Slide 1: AVI Limited presentation to shareholders & analysts for the year ended 30 June 2024
AVI Limited presentation to shareholders & analysts for the year ended 30 June 2024
Slide 2: Agenda
AGENDA Key features and results history Group financial results Performance Prospects Questions and answers
Slide 3: Key Features
KEY FEATURES Pleasing performance in a challenging environment Constrained consumer demand Increasing competition in all categories Unreliable municipal infrastructure impacting manufacturing sites I&J impacted by poor catch rates and constrained abalone markets Weaker Rand and rising ra
Slide 4: Key Features
KEY FEATURES Group operating profit for the year increased by 21,7% Headline earnings per share up 24,1% to 687,1 cents Sustained strong cash generation supported a reduction in net debt Capital expenditure of R476,5 million for capacity and efficiency projects Final dividend of 388 cents
Slide 5: Results History: Operating profit history
RESULTS HISTORY Operating profit history 3 400 3 305 3 200 3 000 341 2 800 2 715 220 2 600 2 552 2 523 2 409 2 540 355 200 2 385 395 2 334 2 400 303 328 2 200 2 155 202 230 233 366 193 2 000 250 237 150 170 197 1 917 345 306 R million 1 800 1 713 241 238 342 1 271 404 408 1 600 1 526 218 425 1 038 3
Slide 6: Results History: Return on capital employed
RESULTS HISTORY Return on capital employed 8 000 40% 7 000 35% 6 000 30% 5 000 R million 4 000 25% 3 000 20% 2 000 15% 1 000 0 10% F14 F15 F16 F17 F18 F19 F20 F21 F22 F23 F24 Net operating profit after tax Average capital employed ROCE (%) High return maintained in challenging environment
Slide 7: Results History: Cash conversion
RESULTS HISTORY Cash conversion 4 500 120% 4 000 100% 3 500 3 000 80% R million 2 500 60% 2 000 1 500 40% 1 000 20% 500 0 0% F14 F15 F16 F17 F18 F19 F20 F21 F22 F23 F24 EBITDA Cash generated by operations Cash to EBITDA (%) Sustained strong conversion of earnings to cash
Slide 8: Results History: Dividend yield
RESULTS HISTORY Dividend yield 14,0% 12,0% 12,0% 10,1% 10,0% 9,2% 7,7% 8,0% 7,4% 7,0% 7,1% 6,4% 6,5% 6,3% 6,2% 5,8% 6,1% 6,2% 6,0% 5,2% 4,9% 3,8% 4,5% 4,1% 4,5% 4,3% 4,5% 4,4% 4,1% 3,7% 4,0% 4,0% 4,0% 2,8% 2,0% 0,0% F05 F06 F07 F08 F09 F10 F11 F12 F13 F14 F15 F16 F17 F18 F19 F20 F21 F22 F23 F24 Norm
Slide 9: Results History: Returns to shareholders
RESULTS HISTORY Returns to shareholders 3 500 3 000 2 906 2 500 2 364 935 2 253 2 000 R million 1 704 823 926 1 531 1 606 1 500 1 360 1 368 1 354 639 1 197 1 322 1 296 550 953 1 000 870 789 270 621 1 430 1 368 1 354 1 438 1 531 1 606 319 1 197 1 322 500 318 263 301 227 810 953 1 065 166 229 231 621
Slide 10: Group Financial Results
Group Financial Results
Slide 11: Group Financial Results: Income statement
GROUP FINANCIAL RESULTS Income statement F24 F23 Rm Rm %∆ Revenue 15 862,3 14 919,6 6,3 Cost of sales (9 248,9) (9 095,1) 1,7 Gross profit 6 613,4 5 824,5 13,5 Gross profit margin % 41,7 39,0 6,9 Selling and administrative expenses (3 308,8) (3 109,7) 6,4 Operating profit 3 304,6 2 714,8 21,7 Operat
Slide 12: Change in operating profit F24 vs F23
GROUP FINANCIAL RESULTS Change in operating profit F24 vs F23 700 590 600 500 380 R million 400 305 327 300 232 263 205 200 100 75 27 43 3 12 11 0 (25) (13) (14) (100) (40) (25) Entyce Beverages Snackworks I&J Personal Care Footwear & Apparel AVI Group H1 H2 FY Strong H2 supported by Entyce due to
