Cobram Estate Olives Ltd. · ASX:CBO
Cobram Estate Olives — Investor Presentation (August 2021)
44 slides from Cobram Estate Olives's investor presentation, August 2021
Slide 1: Investor Presentation
Investor Presentation Cobram Estate Olives Limited ACN 115 131 667 August 2021 Private Private & Confidential 1 & Confidential
Slide 2: Disclaimer
Disclaimer This document dated 23 July 2021 has been prepared by Cobram Estate Olives Limited ACN 115 131 667 responsibility for, the accuracy, reliability, completeness or fairness of the information, opinions, forecasts, (Company) and is provided for information purposes only. This document does n
Slide 3: Presenting today
Presenting today Rob McGavin Sam Beaton Leandro Ravetti Chair & Co-Founder Executive Director & Joint-CEO Executive Director & Joint-CEO Cobram Estate Olives Limited | June 2021 Private & Confidential 3
Slide 4: Cobram Estate Olives - From Tree to Table
Cobram Estate Olives - From Tree to Table Growing and marketing olive goodness in Australia and the USA Cobram Estate Olives Limited | June 2021 Private & Confidential 4
Slide 5: Cobram Estate Olives - Fast Facts
Cobram Estate Olives - Fast Facts Cobram Estate has invested approx. $200 million1 over the past 5 years to build a profitable global consumer branded platform positioned for continued growth Note: 1. Represents since FY17, the EBITDA loss from the USA business segment of $26m, EBITDA loss from the
Slide 6: Executive Summary
Executive Summary Cobram Estate Olives is Australia’s largest vertically integrated olive grower, processor and marketer Company • Established in 1998, with operations in both Australia and the USA and export customers in 17 countries. overview • A market leader in the Australian extra virgin olive
Slide 7: Executive Summary Cont.
Executive Summary Cont. Cobram Estate Olives is Australia’s largest vertically integrated olive grower, processor and marketer Business model • Vertically integrated olive growing, processing and marketing the sale of premium quality, branded extra virgin olive oils in Australia and the USA. • The C
Slide 8: Company History
Company History Over 23 years Cobram Estate has achieved considerable growth to build a profitable global consumer branded business Cobram Estate Olives Limited | June 2021 Private & Confidential 8
Slide 9: Industry Overview
Industry Overview Private & Confidential 9
Slide 10: Global Olive Oil Market
Global Olive Oil Market Favourable market thematics in an industry dominated by sub-scale growers globally Share of forecast olive oil Share of forecast olive oil Global olive oil consumption vs global available stock levels production by country production by growing method and monthly coverage Sou
Slide 11: Australian and USA Olive Oil Markets
Australian and USA Olive Oil Markets Australia and USA are high growth markets for olive oil products Australian supermarket sales of Evolution of olive oil sales in USA supermarkets olive oil by grade and specialty stores Source: Spins/RI data Source: IRI data Australian consumers are demanding Aus
Slide 12: Consumer Shift to Extra Virgin Olive Oil
Consumer Shift to Extra Virgin Olive Oil Higher antioxidant content driving the consumer shift to Extra Virgin Olive Oil Extra Virgin Olive Oil is a more desirable source of unsaturated and saturated oil than refined oils, with its higher antioxidant content resulting Cooking Oil antioxidants conten
Slide 13: Company Overview
Company Overview Private & Confidential 13
Slide 14: Competitive Advantages
Competitive Advantages Cobram Estate Olives has significant competitive advantages and barriers to entry 1 2 Continuous Premium market Vertical integrated, Proprietary Oliv.iQ® 3 improvement and leading consumer freehold owned and Integrated Olive sustainable practices brands scalable operations Pro
Slide 15: Cobram Estate Olives' Key Consumer Brands
Cobram Estate Olives’ Key Consumer Brands Iconic, highly visible consumer brands with demonstrated pricing power Cobram Estate® Red Island® Wellness • $80m forecast net sales in FY21 • Purchased in 2012 • Established in 2017 • Australia’s #1 selling EVOO¹ in • 2nd highest selling brand of • Wellgrov
Slide 16: Cobram Estate Olives Sales Growth
