Graincorp Limited Class A · ASX:GNC
Graincorp Limited Class A — Shareholder Meeting (February 2011)
23 slides from Graincorp Limited Class A's shareholder meeting presentation, Feb 23, 2011
Slide 1: Managing Director's Presentation to GrainCorp's 2011 Annual General Meeting
Company announcement For personal use only GrainCorp Limited ABN 60 057 186 035 Date: 23 February, 2011 To: The Manager Announcements Company announcements office PUBLIC ANNOUNCEMENT MANAGING DIRECTOR’S PRESENTATION TO GRAINCORP’S 2011 ANNUAL GENERAL MEETING Michael G. A. Smith Company Secretary Gra
Slide 2: Managing Director's Presentation – GrainCorp 2011 AGM
For personal use only Ms Alison Watkins (Managing Director and Chief Executive Officer) 23rd February 2011 MANAGING DIRECTOR DIRECTOR’SS PRESENTATION – GRAINCORP 2011 AGM 1
Slide 3: FY10 Business Report
For personal use only FY10 BUSINESS REPORT 2
Slide 4: Improved diversification and stability
Improved diversification and stability For personal use only 250 EBITDA by Segment – $M 200 • Malt provides improved earnings 150 stability and predictability 100 50 0 FY04 FY05 FY06 FY07 FY08 FY09 FY10 (1) Storage & Logistics Ports Trading Allied Mills Malt Core debt and gearing(2) 300 60% • Core g
Slide 5: Strong dividend payout
Strong dividend payout For personal use only Dividend de d Profile o e ($ per pe share) s a e) • Policy – to pay 40‐60% of NPAT 1.00 Dividend per share Earnings per share through the business cycle 0.75 • FY10 dividends of $0.30 per share 0.50 (75% of NPAT), including fully 0.25 franked: 0.00 - $0.1
Slide 6: Malt – in line with expectation
Malt – in line with expectation For personal use only $M FY10(1) FY09 • Underlying volume and margins in line with i hbbusiness i case Revenue 796 ‐ • FY10 includes: EBITDA 119 ‐ - $8.7M compensation payment from EBIT 90 ‐ Port of Vancouver (WA) Capital Expenditure 54 ‐ - $15M positive inventory rev
Slide 7: Country Operations – below normalised crop
Country Operations – below normalised crop For personal use only $M FY10 FY09 • Lower earnings per tonne received d to lower due l production d i Revenue 340 409 EBITDA 34 91 • Continued improvement with grower interface – increased ‘front line’ GMS EBIT 10 69 accumulation team Capital Expenditure 2
Slide 8: Ports – grain export volumes lower
Ports – grain export volumes lower For personal use only $M FY10 FY09 • 2 year agreements with all exporters Revenue 104 130 • 3 year renewal of ACCC Access Undertaking commenced EBITDA 52 78 • Containerised exports 0.3mmt 0 3mmt and EBIT 38 64 increased asset utilisation Capital Expenditure 15 7 •
Slide 9: Trading – improved market share
Trading – improved market share For personal use only $M FY10 FY09 • Revenue lower due to decrease in grain prices Revenue 924 1,346 • Large fall in eastern Australia grain EBITDA 32 39 production – tonnes traded only PBT 20 26 marginally lower Trading inventory held 188 85 • GrainCorp exports 1.1mm
Slide 10: Allied Mills – retail and food service innovation
Allied Mills – retail and food service innovation For personal use only $M FY10 FY09 • Retail sales pressure and competitive market EBITDA 45 48 • Development at Yatala of Equity Profit 9 10 - Par bake bread range (60% Joint Venture Share) Net Asset Value 227 211 - Frozen doughnut range Capital Expe
Slide 11: FY11 Update and Guidance
For personal use only FY11 UPDATE AND GUIDANCE 10
Slide 12: Volume update and drivers
Volume update and drivers For personal use only Volume Drivers Country • YTD received 13.9mmt • Ex‐farm winter receivals receivals • FY11 guidance ~14.5mmt • Sorghum harvest Port grain • YTD elevated 1.9mmt • Rail and road freight elevations • FY11 gguidance 6.5‐7.5mmt availability • Committed C itt
Slide 13: Earnings guidance
Earnings guidance For personal use only GrainCorp EBITDA(1) $275‐310M GrainCorp NPAT(2) $115‐135M (1) Excludes Trading interest expense and includes 60% share of Allied Mills NPAT (2) Depreciation and Amortisation of ~$80M, and tax rate of ~31% 12
Slide 14: Challenging harvest impacts earnings
Challenging harvest impacts earnings For personal use only Harvest 4 4‐6 6 • Labour costs – employing p y g casuals duringg harvest delayy weeks late • Storage fees forgone – delayed receivals & disrupted • Managing mobile equipment – additional hire fees and transport • R&M – recommission equipment
Slide 15: R&M reflects business reinvestment
R&M reflects business reinvestment For personal use only • FY11 R&M increasing to ~$30M to handle large FY11 harvest and improvements for FY12 • Ongoing R&M spend at a rate which hich – Improves levels of safety – Improves I productivity d ti it and d efficiency ffi i – equipment, i t IT, IT managem
Slide 16: Outlook
Outlook For personal use only Grains • Price outlook for wheat and barley positive, despite high AUD • Moisture i profiles fil also l a positive i i for f planting l i intentions i i Malt • Sustained high AUD and CAD currencies continue to impact competitiveness of export sales from Australia and Ca
Slide 17: Strategy Update
For personal use only STRATEGY UPDATE 16
Slide 18: Operating along the grain chain
Operating along the grain chain For personal use only GrainCorp has assets and capabilities at every stage along the grain chain Storage & Transport Ports Processing Handling Trading (grain ownership along the chain) • 280+ sites serving • Contract 15+ and • 7 bulk export • ~1.1mmt ~1 1mmt of malt p
Slide 19: An increasing international presence
An increasing international presence For personal use only International operations provide a platform for global reach European Trading office(1) Australia Grain Storage g & Logistics g United Kingdom Ports Grain Trading Scotgrain Grain Processing Saxon Agriculture Barrett Burston Malti
Slide 20: Strong focus on improving ROE
Strong focus on improving ROE For personal use only EBITDA and Return on Equity (ROE) 250 10% 8% 200 6% 4% 150 2% ‐ 100 ‐2% 50 ‐4% ‐6% $M ‐ ‐8% 8% FY04 FY05 FY06 FY07 FY08 FY09 FY10 EBITDA $M ROE (%) 19
Slide 21: Five strategies
Five strategies For personal use only 1. Maintain a strong market presence → Leading provider of grain supply chain services 2. Operate along the grain chain → ‘End to end’ supplier of grain to domestic and international consumers 3. Increase participation in grain processing → Broader B d and d com
Slide 22: Grow as an integrated international agribusiness
Grow as an integrated international agribusiness For personal use only 1 • Increase container packing Maintain M i i a • Pursue non grain products (imports/exports) at GrainCorp ports strong market • Rail interface and coordination improvement presence • Create a strong market place for buyers and s
Slide 23: Grow as an integrated international agribusiness
Grow as an integrated international agribusiness For personal use only 3b Increase Allied Mills participation • Reliable service based on quality, Research & Development and in grain distribution processing i • Pursue opportunities in other h flflour products d 4 Grow as an G • Organic and non‐organ