Slide 13: Business unit financial results
GROUP FINANCIAL RESULTS Business unit financial results Segmental Segmental Operating Revenue Operating Profit Margin F24 F23 Δ F24 F23 Δ F24 F23 Rm Rm % Rm Rm % % % Food & Beverage brands 13 082,5 11 999,4 9,0 2 770,7 2 155,4 28,5 21,2 18,0 Entyce Beverages 5 025,4 4 251,6 18,2 1 300,1 920,2 41,3 2
Slide 14: Movement in group revenue
GROUP FINANCIAL RESULTS Movement in group revenue 17 000 16 500 16 000 15 500 15 000 R million 14 500 14 000 13 500 13 000 12 500 12 000 14 920 1 595 (653)* 15 862 F23 Price/Mix Volume F24 * Includes impact of loss of Coty business in Personal Care Price increases across the group to recover signi
Slide 15: Gross profit margin
GROUP FINANCIAL RESULTS Gross profit margin 60% 50% Gross Profit Margin % 41,1% 41,7% 39,8% 39,0% 39,0% 40% 38,6% 30% 20% F19 F20 F21 F22 F23 F24 Gross profit margins recover to pre-pandemic levels despite poor I&J profit Ongoing focus on cost control and efficiency to protect gross profit margi
Slide 16: Operating profit up 21,7%
GROUP FINANCIAL RESULTS Operating profit 21,7% up 3 400 3 300 3 200 3 100 3 000 R million 2 900 2 800 2 700 2 600 2 500 2 715 380 232 3 (13) (14) 2 3 305 F23 Entyce Snackworks I&J Personal Footwear & Other F24 Care Apparel Entyce: Tea recovery off weaker base supported by coffee growth and strong
Slide 17: Cash flow, gearing and return on capital
GROUP FINANCIAL RESULTS Cash flow, gearing and return on capital F24 F23 Rm Rm % Cash generated by operations 3 778,3 3 079,7 22,7 Cash / EBITDA % 98,1 93,6 4,8 Working capital to revenue % 24,2 23,7 2,1 Capital expenditure (476,5) (482,2) (1,2) Acquisition of intangibles (25,8) (8,0) 222,5 Net deb
Slide 18: Dividends
GROUP FINANCIAL RESULTS Dividends F24 F23 Rm Rm % Interim dividend – cps 202,0 172,0 17,4 Final dividend – cps 388,0 310,0 25,2 Normal dividend – cps 590,0 482,0 22,4 Dividend yield - %* 6,2 7,1 Special dividend – cps 280,0 - Total dividend yield - %* 9,2 7,1 Normal dividend cover ratio 1,15 1,15 C
Slide 19: Performance: Entyce
\TYCE A DIVISION OF NATIONAL BRANDS LIMITED ‘COFFEES Performance a ciro} __ twin
Slide 20: Entyce Income statement: Tea
Income statement F24 F23 % Rm Rm Revenue 5 025,4 4 251,6 18,2 Operating profit 1 300,1 920,2 41,3 Operating profit margin % 25,9 21,6 19,9 Sound improvement in Tea profit supported by top-line growth and effective margin management Price increases across both black tea and rooibos to ameliorate
Slide 21: Entyce Income statement: Coffee
Income statement F24 F23 % Income statement Rm Rm Revenue 5 025,4 4 251,6 18,2 Operating profit 1 300,1 920,2 41,3 Operating profit margin % 25,9 21,6 19,9 Coffee growth with improved performances across all segments Significant selling price increases to recover increases in underlying commod
Slide 22: Entyce Income statement: Creamer
Income statement F24 F23 % Income statement Rm Rm Revenue 5 025,4 4 251,6 18,2 Operating profit 1 300,1 920,2 41,3 Operating profit margin % 25,9 21,6 19,9 Pleasing Creamer performance supported by production efficiencies, sales volumes growth and higher selling prices Selling price increases
Slide 23: Sales volume and selling prices
