Zeder Investments Limited · JSE:ZED
Zeder Investments — H1 FY2022 Earnings Presentation
27 slides from Zeder Investments's earnings presentation, Oct 6, 2021
Slide 1: Interim Results 31 August 2021
INTERIM RESULTS 31 AUGUST 2021 PRESENTED BY: JOHANN LE ROUX DATE: 6 OCTOBER 2021 1
Slide 2: Agenda
AGENDA • Noteworthy transactions • Interim financial results • Portfolio review • Prospects and strategy • Questions – email to cosec@zeder.co.za 2
Slide 3: Noteworthy Transactions
NOTEWORTHY TRANSACTIONS • Dividends, portfolio transaction and buyback of Zeder shares Payment of Special Portfolio Dividends EA Seeds Buyback of Zeder Dividend Received Transaction Shares • A special dividend of • Dividends received • Zaad acquired a 40% • No further shares 20c per share was paid f
Slide 4: Interim Financial Results
INTERIM FINANCIAL RESULTS • Results summary • Sum-of-the-parts • Covid-19 4
Slide 5: Interim Financial Results: Results Summary
INTERIM FINANCIAL RESULTS RESULTS SUMMARY • Intrinsic value of portfolio impacted by valuation adjustments and special dividend ─ Total Sum-of-the-Parts increased from R4.33 to R4.45 per share during the period as a result of: ─ Upward valuations of Kaap Agri and TLG (combined fair value adjustment
Slide 6: Interim Financial Results: Sum-of-the-Parts
INTERIM FINANCIAL RESULTS SUM-OF-THE-PARTS The SOTP value per share increased by 25% over the past 12 months, including the effects of the special dividend paid during May 2021. 31-Aug-20 28-Feb-21 31-Aug-21 Share of Share of Share of Company Interest Rm Assets Interest Rm Assets Interest Rm Assets
Slide 7: Interim Financial Results: Covid-19
INTERIM FINANCIAL RESULTS COVID-19 • Impact on South Africa and business ─ GDP retraction and significant job losses (resultant increase in unemployment rate) ─ Economy struggling, government debt levels high and business confidence low ─ Current low interest rate environment however beneficial ─ 3r
Slide 8: Portfolio Review
PORTFOLIO REVIEW INVESTMENTS LIMITED
Slide 9: Zaad is a specialist agricultural seed and agrochemicals company
Zaad is a specialist agricultural seed and agrochemicals company that develops and supplies a broad basket of proprietary seeds and chemicals to emerging markets. 9
Slide 10: Portfolio Review: Zaad Financial Results
PORTFOLIO REVIEW FINANCIAL RESULTS Zaad changed its year end in order to better align the financial reporting outside the key summer crop cycle. Zaad reported recurring headline earnings of R177m for the year ended 30 June 2021. Jan 19 Jan 20 Jan 21 Jun 21 Summarised Income Statement 12 months 12 mo
Slide 11: Zaad valuation unchanged at R2.010bn
PORTFOLIO REVIEW FINANCIAL RESULTS The valuation of Zeder’s interest in Zaad has remained unchanged at R2.010bn in-line with the flat reported earnings numbers for the year ended 30 June 2021. GENERAL COMMENTS VALUATION CONSIDERATIONS • Good performances from May Seed (Turkey) and FarmAg • Valuation
Slide 12: The Logistics Group is an asset light business
The Logistics Group is an asset light business, operating strategic logistical and terminal assets in South Africa, whilst expanding its service offering and capabilities to a broader market base in Southern Africa. 12
Slide 13: Portfolio Review: TLG Financial Results
PORTFOLIO REVIEW FINANCIAL RESULTS TLG reported an increase of 178% in recurring headline earnings per share for the six-months ended 30 June 2021. The substantial increase is as a result of good growth, but also due to the prior reporting period Covid-19 impact. Dec 19 Dec 20 Jun 20 Jun 21 Summaris
Slide 14: TLG valuation increased to R1.430bn
PORTFOLIO REVIEW FINANCIAL RESULTS The valuation of Zeder’s interest in TLG has increased to R1.430bn, as a result of an improved performance in recurring headline earnings and good growth prospects. GENERAL COMMENTS VALUATION CONSIDERATIONS • Business has been resilient post the level-5 Covid lockd
