Slide 1: Scales Corporation Limited Half Year Results
SCALES CORPORATION LIMITED YOUR DIVERSIFIED AGRIBUSINESS PORTFOLIO Half Year Results For the six months ended 30 June 2015 27 August 2015
Slide 2: Highlights
HIGHLIGHTS • 2015 EBITDA expected to exceed Prospectus Forecast of $41.2m by between 25-35%. • Mr Apple export volumes up 16% on Prospectus Forecast at 3.15m TCEs: Record crop, 11% above previous best crop. >3m TCE crops here to stay under normal growing conditions, further upside from ongoing o
Slide 3: Financials
2 FINANCIALS
Slide 4: Financial Overview
FINANCIAL OVERVIEW • Revenue $161.2 million, up 7% on 1H14. • Gross Profit $75.8 million, up 31% on 1H14: Profit growth higher than revenue growth due to Accounting Standard NZ IAS 41 “Agriculture”. This is covered on the next slide. • EBITDA $52.4 million, up 47% on 1H14: A strong performance f
Slide 5: Interpreting Our Interim Accounts
INTERPRETING OUR INTERIM ACCOUNTS Revenues are up, and cost of sales down, leading to a groupwide Gross Profit increase of 31%. This slide explains the accounting behind this result. • NZ IAS 41 “Agriculture” requires unsold agricultural produce to be measured at fair value less costs to sell. This
Slide 6: Divisional Performance
DIVISIONAL PERFORMANCE All divisions trading ahead of 1H14. • Horticulture – increased volumes, especially premium varieties. • Storage & Logistics – improved utilisation. • Food Ingredients – ongoing strength in petfood ingredients. • Corporate – ‘normal’ performance without one-off IPO listing cos
Slide 7: Balance Sheet
BALANCE SHEET $000 1H15 Group 1H14 Total Equity 156,234 139,774 • Our Financial Position remains positive: represented by: Working Capital Average Net Debt (30 June 15 and 31 Dec 14) Current Assets $44.5m. Increase on FY14 average net debt mostly Cash / Overdraft Balances 10,575 10,885 due to addi
Slide 8: Divisional Performance & Outlook
DIVISIONAL PERFORMANCE & OUTLOOK 3
Slide 9: Horticulture
HORTICULTURE • Total Mr Apple grown export volumes are up 15% on FY14, and 16% on FY15 Prospectus Forecasts. • Growth almost entirely from Premium Varieties, up 42% on FY14, reflecting: Maturing of redeveloped orchards. Investment in Reflective Foil improving colour characteristics. Mr Apple Gro
Slide 10: Horticulture: Volume Outlook
HORTICULTURE Volume Outlook. • Following 3 strong crop results, we are raising our forecast crop volumes for FY16 through FY18 by ~200k TCEs for each year above the forecasts provided in our Prospectus. • Our crop forecasts are based on rolling 5 year average actual results for gross yields and pack
Slide 11: Horticulture: Strategy - Variety and Market Mix
HORTICULTURE Strategy - Variety and Market Mix. • We are redeveloping lower returning orchards into high quality premium varieties for today and tomorrow. We have and will continue to redevelop orchard to maximise the long-run profitability of Mr Apple. Our focus is on the broader Asia and Middle
Slide 12: Storage & Logistics
STORAGE & LOGISTICS Our Drivers of Growth. 1 Asset Expansion 4 Return to Normal Coldstore Utilisation Customer demand for coldstorage space at our new Auckland facility is As indicated, total volumes in coldstorage have returned to more ordinary stronger than anticipated. We now expect performance f
Slide 13: Food Ingredients
FOOD INGREDIENTS • Meateor: Sales volumes have been strong for the year to Meateor – Volumes Sold (MT) date, supported by our Australian procurement 1H15 vs 1H14 strategy. 12,000 Volumes sold are 19% ahead of 1H14. FY14 1H14 10,000 Demand remains firm and Meateor is on track 1H15 FY15 8,000 to
Slide 14: Financial Outlook
4 FINANCIAL OUTLOOK
Slide 15: FY15 Full Year Outlook
FY15 FULL YEAR OUTLOOK • Horticulture: Final crop now known, a favourable varietal mix and a higher percentage of sales to Asia and Middle East is expected to result in a higher average price / TCE than Prospectus Forecasts. As a result of different instruments and cover in place for FY15, Avera
Slide 16: What We Know About FY16
WHAT WE KNOW ABOUT FY16 • Scales will provide further information for FY16 early in the new year, however at this stage we have improved information on some metrics: Our target apple export crop is ~3m TCEs. The market dynamic for Asia and Middle East remains supportive. Based on current hedge
Slide 17: Disclaimer
DISCLAIMER Please do not read this presentation in isolation This presentation supplements our half year results announcement dated 27 August 2015. It should be read subject to and in conjunction with the additional information in that release, and other material which we have released to the NZX. T