Agthia Group · ADX:AGTHIA
Agthia — Q3 2022 / 9M 2022 Earnings Presentation
35 slides from Agthia's earnings presentation, Nov 9, 2022
Slide 1: Analyst and Investor Call Q3'22 / 9M'22 Results
Analyst and Investor Call Q3’22 / 9M’22 Results 09 November 2022
Slide 2: Disclaimer
02 Analyst and Investor Call Disclaimer Agthia Group PJSC and its management may make certain statements that constitute “forward-looking statements” with respect to the financial condition, results of operations and business of the Group. These statements can be identified by the fact that they do
Slide 3: Agenda
03 Analyst and Investor Call Agenda 1 2 3 Strategic Executive Key Vision Summary Financials 4 5 6 Key Segmental Operational Appendix performance Highlights
Slide 4: Our strategic vision: A regional F&B leader by 2025
04 Analyst and Investor Call Our strategic vision: A regional F&B leader by 2025 From… To… UAE centric Footprint MENAP & beyond Becoming a Commoditized portfolio Value-add F&B brands regional F&B Stable financial performance Strong shareholder returns leader by 2025 Local organization mindset Consum
Slide 5: Executive Summary
05 Analyst and Investor Call Executive Summary Continued progress in integrating acquired companies, leveraging synergies, and maintaining a profitable core Delivering Growth Driving Efficiency Expanding Capabilities Strong, quality and profitable growth Effective pricing and revenue growth Finalize
Slide 6: Al Foah Success Story
06 Analyst and Investor Call Al Foah Success Story Profit doubled YoY with strong double-digit topline growth: Revenue +19%; Net Profit +93% Execution Excellence – UAE Modern Trade Activations New Packaging Perfect Store Expansion of portfolio Travel Retail Choco Date Range
Slide 7: Key Financials
Key Financials
Slide 8: Quality and profitable growth in a challenging macroeconomic environment
08 Analyst and Investor Call Quality and profitable growth in a challenging macroeconomic environment +20% +40% 2,949 954 2,113 159 795 +14% 103 +54% Revenue Net Profit2 35 40 (AED MN) (AED MN) Q3'21 Q3'22 9M'21 9M'22 Q3'21 Q3'22 9M'21 9M'22 +15% +35% 2.1 1.7 1.7 268 624 843 Net Debt3/ 0.9 1.3 Gross
Slide 9: Strong topline growth driven by key Protein and Snacking segments
09 Analyst and Investor Call Strong topline growth driven by key Protein and Snacking segments Year-to-date revenue growth +40% YoY, with 13% from pricing and 27% from volume Group revenues (AED MN) 40% growth YoY to 9M’22 2,949 37 146 (2) 67 360 2,114 229 Improved water Favourable Stronger Portfoli
Slide 10: Gross profit growth broadly in line with revenue despite raw material price inflation
10 Analyst and Investor Call Gross profit growth broadly in line with revenue despite significant raw material price inflation Group Gross Profit (AED MN) 35% growth YoY to 9M’22 0 23 843 (23) 30 103 624 86 softness in Q3 improved Maintained volume volumes mix + better margin while growth + + pricin
Slide 11: Clear focus on efficiency generation and cost discipline
11 Analyst and Investor Call Clear focus on efficiency generation and cost discipline with operating cost to sales ratio -333bps YoY Group OPEX (AED MN) 1 1 (6) 15 643 52 532 49 Inorganic growth 9M'21 Snacking Protein Water & Food AgriBusiness Snacking Protein & Frozen 9M'22 acquisitions acquisition
Slide 12: Net profit growth ahead of revenue despite higher interest rate environment
