Comvita Limited · NZX:CVT
Comvita — Shareholder Meeting (October 2023)
94 slides from Comvita's shareholder meeting presentation, Oct 4, 2023
Slide 1: Poised for Take-off: Annual Shareholders' Meeting
PRESENTED BY: ANNUAL SHARE HOLDE RS’ MEETING Brett Hewlett, Chair 4 OCTOBER 202 3 David Banfield, CEO Poised F O R TA K E - O F F
Slide 2: Mihi Whakatau
Mihi Whakatau
Slide 3: Important Notice
I M P O R TA N T Notice This presentation is given on behalf of Comvita used in substitution for, or isolation of, Comvita’s indicator of future performance. Limited. Information in this presentation: audited financial statements. We monitor these • Is for general information purposes only, and • Sh
Slide 4: Chair Address
SECTION POISED FOR TAKE-OFF Chair Address 4
Slide 5: Voting and Asking Questions
I M P O R TA N T – O N L I N E G U E S T S Voting and Asking Questions Voting Card Question box COMVITA ASM 2023 5
Slide 6: Formalities
Formalities • Notice of Meeting • Quorum • Proxies • Annual Financial Statements COMVITA ASM 2023 6
Slide 7: Agenda
SECTION POISED FOR TAKE-OFF Agenda 7
Slide 8: Board of Directors
INTRODUCTIONS Board of Directors KEEPING US FOCUSED DIRECTOR, CHAIR COMVITA ASM 2023 8
Slide 9: Record Sales
DELIVERING ON OUR PLAN Record Sales HEADLINES • Record revenue $234M 234.2 58.0 30.5 • +$25M and +12.1% vs PCP • H2 revenue +17.4% vs PCP $ M % $ M • Gross profit 58.0%, normalised 59.5%* in line with plan RECORD REVENUE GROSS PROFIT MARKET INVESTMENT • Record brand investment $30.5M +$2.4M vs PCP +
Slide 10: Our Cause
Our Cause Working in harmony with bees and nature in New Zealand to heal and protect the world. E reretau ana, e mahi ngātahi ana mātou ko ngā pi me te taiao I Aotearoa, hei whakaora, hei manaaki āno I te Ao Tūroa. COMVITA ASM 2023 10
Slide 11: ESG Leadership at Comvita
ESG Leadership at Comvita ENVIRONMENTAL SOCIAL GOVERNANCE Key Focus Areas: Key Focus Areas: Key Focus Areas: ● GHG emissions ● Product quality and food safety ● Board composition (diversity and ● Air and water pollution ● Customer satisfaction independence) ● Biodiversity reporting ● Ethical procure
Slide 12: BCorp Certification
S U S TA I N A B I L I T Y BCorpCERTIFIED Comvita achieved BCorp certification • In September 2022 Comvita became the first NZX listed organisation to change its constitution to reflect the importance of all stakeholders when making investment and strategic decisions • Thank you to all shareholders
Slide 13: GHG Summary
FY23 GLOBAL GHG Summary R E S U LT S GREENHOUSE GAS EMISSIONS – GLOBAL tCO2e FY23 FY22 Difference tCO2e tCO2e % Total Gross Emissions (S1,2,3) 34,944 32,004 9% Removals GHG Inventory -5,843 -5,972 -2% Total Net GHG Inventory Emissions 29,102 26,032 12% ALL COMVITA OWNED AND/OR MANAGED REMOVALS Other
Slide 14: Safety & Wellbeing
PERFORMANCE VS PCP Safety & Wellbeing 1 J U LY 2 0 2 2 – 3 0 J U N E 2 0 2 3 3.8 2.7 + 19% TRIFR LTIFR NEAR MISS REPORTING + 1 9 % vs F Y 2 2 ( 3 . 2 ) + 8 0 % vs F Y 2 2 ( 1 . 5 ) 2.2 0.53 341 SAFETY CULTURE MVIFR INDIVIDUAL WELLBEING MATURITY - 4 1 % vs F Y 2 2 ( 0 . 9 ) CHECKS CHINA & NZ + 3 8 %
Slide 15: Team / Whānau
FY23 GLOBAL Team / Whānau 559 91% + 21 GLOBAL FTE GLOBAL TEAM ARE SHAREHOLDERS GLOBAL eNPS (FULL TIME EQUIVALENT ROLES)) (OR EQUIVALENT) (EMPLOYEE NET PROMOTER SCORE) COMVITA ASM 2023 16
Slide 16: Summary
