Sucro Limited · TSXV:SUGR
Sucro — Investor Presentation (November 2023)
30 slides from Sucro's investor presentation, Nov 10, 2023
Slide 1: Investor Presentation Fall 2023
Investor Presentation Fall 2023
Slide 2: Disclaimer
Disclaimer General Matters Prospective investors should only rely on the information contained in the prospectus of Sucro Limited (“Sucro”, the “Company”, “us”, “we” or “our”). This presentation is qualified in its entirety by reference to, and must be read in conjunction with, the information conta
Slide 3: Sucro at a Glance
Sucro at a Glance 9+ Years Strategically In a Growing Market Operating History Positioned Assets Established Operations in 2014 • 2 Refineries • 6 Regional Offices Since 2008, US sugar deliveries grew ~15% (1,500K Mt), equaling the demand • 2 Processing Facilities • 2 Third-party Partners of the ent
Slide 4: Evolution of Sucro
Evolution of Sucro 2024+ Sucro continues to scale refinery capacity with its Developed network of proposed 1,000K Mt facility customers and suppliers and increased sales of bulk through active management sugar to food of the supply chain 2022 manufacturers Lackawanna facility 2020 begins refining Li
Slide 5: Established Business: Sucro's Trading Operations
Sucro’s Trading Operations Sucro’s revenues are primarily driven by its Trading segment through the purchase and sale of sugar, where a margin is made by capturing a price differential in time, geographical location, or quality. Sucro’s refineries and processing facilities provide a competitive adva
Slide 6: World Class Management Team
World Class Management Team Sucro Management Team Jonathan Taylor Stefano D’Aniello Matt Dyer Eli Cohen Founder & CEO CFO Managing Director Oliver Hire VP CAN Sales & VP, Head of Trading Director & Head of US Sales Operations • 15+ years of sugar • 15+ years of financial • 13+ years of Food • 25+ ye
Slide 7: World Class Management Team: Board of Directors
World Class Management Team Sucro Board of Directors Don Hill Brian O’Malley Andrew Ferrier Tony Cina Françoise Duboc Chairman Director Independent Director Independent Director Independent Director • 30+ years of North • Former president and • 16 years of sugar • 35 years of finance and • Former Ma
Slide 8: Growth of the US Sugar Market
Growth of the US Sugar Market Continuous increase over the past 15 years has resulted in an additional ~1,500K STRV (Short Tons Raw Value), an increase of ~15% over such period United States Total Sugar Deliveries1 Short Tons Raw Value Log. (Short Tons Raw Value) 12,546 12,526 Sugar deliveries in 12
Slide 9: Food Industry Dynamics
Food Industry Dynamics Hershey posts double-digit growth in Barry Callebaut increases investment in • No evidence of declining first-quarter earnings, sales Canada with expansion of Ontario sugar demand in total factory market consumption Despite price hikes, consumer demand for snacks and candy rem
Slide 10: Sugar Pricing Dynamics
Sugar Pricing Dynamics Sucro is not directly impacted by raw sugar prices in Canada and competes on the toll price over and above the raw sugar price. Producers like Sucro are exposed to the raw sugar market in the U.S. but this exposure is actively hedged by management Raw Sugar Raw Sugar Refining
Slide 11: Sugar Pricing Dynamics: ICE #11 and #16 Futures
Sugar Pricing Dynamics ICE US Sugar #11 and #16 Futures (US$M) 1 ICE US Sugar #11 Futures ICE US Sugar #16 Futures $45.00 • The #11 and #16 markets have typically had a very low $40.00 correlation, however, more $38.29 recently that has changed: $35.00 • US market is now in a structural deficit whic
Slide 12: Sucro Investment Highlights
Sucro Investment Highlights 1 Growing Business Within a Growing Market 2 Highly Integrated Supply Chain with Strategically Positioned Assets 3 Low-Capital Cost Refinery Facilities 4 Blue-Chip Customer Base 5 Pure-Play Exposure to a Reliable & Profitable Industry 6 A Leader in High Growth Organic 7 E
Slide 13: 1. Growing Business: Operational Overview
1. Growing Business Operational Overview Sucro’s mission is to become North America’s leading alternative integrated sugar supplier through innovation and investment • Since its founding in 2014, Sucro has continuously increased sugar deliveries by focusing on active management of the supply chain f
Slide 14: 1. Growing Business: Financial Performance
1. Growing Business Financial Performance EBITDA (US$M)1 Adj. EBITDA (US$M)1 EBT (US$M)1 40.4% $81 CAGR $70 39.7% CAGR 55.5% $61 CAGR $55 $54 $53 $41 $42 $29 $48 Q2 YTD $23 $22 Actual2 $36 Q2 YTD $14 Actual2 $17 Q2 YTD Actual2 2021A 2022A 2023E 2024E 2021A 2022A 2023E 2024E 2021A 2022A 2023E 2024E 1
Slide 15: 2. Highly Integrated Supply Chain: Strategically Positioned Assets
2. Highly Integrated Supply Chain Strategically Positioned Assets City State / Country Function Granular Refinery with 130K t Hamilton Ontario Capacity (2023E) Granular Refinery with 350K t Lackawanna New York Expected Capacity (2026E) Liquid Processing (50K t), Chicago Illinois Packaging and Wareho
