Uac Of Nigeria Plc · NSENG:UACN
Uac Of Nigeria — H1 2023 Earnings Presentation
26 slides from Uac Of Nigeria's earnings presentation, Aug 3, 2023
Slide 1: UAC of Nigeria PLC H1 2023 Results
UAC of Nigeria PLC H1 2023 Results 03 August 2023 Fola Aiyesimoju – Group Managing Director Funke Ijaiya-Oladipo – Group Finance Director
Slide 2: Disclaimer
Disclaimer 2 This presentation contains forward-looking statements which reflect management's expectations regarding UAC of Nigeria PLC, its subsidiaries and associate businesses (“UAC”, the “Company” or “Group”) future growth, results of operations, performance, business prospects, operating market
Slide 3: Contents
Contents 3 Operating context 4 Performance highlights 7 H1 2023 financial performance 13 Outlook 18 Appendix 1: Additional financial information 21
Slide 4: Operating Context
Operating Context
Slide 5: Macroeconomic conditions remain challenging with low growth, high inflation and naira devaluation
Macroeconomic conditions remain challenging with low growth, record high 5 inflation, high interest rates, and naira devaluation Real GDP Growth Exchange Rate ₦:$ 5.0% CBN rates Parallel 4.0% 4.0% 3.5% 3.5% 3.1% 1.9% 2.3% 2.4% 800 0.1% 0.5% 600 400 (3.6%) 200 (6.1%) 0 2018 Jan-22 Oct-22 Dec-22 Jan-2
Slide 6: Escalation of key input and operating costs
Escalation of key input and operating costs 6 Animal Feed Maize Soya Bean Resin Titanium Dioxide Paints Food 417 317 303 276 254 243 190 226 210 221 207 118 132 100 100 100 100 Q2 2020 Q2 2021 Q2 2022 Q2 2023 Jul-23 Q2 2020 Q2 2021 Q2 2022 Q2 2023 Q2 2020 Q2 2021 Q2 2022 Q2 2023 Q2 2020 Q2 2021 Q2 2
Slide 7: Performance Highlights
LS je Performance Highlights \
Slide 8: UAC Group: Returned to profitability, deleveraged balance sheet
UAC Group: Returned to profitability, deleveraged balance sheet 8 Revenue (₦’mn) Operating profit / (loss) (₦’mn) ▪ Revenue +16% YoY in Q2 2023 vs Q2 2022 driven by price increases across all ▪ The Group returned to profitability in Q2 2023 with an operating profit of ₦665mn operating segments and v
Slide 9: Animal Feeds: Reduced operating loss and de-risked balance sheet
Animal Feeds: Reduced operating loss and de-risked balance sheet 9 Revenue (₦’mn) Operating profit / (loss) (₦’mn) ▪ Revenue +12% YoY in Q2 2023 vs Q2 2022 primary driven by price increases ▪ Improvement in operating loss a result of cost management initiatives and ▪ Management is focused on returni
Slide 10: Packaged Food & Beverages: Reversed underperformance in Q2
Packaged Food & Beverages: Reversed underperformance in Q2 10 with higher sales and operational efficiency Revenue (₦’mn) Operating profit / (loss) (₦’mn) ▪ Revenue +11% YoY in Q2 2023 vs. Q2 2022 primarily driven by price increases. ▪ Recorded highest EBIT in the last six quarters of N528mn ▪ Highe
Slide 11: Segment performance highlights
Segment performance highlights 11 Animal Feeds • Quarter on quarter improvement in operating loss a result of cost management initiatives and proactive pricing & Other Edibles • Management is focused on returning the segment to profitability however, industry conditions remain challenging 55% of Gro
Slide 12: We recently executed the following strategic objectives
We recently executed the following strategic objectives 12 ▪ In line with our objective to align the board composition of our portfolio companies with ownership, the following has been implemented in 2023: Governance − UACN’s Group Managing Director has been appointed Chairman of the Boards of Direc
Slide 13: H1 2023 Financial Performance
