Slide 1: Interim report, Q3 2007 & Nine months report, Q1-3 2007
Interim report, Q 3 2007 & Nine months report, Q 1-3 2007 Jerker Hartwall Anders Byström President and CEO Vice President and CFO 1 IR 071101 CEO
Slide 2: Nine months 2007
Nine months 2007 • Net sales +18 %, SEK 9.296 million (7,872). • Operating profit +37 %, SEK 475 million (347). 2 IR 071101 CEO
Slide 3: 3rd quarter 2007
3rd quarter 2007 CBE growth and synergies have been the main contributory factors in the improvement in results, while strategic acquisitions and alliances are strengthening the speciality fat strategy. The Company is expecting a clear improvement in operating profit, primarily due to CBE growth and
Slide 4: 3rd quarter 2007
3rd quarter 2007 • Net sales +36 %, SEK 3,360 million (2,476). Operating profit +27 %, SEK 161 million (127). 4 IR 071101 CEO
Slide 5: Operating profit by quarter
Operating profit by quarter Operating profit 180 160 162 161 140 152 120 127 SEK M, Quarter 100 119 108 80 101 60 40 20 0 Q1 Q2 Q3 Q4 Q1 Q2 Q3 2006 2007 5 IR 071101 CEO
Slide 6: Operating profit 2007 by Business Area
Operating profit 2007 by Business Area •Q3 • Q 1-3 90 83 250 250 80 71 68 197 70 200 179 60 137 50 150 38 2007 2007 40 2006 100 2006 30 18 53 38 20 12 50 10 0 0 CCF/LfC FI TPF CCF/LfC FI TPF 6 IR 071101 CEO
Slide 7: Business Areas – Gross Contribution
Business Areas – Gross Contribution Chocolate & Food Ingredients Technical Products & Confectionery Fats Feed Q3, +21 %, Q3, +12 % Q3, +8 % 3.36 to SEK 4.05/kg 1.59 to SEK 1.78/kg 0.75 to SEK 0.81/kg Q 1-3, +19 % Q 1-3, +47% Q 1-3, -1 % 3.50 to SEK 4.15/kg 1.57 to SEK 1.68/kg 0.80 to SEK 0.79/kg - I
Slide 8: Chocolate & Confectionery Fats (including Lipids for Care)
Chocolate & Confectionery Fats (including Lipids for Care) Q3 Q3 Q 1-3 Q 1-3 Rolling SEK million 2007 2006 2007 2006 12 months Net sales 1,035 796 2,784 2,439 Gross contribution 298 249 895 758 Gross contribution per kilo 4.05 3.36 4.15 3.50 Operating profit excl. non-recurring items 83 38 250 137 +
Slide 9: Shea situation
Shea situation • The demand for CBE is high. • We haven't got the quantities we want 2007. • We continuously increase our presence in the logistic chain. • We see positive results of initiatives taken for 2008. • For the next coming years a limited supply of shea might form a restriction on AAKs exp
Slide 10: Cocoa butter price development in SEK/tonne
Cocoa butter price development in SEK/tonne Price trend Cocoa Butter 01.01.1998 - 26.10.2007 45000 40000 35000 30000 SEK/ton 25000 20000 15000 10000 5000 0 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 10 IR 071101 CEO
Slide 11: Our new CBE factory in Aarhus, Denmark stands ready
Our new CBE factory in Aarhus, Denmark stands ready 11 IR 071101 CEO
Slide 12: Our new CBE factory in Aarhus, Denmark stands ready
Our new CBE factory in Aarhus, Denmark stands ready 12 IR 071101 CEO
Slide 13: Our new CBE factory in Aarhus, Denmark stands ready
Our new CBE factory in Aarhus, Denmark stands ready 13 IR 071101 CEO
Slide 14: AAK has created the world's largest CBE center!
