Slide 1: Preliminary Results: Year Ended 30 June 2023
PRELIMINARY RESULTS YEAR ENDED 30 JUNE 2023 SOLID PERFORMANCE AND GOOD STRATEGIC PROGRESS
Slide 2: Disclaimer
2 PRELIMINARY RESULTS: YEAR ENDED 30 JUNE 2023 DISCLAIMER This presentation has been prepared by Genus plc (“Genus” or the part of the issuer to provide the recipient access to any “the Company”) and has not been independently verified. Genus additional information or to update this presentation or
Slide 3: New CEO: Jorgen Kokke
3 PRELIMINARY RESULTS: YEAR ENDED 30 JUNE 2023 NEW CEO: JORGEN KOKKE INTRODUCTION WHY GENUS 30 Years experience in the food and The Genus vision of ‘Pioneering animal genetic improvement to help nourish the world’ agriculture industries Technology platform for growth enabled by investments made in i
Slide 4: Business & Strategic Update
BUSINESS & STRATEGIC UPDATE STEPHEN WILSON RETIRING CEO
Slide 5: FY23 Headlines
5 PRELIMINARY RESULTS: YEAR ENDED 30 JUNE 2023 FY23 HEADLINES FINANCIAL PERFORMANCE1 REVENUE ADJ. OPERATING PROFIT £689.7m (+16%) £85.8m (+10%) ADJ. PROFIT BEFORE TAX FULL YEAR DIVIDEND MAINTAINED £71.5m (0%) 32p SOLID PERFORMANCE AND GOOD STRATEGIC PROGRESS • Growing share in challenging markets th
Slide 6: Market Context: Challenging Environment for Animal Protein Producers
6 PRELIMINARY RESULTS: YEAR ENDED 30 JUNE 2023 MARKET CONTEXT CHALLENGING ENVIRONMENT FOR ANIMAL PROTEIN PRODUCERS CURRENT CURRENT FEB 2023 FEB 2023 Low producer profitability, driving herd size Declining milk price outpacing input cost reduction; soft domestic demand. Exports decrease, high interes
Slide 7: PIC: Strong Strategic Platform for Growth
7 PRELIMINARY RESULTS: YEAR ENDED 30 JUNE 2023 PIC: STRONG STRATEGIC PLATFORM FOR GROWTH WORLD-CLASS TEAM MARKET LEADING GENETICS GLOBAL SUPPLY 2019 2023 PIC800 – Used by 85% of top producers in NAM, $2 economic Elite farms 13 18 advantage over competitors1 PIC Camborough – Market leading sow with b
Slide 8: Consistently Gaining Share
8 PRELIMINARY RESULTS: YEAR ENDED 30 JUNE 2023 CONSISTENTLY GAINING SHARE VOLUME GROWTH (MPEs M) CASE STUDY 1: GROWING WITH A KEY ACCOUNT 75 4-Year CAGR • Brenneman Pork are a 50k sow producer on royalty model; PIC’s influence in the herd NAM increased by 16k sows in FY23 +6% 65 • 1.7k boar gene tra
Slide 9: Market Leading Genetics
9 PRELIMINARY RESULTS: YEAR ENDED 30 JUNE 2023 MARKET LEADING GENETICS STRONG GENETIC IMPROVEMENT EVERY YEAR DRIVING GENETIC PROGRESS IN CHINA PORCINE GENETIC IMPROVEMENT PER ANNUM (US$)1 • PIC investing in China based genetic improvement program: • Established a China genetic index; creating value
Slide 10: China: Building a Predictable Business
10 PRELIMINARY RESULTS: YEAR ENDED 30 JUNE 2023 CHINA: BUILDING A PREDICTABLE BUSINESS PIG PRICE TO CORN PRICE RATIO1 CHINA VOLUME (MPEs M) CASE STUDY 1: GROWING WITH 30 LEADING PRODUCER 24 25 Royalty MPEs • 130k sow producer (FY21: 81k sows) Non-royalty MPEs • • World-class China government policie
