Mbrf Global Foods Company S.a. · BMFBOVESPA:MBRF3
Mbrf Global Foods — Marfrig Global Foods — Q2 2015 Earnings Presentation
23 slides from Mbrf Global Foods's earnings presentation, Aug 12, 2015
Slide 1: 2Q15 Earnings
2Q15 Earnings August 12, 2015
Slide 2: Strategic Vision
1 Strategic Vision FOCUS TO WIN Continuous Adjusting the Profitable operational capital growth and VALUE improvement structure and global LEVERAGE and increased reducing leadership in operating cash borrowing costs foodservice flow • Productivity Agenda GREATER Prioritizing VALUE TO • Streamlining o
Slide 3: Highlights in 2Q15
2 Highlights in 2Q15 � Strong growth in net revenue (+26%) and Adjusted EBITDA (+41%) on 2Q14¹; � EBITDA Margin expansion at all business units, with combined1 Adjusted EBITDA of 8.7%; � Positive free cash flow of R$136 million in the quarter and R$48 million year to date; � Keystone’s adjusted EBIT
Slide 4: Achievement of Guidance
3 Achievement of Guidance Target Range 6M15 2015 (1) Achieved R$23 to25 R$12.3 Net Revenue billion billion Adjusted 8.0% - 9.0% 8.3% EBITDA Margin (2) R$650 R$339 CAPEX million million Free Cash Flow to R$100 to R$200 R$48 Shareholders (3) million million Note: (1) In BRL based on the exchange rates
Slide 5: Financial Performance | Including Moy Park
4 Financial Performance | Including Moy Park � Net Revenue � Gross Profit and Gross Margin (R$ million) (R$ million and %) 12.345 12,2% 11,6% 12,6% 11,2% 9.905 25% 1.384 1.244 11% 6.462 752 5.118 625 26% 20% 2Q14 2T14 2Q15 2T15 6M14 1S14 6M15 1S15 2Q14 2T14 2Q15 2T15 6M14 1S14 6M15 1S15 � SG&A and S
Slide 6: Financial Performance | Continuing Operations
5 Financial Performance | Continuing Operations � Net Revenue � Profile of Continuing Ops. (R$ million) 9.099 Approximately 33,000 employees 46 commercial, production and 7.265 25% distribution units 4.728 Operational presence Serving clients with our 3.789 25% in 11 countries in products in approx.
Slide 7: Net Income
6 Net Income � Net Income and Net Margin (R$ million) 2Q14 2T14 2Q15 2T15 6M14 1S14 6M15 1S15 (6) (55) (152) -0,1% -1,1% -1,5% (577) -4,7% � The capture of operating efficiency gains and the lower effect from exchange variation on the financial result contributed to reductions in the net loss of 99%
Slide 8: 2Q15 Highlights | Keystone
7 2Q15 Highlights | Keystone � Net Revenue � Gross Profit and Gross Margin (USD million) (USD million and %) 1.359 1.223 7,6% 7,3% 6,8% 5,7% 11% 99 698 83 634 18% 53 10% 36 47% 2Q14 2T14 2Q15 2T15 6M14 1S14 6M15 1S15 2Q14 2T14 2Q15 2T15 6M14 1S14 6M15 1S15 � SG&A and SG&A/Net Revenue � Adjusted EBIT
Slide 9: Operating Performance | Keystone
8 Operating Performance | Keystone � Total Volume � Net Revenue � Net Revenue (‘000 ton) (USD million) Key Accounts (1) (USD million) 10% 10% 698 272 634 248 19% 47 198 37 163 163 25% 22% 137 211 226 471 500 7% 6% 2Q14 2T14 2Q15 2T15 2Q14 2T14 2Q15 2T15 2Q14 2T14 2Q15 2T15 EUA USA APMEA (1) Processe
Slide 10: 2Q15 Highlights | Marfrig Beef
9 2Q15 Highlights | Marfrig Beef � Net Revenue � Gross Profit and Gross Margin (R$ million) (R$ million and %) 5.044 16,5% 16,9% 15,4% 14,7% 4.459 13% 754 743 2.375 2.581 9% 391 398 -2% 2% 2Q14 2T14 2Q15 2T15 6M14 1S14 6M15 1S15 2T14 2Q14 2T15 2Q15 1S14 6M14 1S15 6M15 � SG&A and SG&A/Net Revenue � A
Slide 11: Operating Performance | Marfrig Beef
10 Operating Performance | Marfrig Beef � Share of Net Revenue � Net Revenue Brazil (%) (R$ million) 5% By Country 1.956 1.865 3% 6% BRL 18% Exportação Domestic 18% URG/CHL 1.055 ARG 1.099 -4% Mercado Exports 79% 76% Interno 766 901 2Q14 2T14 2Q15 2T15 18% By Product Carne Fresh in natura meat 2Q14
