Agthia Group · ADX:AGTHIA
Agthia — Q1 2024 Earnings Presentation
43 slides from Agthia's earnings presentation, May 20, 2024
Slide 1: Investor Presentation Q1'24 Results
Investor Presentation Q1’24 Results 20 May 2024
Slide 2: Disclaimer
2 Analyst and Investor Presentation Disclaimer Agthia Group PJSC and its management may make 7. expected financial results; 8. sensitivity to changes in 4. various events which could disrupt operations, certain statements that constitute “forward-looking product prices; 9. sensitivity to key input p
Slide 3: Agenda
3 Analyst and Investor Presentation Agenda 01 Strategic update 04 Guidance 02 Key financials 05 Q&A 03 Segment performance
Slide 4: Recap: Our strategic vision to become a regional F&B leader by 2025
4 Analyst and Investor Presentation Recap: Our strategic vision to become a regional F&B leader by 2025 From… To… UAE centric Footprint MENA+ & beyond Becoming a Commoditized portfolio Value-add F&B brands regional F&B Stable financial performance Strong shareholder returns leader by 2025 Local orga
Slide 5: Progress on strategic vision
5 Analyst and Investor Presentation Progress on strategic vision Delivering Growth Driving Efficiency Expanding Capabilities • Reported revenue growth +22.6% YoY; • Focus on productivity enhancement: • Investing in innovation: 17.5% from volume & 5.1% from pricing • Snacking – new Date Crown organic
Slide 6: Key Financials
Key Financials
Slide 7: Q1'24: Strong and profitable growth across the business
7 Analyst and Investor Presentation Q1’24: Strong and profitable growth across the business Strong revenue growth… … outpaced by EBITDA Significant net profit growth AED MN AED MN AED MN +23% +23% +32% 1,449 233 128 1,182 189 97 Q1'23 Q1'24 Q1'23 Q1'24 Q1'23 Q1'24 +12.4% excluding one-off sales EBIT
Slide 8: …amidst a volatile backdrop
8 Analyst and Investor Presentation …amidst a volatile backdrop 19% EGP devaluation Rising interest rate Average EGP vs USD FX Rate Average 3M LIBOR / SOFR1 +40bps 35.7 5.0% 5.4% 30.0 Q1'23 Q1'24 Q1'23 Q1'24 Devaluation impact vs. last year • Revenue AED 42.5 MN • EBITDA AED 10.2 MN • Group net prof
Slide 9: Significant step up in EPS and Working Capital
9 Analyst and Investor Presentation Significant step up in EPS and Working Capital EPS Optimization of WC1 FCF AED WC as % of Sales AED MN +33% -751 bps -62% 229 0.146 0.110 15.9% 8.4% 88 2 Q1'23 Q1'24 Q1'23 Q1'24 Q1'23 Q1'24 Q1’24 FCF impacted by lower base of NWC vs. same period last year (please
Slide 10: Notable reduction of cash conversion cycle
10 Analyst and Investor Presentation Notable reduction of cash conversion cycle Cash Conversion Cycle Impact of change in NWC on FCF CCC days NWC as of eop, AED MN 77 -157 37 -77 829 DSO 77 71 752 88 DIH 76 80 487 407 -89 DPO -111 FY 2022 Q1 2023 FY 2023 Q1 2024 Q1’23 Q1’24
Slide 11: Strong balance sheet to fuel future growth and boost shareholder value
11 Analyst and Investor Presentation Strong balance sheet to fuel future growth and boost shareholder value Net debt / EBITDA1 Interest coverage2 1.3x FY Dec’23 - 1.3x 8.2x FY Dec’23 – 7.6x High borrowing capacity 1.9bn Avg Dividend yield3 FY Dec’23 – 1.8bn 4.5% FY’23 DPS = AED 0.235 1 Net debt as o
Slide 12: Strong topline growth across all segments
12 Analyst and Investor Presentation Strong topline growth across all segments Q1’24 revenue growth +22.6% YoY, with 17.5% from volume and 5.1% from pricing; 12.4% excl. one-off wheat trading Group Revenue (AED MN) after absorbing after absorbing including AED 120 MN EGP devaluation of EGP devaluati
Slide 13: EBITDA growth ahead of revenue
13 Analyst and Investor Presentation EBITDA growth ahead of revenue Q1’24 EBITDA growth +23.4% YoY, +28.8% pre devaluation Group EBITDA (AED MN) after absorbing after absorbing EGP devaluation of EGP devaluation of AED 6MN AED 4MN 1 Others include digital and capability investments
Slide 14: Solid net profit growth despite continued macroeconomic headwind
14 Analyst and Investor Presentation Solid net profit growth despite continued macroeconomic headwind Q1’24 reported net profit growth +32.0% YoY, +38.7% pre devaluation Group net profit1 (AED MN) after absorbing after absorbing EGP devaluation of EGP devaluation of AED 4MN AED 3MN 1 Net profit incl
Slide 15: Segmental performance
Segmental performance
Slide 16: Diversified growing portfolio in large growing scalable markets