Slide 11: PRRSv Resistance Programme
11 PRELIMINARY RESULTS: YEAR ENDED 30 JUNE 2023 PRRSv RESISTANCE PROGRAMME ADVANCING GLOBAL REGULATORY APPROVAL SUBMISSIONS COMPLETED; AWAITING FDA1 APPROVAL OTHER MARKETS 2021 Phase I - Product Claim and Methods 1. Product Definition Submitted and accepted • Submitted regulatory approval packages i
Slide 12: PRRSv: Preparing to Go-to-Market
12 PRELIMINARY RESULTS: YEAR ENDED 30 JUNE 2023 PRRSv: PREPARING TO GO-TO-MARKET MARKET ACCEPTANCE STRATEGY GENETIC DISSEMINATION PRICING Genetic dissemination over time • Additional fee per pig to access the PRRSv trait PRRSv • Incremental above trait fee existing royalty fees Homozygous Heterozygo
Slide 13: ABS: Strong Strategic Platform for Growth
13 PRELIMINARY RESULTS: YEAR ENDED 30 JUNE 2023 ABS: STRONG STRATEGIC PLATFORM FOR GROWTH WORLD-CLASS TEAM WORLD-LEADING GENETICS1 GLOBAL SUPPLY $1,000 Average age of NAM2 facilities $900 2019 22 years +$113 $800 2023 4 years $700 Competitor Angus T14 LONG-TERM CUSTOMER RELATIONSHIPS PIONEERING TECH
Slide 14: Gaining Share by Driving Customer Performance
14 PRELIMINARY RESULTS: YEAR ENDED 30 JUNE 2023 GAINING SHARE BY DRIVING CUSTOMER PERFORMANCE ABS: GLOBAL SALES VOLUME CASE STUDY 1: SUPERIOR GENETICS AND SERVICE DRIVING CUSTOMER WIN 100% • Large US dairy, 10k dairy cows • Customer was experiencing poor reproduction outcomes 80% • Won 100% share of
Slide 15: Genetic Progress Driving Sustainability
15 PRELIMINARY RESULTS: YEAR ENDED 30 JUNE 2023 GENETIC PROGRESS DRIVING SUSTAINABILITY DAIRY 1,200 Average NM$ index1 score of commercial bulls launched FY22 NM$ FY23 NM$ 1,000 Reduction of 665 kg CO2e per cow sired by ABS bulls since FY19 800 ABS Competitor 1 Competitor 2 Competitor 3 Competitor 4
Slide 16: Strong R&D Platform for Growth
16 PRELIMINARY RESULTS: YEAR ENDED 30 JUNE 2023 STRONG R&D PLATFORM FOR GROWTH KEY ACTIVITIES AND OUTCOMES PORK DAIRY BEEF Better breeding outcomes through enhanced analysis of 1 individual animal genomes, phenotypes, reproduction outcomes, and farm management data Increased sexed semen quality and
Slide 17: Sustainability Progress Ahead of Plan
17 PRELIMINARY RESULTS: YEAR ENDED 30 JUNE 2023 SUSTAINABILITY PROGRESS AHEAD OF PLAN SCOPE 1 AND 2 CARBON FOOTPRINT REDUCTION CLIMATE SMART BEEF GENETICS PROJECT 100,000 PARTNERS Awarded £3m funding by Innovate UK 75,000 Project seeks to select cattle with a microbiome that emits less methane tCO2e
Slide 18: Financial Results
FINANCIAL RESULTS ALISON HENRIKSEN CHIEF FINANCIAL OFFICER
Slide 19: Genus Adjusted Profit Performance
19 PRELIMINARY RESULTS: YEAR ENDED 30 JUNE 2023 GENUS ADJUSTED PROFIT PERFORMANCE £M FY23 FY22 % Change % Change GENUS ADJUSTED OPERATING PROFIT2 £M actual constant1 Full year results Genus PIC 145.3 121.2 20% 11% 89.8 85.8 Genus ABS 43.6 40.5 8% 5% 77.7 70.8 Operating units 188.9 161.7 17% 9% 59.0
Slide 20: Drivers of Profit