AAK has created the world´s largest CBE center! 14 IR 071101 CEO
Slide 15: Food Ingredients
Food Ingredients Q3 Q3 Q 1- 3 Q 1-3 Rolling SEK million 2007 2006 2007 2006 12 months Net sales 1,930 1,306 5,378 4,402 Gross contribution 380 350 1,103 1,030 Gross contribution per kilo 1.66 1.59 1.64 1.57 Operating profit excl. non-recurring items 71 68 197 179 + 3 or 4 % + 18 or 10 % Volumes (tho
Slide 16: External circumstances and driving forces for Food Ingredients
External circumstances and driving forces for Food Ingredients • The greatest external change for AAK is the accelerating consumption of vegetable oils – energy, India and China. • This combined with weak crops has driven up the raw material prices for the Group. How it will continue is difficult to
Slide 17: Price development, Palm, Rapeseed and Soya, SEK/tonne
Price development, Palm, Rapeseed and Soya, SEK/tonne Raw material prices 01.01.2001 - 26.10.2007 9000 8000 7000 Rape seed 6000 SEK/ton 5000 Palm 4000 Cocoa nut 3000 2000 1000 0 2001 2002 2003 2004 2005 2006 2007 17 IR 071101 CEO
Slide 18: Technical Products & Feed
Technical Products & Feed Q3 Q3 Q 1-3 Q 1-3 Rolling SEK million 2007 2006 2007 2006 12 months Net sales 317 256 915 761 Gross contribution 59 51 174 150 Gross contribution per kilo 0.81 0.75 0.79 0.80 Operating profit excl. non-recurring items 18 12 53 38 + 6 or 50 % + 15 or 40 % Volumes 73 68 219 1
Slide 19: Condensed balance sheet
Condensed balance sheet Equity/Total assets 29 % 49 % 33 % 19 IR 071101 CEO
Slide 20: Summary cash flow statement for the Group
Summary cash flow statement for the Group • Q 1-3 2007 • Increased working capital – mainly due to increased inventory and receivables, following increased raw material prices and higher volume of shea. • Investments: - Croda Food Service, SEK 103 million, and CBE related capacity increase in Denmar
Slide 21: Inventory and current receivable development
Inventory and current receivable development Inventory and current receivable development 2 500 2 000 - CBE related inventory - Raw material 1 500 price increases 1 000 500 Inventory Current receivables 0 Q3 Q4 Q1 Q2 Q3 2006 2006 2007 2007 2007 21 IR 071101 CEO
Slide 22: Acquisition of Deinking Products from Ciba
Acquisition of Deinking Products from Ciba • Products for deinking (the removal of ink from recycled paper) are based on special fatty acids. (AAK main supplier today) • The acquisition is a strategic step forward in the value chain for AAK’s Business Sector Tefac (fatty acids). • The business unit
Slide 23: Growth
Growth Deinking Standard Speciality Volumes Lantmännen Croda Food Service Advanced Lipids AAK The market commoditization Gross margin 1 10 30 >100 index 23 IR 071101 CEO
Slide 24: Nine months 2007
Nine months 2007 EBIT development according to plan AAK Positive CBE-development Original synergy program – full impact 2008 as earlier communicated. Food Ingredients although stable in a tough competition Technical Products & Feed can see effects of rationalisation program 24 IR 071101 CEO
Slide 25: Outlook 2007
Outlook 2007 We expect a clear EBIT-improvement, primarily due to CBE growth and the cost synergies resulting from the merger. 25 IR 071101 CEO
Slide 26: AAK vision
AAK vision: The first choice for value added vegetable oil solutions 26 IR 071101 CEO
Slide 27: Appendix
RAK AarhusKarlshamn Appendix
Slide 28: Example of our specialisation strategy
Example of our specialisation strategy AAK The Bakery Fat specialist Year No 1 Bakery process aid 2007 + in Bakery fats Croda Food Service Acquired Bakery fat production 2000 Simple oils Bakery fat 28 IR 071101 CEO