Ag Growth International Inc. · TSX:AFN
Ag Growth International — Investor Presentation (March 2025)
40 slides from Ag Growth International's investor presentation, March 2025
Slide 1: AGI Strategy & Vision Presentation
March 2025 AGI Strategy & Vision Presentation 1
Slide 2: Key Messages
KEY MESSAGES AGI’s Plan to Navigate Current Market Dynamics & Grow The Business to a New Level Challenging NA Farm conditions persist into 2025; focus on maintaining market position and margins International Commercial delivering solid results & new turnkey opportunities; offset to near-term NA Farm
Slide 3: I. AGI Overview
I. AGI OVERVIEW 3
Slide 4: AGI is a Diversified Platform Focused on the Agriculture Complex
I. AGI OVERVIEW AGI is a Diversified Platform Focused on the Agriculture Complex LEGEND • AGI is a leading provider of the equipment and solutions required to support the efficient storage, transport, and processing of food globally • The Company has 27 manufacturing facilities across Canada, the Un
Slide 5: Evolution of our business into a leading supplier of value-add ag equipment solutions
I. AGI OVERVIEW Evolution of our business into a leading supplier of value-add ag equipment solutions Consolidation, Operational Excellence, and Organic Growth, Market Share Capture, and Platform M&A-Driven Growth & Capability Building (2010 - 2020) Integration (2020 - 2024) Monetization (2025+) $80
Slide 6: AGI Has Built Scale Across Our Key Markets
I. AGI OVERVIEW Canada U.S. International1 AGI Has Built Scale Across Our Key Markets • AGI’s ongoing product catalogue transfer from N.A. to international markets has supported strong organic growth by leveraging proven platforms and service models • Thoughtful balance of selective local manufactur
Slide 7: Successful Delivery Against Two Key Objectives: Growth and Improved Resilience
I. AGI OVERVIEW Successful Delivery Against Two Key Objectives: Growth and Improved Resilience in the Business Paul Householder tenure as CEO Paul Householder tenure as CEO 19.3% 18.9% $1,527 $1,458 $1,405 16.1% 14.9% 14.7% $294 $1,198 $265 $1,000 $235 $176 $149 2020 2021 2022 2023 2024 2020 2021 20
Slide 8: Material Improvement in Free Cash Flow Generation
I. AGI OVERVIEW Material Improvement in Free Cash Flow Generation • On an LTM basis, FCF generation has stepped up to a new level of performance over recent years $79 • Combination of improving margins, working capital focus, $50 $49 and capex discipline $34 • Across 2025, FCF will be leveraged to s
Slide 9: Near-Term Capital Allocation Priorities
I. AGI OVERVIEW Near-Term Capital Allocation Priorities • Operational improvements (ERP implementation) • Temporary step-up in working • Working capital investment to support Commercial growth capital investment required for High strategic international Priority • Routine capital investments (mainte
Slide 10: AGI-Wide Focus on Operational Excellence Has Driven Significant Margin Expansion
I. AGI OVERVIEW AGI-Wide Focus on Operational Excellence has Driven Significant Margin Expansion Footprint & Supply Chain Rationalization SG&A Efficiency Initiatives Adjusted EBITDA Margin Expansion Targeting $100M + revenue per facility +80 bps in SG&A improvement as a % of revenue +400 bps in marg
Slide 11: AGI's Performance Remains Compelling Relative to Peers
I. AGI OVERVIEW AGI’s Performance Remains Compelling Relative to Peers Amid Challenging Macroeconomic Backdrop Peer A Peer B Peer C Ag segment of a Ag segment of a Global Ag global industrial global industrial equipment equipment equipment manufacturer manufacturer manufacturer Q4/24 revenue (YoY Gr
Slide 12: II. Segment Updates
II. SEGMENT UPDATES 12
Slide 13: The Farm Segment Has Been a Key Challenge in 2024
II. SEGMENT UPDATES CAD, millions The Farm Segment Has Been a Key Challenge in 2024 FARM REVENUE COMMERCIAL REVENUE TOTAL REVENUE -8% $1,458 $1,527 $1,405 -16% +1% $778 $832 $702 $680 $695 $703 2022 2023 2024 2022 2023 2024 2022 2023 2024 The order book for Commercial Despite a challenged U.S. Farm
Slide 14: Farm Segment Commentary