Summary ▪ Good result in a tough environment ▪ Resilient and agile in our response to risks as they evolve ▪ Cause led organisation ▪ Well positioned responding well to the additional ESG and reporting requirements expected of a sustainable global company ▪ Ongoing evolution of the board to meet fut
Slide 17: Leadership Team
INTRODUCTIONS Leadership Team BUILDING OUR BUSINESS COMVITA ASM 2023 18
Slide 18: CEO Address
SECTION POISED FOR TAKE-OFF CEO Address 19
Slide 19: Targeting c$50M EBITDA 2025 (20%)
TA R G E T I N G c$ 50M EBITDA 2025 (20%) PURPOSE + VALUES OUR MISSION TO 2025 COMVITA 50:2025 Working in harmony with bees and nature in New Zealand “To deliver world-leading standards for our team, our consumers, our 60 : 15 : 20 to heal and protect the world shareholders and our planet, contribut
Slide 20: Focus & Progress
CLARITY OF Focus & Progress TO 2025 COMVITA ASM 2023 21
Slide 21: Comvita Our Core
Comvita OUR SEASONA ON-THE- HEALTHY HONEY+ TOPICAL CARDIAC CORE L GO SNACKIN and TREATME SUPPORT RANGE SUPPORT G PROPOLIS NT Wellbeing at + Olive Life its most Healthy Including Mānuka Immunity alternatives skin care, honey in a support for convenient Powerful to boost your ingredient medi-honey. po
Slide 22: Harmony Plan
Harmony PLAN COMVITA ASM 2023 23
Slide 23: Bee advocacy and welfare
bee advocacy and welfare. COMVITA ASM 2023
Slide 24: Record Sales FY23
Record Sales FY23 ON TRACK 2025 • Strong revenue growth • Revenue +$25.3M or +12.1% vs PCP • All segments showed double digit revenue growth • Greater China revenue over $100M for the first time • Growing share in key markets • Ecommerce share 41.7% of total sales +19% vs PCP • Gross margin in line
Slide 25: Revenue
PERFORMANCE vs. PCP Revenue REPORTED CURRENCY GREATER CHINA NORTH AMERICA REST OF ASIA 109.0 $ M 35.6 $ M $31.8 M 2022 : $27.3m 2022 : $96.9m 2022 : $31.8m +16.2% +12.5% +12.0% (30 June 2023 vs 30 June 2022) AUSTRALIA + NZ EMEA MARKET SEGMENTS 40.8 $ M $5.9 M + 17.4 % 2022 : $34.7m 2022 : $5.1m +17.
Slide 26: Business Model Proving Successful
Business Model Proving Successful COMVITA ASM 2023 27
Slide 27: Greater China: Collagen drink award
GREATER CHINA Collagen drink was awarded by ISEEWARD as Silver NP of 2022 COMVITA ASM 2023 28
Slide 28: Greater China
GREATER CHINA COMVITA ASM 2023 29
Slide 29: Building Momentum
Building Momentum P O I S E D F O R TA K E - O F F COMVITA ASM 2023 30
Slide 30: Growth Opportunity
EXCITING FUTURE Growth OPPORTUNITY GLOBAL HONEY MARKET 2022 2030 TOTAL ADDRESSABLE MARKET US$9BN US$ 15 BN 3 MANUKA <1% > CATEGORY HOUSEHOLD PENETRATION % COMVITA LIFETIME VALUE GROWTH BASE LINE + 335 % COMVITA ASM 2023
Slide 31: Securing Long-Term Quality Supply
SECTION POISED FOR TAKE-OFF Securing Long-Term Quality Supply 32
Slide 32: Native Forest Partnerships with NZ Landowners
N AT I V E F O R E S T PA R T N E R S H I P S W I T H NZ Landowners AT S C A L E Purpose: To establish a Comvita managed forest footprint at scale of high performing Mānuka which will: ▪ Improve honey quality ▪ Reduce cost of production ▪ Ensure a secure supply Comvita manages New Zealand’s largest
Slide 33: Our Supply Model
H IG H EST Q U A L IT Y B EST PA R T N ER F O R L O W EST B EES C O ST * Our Supply C O N SUMER Model B EST H EA L T H & SA F ET Y OUR COMPETITIVE ADVANTAGE MO ST SU ST A IN AB L E O PER AT OR B EST PA R T N ER F O R L A N D O W N ERS COMVITA ASM 2023 *FOR DELIVERED QUALITY 34
Slide 34: Long Term Supply