20 PRELIMINARY RESULTS: YEAR ENDED 30 JUNE 2023 DRIVERS OF PROFIT ADJ. OPERATING PROFIT1 EX. GENE EDITING (£M) ADJUSTED PROFIT BEFORE TAX BRIDGE (£M) PIC CHINA SHOWN SEPARATELY Full year results Full year results 9.4 90.7 5.6 33.4 +13% 80.0 21.3 64.0 54.7 14.2% 13.8% 12.3% 10.7% FY20 FY21 FY22 FY23
Slide 21: Volume Growth
21 PRELIMINARY RESULTS: YEAR ENDED 30 JUNE 2023 VOLUME GROWTH YEAR ENDED 30 JUNE 2023 GENUS PIC – VOLUME GROWTH (%) GENUS ABS – VOLUME GROWTH (%) EXCLUDING CHINA FY19 FY20 FY21 FY22 FY23 5% 6% 5% 8% 6% 13% 11% 15% 5% 8% 6% 3% 3% 0% 0% FY19 FY20 FY21 FY22 FY23 FY19 FY20 FY21 FY22 FY23
Slide 22: Genus PIC
22 PRELIMINARY RESULTS: YEAR ENDED 30 JUNE 2023 GENUS PIC ADJUSTED OPERATING PROFIT1 LATIN AMERICA ROYALTY REVENUE +10% • Royalty revenue growth 12% +11% +12% • • Double digit profit growth across all trading countries Agroceres JV in Brazil up 14% GENUS PIC ADJ. OPERATING PROFIT £M Full year result
Slide 23: Genus ABS
23 PRELIMINARY RESULTS: YEAR ENDED 30 JUNE 2023 GENUS ABS ADJUSTED OPERATING PROFIT LATIN AMERICA SEXED VOLUME BEEF VOLUME +18% 0% • Market share gains in Brazil, in a weak +5% 0% market environment, volume up 3% • Dairy down 5%, beef stable • Strong sexed volume growth 14% GENUS ABS ADJ. OPERATING
Slide 24: Genus R&D
24 PRELIMINARY RESULTS: YEAR ENDED 30 JUNE 2023 GENUS R&D NET RESEARCH AND DEVELOPMENT1 £M PORCINE PRODUCT GENE EDITING Full year results DEVELOPMENT INVESTMENT +19% 86.3 +24% +66% 17.4 • Increased investment in customer- • Significant progress made on the 67.1 centric support programs and PRRSv res
Slide 25: Statutory Income
25 PRELIMINARY RESULTS: YEAR ENDED 30 JUNE 2023 STATUTORY INCOME FY23 FY22 Change STATUTORY PROFIT BEFORE TAX £m £m £m Adjusted operating profit 74.6 68.8 5.8 £39.4m (FY22: £48.4m) Net IAS 41 valuation movement on bio assets (16.9) (5.4) (11.5) Non-cash impacts Amortisation of acquired intangible as
Slide 26: Improved Free Cash Flow
26 PRELIMINARY RESULTS: YEAR ENDED 30 JUNE 2023 IMPROVED FREE CASH FLOW RECORD ADJUSTED EBITDA FY23 PERFORMANCE FULL YEAR FREE CASH CONVERSION CASH CONVERSION CASHFLOW BRIDGE (£M) 107% 105% FY23 FY22 Change £m £m £m (FY22 : 82%) Adjusted operating profit ex. JV 74.6 68.8 5.8 Depreciation and amortis
Slide 27: Solid Financial Position
27 PRELIMINARY RESULTS: YEAR ENDED 30 JUNE 2023 SOLID FINANCIAL POSITION NET DEBT BRIDGE £M Lower capital investments • Capital expenditure £35.2m (FY22 : £50.9m), as planned • Lower working capital outflows, 8 day DSO improvement • Investments £1.2m inflow; included £3.4m from sale of Net Free cash
Slide 28: Meeting Medium Term Objectives
28 PRELIMINARY RESULTS: YEAR ENDED 30 JUNE 2023 MEETING MEDIUM TERM OBJECTIVES GROW ADJUSTED OPERATING PROFIT: CONVERT PROFIT TO CASH: 10% 5-YEAR CAGR 90%+ ANNUAL CASH CONVERSION (5-year CAGR, constant currency, inc. JVs, exc. Gene editing) (net cash from operations : op. Profit exc. JVs) 14% 128% 1
Slide 29: Summary & Outlook
SUMMARY & OUTLOOK ALISON HENRIKSEN CHIEF FINANCIAL OFFICER
Slide 30: Summary and Outlook