Slide 16: 2. Highly Integrated Supply Chain: Diversified Supplier Base
2. Highly Integrated Supply Chain Diversified Supplier Base Global Volume Supply Sucro Volume Supply by Country (2022) 1 by Country (2022) No single country accounts for >35% of aggregate raw USA Australia 2.2% Costa Rica materials Guatemala 2.7% Honduras EU 2.5% 5.4% Guatemala Mexico 5.2% Pakistan
Slide 17: More Capacity, Less Capex
3. Low-Capital Cost Refinery Facilities Company Location Status Capacity Price US$M / K Mt Hamilton, Ont. Completed 130K Mt1 US$21M $0.16 per K Mt Lackawanna, NY In Progress 210K Mt2 US$44M2 $0.21 per K Mt2 Montreal, Que. Planned 100K Mt3 US$149M3 $1.49 per K Mt3 (Expansion) More Capacity, Less Cape
Slide 18: 4. Blue-Chip Customer Base
4. Blue-Chip Customer Base Sucro Global Distribution ROW Sucro has sold 100% of the production of 13.4% its Hamilton facility from 2021A through 2023E1 USA 53.8% Mexico 16.4% Sucro has a low degree of customer concentration with no single customer representing >12% of revenue in 2022 Canada 16.4% Su
Slide 19: 5. Pure-Play Exposure to Profitable and Growing Market
5. Pure-Play Exposure to Profitable and Growing Market 2022A Financial Performance (US$M) Sugar Maple Sugar $439 $55 $771 $82 10.4% 20.8% 100.0% 100.0% 89.6% 79.2% 1 2022A Revenue 2022A EBITDA 2022A Revenue 2022A EBITDA • Sucro is the only North American public • Maple operations have acted as a dra
Slide 20: 5. Pure-Play Exposure to Profitable and Growing Market
5. Pure-Play Exposure to Profitable and Growing Market Sucro’s Advantage Building additional refining capacity to serve US Refining Assets a large and attractive market USA Geographically diverse Geographic Sales (%) ROW 54% 30% 16% 15% 7% 78% Canada customers Operating Expense Ratio (2021A – 2023E)
Slide 21: 6. A Leader in Organic
6. A Leader in Organic A leader in the fastest-growing sugar market segment in the United States Sucro has established market leadership with an estimated 18 - 25% share in the US organic sugar market, which has seen 15% compounded annual growth over the last decade • First company to utilize bulk v
Slide 22: 7. Experienced Management Team
7. Experienced Management Team Years of Relevant Management team has demonstrated its ability to: Experience Executive Age • Deliver sustainable above-market growth Sucro Other Total • Deploy capital on a disciplined basis • Maintain a prudent capital structure Jonathan Taylor 8 7+ 15+ 42 CEO • Deli
Slide 23: Competitive Landscape in North America
Competitive Landscape in North America Legacy Trade Distributors Refiners Houses Low Capital Cost Refineries Low Cost of Capital Geographically Diverse Supply Sources Organic Offerings Capture NY16 & NY11 Differential Distribution in Close Proximity to Customers Highly Integrated Supply Chain 23
Slide 24: Our Growth Strategy: Walk Before Running
Our Growth Strategy Walk Before Running Sucro has employed a measured and prudent approach to scaling its facilities (1) Hamilton Lackawanna Proposed New Refinery Refinery Canadian Refinery On schedule On schedule Proven record Low capex Low capex Enormous scale Industry disruptor Ramping up Prudent
Slide 25: Ontario Facility Overview (Hamilton)
Ontario Facility Overview (Hamilton) Current Operations Strategic Rationale Location Hamilton, ON • Ideally situated in the middle of the Ontario food market Year 2014 • Canadian sugar market was an uncompetitive Product Full Granular duopoly Maximum Capacity 130K Mt • Sucro had very strong customer
Slide 26: New York Facility Overview (Lackawanna)
New York Facility Overview (Lackawanna) Current Operations Strategic Rationale Location Lackawanna, NY • Located in an underserved market Year 2023E • Logistics synergies with nearby Canadian facility • Full logistics capabilities: rail, truck, and ship Product Full Granular • Low-cost refining asse
Slide 27: Lackawanna Facility Construction
Lackawanna Facility Construction Sucro has begun commissioning liquid sugar, with granular sugar operational as of Q4 2022 Sucro anticipates a gradual ramp of sugar production to its peak capacity of 350K Mt in 2026E1,2 Sucro is 1 of 2 suppliers operating refineries in Canada and the US, with the cl
Slide 28: Capitalization Overview
Capitalization Overview Share Information Use of Proceeds Trading Symbol – TSX Venture SUG • Strengthen Sucro’s balance sheet and cash account Shares O/S (converted) 23,247,350 • Increase Sucro’s working capital and liquidity position Market Capitalization1 $244 M • Provide financial flexibility and
Slide 29: Appendix
pens eet Appendix
Slide 30: Outlook
Outlook Over the past two years Sucro has invested capital in expanding its Hamilton, Ontario refinery and also its newly built refinery in Lackawanna, New York. In both cases, virtually all construction and installation costs have been completed. As a result, the Hamilton refinery, at which the cap