II. SEGMENT UPDATES Farm Segment Commentary • Challenging conditions in North American Farm persisting into 2025; low overall visibility • Adjustments made to preserve margin and minimize operating expenses • Farm order intake still slow in early 2025; possible catalysts: sustained rally in crop pri
Slide 15: Commercial Segment Commentary
II. SEGMENT UPDATES Commercial Segment Commentary • AGI’s largest addressable market, including high-growth international markets • Strategic focus on emerging markets, enabled by product transfers • Increased and differentiated capabilities leading to several large projects in International Commerc
Slide 16: III. Market Context
III. MARKET CONTEXT 16
Slide 17: Significant Total Addressable Market Enables Substantial Runway
III. MARKET CONTEXT Farm Commercial Significant Total Addressable Market Enables Substantial Runway $0.2B LATAM Product Farm TAM / Share1 Transfer-Enabled $0.4B Canada Farm (Permanent) $2.6B / 25% Addressable Market $0.4B Global Portable ~$14B Globally (+40%) $0.5B Commercial TAM / Share2 EMEA $7.5B
Slide 18: Attractive Long-Term Growth Tailwinds for Our Products
III. MARKET CONTEXT Attractive Long-Term Growth Tailwinds for Our Products • Increasing global food and feed • Product transfers increase AGI’s TAM and sales opportunities within consumption Growth Driven by each region Product Transfers, Long-term • Growing population as well crop • Global exposure
Slide 19: Order Book has Reached a Record Level
III. MARKET CONTEXT CAD, millions Order Book has Reached a Record Level A Clear Indication Indication that our Strategy is Creating Demand Across Our Business +4% $737 $710 • Record-level order book, up +11% sequentially Q3 • Commercial +46% year-over-year Order book Order highlights • Commercial ac
Slide 20: Significant Momentum in 2024 with Large Project Wins
III. MARKET CONTEXT Significant Momentum in 2024 with Large Project Wins Enabled by International Commercial Growth Strategy 15 $500M $34M Large Scale Commercial Total Contract Value Average Contract value Projects Won in International Regions in 2024 • Result of our international commercial strateg
Slide 21: IV. Positioning the Business for Success
IV. POSITIONING THE BUSINESS FOR SUCCESS 21
Slide 22: Our Growth Opportunity is Underpinned by 3 Key Strategies
IV. POSITIONING THE BUSINESS FOR SUCCESS Our Growth Opportunity is Underpinned by 3 Key Strategies 1 2 3 Product Transfers Emerging Markets Growth Platforms • Exhibit growth drivers such as an • Continue to expand high growth, high Expand winning products to other increasing population and focus on
Slide 23: Strategic Growth Levers: Product Transfer
IV. POSITIONING THE BUSINESS FOR SUCCESS 1 Strategic Growth Levers: Product Transfer - $100M to $150M Annual Revenue Opportunity • C-Line of Material Handling → U.S. • Fertilizer → Brazil Complete Product Transfers 8 • Storage Bins → India • Permanent Handling → India • Portable Handling → India (fo
Slide 24: Strategic Growth Levers: Emerging Markets
IV. POSITIONING THE BUSINESS FOR SUCCESS 2 Strategic Growth Levers: Emerging Markets - $100M Annual Revenue Opportunity KEY GROWTH DRIVERS 1 Focus on food security 2 Historical under-investment in agricultural infrastructure 3 Growing population 4 Changing dietary trends; Emerging markets opportunit
Slide 25: Strategic Growth Levers: Growth Platforms
IV. POSITIONING THE BUSINESS FOR SUCCESS 3 Strategic Growth Levers: Growth Platforms - $100M to $150M Annual Revenue Opportunity Feed Food Digital STRATEGIC PRIORITIES 1 Product transfer 1 Complete food platform unification 1 Continued business optimization 2 Partnerships / acquisitions 2 Develop ne
Slide 26: V. Long Term Value Creation Opportunity
V. LONG TERM VALUE CREATION OPPORTUNITY 26
Slide 27: Clear Path to Achieving Long-Term Potential
V. LONG TERM VALUE CREATION OPPORTUNITY CAD, millions Clear Path to Achieving Long-Term Potential Revenue $2,000+ $1,405 $1,000 Strategic Growth Levers: ✓ Product transfers (+$100-$150M revenue annually) ✓ Significant expansion since ✓ Emerging markets 2020 almost entirely attributable (+$100M reven
Slide 28: Clear Levers to Deliver 20%+ EBITDA Margins