16 Analyst and Investor Presentation Diversified growing portfolio in large growing scalable markets Diversified revenue by geography... …and segments 9% 20% 31% 22% 57% 31% 12% 18% UAE Other Arab Countries Protein & Frozen Water & Food RoW Snacking Agri Business GCC excl UAE
Slide 17: Snacking: Strong growth in dates and coffee
17 Analyst and Investor Presentation Snacking: Strong growth in dates and coffee Revenue, AED MN EBITDA1, AED MN Key highlights EBITDA margin 24.5% (+430 bps) Revenue • Strong revenue mainly led by coffee and dates’ notable +18% performance during the quarter. +43% o Abu Auf continued to deliver str
Slide 18: Protein & Frozen: Revenue and EBITDA growth in AED terms
18 Analyst and Investor Presentation Protein & Frozen: Revenue and EBITDA growth in AED terms Revenue, AED MN EBITDA1, AED MN Key highlights EBITDA margin 11.5% (-63 bps) Revenue +16% • Revenue +15.9% YoY, marking the first positive growth for the segment since Q3 2022, despite EGP devaluation and +
Slide 19: Water & Food: Consistent revenue growth, with EBITDA surpassing
19 Analyst and Investor Presentation Water & Food: Consistent revenue growth, with EBITDA surpassing driven by step up in efficiency Revenue, AED MN EBITDA1, AED MN Key highlights EBITDA margin 16.5% (+213 bps) Revenue • +3.5% YoY on positive growth across local (UAE +3% +19% water +5.9%) and intern
Slide 20: Agri-Business: Strong volumes in Flour and Feed
20 Analyst and Investor Presentation Agri-Business: Strong volumes in Flour and Feed Revenue, AED MN EBITDA1, AED MN Key highlights EBITDA margin 13.1% (+48 bps) Revenue • Revenue +10.5% YoY excluding the one-off trading +51% on strong volume growth across Flour and Feed +56% • +50.6% YoY reported g
Slide 21: Egypt: Emerging market with high potential
21 Analyst and Investor Presentation Egypt: Emerging market with high potential Strong revenue growth and profitability improvement Revenue, AED MN EBITDA (AED MN) & EBITDA margin (%) “Export Hub” strategy +39% 281.7 15.9% +230 bps +59% 18.2% AED 24.4 MN exports from Egypt in Q1’24 51.2 203.0 • 24%
Slide 22: Q1'24: Over AED 48MN in revenue generated from strategic product innovation
22 Analyst and Investor Presentation Q1’24: Over AED 48MN in revenue generated from strategic product innovation Snacking Protein & Frozen Veg Agri-Business Dates: new organic date range, chocolate- Jordan: launched new range of chicken Flour: two new specialty type of flour to meet coated nuts stri
Slide 23: Our FY'24 outlook
Our FY’24 outlook
Slide 24: FY'24 Guidance
24 Analyst and Investor Presentation FY’24 Guidance1 Revenue growth EBITDA margin improvement Net profit margin improvement* +10% to 12% +40 to 60 bps +30 to 50 bps Assumptions • 100% of Group profit including • FY average FX rate of up to USD / EGP 40 • FY average FX rate of up to USD / EGP 40 mino
Slide 25: A forward-looking company
25 Analyst and Investor Presentation A forward-looking company Market leading position across key categories and geographies Growing portfolio of consumer-centric brands in large, scalable markets Growth-oriented mindset focused on leveraging synergies, innovation and digitization Attractive economi
Slide 26: For The Better
ForThe Better * JaoUI Joi yo
Slide 27: Appendix
For The Better + JA0UI Joi yo
Slide 28: Agthia is on track to achieve 2025 external guidance
28 Analyst and Investor Presentation Agthia is on track to achieve 2025 external guidance Robust revenue growth EBITDA margin improvement Net profit margin growth Significant improvement of RoIC1 to AED 6 BN 15.5-16.5% to 8.5-10.0% to 9-10% in FY 2025 in FY 2025 in FY 2025 in FY 2025 2023 Results: a
Slide 29: Improved dividend yield
29 Analyst and Investor Presentation Improved dividend yield Consistent cash dividend payout ratio of 50-60% +5% bonus shares 32% 35% 44% 43% 66% 85%1 58% 53% 56% Dividend payout % 0.185 0.165 0.165 0.165 0.150 0.150 0.150 0.150 0.125 Dividends per share (AED) 2015 2016 2017 2018 2019 2020 2021 2022
Slide 30: Snacking: Innovation-led growth in dates and healthy snacks
30 Analyst and Investor Presentation Snacking: Innovation-led growth in dates and healthy snacks, combined with excellent execution and agility in Abu Auf Innovation drives market share growth Agility and execution excellence in Abu Auf Innovation Strong results in Q1’24 • Launched new Date Crown or
