Olam Group Limited · SGX:VC2
Olam — Olam International — H1 2017 Earnings Presentation
25 slides from Olam's earnings presentation, Aug 14, 2017
Slide 1: H1 2017 Results Briefing
Important instruction: Place an image in exactly Olam International Limited the same position as this H1 2017 Results Briefing grey box. Q1 2016 August 14,Results 2017 Briefing Select the image. May 13, 2016 [Mac] in the menu, select ‘Arrange’ and then ‘Send to Back’. [PC] right click and then ‘send
Slide 2: Presenters
Presenters Sunny Verghese Co-Founder and Group CEO A. Shekhar Executive Director and Group COO N. Muthukumar President and Group CFO 2
Slide 3: Notice
Notice This presentation should be read in conjunction with Olam International Limited’s Financial Statements for the Second Quarter (“Q2 2017”) and First Half ended June 30, 2017 (“H1 2017”) and Management Discussion and Analysis lodged on SGXNET on August 14, 2017. 3
Slide 4: Cautionary note on forward-looking statements
Cautionary note on forward-looking statements This presentation may contain statements regarding the business of Olam International Limited and its subsidiaries (‘Group’) that are of a forward-looking nature and are therefore based on management’s assumptions about future developments. Such forward
Slide 5: Agenda
Agenda • Welcome address by Olam Co-Founder & Group CEO • H1 2017 highlights • Financial and operating performance • Segmental analysis • Balance sheet and cash flow • Key takeaways 5
Slide 6: Welcome address
Welcome address
Slide 7: H1 2017 highlights
H1 2017 highlights
Slide 8: H1 2017 highlights
H1 2017 highlights • PATMI grew 27.5% to S$291.5 million • Strong underlying growth with Operational PATMI up 23.6% despite higher depreciation and amortisation, and finance costs • EBITDA up 19.1% to S$772.3 million • Higher positive Free Cash Flow to Firm (FCFF) at S$239.4 million (H1 2016: S$191.
Slide 9: Financial and operating performance
Financial and operating performance
Slide 10: P&L Analysis
P&L Analysis SGD Mn H1 2017 H1 2016 % Change Volume ('000 MT) 8,939.8 6,447.5 38.7 Revenue 12,324.7 9,742.8 26.5 Net gain/(loss) in fair value (1.6) (6.5) (75.2) of biological assets EBITDA 772.3 648.4 19.1 Depreciation & (183.7) (164.3) 11.8 Amortisation Net Finance costs (258.0) (191.1) 35.0 Taxat
Slide 11: EBITDA and Invested Capital
EBITDA and Invested Capital SGD Mn EBITDA SGD Mn Invested Capital 16,649.0 16,919.8 1,400 18,000 1,202.8 16,000 1,200 1,129.0 14,374.7 13,547.6 1,085.2 14,000 1,000 11,560.7 12,000 8,852.8 9,096.7 772.3 800 10,000 7,652.8 7,119.8 648.4 8,000 6,017.2 600 6,000 400 4,000 7,796.2 7,823.1 200 5,543.5 6,
Slide 12: Segmental analysis
vy Olam Segmental analysis
Slide 13: Edible Nuts, Spices & Vegetable Ingredients
Edible Nuts, Spices & Vegetable Ingredients SGD Mn EBITDA SGD Mn Invested Capital 450 393.5 4,000 3,642.7 3,363.6 3,463.0 3,425.0 400 360.5 331.8 3,500 3,021.8 350 3,000 1,421.0 300 1,415.0 255.1 1,587.1 1,455.1 2,500 1,195.9 250 200 179.2 2,000 150 1,500 100 1,000 2,048.0 2,221.7 1,969.9 1,776.5 1,
Slide 14: Confectionery & Beverage Ingredients