Slide 15: Capespan is an internationally diversified group
Capespan is an internationally diversified group with a primary exposure to fruit farming, marketing, distribution and related services. 15
Slide 16: Portfolio Review: Capespan Financial Results
PORTFOLIO REVIEW FINANCIAL RESULTS Capespan reported a loss of R56m for the six-months ended 30 June 2021, compared to the prior period loss of R27m, largely as a result of decisions taken during the prior year Covid-19 period and resultant timing differences on the farms. Dec 19 Dec 20 Jun 20 Jun 2
Slide 17: Capespan valuation unchanged at R1.117bn
PORTFOLIO REVIEW FINANCIAL RESULTS As a result of the annual input-cost cycle associated with agricultural investments, the valuation of Zeder’s interest in Capespan has remained unchanged at R1.117bn. GENERAL COMMENTS VALUATION CONSIDERATIONS • Farms performance main reason for year on year fluctua
Slide 18: Kaap Agri is a leading agri-related retail company
Kaap Agri is a leading Agri-related retail, trade, supply and services company that supplies a variety of products and services mainly to the agricultural sector, but also to the general public. 18
Slide 19: Portfolio Review: Kaap Agri Financial Results
PORTFOLIO REVIEW FINANCIAL RESULTS Kaap Agri delivered strong interim 31 March 2021 results with an increase in recurring headline earnings per share of 23% and an interim dividend payment of 40c per share. Sep 19 Sep 20 Mar 20 Mar 21 Summarised Income Statement 12 months 12 months 6 months 6 months
Slide 20: Kaap Agri valuation increased to R1.391bn
PORTFOLIO REVIEW FINANCIAL RESULTS The valuation of Zeder’s interest in Kaap Agri has increased to R1.391bn, as a result of the increase in the JSE listed share price. GENERAL COMMENTS VALUATION CONSIDERATIONS • Interim reported recurring headline earnings per share • Valuation based on JSE listed s
Slide 21: Agrivision Africa is a vertically integrated food supplier
Agrivision Africa is a vertically integrated, grain-related food supplier that farms, mills and distributes products in the northern region of Zambia and southern parts of the DRC. 21
Slide 22: Portfolio Review: Agrivision Financial Results
PORTFOLIO REVIEW FINANCIAL RESULTS Agrivision reported an improved performance on the farming operations and as a result managed to reduce debt on the balance sheet. Dec 19 Dec 20 Jun 20 Jun 21 Summarised Income Statement 12 months 12 months 6 months 6 months Historical $'000 $'000 $'000 $'000 $'000
Slide 23: Agrivision valuation unchanged at R146m
PORTFOLIO REVIEW FINANCIAL RESULTS As a result of the annual input-cost cycle associated with agricultural investments, the valuation of Zeder’s interest in Agrivision has remained unchanged at R146m. GENERAL COMMENTS VALUATION CONSIDERATIONS • Improved results due to: • Valuation based on Agrivisio
Slide 24: Prospects and Strategy
PROSPECTS AND STRATEGY INVESTMENTS LIMITED
Slide 25: Prospects
PROSPECTS • Portfolio represents strategic interests in well-run organisations that offer value • Agricultural conditions remain mostly favourable in Southern Africa • Demand for agri-inputs and commodities positive in the short term • Increased pressure on farmers as a result of higher fuel price,
Slide 26: Strategy
STRATEGY • Zeder to grow and support the investee portfolio - R1.4bn of value created over the past 12 months • Zeder remains under cautionary since April 2021 (renewal SENS on 30 September 2021) • Board is evaluating the approaches received on various portfolio investments • Good progress in this r
Slide 27: Thank you
Awaiting image… Thank you WE ARE BASED IN STELLENBOSCH, WESTERN CAPE, SOUTH AFRICA. PHYSICAL ADDRESS POSTAL ADDRESS 2ND FLOOR, OU KOLLEGE PO BOX 7403 35 KERK STREET STELLENBOSCH STELLENBOSCH 7599 7600 TEL: 021 831 9559 FOR FURTHER INFORMATION, PLEASE CONTACT US AT INFO@ZEDER.CO.ZA