Fraser & Neave Ltd. · SGX:F99
Fraser & Neave — 9M2017 Earnings Presentation
21 slides from Fraser & Neave's earnings presentation, Aug 8, 2017
Slide 1: F&N 9M2017 Financial Highlights
F&N 9M2017 Financial Highlights
Slide 2: Important notice
Important notice Certain statements in this Presentation constitute “forward-looking statements”, including forward-looking financial information. Such forward-looking statements and financial information involve known and unknown risks, uncertainties and other factors which may cause the actual res
Slide 3: 9M2017 Performance Highlights
9M2017 Performance Highlights Attributable profit (“AP”) rose to $1.3 billion due to realisation of fair value reserves upon change of interests in Vinamilk; excluding fair value reserves, AP rose 16%, to $87 million Strong operating performance in the nine-month ended 30 June 2017 (“9M2017”) • Aros
Slide 4: 9M2017 Group Financial Highlights
9M2017 Group Financial Highlights Revenue Earnings before interest and tax (“EBIT”) (million) (million) $1,429.4 $146.8 ▼ 4.8% ▲ 4.2% Profit after tax Gearing3 (million) (%) $1,331.91 6.1 ▲ NM2 Net cash of $908.5m @ FY2016 Dividend per share (interim) Earnings per share (basic) (cents) (cents) 1.54
Slide 5: Revenue down 4.8%
9M2017 Revenue down 4.8% Continuing weak consumer sentiments and increasing competitive environment in Malaysia impacted performance Revenue by Business Segment 9M2017 ($) Revenue by Business Segment (%) -4.8% Dairies 58% Publg $1,501m $1,429m & Print $1,429m 15% -0.2% -11.9% Beverages $826m $828m 2
Slide 6: Revenue | Beverages
9M2017 Revenue | Beverages Despite contribution from new vending business, Beer and New Markets, revenue declined 12% on increasing competitive environment in Malaysia, intensifying price discounting and weaker Ringgit 9M2017 Revenue Beverages Malaysia (-19%; -15% in constant currency) -15% +26% +11
Slide 7: Revenue | Dairies
9M2017 Revenue | Dairies Revenue flat; higher sales in Thailand, Singapore and New Markets of Myanmar and Indonesia, offset by lower sales in Malaysia Dairies Malaysia (-9%; -5% in constant 9M2017 Revenue currency) – Double-digit growth in Export helped to -0.2% -0.5% mitigate fall in domestic sales
Slide 8: Revenue | Publishing & Printing
9M2017 Revenue | Publishing & Printing • Revenue impacted by • Lower education publishing revenue, impacted by lower reprint demand and absence of one-time project sales • despite higher print volumes from China and Malaysia - 7% $226m $209m 9M2016 9M2017 8 Nine-month ended 30 June 2017 8 August, 20
Slide 9: EBIT gained 4%
9M2017 EBIT gained 4% Buoyed by higher dividend income and stronger Dairies earnings following the maiden recognition of profit from its associated company, Vinamilk EBIT by Business Segment 9M2017 9M17 ($) 9M16 EBIT by Business Segment (%) EBIT EBIT Margin 19.7% 14.0% Margin Publg 10.3% Dairies 6.5
Slide 10: EBIT | Beverages
9M2017 EBIT | Beverages Earnings fell 80% mainly on lower soft drinks sales in Malaysia and Singapore Beverages Malaysia (-64%; -62% in constant EBIT: Beverages currency) – EBIT impacted by lower revenue and higher input costs -62% -62% – One-off professional fees incurred for the realignment $29m -
Slide 11: EBIT | Dairies
9M2017 EBIT | Dairies Earnings jumped 40% on maiden profit contribution from associated company, Vinamilk Vinamilk EBIT +40% -4% – Effective 16 Apr, the Group accounts for its share Others +258% of Vinamilk’s profit under equity accounting $4m +17% -9% method; 2.5-months of Vinamilk’s profit $5m Vin
Slide 12: EBIT | Publishing & Printing
9M2017 EBIT | Publishing & Printing • Losses before interest and taxation increased to $11m, due to a decline in revenue, lower margins from a change in product mix in Education Publishing, investments made in its e- commerce project and higher inventory provision EBIT: Publishing & Printing 9M2016
Slide 13: Maintained a strong financial position
Maintained a strong financial position Focused on prudent balance sheet management Key Financials • Borrowings increased to finance purchases of Vinamilk FY2016 9M2017 shares • The Group owns 18.74% of Vinamilk shares @ 18 July 2017 Total Equity1 $3,153m $3,172m • The Group adopts a prudent gearing
Slide 14: Key Developments: Investing for Growth
KEY DEVELOPMENTS: Investing for Growth
Slide 15: Vinamilk: Deepening our participation in Vietnam
Deepening our participation in Vietnam 18.74% Vietnam Dairy Products Joint Stock Company INTERESTS @ 18 July VINAMILK The Group’s 18.74% stake and 2 board @ 21 Dec 2016: 16.35% representatives constitutes significant influence ▲ @ 30 Sep 2016: 10.95% over Vinamilk, in accordance with Singapore Finan
Slide 16: Vinamilk: Deepening our participation in Vietnam
Deepening our participation in Vietnam 18.74% Vietnam Dairy Products Joint Stock Company INTERESTS @ 18 July VINAMILK @ 21 Dec 2016: 16.35% Investment in Associate ▲ Other Investments (Equity Accounting) @ 30 Sep 2016: 10.95% Balance Sheet: Balance Sheet: • Carrying amount of • Carrying amount of &
Slide 17: Vinamilk: Deepening our participation in Vietnam
Deepening our participation in Vietnam 18.74% Vietnam Dairy Products Joint Stock Company INTERESTS VINAMILK @ 18 July 2017 Top listed company by market value on Ho Chi Minh & Stock Exchange Vietnam’s largest and leading dairy company involved 2 in the production, supply and distribution of products
Slide 18: New Launches: Innovation: New Flavours
New Launches Innovation: New Flavours F&N FRUIT TREE FRESH 100PLUS Active Singapore Malaysia 2 flavours: Berries & Lime Non-carbonated 18 Nine-month ended 30 June 2017 8 August, 2017
Slide 19: New Launches: Portfolio expansion: Agency brands
New Launches Portfolio expansion: Agency brands RIBENA MAGNERS Singapore Singapore 11 flavours 3 flavours: Pear, Original & Berry 19 Nine-month ended 30 June 2017 8 August, 2017
Slide 20: Strengthening market positions in primary markets
Strengthening market positions in primary markets RM NEW UHT LINE, Kuching 31.5 Adds capacity of 3.4 million cases per year Localises production and enables the Group to understand customers’ needs MILLION Improves the plant’s carbon footprint through environmentally-friendly packaging and reduced s
Slide 21: Analyst and media contact
Analyst and media contact: Jennifer Yu Head, Investor Relations T: (65) 6318 9231 E: jenniferyu@fngroup.com.sg Fraser and Neave, Limited 8 August, 2017 21