Bunge Limited · NYSE:BG
Bunge — Lehman Brothers Back to School Conference 2008
41 slides from Bunge's conference presentation, Sep 3, 2008
Slide 1: Lehman Brothers Back to School Conference September 3, 2008
Lehman Brothers Back to School Conference September 3, 2008
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: Bunge Today
Bunge Today • Employees: ~ 25,000 • Facilities: 400+ • Countries of Operations: 30+ • 2007 Net Income: $778 million • 2007 Total Volume: 137 mmt Fertilizer 35% Foods 20% Agribusiness 45% NORMALIZED SEGMENT EBIT KEY FACTS 3
Slide 4: Balanced Oilseed Processing Asset Network
Balanced Oilseed Processing Asset Network 36% 37% 24% 3% North America • Soybean • Canola Europe • Soybean • Rapeseed • Sunseed South America • Soybean • Cottonseed Asia • Soybean 4
Slide 5: Largest producer and supplier of fertilizers in South America
Largest producer and supplier of fertilizers in South America Brazil’s only completely vertically integrated fertilizer company • Operate 4 of 5 major phosphate mines in Brazil • Domestically produced products priced to import parity • 25-30% share of retail fertilizer market Integrated, Local Opera
Slide 6: Outstanding, Trusted Consumer Brands
Country Brazil Russia Ukraine Poland Romania Hungary Bulgaria #1 #2 #1 #1 #1 #1 #1 Outstanding, Trusted Consumer Brands Population 190 million 141 million 46 million 39 million 22 million 10 million 7 million Bottled Vegetable Oils Market Share 6
Slide 7: Demand For Core Products Growing at 5% Per Annum
Demand For Core Products Growing at 5% Per Annum 0 20 40 60 80 100 120 140 160 180 1991 1993 1995 1997 1999 2001 2003 2005 2007e Global Consumption MMT Soybean Meal Vegetable Oil Source: USDA 7
Slide 8: Agricultural Commodities Are in Tight Supply
Agricultural Commodities Are in Tight Supply Source: USDA Global Stocks to Consumption Ratio 1998-2009e 0% 5% 10% 15% 20% 25% 30% 35% 40% Oilseeds Oils Food Grains Feed Grains Stocks to Use 8
Slide 9: Faster Improvement in Diets
Territory size shows the proportion of all people living on PPP US$ 10-20 a day worldwide that reside there. Faster Improvement in Diets Map © Copyright 2006 SASI Group (University of Sheffield) and Mark Newman (University of Michigan). www.worldmapper.org 9
Slide 10: Rainfall Levels
Territory size shows the proportion of worldwide precipitation that falls there. Map © Copyright 2006 SASI Group (University of Sheffield) and Mark Newman (University of Michigan). www.worldmapper.org Rainfall Levels 10
Slide 11: Brazil's Growing Fertilizer Market
Brazil’s Growing Fertilizer Market Brazilian Retail Fertilizer Market Volumes MMT 5 7 9 11 13 15 17 19 21 23 25 1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 CAGR = 6.5% Source: ANDA 11
Slide 12: We Have a Proven Approach
We Have a Proven Approach PURPOSE Enhance lives by improving the global agribusiness and food chain GOAL To be the world’s best agribusiness and food company STRATEGIC PILLARS Strengthen Core Businesses
Slide 13: Our Global Asset Network and Businesses as of 2001
Our Global Asset Network and Businesses as of 2001 Fertilizer Agribusiness Food Products 13
Slide 14: Our Global Asset Network and Businesses as of 2008
Our Global Asset Network and Businesses as of 2008 Fertilizer Agribusiness Food Products 14
Slide 15: Nipawin, Canada Canola Crushing/Refining Expansion
Nipawin, Canada Canola Crushing/Refining Expansion Nipawin • Increases canola crushing capacity by about 50% to 1,400 mt/day and doubles refining capacity • Enhances efficiency of asset network in Canada • Serves growing demand for low saturate and trans-fat free products • Capable of processing spe
Slide 16: Expanding Access to Fertilizer Raw Materials: Mine Expansions
Expanding Access to Fertilizer Raw Materials: Mine Expansions Araxá mine expansion (Phase II) late 2009 Anitápolis mine opening JV 50/ 50 2011 4.9 0.67 0.15 2.0 8.1 Fosfertil Salitre mine opening 2011 Fosfertil Tapira & Catalao mines expansion early 2010 0.34 Phosphate Rock Production Capacity (mill
