Slide 1: FY24 1H Results: Growing the Business
ASX: RIC FY24 1H RESULTS GROWING THE BUSINESS Quinton Hildebrand - MD & CEO Richard Betts - CFO 14 February 2024 LEADING ANIMAL NUTRITION FY24 1H RESULTS | 14 February 2024 1
Slide 2: FY24 1H Financial Summary
FY24 1H FINANCIAL SUMMARY 2 3 1 EBITDA (reported) EBITDA (underlying) Earnings Growth $46.3m $48.0m --- 8.8% YoY EBITDA growth from ongoing operations +5.0% YoY growth +8.8% YoY growth --- Bulk Stockfeeds delivered volume and margin growth --- Packaged Feeds & Ingredients delivered higher NPAT (repo
Slide 3: Packaged Feeds & Ingredients Segment
PACKAGED FEEDS & INGREDIENTS SEGMENT FY24 1H FY23 1H Variance ($m) ($m) EBITDA before significant items 31.5 33.0 -5% EBIT 27.0 28.0 -3% Segment Assets 249.0 271.2 Segment Liabilities (54.6) (63.7) Segment Net Assets 194.4 207.5 -4% EBITDA ROFE 33.1% 30.8% As foreshadowed1, the Packaged Feeds & Ingr
Slide 4: Bulk Stockfeeds Segment
BULK STOCKFEEDS SEGMENT FY24 1H FY23 1H Variance ($m) ($m) EBITDA before significant items 23.0 17.9 +29% EBIT 14.9 10.3 +45% Segment Assets 316.9 284.4 Segment Liabilities (167.1) (175.7) Segment Net Assets 149.8 108.7 +33% EBITDA ROFE 27.5% 31.0% The Bulk Stockfeeds Segment returns increased by $5
Slide 5: LEADING ANIMAL NUTRITION FY24 1H RESULTS
LEADING ANIMAL NUTRITION FY24 1H RESULTS | 14 February 2024 5
Slide 6: Profit & Loss Summary
PROFIT & LOSS SUMMARY Consolidated Result ($m) FY24 1H FY23 1H Analysis of Results EBITDA – Packaged Feeds and Ingredients 31.5 33.0 See segment performance reporting – p3 EBITDA – Bulk Stockfeeds 23.0 17.9 See segment performance reporting – p4 EBITDA – Ongoing operations before significant items 5
Slide 7: Balance Sheet
BALANCE SHEET Balance sheet ($m) Dec 23 June 23 Analysis of balances and movements Cash & cash equivalents 38.9 43.0 Cash is a function of timing of receipts / payments and draw down / repayment of bank funding Decrease in inventory relates primarily to the Ingredient Recovery segment Inventory 102.
Slide 8: Cash Management
CASH MANAGEMENT Consolidated Cash flow ($m) FY24 1H FY23 1H Analysis of movement Consolidated EBITDA Before Significant Items 48.0 44.1 Significant Items (1.7) - Consolidated EBITDA 46.3 44.1 The increased EBITDA after significant items, has provided a slight cash improvement Movement in working cap
Slide 9: Working Capital
WORKING CAPITAL Change in Working Capital by Segment Group Working Capital increased by $11.2m at 31 Dec 2023 40 30 20 Bulk Stockfeeds increased working capital due to: 10 • increased sales volumes; and - $m (10) • a procurement strategy to support higher margins that (20) included more inventory ac
Slide 10: Capital Management
CAPITAL MANAGEMENT Net Debt 160 Net Debt was $43.6m as at 31 Dec 2023, primarily 140 due to the increase in working capital (see 120 previous slide). 100 The net debt represents a: $m 80 • Gearing Ratio of 13.6%; and 60 • Leverage Ratio of 0.47x. 40 20 The Balance Sheet supports the intended debt fu
Slide 11: Project Boost Complete
PROJECT BOOST COMPLETE Project Targets SCORECARD (31 DEC 2023) (announced July 2021) New De- Operational Total Capability bottlenecking Efficiency to Date Projects approved (#) 4 10 18 32 FY22-23 Targeted $15m Capital Expenditure Approved spend $3.8m $3.4m $8.6m $15.8m Spend to date $3.8m $3.4m $7
Slide 12: Capital Allocation Framework
CAPITAL ALLOCATION FRAMEWORK Delivered in FY24 H1 : • Increase in operating result - underlying EBITDA up 8.8% Operating Cash Flow • Maintenance & ESG capital ($7.7m) prioritised; used Maintenance & ESG Capital (~60 – 80% of Depreciation) balance sheet for grain inventory and shorter terms to and Wo
Slide 13: LEADING ANIMAL NUTRITION FY24 1H RESULTS