Sales volume and selling prices %Δ Comments F24 vs F23 Tea revenue growth 16,4 Volume 5,9 Growth in black tea off weaker base in first semester which included aggressive competitor promotions. Growth achieved in rooibos brands Ave. selling price 9,9 Price increases in August 2023 and April 2024 on b
Slide 24: Market shares – 12 months value
Market shares – 12 months value 60,0% 56,7% 53,9% 50,0% 46,4% 43,5% 40,0% 29,6% 29,2% 30,0% 20,0% 17,1% 17,8% 17,1% 15,3% 10,0% 0,0% Five Roses Freshpak Frisco Ellis Brown Trinco F23 F24 Short-term market shares reflect targeted price / volume balance in volatile market Trinco brand well positio
Slide 25: Raw material costs
Raw material costs Cost impact of raw materials and commodities consumed in the period (F24 vs F23): 60 50 47 40 35 30 26 20 11 11 R million 10 0 (10) (20) (16) (19) (30) Palm oil Casein Arabica Glucose Rooibos Black tea Robusta / chicory Impact net of hedging
Slide 26: Performance: Snackworks
Snackworks That’s Good Times! Rey Willard air, Performance
Slide 27: Snackworks Income statement: Biscuits
Income statement F24 F23 % Rm Rm Revenue 5 597,9 5 261,2 6,4 Operating profit 1 270,9 1 038,4 22,4 Operating profit margin % 22,7 19,7 15,2 Increase in Biscuit profit supported by top-line growth and improved factory efficiencies Selling price increases to recover input cost pressures and prote
Slide 28: Snackworks Income statement: Snacks
Income statement F24 F23 % Rm Rm Revenue 5 597,9 5 261,2 6,4 Operating profit 1 270,9 1 038,4 22,4 Operating profit margin % 22,7 19,7 15,2 Sound increase in Snacks’ profit Sustained competitor activity impacted potato chip sales volumes Maize extruded snacks volumes were in line Launch of
Slide 29: Sales volume and selling prices
Sales volume and selling prices %Δ Comments F24 vs F23 Biscuits revenue growth 6,8 Volume (4,0) Constrained consumer demand partly offset by strong festive season and benefits of innovation Ave. selling prices 11,4 Impact of price increases taken last year and in April 2024 Snacks revenue growth 5,0
Slide 30: Market shares – 12 months value
Market shares – 12 months value 45,0% 40,0% 38,4% 37,3% 35,0% 30,0% 25,0% 20,0% 16,2% 15,7% 14,1% 13,4% 15,0% 10,0% 5,0% 0,0% Bakers (Sweet) Bakers (Savoury) Willards F23 F24 Balanced price / volume Market share reflects formal retail only Sound demand growth in wholesale channels
Slide 31: Raw material costs
Raw material costs Cost impact of raw materials and commodities consumed in the period (F24 vs F23): 30 25 23 20 15 10 10 5 3 R million 0 (5) (4) (10) (15) (20) (20) (20) (25) Flour Palm oil Maize Butter Potatoes Sugar Impact net of hedging
Slide 32: Performance: I&J
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Slide 33: I&J Income statement
Income statement F24 F23 % Rm Rm Revenue 2 459,2 2 486,6 (1,1) Operating profit 199,7 196,8 1,5 Operating profit margin % 8,1 7,9 2,5 Difficult year with improved fishing profits but off a low base Higher selling prices supported by benefit of weaker Rand on export sales Lower catch rates imp
Slide 34: I&J Income statement: Abalone
Income statement F24 F23 % Income statement Rm Rm Revenue 2 459,2 2 486,6 (1,1) Operating profit 199,7 196,8 1,5 Operating profit margin % 8,1 7,9 2,5 Lower profit from abalone business Increased competition and reduced demand constrained selling prices and volumes in key markets Weaker Rand
Slide 35: I&J Operating profit