30 PRELIMINARY RESULTS: YEAR ENDED 30 JUNE 2023 SUMMARY AND OUTLOOK SOLID FY23 PERFORMANCE • Adjusted Profit Before Tax £71.5m OUTLOOK • Free cash flow £18.2m • Tough conditions for producers; • Met medium term growth targets but well placed for market share gains • Growing royalty business in China
Slide 31: Appendices
7) Lu = a) z= LL oO. oO. <
Slide 32: Proportion of Total Porcine Volumes Under Royalty
32 PRELIMINARY RESULTS: YEAR ENDED 30 JUNE 2023 PROPORTION OF TOTAL PORCINE VOLUMES UNDER ROYALTY NORTH AMERICA EMEA 79% 80% 77% 98% 96% 98% 97% 97% 70% 68% FY19 FY20 FY21 FY22 FY23 FY19 FY20 FY21 FY22 FY23 LATIN AMERICA ASIA 67% 84% 83% 58% 57% 1 81% 77% 78% 46% 45% FY19 FY20 FY21 FY22 FY23 FY19 FY
Slide 33: Porcine Royalty Revenue Growth
33 PRELIMINARY RESULTS: YEAR ENDED 30 JUNE 2023 PORCINE ROYALTY REVENUE GROWTH NORTH AMERICA EMEA 8% 7% 13% 11% 11% 3% 9% 7% 1% -1% FY19 FY20 FY21 FY22 FY23 FY19 FY20 FY21 FY22 FY23 LATIN AMERICA ASIA 17% 14% 70% 12% 50% 9% 9% 19% 20% -32% FY19 FY20 FY21 FY22 FY23 FY19 FY20 FY21 FY22 FY23
Slide 34: Financial Results
34 PRELIMINARY RESULTS: YEAR ENDED 30 JUNE 2023 FINANCIAL RESULTS FY23 FY22 % Change % Change Actual Constant £m £m Currency Currency Revenue 689.7 593.4 16% 10% Adjusted operating profit inc. JV ex. gene editing 100.1 85.6 17% 9% Adjusted operating profit inc. JV 85.8 77.7 10% 3% Net finance costs
Slide 35: Genus PIC Results
35 PRELIMINARY RESULTS: YEAR ENDED 30 JUNE 2023 GENUS PIC RESULTS FY23 FY22 % Change % Change Actual Constant £m £m Currency Currency Revenue 349.5 306.6 14% 7% Adjusted operating profit ex. JV 135.0 112.3 20% 11% Adjusted operating profit inc. JV 145.3 121.2 20% 11% Adjusted operating margin ex. JV
Slide 36: Genus ABS
36 PRELIMINARY RESULTS: YEAR ENDED 30 JUNE 2023 GENUS ABS FULL YEAR PERFORMANCE ADJUSTED OPERATING PROFIT RESULTS FULL YEAR OPERATING PROFIT BRIDGE1 (£M) FY23 FY22 % Change % Change Actual Constant £m £m Currency Currency Revenue 318.8 272.0 17% 12% Adjusted operating profit 43.6 40.5 8% 5% Regional
Slide 37: Exchange Rate Sensitivity
37 PRELIMINARY RESULTS: YEAR ENDED 30 JUNE 2023 EXCHANGE RATE SENSITIVITY FY23 FY23 Spot at Profit Average1 Closing 1 Sep 2023 Sensitivity £m2 • Genus’s geographic profile can Mexican Peso 22.7 21.7 21.5 2.0 lead to translational currency impacts Euro 1.15 1.16 1.17 1.6 • We monitor key rates agains
Slide 38: Return on Adjusted Invested Capital
38 PRELIMINARY RESULTS: YEAR ENDED 30 JUNE 2023 RETURN ON ADJUSTED INVESTED CAPITAL FY23 FY22 £m £m Adjusted operating profit inc JV 85.8 77.7 Tax rate 22.2% 24.3% Adjusted operating after tax 66.8 58.8 Equity attributable to owners of the company 574.9 578.5 Add back: Net debt 195.8 185.0 Pension l
Slide 39: Glossary
39 PRELIMINARY RESULTS: YEAR ENDED 30 JUNE 2023 GLOSSARY Artificial insemination (‘AI’) Using semen collected from a bull or Genomic bull A bull which has been assessed through genomic NuEra The ABS beef breeding programme and index designed to boar to impregnate a cow or sow when in estrus. Artific