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Slide 14: Growth Plan FY23 – FY25
GROWTH PLAN FY23 – FY25 Key Initiatives FY22 FY23 FY24 FY25 • NovaqPro™ international sales • Growing with aqua customers • Companion animal sales • Premiumisation of rendered products • Tallow & protein meal trading EBITDA Earnings Growth Packaged & • NovaqPro™ operating efficiencies Ingredients •
Slide 15: FY23-FY25 Growth Plan: Bulk Stockfeeds
FY23 - FY25 GROWTH PLAN : BULK STOCKFEEDS Ridley’s Virtuous Cycle Bulk Stockfeed Increase Capacity Key Initiatives and Efficiency Strategy Growth • increase mill utilisation Invest in Better Delivery Infrastructure and Reliability • de-bottleneck sites Leverage the flywheel effects • new product off
Slide 16: FY24 Update: Bulk Stockfeeds
FY24 UPDATE : BULK STOCKFEEDS +5% Bulk Stockfeed UPDATE • Two debottlenecking projects in FY24 Bulk Stockfeeds Strategy capacity increase Pakenham (Ruminant) Feedmill in FY24 Leverage the flywheel effects - project completed November 2023 of scale, extend our role in the - dairy customers gained in
Slide 17: FY23–FY25 Growth Plan: Packaged Feed & Ingredients
FY23 – FY25 GROWTH PLAN : PACKAGED FEED & INGREDIENTS Packaged Aqua Ingredient Recovery (formerly Rendering) Products (Feed / Sector Support) NovaqPro™ Strategy Strategy Strategy Strategy “climbing the wall of value” Invest in processing Product Extend our rural market Share in the growth of Continu
Slide 18: FY24 Update: Packaged Products
FY24 UPDATE : PACKAGED PRODUCTS Packaged UPDATE Products Strategy • The new Narangba packing facility - completed in December 2023 – provides: Extend our rural • production efficiency and labour savings market share by • access to new segments through smaller leveraging our national pack sizes footp
Slide 19: FY24 Update: Aqua Nutrition
FY24 UPDATE : AQUA NUTRITION Aqua UPDATE NovaqPro® (Feed / Sector Support) Strategy Strategy • Restructure undertaken in response to underperformance in aquafeed sales Share in the growth of Continue the tropical aqua commercialising • Focus is on developing the NovaqPro® sector, and benefit NovaqPr
Slide 20: FY24 Update: Ingredient Recovery
FY24 UPDATE : INGREDIENT RECOVERY UPDATE Ingredient Recovery (formerly Rendering) Strategy Tallow and meal prices have fallen in recent months impacting “climbing the wall of value” returns: Product • directly through Ridley’s participation in the premiums • Invest in processing Freeze Dried Product
Slide 21: OMP Transaction Overview
OMP TRANSACTION OVERVIEW • Ridley has entered into a agreement to acquire Oceania Meat Processors (“OMP”) for NZ$57.0m (~A$52.8m1) TRANSACTION • Implied acquisition multiple of ~5.4x EBITDA (LTM as at September 2023) OVERVIEW • Acquisition to be fully funded from debt facilities • OMP is a premium p
Slide 22: LEADING ANIMAL NUTRITION FY24 1H RESULTS
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Slide 23: Ridley's Growth Platform
RIDLEY’S GROWTH PLATFORM • With a well-defined Growth Plan, strong balance sheet and disciplined approach to capital management, Ridley is well positioned to execute on opportunities to create shareholder value. • Ridley’s position as market leader in the animal nutrition sector provides scale benef
Slide 24: Outlook
OUTLOOK Macro-economic conditions are likely to be challenging in the short-term, and the business is taking steps to reduce the adverse impact of inflationary pressures and changes in commodity cycles. Ridley expects ongoing earnings growth in the second half from premiumisation in the Packaged Fee
Slide 25: Important notice and disclaimer
The material in this presentation is general background information about the activities of Ridley Corporation Limited (ACN 006 708 765) and its related entities (Ridley), current as at the date of this presentation, unless otherwise stated. The content is information given in summary form and does