Slide 31: Protein & Frozen: Expanding capabilities and gain on innovations
31 Analyst and Investor Presentation Protein & Frozen: Expanding capabilities and gain on innovations Portfolio premiumization New investment updates • Nabil launched premium line category that plays around KSA: New Protein facility in Jeddah started trial runs and is the hero items to: planned to r
Slide 32: Water & Food: Broad-based strong performance with improved business fundamentals
32 Analyst and Investor Presentation Water & Food: Broad-based strong performance with improved business fundamentals Delivering our Water Strategy across GCC Winning with communications Al Ain bottled water retaining its market leadership position Continue to strengthen brand loyalty through: Notab
Slide 33: Agri-Business: Grow together with our customers
33 Analyst and Investor Presentation Agri-Business: Grow together with our customers Growth and innovation Digitalization Flour: Launch of Agrivita marketplace 2 new products: Shandar and Asad • New partnership with Sherwood flour, to meet the needs of our • Introducing Pest Control Category custome
Slide 34: Investing in growth: Protein expansion in KSA
34 Analyst and Investor Presentation Investing in growth: Protein expansion in KSA Project overview ▪ Location: Jeddah, KSA ▪ Category: Protein ▪ Capex c. AED 87.5MN (Phase 1) ▪ Available land 9,436 sqm; Built-up area 6,600 sqm ▪ Capacity ≈ 6,500- 8,700 tons/annum ▪ ≈ 40 SKUs Rationale ▪ Strengthen
Slide 35: 5-year digital roadmap with clear priorities
35 Analyst and Investor Presentation 5-year digital roadmap with clear priorities Priority #1 Priority #2 Best customer / consumer experience Empowered employees in a collaborative environment • Seamless omnichannel experience with optimized • Integrated business planning and cross-domain online and
Slide 36: Progress on digital agenda
36 Analyst and Investor Presentation Progress on digital agenda Accelerate digital transformation by Adopting AI Other achievements in Q1’24 Rolled out a safety AI image recognition We signed a Memorandum of Understanding (MoU) with Microsoft UAE solution to alert and report on potential The MoU foc
Slide 37: Agthia Sustainability Strategy Pillars
37 Analyst and Investor Presentation Agthia Sustainability Strategy Pillars Environmental Integrity Scaling Health and Wellness • 7% reduction in CO2 emissions Q1’24 vs Q1’23 ▪ Continued growth in our Water Sustainable Portfolio (Q1’24 vs Q1’23): • AED 1.35 MN savings on packaging consumption reduct
Slide 38: Board of Directors
38 Analyst and Investor Presentation Board of Directors Chairman / Vice Chairman Board Member Khalifa Sultan Salmeen Khamis Mohamed Ms. Mariam Ahmed Gil Adotevi Svet Varadzhakov Ms. Caitlin Nguyen Ms. Sharmila Murat Maurizio Patarnello Al Suwaidi Alameri Buharoon Al Shamsi Al Remeithi Chairman Vice
Slide 39: Strong leadership team with track record of value creation
39 Analyst and Investor Presentation Strong leadership team with track record of value creation Group Functions Business Units Alan Sherif Ramy Vandy Dos Rafik Hala Abdulla Mubarak Ahmad Declan Nizar Smith Elfaham Merdan Santos Lawendy Hobeiche Al Marzooqi Al Mansoori Yahya Bennett Kayali Katounas C
Slide 40: Summary Profit & Loss Statement
40 Analyst and Investor Presentation Summary Profit & Loss Statement AED'000 Q1’24 Q1’23 YoY Revenue 1,449,349 1,182,357 22.6% Cost of sales (1,032,742) (844,880) 22.2% Gross profit 416,607 337,477 23.4% Selling and distribution expenses (163,390) (133,837) 22.1% General and administrative expenses
Slide 41: Summary Balance Sheet Statement
41 Analyst and Investor Presentation Summary Balance Sheet Statement AED'000 Q1'24 FY’23 Property, plant and equipment 1,419,972 1,460,821 Intangible assets & Goodwill 2,404,736 2,408,106 Others 130,574 128,038 Total non-current assets 3,955,282 3,996,965 Inventories 802,093 926,834 Trade and other
Slide 42: Summary Cash Flow Statement
42 Analyst and Investor Presentation Summary Cash Flow Statement AED'000 Q1'24 Q1'23 YoY Profit before tax & zakat expenses 147,540 107,370 37.4% Adjustments for: Depreciation & Amortization 56,738 58,235 -2.6% Provisions & Allowances 10,755 6,122 75.7% Others 15,516 22,483 -31.0% Cash generated fro
Slide 43: Thank you
For The Better + JAoUI Joi yo 20 May 2024 Sa ae