Long Term Supply ▪ Harvest model proven 4th consecutive time since launched in 2020 ▪ Continued investment in forests ▪ Targeting 20,000 hectares by 2030 ▪ FY23 total forest to 7,500 hectares ▪ Highest quality honey, lowest relative cost ▪ 40.60.20 model proven again in FY23 − 40% improvement in yie
Slide 35: Mānuka Forest Supply FY22–FY25
Mānuka Forest Supply FY22 – FY25 FY22 FY23 FY24 (forecast) Forest supply as percentage of CVT Apiaries Total 3.60% 4.30% 10.98% Total Forest Hectares in Productive Status 518ha 753ha 1461ha COMVITA ASM 2023
Slide 36: Kaitiakitanga
Kaitiakitanga OUR LAND MANAGEMENT PROGRAM Mānuka is a native species that supports the creation of a diverse habitat to allow our native flora and fauna to thrive while also healing our land. We have developed a framework which monitors the benefits of our Mānuka forests, specifically: • Our carbon
Slide 37: Clinical Trials Aid Comvita Differentiation
SECTION POISED FOR TAKE-OFF Clinical Trials Aid Comvita Differentiation 38
Slide 38: Comvita Invests More in Science and Research
Comvita Invests More in Science and Research than the Rest of the Industry Combined
Slide 39: Nature doesn't hide its intelligence
Nature doesn’t hide its intelligence – we just need the wisdom to see it
Slide 40: International Science Advisory Board
I N T E R N AT I O N A L Science ADVISORY BOARD W O R L D - L E A D I N G G A S T R O E N T E R O L O G I S T S A N D H E A LT H R E S E A R C H E R S COMVITA ASM 2023
Slide 41: Comvita IP Differentiates Us From the Rest
C O M V I TA I P Differentiates US FROM THE REST 44 + 21 C O M V I TA PAT E N T S ADDITIONAL GRANTED PAT E N T S P E N D I N G 42
Slide 42: More Scientific Breakthroughs
MORE Scientific BREAKTHROUGHS Comvita Lepteridine® ▪ Unique natural compound found in Mānuka nectar and honey ▪ Low molecular weight, drug-like structure ▪ Multiple clinically relevant biological targets ▪ Highly heat stable and in gastric and intestinal simulation model ▪ Inhibits a key biological
Slide 43: Clinical Trials: SOOTHE
E X T E N D E D A D VA N TA G E Clinical Trials SOOTHE: Mānuka honey for digestive health ▪ $1.4M investment over 2 years: $900K HVN grant ▪ Proprietary treatment: Comvita Lepteridine® patented Mānuka honey CONNECTING ▪ Unique To Comvita CONSUMERS TO THE ▪ Dunedin and Christchurch sites ▪ Ethics app
Slide 44: Clinical Trials Pending
E X T E N D E D A D VA N TA G E Clinical Trials PENDING C A R D I O M E TA B O L I C IMMUNITY AT O P I C ANTIMICROBIAL H E A LT H D E R M AT I T I S R E S I S TA N C E COMVITA ASM 2023 46
Slide 45: Biodiversity Regeneration
A FORCE FOR GOOD Biodiversity R E G E N E R AT I O N New research shows significant biodiversity and ecological improvement with our Mānuka Forest planting. Environmental improvements include: 1. Invertebrate density and diversity 2. Native bird and bat activity HEALING WITH 3. Fresh water health an
Slide 46: Brand Transformation
SECTION POISED FOR TAKE-OFF Brand Transformation 49
Slide 47: Ideal She: Target Consumer
C O M V I TA Ideal She TA R G E T C O N S U M E R Strengthening our connection : • 30-50's well-educated females living in big cities • Seeking a healthy natural way to maximise life and energy • Looking for authentic brands, to help her become an “ideal she” – i.e, a person full of vitality with a
Slide 48: The Evolution of Comvita: Consumer