Cobram Estate Olives Sales Growth Pricing continues to improve as market share expands Global olive oil sales for Cobram Estate® and Australian supermarket sales of Cobram Estate® Red Island® branded products and Private Label and $/litre versus $/litre for Mediterranean olive oil products (all grad
Slide 17: Cobram Estate Olives Sales Growth - USA
Cobram Estate Olives Sales Growth - USA Well established USA sales platform ready for growth Evolution of packaged olive oil sales by Cobram USA selected distribution points Estate Olives’ USA business The Company’s olive oil sales in the USA started with bulk and over time are trending Cobram Estat
Slide 18: Australian Operations
Australian Operations Industry leading large-scale operations with scope for growth Cobram Estate has pioneered super high density and intensive farming Age profile of the Company’s olive trees vs methods for olive groves in Australia average oil yield per year of age • Over 2.4 million olive trees
Slide 19: USA Operations
USA Operations Industry leading operations with scope for growth USA operations • Over 149,000 trees planted on 305 hectares of long-term leased and freehold properties with 100% of trees not yet mature. • An olive mill in Woodland, California, with milling capacity of 32 tonnes of olive fruit per h
Slide 20: Oliv.iQ Integrated Olive Production System
Oliv.iQ® Integrated Olive Production System A proprietary solution to drive increased yields and quality whilst keeping costs down Cobram Estate’s proprietary, vertically integrated olive production system Oliv.iQ® integrated olive system was developed with the aim of maximising returns and achievin
Slide 21: Biennial Nature of Olive Tree Production
Biennial Nature of Olive Tree Production Cobram Estate Olives’ production profile should be assessed on the average of two-years’ production IMPORTANTLY, Cobram Estate Olives manages key aspects of its business based on rolling two-year cycles. Evolution of Total Yields vs Mature Groves • Olive tree
Slide 22: Farm Management Initiatives
Farm Management Initiatives Continuing to invest in improving operational efficiencies, yields, and mitigating production risks with a focus on driving earnings growth Cobram Estate Olives are a proponent of intensive olive growing techniques involving large-scale olive farming operations, moderate
Slide 23: Sustainability
Sustainability Sustainability is a core component of the Cobram Estate Olives operations The adoption of more sustainable and efficient agricultural and irrigation practices, and due to the significantly higher yields than the industry average, the Company has Comparison of carbon emissions and deve
Slide 24: Wellness and Wellgrove Vision
Wellness and Wellgrove® Vision Aspiring to be the leader in developing innovative and sustainable solutions from olive by- products and realising their full potential Over the past five years, Cobram Estate has invested over $20 million in R&D and Cobram Estate’s Wellness division commenced commerci
Slide 25: Water Management
Water Management Australian operations have a defined water management strategy with a focus on environmental sustainability Cobram Estate Olives annual Temporary Water purchases and average annual price Water stewardship initiatives • Designed and implemented its irrigation system according to a co
Slide 26: Growth Strategy
Growth Strategy Four core pillars of future growth Increasing extra virgin olive oil supply from its Australian olive groves 1 39% of the Company’s total Australian plantings are not fully mature and are not yet producing mature yields including 16% of total Australian plantings yet to produce a har
Slide 27: Financial Information
Financial Information Private & Confidential 27
Slide 28: Understanding Business Performance
Understanding Business Performance Past investment is realising material growth in two-year rolling Average EBITDA Underlying EBITDA Australia adjusted for long term average temporary water costings • As EBITDA is materially impacted by the AASB 14 accounting standards agricultural crops, and becaus
Slide 29: Statutory Results
Statutory Results Strong earning growth supported by a significant underlying asset base Group EBITDA by Segment Strong earnings growth profile (A$ million) • Sales Revenue showing sustainable growth: • FY19A $112.3 million • FY20A $140.7 million • FY21F $145.1 million • Most of the costs of produci