Slide 26: Historical Financial Information
HISTORICAL FINANCIAL INFORMATION LEADING ANIMAL NUTRITION FY24 1H RESULTS | 14 February 2024 26
Slide 27: Profit & Loss Summary
PROFIT & LOSS SUMMARY Consolidated Result ($m) FY24 1H FY23 1H Analysis of Result FY22 1H FY21 1H FY20 1H Up $3.7m, or 7.2% on prior year period on the back of earnings EBITDA – Ongoing operations before significant items 54.5 50.8 45.7 37.6 33.3 growth Cost control and efficiency gains have resulte
Slide 28: Balance Sheet - Assets
BALANCE SHEET - ASSETS Balance Sheet ($m) Dec 23 June 23 Analysis of Result Dec 22 June 22 June 21 Cash is a function of timing of receipts / payments and draw down / repayment Cash & cash equivalents 38.9 43.0 39.3 27.1 39.9 of bank funding Inventory 102.4 107.0 Decrease in inventory relates primar
Slide 29: Balance Sheet - Liabilities
BALANCE SHEET - LIABILITIES Balance Sheet ($m) Dec 23 June 23 Analysis of Result Dec 22 June 22 June 21 Whilst in line with June it has reduced significantly since Dec ’22, as the business Current payables 196.0 205.2 received a cost advantage from procuring grain direct from farmers on shorter 218.
Slide 30: Cash Management
CASH MANAGEMENT Consolidated Cash flow ($m) FY24 1H FY23 1H Analysis of Result FY22 1H FY21 1H FY20 1H Consolidated EBIT before Significant Items 35.4 31.5 25.9 17.3 14.6 Includes the transaction costs incurred to date for the proposed Significant Items (1.7) - acquisition of OMP and costs associate
Slide 31: Net Debt, Gearing & Leverage
NET DEBT, GEARING & LEVERAGE Major capital projects ($m) FY24 1H FY23 1H Analysis of Result FY22 1H FY21 1H FY20 1H Includes de-bottlenecking and Boost projects Development capital expenditure 9.9 8.5 3.4 2.6 24.8 Maintenance capital expenditure 7.7 6.7 Prioritised in line with the capital allocatio
Slide 32: OMP Acquisition Information
OMP ACQUISITION INFORMATION Extract from ASX Disclosure 18 December 2023 LEADING ANIMAL NUTRITION FY24 1H RESULTS | 14 February 2024 32
Slide 33: Acquisition of Oceania Meat Processors
LEADING ANIMAL NUTRITION Acquisition of Oceania Meat Processors 18 December 2023 LEADING ANIMAL NUTRITION FY24 1H RESULTS | 14 February 2024 33
Slide 34: Transaction Overview
Transaction Overview • Ridley has entered into a agreement to acquire Oceania Meat Processors (“OMP”) for NZ$57.0m (~A$52.8m1) Transaction • Implied acquisition multiple of ~5.4x EBITDA (LTM as at September 2023) overview • Acquisition to be fully funded from debt facilities OMP • OMP is a premium p
Slide 35: Alignment to Ridley's Strategy
Alignment to Ridley’s Strategy FY23 – 25 Growth Plan How Does this transaction align with strategy? Ingredient Recovery “Climbing the wall of value” Strategy Extends the scope of raw materials to be purchased from suppliers Product • Invest in processing capability to Freeze Dried Products produce
Slide 36: Overview of OMP
Overview of OMP Business Snapshot Location of Operating Facilities Australia New Zealand United States • OMP is a premium producer of mechanically deboned meat frozen block Approved channel to market in the US product (“MDM Products”) and other raw materials for the global pet food industry Prescott
Slide 37: Acquisition Rationale
Acquisition Rationale 1 OMP provides Ridley the capability to “climb the wall of value” producing frozen block MDM Products (aligned to strategy) OMP is a provider of premium Australian and New Zealand products focused on novel proteins, which are highly sought after by the global pet 2 food industr
Slide 38: LEADING ANIMAL NUTRITION FY24 1H RESULTS
LEADING ANIMAL NUTRITION FY24 1H RESULTS | 14 February 2024 38