T H E E V O L U T I O N O F C O M V I TA Consumer PREMIUM LIFESTYLE COMVITA ASM 2023
Slide 49: Slide 49
Slide 50: Multiple Touch Points
T H E E V O L U T I O N O F C O M V I TA Multiple Touch Points PREMIUM LIFESTYLE C O M V I TA H AY M A R K E T – KOREAN AIR C AT H AY PA C I F I C WELLNESS LAB PHOENIX BEAUTY South Korea Hong Kong SAR Auckland, NZ S y d n e y, A U COMVITA ASM 2023
Slide 51: Retail Excellence
SECTION POISED FOR TAKE-OFF Retail Excellence ANDY CHEN, DEPUTY CEO & REGIONAL CEO APAC 54
Slide 52: Hong Kong
M Ā N U K A R E TA I L P I O N E E R Hong Kong SINCE 2001 COMVITA ASM 2023 55
Slide 53: Shenzhen
Shenzhen 56 COMVITA ASM 2023 56
Slide 54: Guangzhou
Guangzhou COMVITA ASM 2023 57
Slide 55: Shanghai
Shanghai COMVITA ASM 2023 58
Slide 56: Beijing and Tianjin
Beijing and Tianjin COMVITA ASM 2023 59
Slide 57: Hainan
Hainan COMVITA ASM 2023 60
Slide 58: HoneyWorld Acquisition
ACQUISITION HoneyWorld™ • On 4 July 2023, we were delight to welcome HoneyWorld™ , the largest honey retailer in Singapore, into our Group • Strategic deployment of capital in growth segment • HoneyWorld™ was founded in 1997 by Pearline Goh • Operates 18 outlets in the Singapore market • Pearline Go
Slide 59: Singapore
Singapore COMVITA ASM 2023 62
Slide 60: Singapore
Singapore COMVITA ASM 2023 63
Slide 61: Retail-tainment
Retail-tainment COMVITA ASM 2023 64
Slide 62: Premiumisation
Premiumisation COMVITA ASM 2023 65
Slide 63: Seoul
Seoul COMVITA ASM 2023 66
Slide 64: Seoul
Seoul COMVITA ASM 2023 67
Slide 65: Sydney
Sydney COMVITA ASM 2023 68
Slide 66: Sydney
Sydney COMVITA ASM 2023 69
Slide 67: Auckland
PURCHASE Comvira MANUKA HONEY UMF20+! ANO RECEIVE A FREE
Slide 68: Building Out Our Winning Proposition
BUILDING OUT OUR Winning BJ/TJ Seoul Tokyo Proposition SZ/GZ SH HK Retail excellence across multiple regional hubs, to: ▪ Create a network of multi million-dollar retail shops, as our global best practice and investment ROI benchmark SGP ▪ Connect our online and offline footprints seamlessly, impact
Slide 69: Responsible Living With Comvita
RESPONSIBLE LIVING With Comvita COMVITA ASM 2023 72
Slide 70: Test & Learn Continues
E V O L U T I O N O F C O M V I TA Test & Learn Continues T H E F U T U R E O F R E TA I L & R E S P O N S I B L E L I V I N G COMVITA ASM 2023 73
Slide 71: WeChat Store
DIRECT TO CONSUMER WeChat Store P O I S E D F O R TA K E - O F F COMVITA ASM 2023 74
Slide 72: Digital + Data
WORLD CLASS Digital + Data ENGAGEMENT AND EXPERIENCE
Slide 73: Growing Our E-Commerce Advantage
GROWING OUR E-Commerce A D VA N TA G E Strongest digital earnings and share of revenue in Comvita history • Digital share globally 41.7% • $97.7M digital sales globally at accretive margins • Three-year revenue CAGR +26.7% • For every 10% increase in digital share, total revenue group gross profit i
Slide 74: Growing Affinity
E V O L U T I O N O F C O M V I TA Growing Affinity FREQUENCY AND RETENTION COMVITA ASM 2023
Slide 75: Explore
Explore
Slide 76: Consumer Experience
E V O L U T I O N O F C O M V I TA Consumer Experience D I G I TA L & I M M E R S I V E COMVITA ASM 2023
Slide 77: Special Reserve tasting experience
ENGLISH ¥ NAU MAI, HAERE MAI. Welcome to this Special Reserve tasting and sensory experience, designed to give you a rare moment of harmony. ENTER MANUKA HONEY
Slide 78: When we give nature the time to thrive
When we give nature the time to thrive, unbelievable things happen.
