Graincorp Limited Class A · ASX:GNC
Graincorp Limited Class A — Austock Agribusiness Conference 2009
26 slides from Graincorp Limited Class A's conference presentation, Mar 19, 2009
Slide 1: Company announcement
For personal use only Company announcement GrainCorp Limited ABN 60 057 186 035 Date: 19 March 2009 To: The Manager Announcements Company announcements office Lodged via www.asxonline.com PUBLIC ANNOUNCEMENT Contents for immediate release: Attached is the MD’s Presentation to Austock Agribusiness Co
Slide 2: GrainCorp Managing Director Mark Irwin - Austock Investors Conference
For personal use only GrainCorp Managing Director Mark Irwin Austock Investors Conference 19 March 2009
Slide 3: Industry Snapshot
For personal use only Industry Snapshot Grain Storage | Supply Chain Logistics | Grain Marketing |Port Terminals | Merchandise | Hunter Grain | Allied Mills 2
Slide 4: Eastern Australian Grains Industry
Eastern Australian Grains Industry For personal use only • Underlying grain production fundamentals are sound • Strong cropping area planted in recent years • While production is variable – average yields are increasing • Good yields north of Dubbo but poor yields in Vic. in 2008 Source: ABS and ABA
Slide 5: GrainCorp Business Model
For personal use only GrainCorp Business Model Grain Storage | Supply Chain Logistics | Grain Marketing |Port Terminals | Merchandise | Hunter Grain | Allied Mills 4
Slide 6: 'Integrated' Business Model
‘Integrated’ Business Model For personal use only Export Port O ’seas Grain Terminal Customers Storage & Supply Grain Marketing Handling Chain Domestic Allied Food Grain Mills Customers Producer Mill run Domestic Farm Supply Customers Meals Farm inputs Fertiliser Inputs Chain Bulk Woodchips & Custom
Slide 7: Business Model Overview
Business Model Overview For personal use only Storage and Rail Ports Trading Merchandise Hunter Grain Logistics 20 MMT grain 8 mainline 7 bulk grain 2 ‐ 3 mmt grain 27 operational Trading 230 kt storage capacity take‐or‐pay ports traded PA sites in Sth. PA of soybean trains Qld., NSW, Vic. meal Busi
Slide 8: Flexible Receival Site Strategy
Flexible Receival Site Strategy For personal use only • Positive pre CAPEX cash contribution from most operating sites • Sites operated each year changes according to receivals • Low ‘holding’ cash cost for non operated sites FY06 to FY08 Ranking of Receival Site Contribution 1.2 Cash Contribution $
Slide 9: Updates and Forecasts
For personal use only Updates and Forecasts Grain Storage | Supply Chain Logistics | Grain Marketing |Port Terminals | Merchandise | Hunter Grain | Allied Mills 8
Slide 10: Receivals
Receivals For personal use only Grain Receivals • Total winter crop receivals 14.0 7.93 mmt 12.0 • Sorghum receivals 10.0 YTD 686 kt Million Tonnes 8.0 • Total grain receivals YTD 8.6 mmt 6.0 • Forecast sorghum crop 4.0 receival range 2.0 0.7 to 1 mmt ‐ 2004 2005 2006 2007 2008 2009 YTD Grain Storag
Slide 11: Exports
Exports For personal use only • Grain exported through Grain Exports Handled 7.0 GrainCorp terminals YTD 1.48 mmt 6.0 • Forecast to exceed 5.0 3.0 mmt* 4.0 • Subject to timing of exports by exporters 3.0 • GrainCorp FIS, FOB and CIF wheat export sales 2.0 YTD 755 kt 1.0 ‐ 2004 2005 2006 2007 2008 20
Slide 12: FY Earnings Guidance
FY 09 Earnings Guidance For personal use only • Good performance from Storage and Logistics, Ports 30.0 and Marketing 28.0 • Merchandise and Hunter 20.0 Grain below target 31.7 25.7 23.0 • Strong financial 10.0 $ Million performance compared to 13.5 10 mmt receivals in 2005 ‐ 2004 2005 2006 2007 200
Slide 13: Storage and Logistics and Ports Restructure
For personal use only Storage and Logistics and Ports Restructure Grain Storage | Supply Chain Logistics | Grain Marketing |Port Terminals | Merchandise | Hunter Grain | Allied Mills 12
Slide 14: Restructure Focus
