Ostasiatiske Kompagni A/s · OMXCOP:OKEAC
Ostasiatiske Kompagni A/s — EAC Group (The East Asiatic Company Ltd. A/S) — FY2009 Earnings Presentation
26 slides from Ostasiatiske Kompagni A/s's earnings presentation, Feb 25, 2010
Slide 1: Full-Year Results 2009
FULL-YEAR RESULTS 2009 Presentation by: President & CEO Niels Henrik Jensen Group CFO Michael Østerlund Madsen 25 February 2010 EAC GROUP 25 February 2010 1
Slide 2: Agenda
AGENDA EAC Group • Hyperinflation • Highlights 2009 Segments • Foods • Industrial Ingredients • Moving & Relocation Services EAC Group • Financial review 2009 • Devaluation impact - illustrative • Outlook 2009 Q&A Disclaimer The outlook for 2010 reflects management’s expectations of future events an
Slide 3: Hyperinflation
HYPERINFLATION • Venezuela considered a hyperinflationary economy for accounting purposes (IAS 29). • Financial reporting restated to reflect changes in general price index from date of transaction to reporting date. • 2009 based on pro forma numbers for EAC Group and EAC Foods relative to 2008 with
Slide 4: Group Highlights
GROUP HIGHLIGHTS • Group revenue was DKK 6.2bn – up 18% • EBIT was DKK 657m – an increase of 4% • Net profit was DKK 376m – a fall of 25% • ROIC was 29.7% compared to 37.7% EAC GROUP 25 February 2010 4
Slide 5: EAC Foods Revenue
EAC FOODS REVENUE 29.7% 2009: DKK 4,340m 2008: DKK 3,347m EAC GROUP 25 February 2010 5
Slide 6: Market Development and Key Events 2009
MARKET DEVELOPMENT AND KEY EVENTS 2009 • Fiscal spending reduced due to lower oil prices • Inflation reached 25.1% - a 5.8% reduction from 2008 • USD requested for the operation received from CADIVI • Marketing focus drove growth • Investments increased capacity by 21% • Improvements of productivity
Slide 7: Income Statement
INCOME STATEMENT • Operating margin affected by higher costs, including higher labour costs following new 3-year agreement • Key success factors were high product quality, raw material cost control, adequate pricing and strong advertising and promotional support DKK USD DKK million 2009* 2008 Change
Slide 8: Strategic Direction
STRATEGIC DIRECTION • Continue expansion of production facilities • Leverage high brand equity through targeted product and packaging innovation • Consider entry into complementary segments • Maintain high market share through effective sales and marketing • Acquire related products to achieve syner
Slide 9: Outlook 2010
OUTLOOK 2010 The outlook is based on the following assumptions: • Inflation is expected to be around 25% • Average oil price of around USD 73 per barrel • Contraction of Venezuelan economy in general • Higher labour cost after new of labour contracts • Continued strong demand • Inflation adjusted an
Slide 10: EAC Industrial Ingredients Revenue
EAC INDUSTRIAL INGREDIENTS REVENUE 4.0% • 2009: DKK 1,347m • 2008: DKK 1,295m EAC GROUP 25 February 2010 10
Slide 11: Market Development and Key Events 2009
MARKET DEVELOPMENT AND KEY EVENTS 2009 • Volumes and margin recovery from H2 • Most business affected by lower demand and prices • Regional focus on less volatile food and beverage industry • Indian business expanded through acquisition and opening of three new distribution offices • Regional platfo
Slide 12: Income Statement
INCOME STATEMENT • Margins improving in H2 2009 as the economy and demand picked up • Strong Thai recovery in Q4 • Strong focus on profit improvement programme DKK DKK million 2009 2008 Change LC Change Revenue 1,347 1,295 4.0% 2.2% Operating profit (EBIT) 56 *64 -12.5% -14.7% Operating margin (%) 4
Slide 13: Strategic Direction
STRATEGIC DIRECTION • Overall objective to become leading solutions provider of industrial ingredients in South and South-East Asia • Organic growth through regional platform, product expansion and value-enhancing initiatives • Strengthen position for new businesses in India and Bangladesh • Geograp
Slide 14: Outlook 2010