12 Analyst and Investor Call Net profit growth ahead of revenue despite higher interest rate environment Owners Net profit1 (AED MN) 54% growth YoY to 9M’22 6 9 (37) 159 (14) 32 26 103 33 Operational Stronger Good portfolio Peak input & efficiencies + Higher Fuel costs profitability management + fin
Slide 13: Proactive working capital management helps underpin good cash conversion
13 Analyst and Investor Call Proactive working capital management helps underpin good cash conversion 30% 28% 27% 25% 23% 23% 21% 959 948 Net Working Capital1 842 885 819 (AED MN) 786 789 Q1'21 Q2'21 Q3'21 FY'21 Q1'22 Q2'22 Q3'22 NWC NWC % TTM sales 28% 1% 22% 10% 11% -1% 21% 319 189 177 199 Free Ca
Slide 14: Robust balance sheet with low leverage
14 Analyst and Investor Call Robust balance sheet with low leverage Net Debt Net Debt / TTM EBITDA Liquidity AED 785 MN 1.3x AED 1.9 BN • Cash balance of AED 1.2bn • Low leverage notwithstanding 5 • Undrawn credit facilities of AED completed acquisitions to date 0.7bn • Operating cashflow of AED 360
Slide 15: Segmental performance
Segmental performance
Slide 16: Strong and continuing momentum in margin accretive Protein and Snacking
16 Analyst and Investor Call Strong and continuing momentum in margin accretive Protein and Snacking Protein & FV Snacking 879 599 222 +39% 308 +136% +69% +79% Revenue 373 182 334 108 (AED MN) Q3'21 Q3'22 9M'21 9M'22 Q3'21 Q3'22 9M'21 9M'22 226 184 62 +26% 78 58 98 100 +127% 34 +68% +87% Gross Profi
Slide 17: Leadership retained in UAE water and resilient Agri performance
17 Analyst and Investor Call Leadership retained in UAE water and resilient Agri performance despite higher outbound travel and adverse commodity price impact in Q3 Water & Food Agribusiness +1% 715 0% 713 -2% 225 692 +10% 759 236 238 229 Revenue (AED MN) Q3'21 Q3'22 9M'21 9M'22 Q3'21 Q3'22 9M'21 9M
Slide 18: Key Operational Highlights
Key Operational Highlights
Slide 19: Driving efficiencies: mitigating industry wide inflationary pressures
19 Analyst and Investor Call Driving efficiencies: mitigating industry wide inflationary pressures Revenue growth Synergy capture Improving asset utilization o Broad-based pricing o 9M’22 efficiency gains of AED 39m o Relocating BMB Jebel Ali facility through automation and route-to-market to Abu Sa
Slide 20: Expanding in-house capabilities to futureproof our growth
20 Analyst and Investor Call Expanding in-house capabilities to futureproof our growth People & Organization Culture & Know-how o 5-year digital roadmap finalized o Formed Central Innovation Team to drive innovation ➢ Consumer centric mindset and capabilities pipeline ➢ Digital ecosystem to help dri
Slide 21: Case study: Acquisition of 100% of Al Foah in Jan'21
21 Analyst and Investor Call Case study: Acquisition of 100% of Al Foah in Jan’21 Our strategy is to acquire attractive consumer-centric businesses in value-add categories, optimize and integrate them into our Group, and create value through leveraging scale economies and platform synergies Acquire
Slide 22: Our Sustainability Agenda: adopting a "4 P" approach
22 Analyst and Investor Call Our Sustainability Agenda: adopting a “4 P” approach Packaging Processes • Target packaging material reduction of 3,000 tons by year-end • 3.3% reduction in water usage ratio for Agthia Group (YTD Sept) • Five-fold increase in PLA volumes vs 2021 YTD • 5.17% reduction in
Slide 23: Experienced leadership team with proven track record of value creation
23 Analyst and Investor Call Experienced leadership team with proven track record of value creation Alan Smith Niraj Jain Mubarak Al Mansoori Ramy Merdan Dr. Rabih Kamleh Ahmad Yahya Declan Mujtaba CEO Acting CFO Chief Human Capital & Chief Operating Chief R&D and QA Officer EVP - Growth & Bennett H