Restructure Focus For personal use only • Right People – Succession planning – Increase skills – Autonomy, accountability, empowerment • Right service – Supply chain solutions for customers – Local solutions • Right time – Post harvest of first year of deregulation – Customer needs are changing – De
Slide 15: Structure – Storage and Logistics
Structure – Storage and Logistics For personal use only • Combine Divisional and Regional levels of management – Operating autonomy and accountability to ensure customer focus and business excellence • Create 6 new regions – To provide better match between geography, rail, ports and alignment of gra
Slide 16: Six New Regions
Six New Regions For personal use only • Queensland • Northern NSW • Central NSW • Southern NSW • East Victoria • West Victoria Grain Storage | Supply Chain Logistics | Grain Marketing |Port Terminals | Merchandise | Hunter Grain | Allied Mills 15
Slide 17: Structure - Ports
Structure ‐ Ports For personal use only • Remove Divisional Management layer • Increase operational and customer management autonomy at a terminal manager level • Interface with logistics • Staff reductions at Geelong, Portland and Sunshine to ensure sustainability of the operations, best practice a
Slide 18: Company Growth Strategy
For personal use only Company Growth Strategy Grain Storage | Supply Chain Logistics | Grain Marketing |Port Terminals | Merchandise | Hunter Grain | Allied Mills 17
Slide 19: Four Key Growth Initiatives
Four Key Growth Initiatives For personal use only Competitive supply chain and rail services for grain Develop our rail and road supply chain for export and domestic grain to secure increased value and delivered increased value to our customers Extend our grain supply chain to overseas customers Dev
Slide 20: Growth Strategy Implementation and Initiatives
For personal use only Growth Strategy Implementation and Initiatives Grain Storage | Supply Chain Logistics | Grain Marketing |Port Terminals | Merchandise | Hunter Grain | Allied Mills 19
Slide 21: Strategic Positioning
Strategic Positioning For personal use only • The superior positioning of supply chain assets from grower, to silo, trains and our ports has allowed us to grow our bulk exports and also be the superior provider of supply chain services on the east coast of Australia • This has been facilitated by: –
Slide 22: Strategic Positioning (cont)
Strategic Positioning (cont) For personal use only • Industry Restructure – Removal of bulk wheat export monopoly • Business Excellence – Shine (2006) – 50 sites closed and staff reduction of 130 FTE – STORM (June 2009) – New stock management system – Phase 1: Storage and Logistics and Ports separat
Slide 23: Trading Growth Initiatives
Trading Growth Initiatives For personal use only • Removal of the bulk wheat export monopoly July 08 • New revenue opportunities – Exporting wheat in bulk in own right (CIF) – Accumulation of grain on behalf of exporters (FOB & FIS) – Build on Supply Chain strength • Logistics service ‘packaging’ •
Slide 24: Take or Pay Trains Growth Initiatives
Take or Pay Trains Growth Initiatives For personal use only • 8 trains with capacity of 2mt PA in NSW and VIC • Approx. 850 kt grain hauled YTD • Substantial efficiencies achieved – 50% increase in train utilisation • Increase in train capacity planned for 2009/10 • Forward sale of capacity for 2009
Slide 25: Allied Mills Growth Initiatives
Allied Mills Growth Initiatives For personal use only • Income growth from acquisition of $10M frozen dough manufacturing facility • Picton commissioning – Customer satisfaction with product – Logistics gains achieved with 40 wagon take or pay train • Coles and Woolworths ‘in store bakery’ contract
Slide 26: Thank You
For personal use only THANK YOU Grain Storage | Supply Chain Logistics | Grain Marketing |Port Terminals | Merchandise | Hunter Grain | Allied Mills 25