Operating profit 700 600 500 R million 400 300 200 100 - 197 99 66 13 (61) (15) (20) (50) (29) 200 F23 Currency Fuel VAP insurance Catch rate Non-cash Restructuring Abalone Other F24 recognition BBBEE charge costs profits Reduction in fuel prices supported by vessel fuel saving initiatives Recog
Slide 36: Profit history
Profit history 480 430 417 398 380 67 380 98 345 71 330 317 350 305 347 69 309 123 280 300 236 R million 230 0 248 199 197 180 236 89 39 182 130 158 80 110 30 (20) (2) F16 F17 F18 F19 F20 F21 F22 F23 F24 Fishing Abalone Improved fishing performance but well below historical levels Abalone profit
Slide 37: Fishing performance
Fishing performance 12,0 10,2 10,1 9,9 10,0 9,5 9,4 9,2 9,0 8,5 8,3 8,1 8,4 Hake tons per sea day 8,0 7,5 6,0 4,0 2,0 0,0 F13 F14 F15 F16 F17 F18 F19 F20 F21 F22 F23 F24 I&J catch rate Average catch rate F13 - F24 Decline across wet and freezer vessels with lowest catch rates in last 20 years Im
Slide 38: Sales volume and selling prices (Hake)
Sales volume and selling prices (Hake) %Δ Comments F24 vs F23 I&J Domestic revenue growth 1,7 Volume (4,0) Competitor activity, constrained demand and impact of lower catch rates negatively impacted food service and retail volumes Ave. selling prices 6,0 Price increases taken to mitigate cost pressu
Slide 39: Performance: Personal Care
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Slide 40: Personal Care Income statement
Income statement F24 F23 % Rm Rm Revenue 1 022,5 1 223,3 (16,4) Operating profit 220,0 233,1 (5,6) Operating profit margin % 21,5 19,1 12,6 Indigo profit decline due to cessation of Coty relationship Like-for-like revenue better with improved roll-on and colour cosmetic performances Volume pr
Slide 41: Sales volume and selling prices
Sales volume and selling prices %Δ Comments F24 vs F23 Personal Care revenue growth* 0,5 Volume (16,4) Volumes declined due to constrained demand, aggressive competitor pricing and aggressive rationalisation of SKUs to improve efficiencies Ave. selling price 16,9 Price increases in response to cost
Slide 42: Market shares – 12 months value
Market shares – 12 months value 45% 41,9% 40% 38,3% 35% 33,3% 32,0% 30% 25% 20% Body sprays - Female * Body sprays - Male * F23 F24 * Excludes Coty Balanced price / volume in competitive environment Reduced performance from Exclamation and the Yardley male and female portfolios Range rationali
Slide 43: Footwear and Apparel Performance
FOOTWEAR AND APPAREL Performance
Slide 44: Footwear and Apparel Income statement
Income statement F24 F23 % Rm Rm Revenue 1 757,3 1 696,9 3,6 Operating profit 340,8 354,8 (3,9) Operating profit margin % 19,4 20,9 (7,2) Operating profit decline due to lower volumes in H2 Higher selling prices to ameliorate weaker Rand and protect margins First semester well supported by a
Slide 45: Sales volume and selling prices
Sales volume and selling prices %Δ Comments F24 vs F23 Spitz and Kurt Geiger Footwear revenue 6,0 growth Volume (2,1) Volume declines due to constrained consumer environment despite strong December and good demand for Carvela and Lacoste brands Ave. selling price 8,2 Price increases to ameliorate in
Slide 46: International Performance
AN | International Performance
Slide 47: AVI International: Operating profit history