Slide 24: A forward-looking company
24 Analyst and Investor Call A forward-looking company Dynamic and Integrated business Organic and Robust financial expanding portfolio model with strong acquisitive growth foundations to of value-add brands cost discipline throughout MENAP support growth
Slide 25: ForThe Better * JaoUI Joi yo
ForThe Better * JaoUI Joi yo
Slide 26: Appendix
ForThe Better * JA0UI Joi yo
Slide 27: Diversification into large, growing and scalable markets
27 Analyst and Investor Call Diversification into large, growing and scalable markets 9M 2020 9M 2021 9M 2022 Revenues AED 1.6BN AED 2.1BN AED 2.95BN (2x 9M’20) 7% 7% 3% 0% 9% 17% 27% 49% 14% 62% 88% 17% YoY Rev Growth UAE +10% GCC excl UAE +68% Other Arab Countries +119% +44% RoW
Slide 28: Shift into margin-accretive categories
28 Analyst and Investor Call Shift into margin-accretive categories 9M 2020 9M 2021 9M 2022 Revenues AED 1.6BN AED 2.1BN AED 2.95BN (2x 9M’20) EBITDAm 7.0% 12.7% 13.6% (+660bps vs. 9M’20) 26% 24% 33% 34% 45% 48% 20% 16% 30% 1% 17% 6% YoY Rev growth NPM (%) Protein & Frozen Veg +136% 7.8% Snacking +7
Slide 29: Volume Growth: low elasticity across faster-growing categories
29 Analyst and Investor Call Volume Growth: low elasticity across faster-growing categories Protein & Frozen (‘000 tons) Snacking (‘000 tons) +77% +24% 77 87 68 66 70 33 38 17 20 18 11 7 4 4 - 5 Nabil Atyab TP & FV Protein & FV Dates Bakery UAE + BMB snacks Snacking Kuwait 9M'21 9M'22 9M'21 9M'22 Wa
Slide 30: Diversified operations enable us to mitigate industry-wide inflationary pressures
30 Analyst and Investor Call Diversified operations enable us to mitigate industry-wide inflationary pressures Group Net Profit1 (AED MN) (321) (6) 189 7 340 182 (29) 2 113 76 Market Trends Economical & External factors 24 NCI 9M'21 Inorganic 9M'21 Volume/Mix Net pricing Higher Input Currency Higher
Slide 31: Softening of key input costs albeit remaining above historical averages
31 Analyst and Investor Call Softening of key input costs albeit remaining above historical averages Oil prices down from April peak but +12% YoY Key commodity prices remain elevated versus history 140 USD/barrel 18 USD/bushel 16 120 14 100 12 80 10 8 60 6 40 4 20 2 - 0 Feb-20 Sep-20 Oct-20 Feb-21 S
Slide 32: Summary Profit & Loss Statement
32 Analyst and Investor Call Summary Profit & Loss Statement AED'000 Q3'22 Q3'21 YoY 9M'22 9M'21 YoY Revenue 953,543 795,137 20% 2,949,164 2,113,504 40% Cost of sales (685,483) (561,251) 22% (2,105,917) (1,489,536) 41% Gross profit 268,060 233,886 15% 843,247 623,968 35% Selling and distribution exp
Slide 33: Summary Balance Sheet Statement
33 Analyst and Investor Call Summary Balance Sheet Statement AED'000 9M'22 FY'21 Property, plant and equipment 1,439,522 1,500,436 Intangible assets & Goodwill 2,065,663 2,085,142 Others 98,196 133,695 Total non-current assets 3,603,381 3,719,273 Inventories 918,173 708,241 Trade and other receivabl
Slide 34: Summary Cash Flow Statement
34 Analyst and Investor Call Summary Cash Flow Statement AED'000 Q3'22 Q3'21 YoY 9M'22 9M'21 YoY Profit for the period 47,178 42,100 12% 182,409 112,842 62% Adjustments for: Depreciation & Amortization 57,469 54,132 6% 169,440 146,251 16% Provisions & Allowances 3,761 10,093 -63% 18,359 25,498 -28%
Slide 35: Thank you
For The Better + JAoUI Joi yo 09 November 2022 Se ee
Agthia Group — Q3 2022 / 9M 2022 Earnings Presentation on 6ix