Slide 12: Operating Performance | Marfrig Beef
11 Operating Performance | Marfrig Beef � Slaughter Volume (‘000 head) Total Brazil � Temporary closure of 5 of the 15 slaughtering plants, or approximately 1.562 1.555 1.220 1.206 29% of the total authorized capacity in operation. -0.5% -1.1% � The objective is to achieve capacity utilization of 90
Slide 13: Domestic Market | Beef Brasil
12 Domestic Market | Beef Brasil � Food Service share in Total � Fresh and Processed Meat Domestic Revenue � Net Revenue (R$ million) (R$ million) 873 861 852 1.098 1.055 1% 2Q14 2T14 1Q15 1T15 2Q15 2T15 � Volume ('000 ton) Others 79 70 70 -11% 373 2T14 2Q14 1T15 1Q15 2T15 2Q15 353 Food Service 6% �
Slide 14: Exports | Beef Brasil
13 Exports | Beef Brasil � Market Share Fresh Meat � Export Volume (% Volume (1)) ('000 ton) 21.6% 22,0% 78 800 20.6% 19.9% 19.8% 21,0% 73 19.0% 20,0% 65 600 19,0% 18,0% 7% 400 17,0% 200 16,0% 15,0% 0 14,0% 2T14 2Q14 3T14 3Q14 4T14 4Q14 1T15 1Q15 2T15 2Q15 2Q14 2T14 1Q15 1T15 2Q15 2T15 � Share of Ex
Slide 15: Debt
14 Debt R$ million Proforma Leverage Ratio of 3.8x
Slide 16: Debt Maturity Schedule excl. Moy Park
15 Debt Maturity Schedule excl. Moy Park R$ million 6,317 Short Term R$ 2.0 bn (1) 3,753 3,014 2,993 2,392 2,564 1,066 450 196 677 757 246 145 Cash 3Q15 4Q15 1Q16 2Q16 2016 2017 2018 2019 2020 2021 (1) Cash to be received from the sale of Moy Park.
Slide 17: Financial Ratios
16 Financial Ratios Ratios | ex-Moy Park 1Q15 2Q15 Leverage: Net Debt / EBITDA LTM (XFxv) � Considering the Moy Park 3.36x 2.77x transaction, leverage ratio would Net Debt / EBITDA LTM 6.20x 4.77x be 3.8x. Proforma Net Debt / EBITDA LTM N/A 3.79x Proforma Net Debt / Annualized Adj. � The operating r
Slide 18: Free Cash Flow Bridge
17 Free Cash Flow Bridge 390 R$ million 46 136 90 300 FC CF Free Livre Recursos Proceeds FC Op. CF Cont. FC CF Moy Moy FC Livre Total incl. Incl.Retap Retap Bond Retap Retap Ops. Cont. Park Park Free CF Total
Slide 19: Closing Remarks
18 Closing Remarks � We generated strong free cash flow, transformed Marfrig Beef Brazil and signed an agreement to sell Moy Park. � The strategic decision to divest Moy Park leaves Marfrig with a stronger focus on the foodservice channel, which offers excellent opportunities for growth in the key m
Slide 20: Closing Remarks
19 Closing Remarks � Marfrig Beef posted margin of 9.7%, driven by greater efficiency, improved sales mix and continuous improvement in the management of costs and expenses. The second-quarter results only partially reflect these changes, since many are still in the implementation phase. � The openi
Slide 21: Closing Remarks
20 Closing Remarks � Keystone continues to contribute to free cash flow, posting accelerated growth and benefitting from its impeccable reputation for customer service and execution excellence in its industrial operations. � Strategically, Marfrig's priorities are: � expanding Keystone's food servic
Slide 22: Disclaimer
Disclaimer This material is a presentation of general information about Marfrig Global This presentation includes forward-looking statements. Such statements do Foods S.A. and its consolidated subsidiaries (jointly the “Corporation”) on the not constitute historical fact and reflect the beliefs and
Slide 23: IR Contacts
IR Contacts Address Telephone E-mail Website Avenida @ Chedid Jafet, 222 Bloco A 5º andar - São Paulo - SP SP: +55 (11) 3792-8650 ri@marfrig.com.br www.marfrig.com.br/ri