AVI INTERNATIONAL Operating profit history 350 313 301 300 271 273 253 250 213 194 197 200 189 R million 159 150 129 132 103 100 92 50 - F11 F12 F13 F14 F15 F16 F17 F18 F19 F20 F21 F22 F23 F24 Price increases in line with domestic businesses in response to cost pressure Zambia subsidiary negativ
Slide 48: AVI International: Non RSA sales
AVI INTERNATIONAL Entyce, Snackworks and Indigo – Non RSA sales F24 F23 % Rm Rm International Revenue 1 276,4 1 275,7 0,1 % of Grocery and Personal Care brands 11,0 11,9 (7,6) International Operating Profit 312,9 300,9 4,0 % of Grocery and Personal Care brands 11,2 13,7 (18,2) % % International Ope
Slide 49: F25 Prospects
F25 Prospects
Slide 50: Prospects for F25
AVI GROUP Prospects for F25 Sustain profitability for Entyce, Snackworks and Indigo in tough trading environment Constrained consumer demand environment expected to persist Increased competition in our categories may put pressure on margins Continued price / volume management essential to pr
Slide 51: Prospects for F25
AVI GROUP Prospects for F25 Sustain profitability for Entyce, Snackworks and Indigo in tough trading environment Volatility in commodity and foreign exchange markets will continue to be managed to protect margins Commodity and currency hedge positions secured provide cost certainty for the fir
Slide 52: Prospects for F25
AVI GROUP Prospects for F25 I&J’s prospects dependent on fishing performance, fuel prices and exchange rates Acquisition of a second-hand freezer vessel to increase catching capacity – from December 2024 Exchange rates hedged at better rates than achieved in F24 Continued focus on cost struc
Slide 53: Prospects for F25
AVI GROUP Prospects for F25 Footwear and Apparel Christmas trading material to F25 Ongoing price / volume management essential through tough demand cycle and ongoing discounts Supply chain challenges expected to persist adding complexity and cost Currency hedge positions provide some certa
Slide 54: Prospects for F25: Capital projects
AVI GROUP Prospects for F25 Capital investment projects to improve capability, product quality and customer service levels Approved and Planned Projects Rm Tea production and packaging equipment 19 Biscuit line upgrades 51 I&J processing plant replacements and upgrades 69 I&J vessel dry-docks and
Slide 55: Investor proposition
AVI GROUP Investor proposition Ability to adapt to changing macro-environment: Ongoing simplification of business model Group initiatives – innovation structure, margin management, procurement, cost savings and production efficiencies Focus on scalable and relevant innovation for constrained
Slide 56: Questions
Questions
Slide 57: Information Slides: Revenue 6,3% up
INFORMATION SLIDES Revenue 6,3% up 16 200 16 000 15 800 15 600 15 400 R million 15 200 15 000 14 800 14 600 14 400 14 200 14 920 774 337 (28) (201) 60 15 862 F23 Entyce Snackworks I&J Personal Footwear & F24 Care Apparel Entyce: Growth across all categories supported by higher selling prices and i
Slide 58: Information Slides: Gross profit 13,5% up
INFORMATION SLIDES Gross profit 13,5% up 6 800 6 600 6 400 R million 6 200 6 000 5 800 5 600 5 400 5 825 480 302 3 (8) 11 6 613 F23 Entyce Snackworks I&J Personal Footwear & F24 Care Apparel Entyce: Revenue growth with improved margins supported by factory efficiencies, effective cost control and
Slide 59: Impact of non-renewal of Coty distributor agreement