Slide 79: Guidance and Summary
Guidance and Summary • FY23 record revenue $234M +12% vs PCP • Momentum building, H2 revenue +17% vs PCP • FY23 earnings in line with plan and guidance • Growing share in key markets • FY24 forecasting double digit EBITDA growth • Positive operating cashflow H1 and H2 • Revenue and earnings growth w
Slide 80: Resolutions
SECTION P O I S E D F O R TA K E - O F F Resolutions
Slide 81: Resolutions
Resolutions Formalities - Reports and Financial Statements Ordinary Resolutions - Appointment and Remuneration of Auditors (Resolution 1) 1. “That the meeting record the re-appointment of KPMG as the auditors of the Company for the current financial year ending 30 June 2024 pursuant to section 207T
Slide 82: Voting and Asking Questions
I M P O R TA N T – O N L I N E G U E S T S Voting and Asking Questions Voting Card Question box COMVITA ASM 2023 86
Slide 83: Resolution 1: Appointment and Remuneration of Auditors
Resolution 1 Appointment and Remuneration of Auditors To consider, and if thought fit to pass, the following ordinary resolution: “That the meeting record the re-appointment of KPMG as the auditors of the Company for the current financial year ending 30 June 2024 pursuant to section 207T of the Comp
Slide 84: Resolution 2: Director's Election – Brett Hewlett
Resolution 2 Director’s Election – Brett Hewlett To consider, and if thought fit to pass, the following ordinary resolution: “That Brett Hewlett, who retires by rotation and is eligible for re-election, be re-elected as a Director of the Company.” COMVITA ASM 2023 88
Slide 85: Director's Election – Brett Hewlett
Resolution 2 Director’s Election – Brett Hewlett Brett is a professional director and consultant. He is a non-executive Director and the Chair of Comvita Ltd (NZX:CVT), and an Independent Director of Quayside Holdings Ltd (ending 31 October 2023). From 2005-2015 Brett was the Chief Executive Officer
Slide 86: Resolution 3: Director's Election – Julia Hoare
Resolution 3 Director’s Election – Julia Hoare To consider, and if thought fit to pass, the following ordinary resolution: “That Julia Hoare (appointed by the Board as a director with effect from 1 March 2023), be elected as a Director by Shareholders.” COMVITA ASM 2023 90
Slide 87: Director's Election – Julia Hoare
Resolution 3 Director’s Election – Julia Hoare Julia is a professional independent director. She is Chair of Port of Tauranga Limited, Director and Chair of the Audit & Risk Committees of Auckland International Airport Limited and Meridian Energy Limited, and a member of the Chapter Zero New Zealand
Slide 88: Resolution 4: Director's Election – Michael Sang
Resolution 4 Director’s Election – Michael Sang To consider, and if thought fit to pass, the following ordinary resolution: “That Michael Sang be elected as a Director by Shareholders.” COMVITA ASM 2023 92
Slide 89: Director's Election – Michael Sang
Resolution 4 Director’s Election – Michael Sang Mike is a professional independent Director. He is Director and Chair of Audit & Risk Committees for Orion NZ, BRANZ and Government Super Fund. Mike has over 20 years’ experience with a finance background and a career in a variety of sectors including
Slide 90: Voting – Proxies Received
Voting – Proxies Received RESOLUTION FOR AGAINST PROXY DISCRETION APPOINTMENT & REMUNERATION OF 28,996,878 166,496 351,081 AUDITORS (98.25%) (0.56%) (1.19%) RE-ELECTION OF BRETT HEWLETT 29,177,151 7,119 351,081 (98.79%) (0.02%) (1.19%) ELECTION OF JULIA HOARE 29,110,616 71,054 351,081 (98.57%) (0.24
Slide 91: Q+A
SECTION Q+A
Slide 92: Farewell & Thanks
Farewell & Thanks Sarah Kennedy & Luke Bunt COMVITA ASM 2023
Slide 93: Mihi Whakatau
Mihi Whakatau
Slide 94: Poised for Take-off
Poised F O R TA K E - O F F FY23 ANNUAL REVIE W