OUTLOOK 2010 The outlook is based on the following assumptions: • Continuation of positive development in H2 2009 • Positive effects from regionalised organisation Outlook 2010 Full-year 2009 Revenue Around 15% growth in local currencies DKK 1,347m EBIT-margin Around 6% DKK 56m (4.2%) INDUSTRIAL ING
Slide 15: EAC Moving & Relocation Services Revenue
EAC MOVING & RELOCATION SERVICES REVENUE -16.2% • 2009: DKK 560m • 2008: DKK 668m EAC GROUP 25 February 2010 15
Slide 16: Market Development and Key Events 2009
MARKET DEVELOPMENT AND KEY EVENTS 2009 • Overall relocations to Asia down 19% in 2009 • Market position strengthened through new and expanded partnerships with international clients • Focus on international quality standards raises competitive barriers • Records management gained market share and co
Slide 17: Income Statement
INCOME STATEMENT • Revenue drop in both moving services and high-margin relocation services – especially in markets dependent on financial sector • Slight revenue improvement in records management • Planned discontinuation of freight forwarding business DKK DKK million 2009* 2008 Change LC Change Re
Slide 18: Strategic Direction
STRATEGIC DIRECTION • Consolidate market leadership in integrated mobility management • Build relocation business through service innovation and customer-driven geographical expansion • Focus on acquisition possibilities • Accelerate growth in all current markets MOVING & RELOCATION SERVICES 25 Febr
Slide 19: Outlook 2010
OUTLOOK 2010 • Global mobility industry to recover in H2 2010 - driven by China and India • Growth expected in relocations to/from Asia • Accelerated growth in records management • Discontinuation of freight forwarding business Outlook 2010 Full-year 2009 Revenue Around 8 growth in local currencies
Slide 20: Group Income Statement 2009
GROUP INCOME STATEMENT 2009 Reported Pro forma 2009 Hyperinflation DKK million 2009* 2008 (IAS 29) adjustment Revenue 6,247 5,310 6,607 360 EBITDA 768 717 697 71 Operating profit (EBIT) 657 630 510 147 Operating margin (%) 10.5 11.9 7.7 Net financials -92 -48 -56 36 Share of profit in 21 26 21 0 ass
Slide 21: Group Balance Sheet 2009
GROUP BALANCE SHEET 2009 DKK million 2009 2008 Total assets 4,067 3,319 Working capital employed (WCE) 1,329 1,183 Net-interest bearing debt (EOP) 416 208 EAC’s share of equity 2,056 1,759 Cash and cash equivalents 604 504 Return on invested capital (%) 29.7 37.7 Equity ratio (%) 49.4 53.0 • Control
Slide 22: Devaluation Impact
DEVALUATION IMPACT Reported 2009 Hyperinflation Reported 2009 DKK million VEF/USD 2.15 adjustment VEF/USD 4.30 Revenue 6,607 2,350 4,257 EBITDA 697 304 393 Operating profit (EBIT) 510 226 284 Profit before income tax 475 207 268 Net profit for the year 214 105 109 Net interest bearing debt 416 273 1
Slide 23: Financials
FINANCIALS Reported Hyper- 2009 inflation Pro forma DKK million (IAS 29) adjustment 2009* 2008 Financial income Interest income 13 1 12 10 Net monetary gain 42 42 Gain transferred from equity related to discontinuation of hedge accounting 19 2 17 Translation adjustment 15 Other interest income 4 4 2
Slide 24: Outlook 2010
OUTLOOK 2010 • Consolidated revenue of around DKK 5.8bn (2009: DKK 4.3bn) • EBITDA of around DKK 450m (2009: DKK 393m) • Consolidated operating profit (EBIT) around DKK 300m (2009: DKK 284m) • Outlook based on an average exchange rate of DKK/USD 550.00 EAC GROUP 25 February 2010 24
Slide 25: Corporate Communications & Investor Relations
CORPORATE COMMUNICATIONS & INVESTOR RELATIONS Niels Henrik Jensen President and CEO Telephone: +45 3525 4300 Mobile: +45 2023 2188 E-mail: nhj@eac.dk Michael Østerlund Madsen Group CFO Telephone: +45 3525 4300 Mobile: +45 2041 0957 E-mail: mom@eac.dk Shareholders' Secretariat The East Asiatic Compan
Slide 26: Q&A Session
Q&A SESSION 25 February 2010 EAC GROUP 25 February 2010 26
EAC Group (The East Asiatic Company Ltd. A/S) — FY2009 Earnings Presentation on 6ix