Ended December 31, December 31, US$ in millions, except per share data 2019 2018 2019 2018 Net income (loss) attributable to Bunge $ (51) $ (65) $ (1,280) $ 267 Net income (loss) per common share from continuing operations-diluted $ (0.48) $ (0.51
Slide 9: Global Competitiveness Program update
Global Competitiveness Program update Original target was $250m of SG&A savings by 2020; the Company achieved that goal one year ahead of schedule $US million 1,450 98 1,352 1,351 24 80 #2 252 89 1,100 58 2017 SG&A Not 2017 Savings Adj. Scope / Notable Other Not 2019 SG&A (1) (2) (1) Baseline Addres
Slide 10: Durable cash flow generation through the cycle
Durable cash flow generation through the cycle Adjusted Funds From Operations (Adjusted FFO) (1) US$ in millions $1,600 $1,477 $1,416 $1,200 $1,089 $1,056 $200 $300 $884 #2 $257 $800 $241 $281 $305 $317 $400 $784 $649 $662 $493 $524 $0 2015 2016 2017 2018 2019 Adjusted FFO Buybacks Dividends (2) Cap
Slide 11: Majority of net debt finances RMI
Majority of net debt finances RMI At year-end 2019, ~80% of Net Debt was used to finance Readily Marketable Inventories (RMI) US$ in billions Net Debt ex RMI $1.1 $2.3 $1.3 $0.5 $1.0 $1.7 $1.8 $0.8 #2 $7.8 $7.0 $6.5 $6.1 $6.2 $5.0 $5.5 $4.7 $5.4 $5.5 $5.7 $4.5 $4.5 $4.4 $4.4 $3.9 Q1 Q2 Q3 Q4 Q1 Q2 Q
Slide 12: Liquidity position is comfortable
Liquidity position is comfortable Bunge has committed credit facilities of ~$4.3 billion, with nothing drawn at December 31, 2019 (US$ million) Amount Drawn Facility Maturity Size Dec 31, 2019 CP Program / Liquidity Facility Dec 2023 $600 $0 2022 Revolving Credit Facility Sep 2022 $865 $0 2022 Revol
Slide 13: Capital allocation process shows discipline
Capital allocation process shows discipline Committed to Investment Grade Credit Rating BBB / Baa2 target Full-Year Adjusted FFO ~$1.1 billion Asset Consistent Comprehensive Strategic Stewardship Returns Vetting Returns #2 EHSS (1) & Shareholder Organic & Strategic Stock Repurchases Maintenance Divi
Slide 14: Improving return on invested capital (ROIC) trend
Improving return on invested capital (ROIC) trend 12% 10% ROIC Target = 9% 7.9% 8% WACC = 7% • 2019 ROIC of 7.9% vs PY of 5.0% 7.7% 6% #2 • Excl. Sugar & Bioenergy: 7.7% vs 6.5% 4% 2% • ROIC target is 9%, 200 basis points above WACC 0% Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 2015
Slide 15: 2020 full-year segment outlook
2020 full-year segment outlook • Agribusiness: expect full-year results to be down vs. 2019 ‒ Actual origination, processing and distribution margins will evolve based upon the fulfillment of U.S.-China trade agreements, crop sizes and farmer commercialization • Food & Ingredients: expect full-year
Slide 16: Closing Remarks and Q&A
Closing Remarks and Q&A BUNGE
Slide 17: Agribusiness | Oilseeds & Grains definitions
Agribusiness | Oilseeds & Grains definitions Oilseeds Grains • Oilseed processing • Grain origination ‒ Soybean: U.S., South America, ‒ Grains (corn, wheat, barley, rice) Europe, Asia ‒ Oilseeds (soybean, rapeseed/canola, ‒ Rapeseed/Canola: Europe, Canada sunseed) #2 ‒ Sunseed: Eastern Europe, Argen
Slide 18: Segment volume highlights
Segment volume highlights Quarter Ended Year Ended December 31, December 31, In thousands of metric tons 2019 2018 2019 2018 Agribusiness 34,976 35,416 139,968 146,309 #2 Oilseeds 16,871 17,160 66,388 65,155 Grains 18,105 18,256 73,580 81,154 Edible Oil Products 2,507 2,423 9,606 9,024 Milling Produ
Slide 19: 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, excludes EBIT attributable to noncontrolling interest and is the aggregate o
Slide 20: Non-GAAP reconciliation
Non-GAAP reconciliation Below is a reconciliation of Net income (loss) attributable to Bunge to Total Segment EBIT, adjusted: Quarter Ended Year Ended December 31, December 31, (US$ in millions) 2019 2018 2019 2018 Net income (loss) attributable to Bunge $ (51) $ (65) $ (1,280) $ 267 Interest income
Slide 21: Non-GAAP reconciliation notes
Non-GAAP reconciliation notes Below is a reconciliation of Net income (loss) attributable to Bunge to Net income (loss), adjusted (excluding certain gains & charges and discontinued operations): Quarter Ended Year Ended December 31, December 31, (US$ in millions, except per share data) 2019 2018 201
Slide 22: Non-GAAP reconciliation notes
Non-GAAP reconciliation notes Return on Invested Capital excluding certain gains and charges Trailing 4 Trailing 4 Trailing 4 Trailing 4 Trailing 4 Quarter Average Quarter Average Quarter Average Quarter Average Quarter Average December 31, December 31, December 31, December 31, December 31, (US$ in
Slide 23: Non-GAAP reconciliation notes
Non-GAAP reconciliation notes Return on Invested Capital excluding Sugar and Bioenergy segment EBIT and certain gains and charges Trailing 4 Trailing 4 Trailing 4 Trailing 4 Trailing 4 Quarters Quarters Quarters Quarters Quarters December 31, December 31, December 31, December 31, December 31, (US$
Slide 24: Non-GAAP reconciliation
Non-GAAP reconciliation Income (loss) before income tax utilized for ROIC calculation Below is a reconciliation of Income (loss) from continuing operations before income tax to Return before income tax, adjusted: Trailing 4 Trailing 4 Trailing 4 Trailing 4 Trailing 4 Quarters Quarters Quarters Quart
Slide 25: Non-GAAP reconciliation
Non-GAAP reconciliation Cash provided by (used for) operating activities to Adjusted FFO reconciliation 2019 2018 2017 2016 2015 Cash provided by (used for) operating activities (814) (1,264) (1,975) 446 610 Foreign exchange (loss) gain on net debt (139) #2 (139) (21) (80) 213 Working capital change
Slide 26: Thank you
Thank you BUNGE