INFORMATION SLIDES Impact of non-renewal of Coty distributor agreement Personal Care F23 Coty F23 excluding F23 Reported contribution Coty Operating performance Rm Rm Rm Revenue 1 223,3 209,8 1 013,5 Operating profit 233,1 50,0 183,1 Operating profit margin 19,1 23,8 18,1 F23 Rm Working capital* 86,
Slide 60: Marketing expenditure
INFORMATION SLIDES Marketing expenditure 14,0% 13,3% 12,6% 12,0% 10,0% 8,6% 8,1% 8,0% 7,0% 7,2% 7,1% 6,2% 5,8% 5,9% 5,7% 5,6% 6,0% 4,2% 4,2% 4,0% 2,5% 1,9% 2,0% 0,0% * Excludes Coty F23 F24 Total expenditure for F24 of R839,7 million compared to R820,7 million in F23 Increase in total spend for
Slide 61: Capital expenditure and depreciation
INFORMATION SLIDES Capital expenditure and depreciation (excl. depreciation on right-of-use assets) 600 546 500 473 482 477 400 420 408 411 394 388 388 388 390 374 377 R million 300 316 200 241 100 - F17 F18 F19 F20 F21 F22 F23 F24 Capital expenditure Depreciation charge Ongoing investment in effi
Slide 62: Capital expenditure
INFORMATION SLIDES Capital expenditure Full Year H1 F24 H2 F24 F24 Actual Actual Actual Rm Rm Rm 41 18 59 Creamer capacity increase Biscuit line upgrades and improvements 25 26 51 Snacks fryer essential replacement 28 9 37 Distribution centre facility upgrades 13 21 34 I&J processing plant replaceme
Slide 63: Cash flows
INFORMATION SLIDES Cash flows 4 500 4 000 3 500 3 000 2 500 R million 2 000 1 500 1 000 500 - 4 049 (255) (910) (477) (26) (148) (185) (338) (1 710) Cash from Working Taxation Capital Acquisition of Lease Net interest Decrease in Ordinary operations capital and expenditure intangibles liabilities pa
Slide 64: Foreign exchange hedges
INFORMATION SLIDES Foreign exchange hedges September 2024 to January 2025 to December 2024 June 2025 % Cover % Cover USD imports 77% 30% EUR imports 79% 27% USD exports 42% 47% EUR exports 40% 43% Consistent hedging philosophy provides stability to manage gross profit margins
Slide 65: I&J period end fair value adjustments
INFORMATION SLIDES I&J period end fair value adjustments F24 F23 Actual Actual Rm Rm Rm Fuel hedge unrealised (gain) / loss (13,1) 12,6 (25,7) Opening mark-to-market liability (12,8) (0,2) Closing mark-to-market asset / (liability) 0,3 (12,8) Abalone – decrease in unrealised profit in stock 3,8 3,
Slide 66: I&J fishing quota
INFORMATION SLIDES I&J fishing quota CY17 CY18 CY19 CY20 CY21 CY22 CY23 CY24 Quota (tons) South African Total Allowable 140 216 133 120 146 430 146 430 139 119 132 163 138 772 145 698 Catch (TAC) % change in (5,0) (5,0) 10,0 - (5,0) (5,0) 5,0 5,0 TAC I&J 37 901 36 013 39 517 39 517 37 543 34 143 35
Slide 67: Trading space and trading density
INFORMATION SLIDES Trading space and trading density Footwear and apparel F24 F23 Number of stores 111 115 Turnover (Rm) 1 757,3 1 696,9 Average m2 23 404 24 362 Trading Density (R/m2) 75 085 69 654 Closing m2 23 199 24 132 Like-for-like metrics* F24 F23 Number of stores 107 107 Turnover (Rm) 1 570,
Slide 68: Trading density – Footwear and apparel stores
INFORMATION SLIDES Trading density – Footwear and apparel stores 80 000 35 000 70 000 30 000 60 000 25 000 50 000 20 000 R/m2 m2 40 000 15 000 30 000 10 000 20 000 10 000 5 000 - - F17 F18 F19 F20 F21 F22 F23 F24 Trading density (R/m2) Average trading space (m2) Closed 7 stores in the last 12 mont