V. LONG TERM VALUE CREATION OPPORTUNITY Clear Levers in out Business to Deliver 20%+ EBITDA Margins - Sustainability DELIVERED TO DATE Operating leverage >20% Mix improvement Operational Efficiencies ~400 bps Improvement 18.9% ✓ Centralizing key ✓ Favorable sales mix ✓ Economies of scale functions f
Slide 29: Significant De-leveraging Progress To-Date
V. LONG TERM VALUE CREATION OPPORTUNITY Significant De-leveraging Progress To-Date Net Debt / LTM Adjusted EBITDA 6.3x • Significant de-leveraging delivered in recent years • AGI continues to target 2.5x net leverage as a balance sheet objective 3.1x Target: 2.5x • Sustainable leverage level unlocks
Slide 30: Business Plan Poised to Unlock Significant Value Upside
V. LONG TERM VALUE CREATION OPPORTUNITY Business Plan Poised to Unlock Significant Value Upside in Our Business Multiple Expansion Operating Margin Improvement Initiatives ✓ Achievement of balance sheet Growth Levers objectives ✓ Greater valuation efficiency vs. peers ✓ Centralizing key functions ✓
Slide 31: VI. Appendix
VI. APPENDIX 31
Slide 32: Our Strategy
VI. APPENDIX BROADENING Our Strategy • Expand Operating Business • Processing Capabilities • Large, Platform Acquisitions EXPANDING • Operating Partner Complementary Acquisitions • Turnkey, Leasing, Parts • Accelerated Innovation Competitive Differentiation ENHANCING • Strategic Growth Expansion • C
Slide 33: Forward-Looking Information (1/3)
FORWARD-LOOKING INFORMATION (1/3) This presentation contains forward-looking statements and information (collectively, "forward-looking information") within the meaning of applicable securities laws that reflect our expectations regarding the future growth, results of operations, performance, busine
Slide 34: Forward-Looking Information (2/3)
FORWARD-LOOKING INFORMATION (2/3) necessary growth to achieve the revenue target, our belief that clear levers in our business, including operational efficiencies, mix improvement and operating leverage, will sustainably deliver at least 20% EBITDA margins in the long-term; our plan to continue to t
Slide 35: Forward-Looking Information (3/3)
FORWARD-LOOKING INFORMATION (3/3) to and delays or cancellation of one or more orders comprising our order book; the requirement to re-supply equipment or re-complete work previously supplied or completed at AGI's cost, and the risk that AGI's assumptions and estimates made in respect of such costs
Slide 36: Presentation of Financial Information
PRESENTATION OF FINANCIAL INFORMATION PRESENTATION OF FINANCIAL INFORMATION All financial information of AGI included in this presentation is reported in Canadian dollars and (except for forward-looking financial information) has been derived from audited and unaudited historical financial statement
Slide 37: Presentation of Financial Information
PRESENTATION OF FINANCIAL INFORMATION Adjusted EBITDA (adjusted earnings before interest, taxes, depreciation, and amortization) is a non-IFRS financial measure and its most directly comparable financial measure that is disclosed in our consolidated financial statements is profit (loss) before incom
Slide 38: Presentation of Financial Information
PRESENTATION OF FINANCIAL INFORMATION Adjusted EBITDA Margin % is a non-IFRS ratio and is defined as Adjusted EBITDA divided by revenue. Adjusted EBITDA margin % is a non-IFRS ratio because one of its components, Adjusted EBITDA, is a non- IFRS financial measure. Management believes Adjusted EBITDA
Slide 39: Presentation of Financial Information
PRESENTATION OF FINANCIAL INFORMATION Net Debt is a non-IFRS financial measure and its most directly comparable financial measure that is disclosed in our consolidated financial statements is Long-Term Debt. Net Debt is defined as the sum of long-term debt, convertible unsecured subordinated debentu
Slide 40: Presentation of Financial Information
PRESENTATION OF FINANCIAL INFORMATION Free Cash Flow is defined as cash provided by operating activities less acquisition of property, plant and equipment and less development and purchase of intangible assets. Free Cash Flow is a non-IFRS financial measure and its most directly comparable financial
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