Slide 17: Expanding Access to Fertilizer Raw Materials: OCP Joint Venture
Atlantic Ocean Brazil Argentina Morocco Main import routes Expanding Access to Fertilizer Raw Materials : OCP Joint Venture • 50/50 Joint venture with OCP • Operation located in Jorf Lasfar, Morocco • Serves as an additional source of phosphate-based raw materials and intermediate products for Bunge
Slide 18: Agroindustrial Santa Juliana Sugarcane Mill
Agroindustrial Santa Juliana Sugarcane Mill • Bunge’s first sugarcane mill, located in Brazilian state of Minas Gerais • Production capacity: 1.6 million metric tons of cane milling capacity, to be expanded to 4 million metric tons in the next several years • Located near Sao Paulo state, the larges
Slide 19: Bunge – Corn Products Combination: Complementary Global Operations
Bunge – Corn Products Combination Complementary Global Operations Corn Products & Bunge Bunge Corn Products Approximately 32,000 employees in 40 countries Corporate Headquarters 19
Slide 20: Bunge – Corn Products Combination: Highly Complementary Value Chain
Bunge – Corn Products Combination Highly Complementary Value Chain Origination Logistics Risk Management Corn (Wet Milling) Corn (Dry Milling) Oilseeds & Grains Sugar & Biofuels Fertilizer Innovation Distribution to Customers Improved supply chain and risk management New food ingredients Fermentatio
Slide 21: Enhanced Product Portfolio
Enhanced Product Portfolio Margin Ag Products Staple Products Higher Value-Added & Specialty Ingredients Raw grains Corn gluten feed Soybean meal Corn gluten meal Crude vegetable oils Sugar Glucose HFCS Glucose syrups Specialty vegetable oils High maltose syrup Liquid dextrose Regular starch Syrup b
Slide 22: Integration in Key Areas Unlocks Greater Value
Analytics Energy Logistics Risk Management Procurement HR Finance Integration in Key Areas Unlocks Greater Value Agribusiness Fertilizer Food Products Nutrients Retail Products & Services Grain Origination Oilseed Processing Food Processing Retail & Consumer Distribution 22
Slide 23: Business Summary
Business Summary Long-term trends that drive global demand growth remain steady • World’s population is increasing • Living standards in developing economies continue to improve Increasing world demand will require greater supplies of crops and smooth global trade • Being global and integrated with
Slide 24: Bunge Financial Performance
BUNGE FINANCIAL PERFORMANCE
Slide 25: Financial Performance
Financial Performance (1) Total segment EBIT is a non-GAAP financial measure. A reconciliation to the most directly comparable GAAP measure is included elsewhere in this presentation. (2) Excludes $111 million gain on the sale of the Brazilian soy ingredients business. 134 300 469 530 521 778 255 20
Slide 26: Strong Returns on Invested Capital
Strong Returns on Invested Capital 9% 11% 9% 11% 10% 10% 10% 0% 2% 4% 6% 8% 10% 12% 2001 2002 2003 2004 2005 2006 2007 Note: ROIC is defined as the sum of income from continuing operations before income tax and minority interest plus interest expense times the effective tax rate divided by the avera
Slide 27: Managing the Growth of the Business
Bunge Limited Managing the Growth of the Business 50 150 250 350 450 550 650 2001 2002 2003 2004 2005 2006 2007 2008 Index 2001 base year = 100 Annual average of monthly data Gross Debt Shareholders’ Equity Sales Operating Working Capital As of 6/30 27
Slide 28: Agricultural Commodity Prices are a Key Driver of Cash Flow
2003 2004 2005 2006 2007 Funds from operations $482 $759 $550 $565 $1,152 (before .'s in working capital) Working capital .'s $(523) $43 $(168) $(854) $(1,563) Readily marketable inventory .'s $(351) $604 $(270) $(791) $(1,033) Cash flow from operations $(41) $802 $382 $(289) $(411) Capital expendit
Slide 29: Financial Liquidity – Committed Credit Facilities
Bunge Limited Financial Liquidity – Committed Credit Facilities Actions to be taken: • Roll-over $1 billion, 364-day, revolving credit facility maturing in Nov-2008 • Refinance $500 million Notes maturing in Dec-2008 as of 6/30/2008 Total Amount Amount $ in millions Maturities availability outstandi
