Camellia Plc · LSE:CAM
Camellia — H1 2020 Earnings Presentation
14 slides from Camellia's earnings presentation, October 2020
Slide 1: Camellia Interim Results Presentation October 2020
CAMELLIA INTERIM RESULTS PRESENTATION OCTOBER 2020 1
Slide 2: A Global Group with a Focus on Agriculture
A GLOBAL GROUP WITH A FOCUS ON OPERATING AGRICULTURE ACROSS 11 LARGEST COUNTRIES PRODUCER OF AVOCADOS IN KENYA LARGEST PRIVATE PRODUCER OF TEA GLOBALLY WITH 57 TEA FACTORIES IN 4 COUNTRIES 78,000 EMPLOYEES 2% GLOBAL WORLDWIDE MACADAMIA MARKET SHARE 2
Slide 3: Overview
OVERVIEW ▪ Diversified international group ▪ Focus on perennial crop production ▪ World’s largest private producer of tea ▪ Long-term strategy of crop and origin diversification ▪ Investing in expansion of macadamia and avocado as well as trialling a potential fourth core crop ▪ Enduring ESG commitm
Slide 4: H1 2020 Strategic Highlights
H1 2020 STRATEGIC HIGHLIGHTS ▪ Covid-19 ▪ Massive tea production in Kenya due to weather conditions and smallholders ▪ Macadamia harvest substantially down ▪ Substantial investment in crop and jurisdictional diversification in recent years mitigated weakness in global tea prices ▪ Acquisition of lan
Slide 5: H1 2020 Financial Highlights
H1 2020 FINANCIAL HIGHLIGHTS ▪ Sales broadly stable at £115m ▪ Underlying loss from continuing operations, partly reflecting normal seasonality ▪ Group expects to record underlying profit before tax for the year ▪ Results adversely impacted by legal costs £3.5m and asset impairments £3.4m ▪ Net cash
Slide 6: ESG at Camellia
ESG AT CAMELLIA ▪ Aligned to seven of the UN SDGs ▪ “Licence to trade” - the success of our operations is fundamentally connected to the communities and environments in which we operate ▪ We support a large number of smallholder farmers ▪ Published 2020 ESG report in June ▪ Operate 500 schools and e
Slide 7: Agriculture Division Tea
AGRICULTURE DIVISION TEA GOODRICKE GROUP EASTERN PRODUCE KENYA ▪ Tea volumes down 43% on H1 2019 INDIA due to: KENYA ▪ Tea volumes up 58% on 2019 ▪ Closure of gardens ▪ Good weather ▪ Cyclone Amphan ▪ Rapid expansion of ▪ Heavy monsoon smallholder sector ▪ In Darjeeling most of first flush lost ▪ Av
Slide 8: Agriculture Division Avocado and Macadamia
AGRICULTURE DIVISION AVOCADO AND MACADAMIA SOUTH MALAWI AFRICA AVOCADO MACADAMIA KENYA ▪ Production up 47% on H1 2019 (‘on’ year for avocado) ▪ Macadamia harvest 25% down on ▪ Logistics working well despite full year due to hot, dry weather in challenges presented by pandemic South Africa & Malawi i
Slide 9: Agriculture Division Speciality Crops
AGRICULTURE DIVISION SPECIALITY CROPS BRAZIL ▪ Soya crop up 3% on H1 2019, KENYA KAKUZI – BLUEBERRIES MAIZE, SOYA, driven by 9% higher dry land yields ▪ Blueberries developed more slowly ▪ Soya pfrices up 4% on H1 2019 SORGHUM & assisted by the devaluation of the ▪ than expected at our trial site Fi
Slide 10: Non-Agriculture Divisions
NON-AGRICULTURE DIVISIONS AJT ACS&T ▪ Busy H1 in the oilfield division but ▪ Positive start to the year with a site services paused difficult Q2 as food service reduced ▪ A slower H2 anticipated as impact ▪ Trading has begun to improve as of pandemic on oil prices is felt out of home dining gets bus
Slide 11: Covid-19 Impact
COVID-19 IMPACT ▪ Tea – substantial impact on production in India and demand in Bangladesh ▪ Macadamia – impact on demand from key markets for kernel in the USA and China ▪ Avocado and other crops – no impact so far ▪ Engineering – mixed results during H1 and concern about demand in H2 ▪ Food Servic
Slide 12: Dealing with Covid-19
DEALING WITH COVID - 19 ▪ Camellia people – welfare and safety a top priority ▪ Community action – Camellia manages 87 hospitals and dispensaries in some of the world’s poorest countries. Where possible, these are now being used for the benefit of the whole community ▪ Focus on cash conservation and
Slide 13: Camellia and the Tea Market
CAMELLIA AND THE TEA MARKET North India CTC Auction Prices ▪ Tea accounts for circa two-thirds of sales and is integral 300 to the performance of the Group 250 US cents per kilo 200 ▪ Globally traded commodity subject to supply and 150 demand economics with complex local and global market 100 dynami
Slide 14: Outlook
OUTLOOK ▪ H2 2020 underlying profit expected to improve over H1, reflecting: ▪ Normal seasonality ▪ Recovering tea prices in India and Bangladesh ▪ Recently improved avocado prices ▪ Covid-19 continues to impact ▪ Engineering seeing reduced demand in H2 ▪ Food services hit by decline in hospitality