Confectionery & Beverage Ingredients SGD Mn EBITDA SGD Mn Invested Capital 6,434.7 450 7,000 407.2 6,109.5 400 6,000 5,680.9 5,564.6 350 5,000 300 275.6 284.0 4,000 3,246.9 4,920.0 250 4,568.7 197.5 186.7 4,329.7 4,200.3 200 3,000 150 2,000 2,745.4 100 1,000 50 1,351.2 1,540.8 1,364.3 1,514.7 501.5
Slide 15: Food Staples & Packaged Foods
Food Staples & Packaged Foods SGD Mn EBITDA SGD Mn Invested Capital 350 330.2 6,000 4,839.3 295.2 4,522.1 300 5,000 250 3,230.6 212.1 217.7 4,000 3,075.1 3,184.4 1,535.0 1,498.3 200 165.6 3,000 150 708.7 915.0 830.4 2,000 100 3,304.3 3,023.8 50 1,000 2,366.4 2,315.6 2,354.0 0 0 2014 2015 2016 YTD Ju
Slide 16: Industrial Raw Materials, Ag Logistics & Infrastructure
Industrial Raw Materials Ag Logistics & Infrastructure SGD Mn EBITDA SGD Mn Invested Capital 250 2,500 2,220.9 2,129.7 215.6 1,872.0 1,917.5 200 185.1 2,000 1,712.7 1,500 1,212.7 1,096.7 150 135.2 911.9 974.2 830.5 105.2 106.5 100 1,000 50 500 1,005.6 1,008.2 1,033.0 897.8 882.2 0 0 2014 2015 2016 Y
Slide 17: Balance sheet and cash flow
vy Olam Balance sheet and cash flow
Slide 18: Balance sheet
Balance sheet SGD Mn Change 30-Jun-2016 vs Jun 16 (assuming Change (assuming 30-Jun-17 30-Jun-16 PPA vs Jun 16 PPA exercise exercise completed) completed) Uses of Capital Fixed Capital 8,280.6 6,245.4 2,035.2 6,911.2 1,369.4 Working Capital 8,851.8 7,693.6 1,158.2 7,672.1 1,179.7 Cash 2,038.0 2,152.
Slide 19: Balance sheet: Optimising tenure and borrowing mix
Balance sheet Optimising tenure and borrowing mix Completed several debt refinancing programmes in H1 2017: • First revolving revolving credit facility in Europe aggregating US$1.0 billion which comprises of three tranches – a 1-year (US$400.0 million), a 2-year (US$300.0 million) and a 3-year (US$3
Slide 20: Cash flow analysis
Cash flow analysis SGD Mn Cash Flow Summary H1 2017 H1 2016 YoY Operating Cash flow (before Interest & Tax) 756.3 661.3 95.0 Changes in Working Capital (35.1) 130.0 (165.1) Net Operating Cash Flow 721.2 791.3 (70.1) Tax paid (45.1) (44.7) (0.4) Capex/ Investments (436.7) (555.4) 118.7 Free cash flow
Slide 21: Gearing
Gearing SGD Mn Change Change 30-Jun-17 31-Dec-16 30-Jun-16 vs Dec 16 vs Jun 16 Gross debt 13,569.8 13,670.5 (100.7) 11,942.2 1,627.6 Less: Cash 2,038.0 2,144.0 (106.0) 2,152.0 (114.0) Net debt 11,531.8 11,526.5 5.3 9,790.2 1,741.6 Less: Readily marketable 5,451.7 5,909.2 (457.5) 4,815.5 636.2 invent
Slide 22: Liquidity position
Liquidity position S$ million as at Jun 30, 2017 13,570 7,394 Short Term 5,687 1,310 16,194 5,452 Long Term 7,883 2,038 Cash and short-term RMI* Secured Receivables Unutilised bank lines Available Liquidity Total Borrowings fixed deposits • Available liquidity sufficient to cover all repayment and C
Slide 23: Key takeaways
vy Olam Key takeaways a
Slide 24: Key takeaways
Key takeaways • Strong EBITDA and Operational PATMI growth in H1 2017 across most segments • Continue to focus on turning around underperforming businesses, ensuring gestating businesses reach full potential and delivering positive free cash flow • Execute on our strategic plan and pursue growth in
Slide 25: H1 2017 Results Briefing
H1 2017 Results Briefing olamgroup.com/investor-relations/ ir@olamnet.com