Slide 30: Results Six Months Ended June
Bunge Limited Results Six Months Ended June 30 565% $130 $865 Agribusiness 392% $107 $526 Fertilizer 95% $66 $129 Food Products (2) $7.56 $1,040 $1,520 67,281 2008 $1.35 $182 $302 65,153 2007 460% 471% 403% 3% %-. Earnings per Share Net Income Total Segment EBIT (1) Volume (000 mt) Six Months Ended
Slide 31: 2008 Outlook
Bunge Limited 2008 Outlook Market fundamentals remain solid • Large harvests expected in U.S. and Europe • Production must expand in South America to supply global market • Fertilizer fundamentals should remain strong • Food products showing improvement Though not without challenges • Strong Brazili
Slide 32: [LOGO]
[LOGO]
Slide 33: Start-Up Schedule of Investments
Start-Up Schedule of Investments x x x 2008 x Cartagena, Spain – crushing/refining x Illiyschevsk, Ukraine – crushing x Martfu, Hungary – crushing/refining expansion Voronezh, Russia – crushing/refining/bottling x Nipawin, Canada – crushing/refining expansion Hamilton, Canada – refining Council Bluf
Slide 34: Start-Up Schedule of Investments
Start-Up Schedule of Investments x Ramallo, Argentina - SSP x Tianjin, China - crushing/refining expansion Asia x Araxa, Brazil – phosphate rock expansion (Phase I) x Ponta Grossa, Brazil - wheat mill expansion x Araxa, Brazil - phosphate rock expansion (Phase II) x Santa Juliana, Brazil – sugarcane
Slide 35: Backup: Non-GAAP Reconciliation Notes
Backup: Non-GAAP Reconciliation Notes Total segment earnings before interest and tax Total segment earnings before interest and tax (“EBIT”) is Bunge’s consolidated net income that excludes interest income and expense and income tax attributable to each segment. Total segment EBIT is a non-GAAP fina
Slide 36: Backup: Non-GAAP Reconciliation
Below is a reconciliation of total segment EBIT to net income: Backup: Non-GAAP Reconciliation In millions 2001 2002 2003 2004 2005 2006 2007 Total Segment EBIT $311 $423 $592 $823 $546 $624 $1,230 Interest - net (134) (107) (113) (110) (126) (161) (187) Income tax (72) (104) (201) (290) 82 36 (309)
Slide 37: Backup: Non-GAAP Reconciliation
Below is a reconciliation of total segment EBIT to net income: Backup: Non-GAAP Reconciliation $168 2 28 (70) (79) 37 $250 2007 $751 – 46 (337) (90) 54 $1,078 2008 $182 $1,040 Net income – – Other (1) 37 60 Minority interest share of interest and tax (76) (454) Income tax (149) (188) Interest expens
Slide 38: Return on Invested Capital
Return on Invested Capital Bunge calculates Return on Invested Capital (ROIC) as net income plus/minus minority interest, income tax (benefit) expense, discontinued operations-loss/gain and interest expense times the effective tax rate divided by the average total capital. Bunge believes that ROIC p
Slide 39: Backup: Non-GAAP Reconciliation Notes: Net Financial Debt
Backup: Non-GAAP Reconciliation Notes Net Financial Debt Net financial debt is the sum of short-term debt, current maturities of long-term debt and long-term debt, less cash and cash equivalents and marketable securities. Net financial debt is presented because management believes it represents a me
Slide 40: Backup: Non-GAAP Reconciliation: Net Financial Debt
Below is a reconciliation of total long-term and short-term debt to net financial debt and to net financial debt less readily marketable inventories: Backup: Non-GAAP Reconciliation June 30, 2008 ($ in millions) Short-term debt $1,426 Long-term debt, including current portion 4,320 Total debt (1) 5,
Slide 41: Additional Information
Additional Information On June 21, 2008, Bunge and Corn Products International, Inc. (Corn Products) entered into a merger agreement pursuant to which Bunge will acquire Corn Products. This material is not a substitute for the joint proxy statement/prospectus and any other documents Bunge and Corn P
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