Slide 30: Analysis of Australian business segment
Analysis of Australian business segment Long-term investment in olive groves will provide embedded long-term production growth Embedded growth in olive oil production (Australian olive oil busines) 7,000 6,000 5,000 5.8% CAGR 4,000 3,000 2,000 1,000 - FY2021 FY2022 FY2023 FY2024 FY2025 FY2026 FY2027
Slide 31: Pro Forma Historical, Forecast and Statutory Forecast Income Statements
Pro Forma Historical, Forecast and Statutory Forecast Income Statements Pro forma Notes: Pro forma historical Statutory forecast 1. Revenue is predominantly derived from the sale of extra A$ millions Note FY2019 FY2020 FY2021F FY2021F virgin olive oil, mostly across Australia and USA. 2. Includes th
Slide 32: Pro Forma Historical and Forecast Cash Flows
Pro Forma Historical and Forecast Cash Flows Pro Forma Notes: Pro Forma Historical Statutory Forecast 1. Sum of current accounts receivables and inventories less the sum of current A$ Millions Note FY2019 FY2020 FY2021F FY2021F accounts payables and accruals. EBITDA 30.5 (21.2) 68.5 68.5 2. Expense
Slide 33: Historical and Pro Forma Balance Sheet
Historical and Pro Forma Balance Sheet Costs of Statutory Related party Employee Gift the Employee Pro Forma A$ Millions 31 Dec 2020 loans2 Offer³ Gift Offer⁴ 31 Dec 2020 Notes: Cash and cash equivalents1 0.8 0.0 0.0 0.0 0.8 1. Proceeds of Employee Gift Offer, less costs of Trade and other receivabl
Slide 34: Debt Summary
Debt Summary Costs Drawn at Statutory of the Pro Forma Facility At 31 Dec 2020 31 Dec 2020 Term 31 Dec 2020 Employee 31 Dec 2020 (A$ million) A$ millions Gift Offer (Per half year accounts) (A$ million) Net cash/debt Core Debt Facility AUD 58.0 AUD 58.0m October 2024 Cash and cash equivalents 0.8 0
Slide 35: Capital Structure, Employee Gift Offer and Free Float %
Capital Structure, Employee Gift Offer and Free Float % Cobram Estate Olives Limited | June 2021 Private & Confidential 35 35
Slide 36: Capital Structure, Employee Gift Offer and Free Float %
Capital Structure, Employee Gift Offer and Free Float % Details of Capital Structure and Employee Gift Offer • The Company completed a 1-for-6 share split in June 2021, changing the number of Shares on issue from 64,562,099 to 387,372,594. • The Company is offering up to 130 eligible staff a gift of
Slide 37: Key Risks
Key Risks Private & Confidential 37
Slide 38: Summary of Key Risks
Summary of Key Risks Weather variability As a horticultural business, Cobram Estate Olives is affected by weather and climate issues. Variable weather conditions and severe weather events may cause impacting crop yield fluctuations in market supply or lead to severe crop damage and crop yield volati
Slide 39: Summary of Key Risks
Summary of Key Risks Water availability Water is a key input to the production of olives. Cobram Estate Olives currently uses approximately 35.8 gigalitres of water per annum in Australia and approximately 1 and cost gigalitre of water per annum in California. While the Company has always been able
Slide 40: Summary of Key Risks
Summary of Key Risks Customer While the Company sells its products to a range of customers globally, sales to the Company’s two largest customers, being supermarket operators Woolworths Limited concentration – and Coles Group Limited, accounted for 52% of the Company’s sales in FY2020 and are foreca
Slide 41: Appendix
Appendix Private & Confidential 41
Slide 42: Senior Management Team
Senior Management Team Valuable combination of technical and commercial experience, track record of working together Sam Beaton Leandro Ravetti Russell Dmytrenko Michael Gonzalez Executive Director & Joint-CEO Executive Director & Joint-CEO CFO of Australian operations & Company CFO of USA operation
Slide 43: Board of Directors
Board of Directors Founder-led board with considerable industry experience to support the ongoing growth of the Company Rob McGavin Paul Riordan Tim Jonas Craig Ball Dr Joanna McMillan Dr Jonathan West Sam Beaton Leandro Ravetti Chair, Non-Executive Non-Executive Non-Executive Director Non-Executive
Slide 44: Thank-you!
Thank-you! Private & Confidential 44
Cobram Estate Olives — Investor Presentation (August 2021) on 6ix