H1 2023 Financial Performance
Slide 14: Financial highlights
Financial highlights 14 In Naira Millions Q1 2023 Q1 2022 %change Q2 2023 Q2 2022 %change H1 2023 H1 2022 %change Revenue 24,620 27,666 (11%) 28,250 24,376 16% 52,870 52,042 2% COGS (21,341) (22,590) (6%) (22,910) (20,515) 12% (44,252) (43,105) 3% Gross Profit 3,279 5,075 (35%) 5,340 3,862 38% 8,619
Slide 15: Key factors impacting Group operating profit - Q2 2023
Key factors impacting Group operating profit- Q2 2023 15 Operating Profit Bridge, in ₦ mn (Q2 2022 to Q2 2023) Increase in operating expenses Increased revenue across across the businesses particularly all operating segment in power cost, distribution cost, personnel, and IT cost
Slide 16: Key factors impacting Group operating profit - H1 2023
Key factors impacting Group operating profit- H1 2023 16 Operating Profit Bridge, in ₦ mn (H1 2022 to H1 2023) Decrease on account of non- repetition of property disposal Increased revenue in gain of ₦386mn offset by Paints and Quick service increased dividend income restaurants offset by increase c
Slide 17: Balance sheet and liquidity
Balance sheet and liquidity 17 Net Assets Net Debt Net Capex Cash Cycle ₦45.6bn ₦3.1bn ₦2.8bn 75 days +₦0.3bn (₦0.3bn) (₦4.3bn) +1 day vs Dec 2022 vs Dec 2022 vs Dec 2022 vs Dec 2022
Slide 18: Outlook
Outlook
Slide 19: Outlook
Outlook 19 ▪ We expect challenging macroeconomic conditions to continue over the course of the second half of the year and will focus on steering our businesses through these challenges. ▪ We anticipate margin pressure on account of the lag between rising input costs and passing these on to the alre
Slide 20: Questions & Answers
Questions & Answers For further information please contact UACN Investor Relations Email: Investorrelations@uacnplc.com Phone: +234 906 269 2908
Slide 21: Appendix 1: Additional financial information
Appendix 1 Additional financial information
Slide 22: Income statement
Income statement 22 ₦ mn, unless otherwise stated H1 2023 H1 2022 D% Revenue 52,870 52,042 2% Gross Profit 8,619 8,937 (4%) Gross Profit Margin (%) 16% 17% (87 bps) Operating Profit (35) 1,611 n/m Operating Profit Margin (%) (0.1%) 3% (316 bps) Net Finance Income 2,717 (1,540) n/m Share of Profit/(L
Slide 23: Performance Snapshot – H1 2023
Performance Snapshot – H1 2023 23 Revenue Profit Before Tax N mn H1 2023 H1 2022 D% N mn H1 2023 H1 2022 D% Group 52,870 52,042 2% Animal Feeds & Other Edibles 30,645 30,403 1% Animal Feeds & Other Edibles (2,171) (1,500) 45% Paints 9,777 8,745 12% Paints 1,912 1,329 44% Packaged Food & Beverages 12
Slide 24: Financial Position – 30 June 2023
Financial Position – 30 June 2023 24 Summary Balance Sheet Working Capital N mn Jun-23 Dec-22 D% N mn Jun-23 Dec-22 D% Non-current Assets 48,888 45,994 6% Inventory 26,248 24,396 8% Current Assets 48,063 47,292 2% Trade Receivables 1,819 1,562 16% Other Assets 542 542 0% Trade Payables 9,594 6,480 4
Slide 25: Net Debt Position
Net Debt Position 25 Net (Debt)/Cash Position as at 30 June 2023 (in ₦ mn) Net cash Intra group Cash & Cash Short term Long term Net cash/ (ex. Intra group receivable/ equivalents debt debt (debt) loans) (payable) Holdco 5,472 (5,611) - (138) 8,778 8,640 Animal Feeds & Other Edibles 1,517 (8,387) (1
Slide 26: Cash Flow
Cash Flow 26 PBT to Free Cash Flow ₦ mn, unless otherwise stated H1 2023 H1 2022 Profit Before Tax from continuing operations 3,163 12 Profit/ (Loss) before tax from discontinued operations - (39) Non-Cash charges 960 2,531 Changes in working capital 1,526 (4,570) of which receivables (204) 3,469 of