Scales Corp. Ltd. · NZX:SCL
Scales — Shareholder Meeting (June 2016)
41 slides from Scales's shareholder meeting presentation, Jun 8, 2016
Slide 1: Scales Corporation Limited: 104 Years and Still Growing
SCALES CORPORATION LIMITED 104 YEARS AND STILL GROWING 2016 Annual Shareholders’ Meeting 8 June 2016
Slide 2: Agenda
AGENDA • Welcome • Chairman’s review • Managing Director’s review • Ordinary business and resolutions Scales – 2016 Annual Shareholders’ Meeting June 2016 2
Slide 3: Chairman's Review
CHAIRMAN’S REVIEW A landmark year for Scales. • Welcoming China Resources • Record financial performance • Progressing strategy, growth in all divisions • Evolving our governance • INFINZ – Emerging Corporate Communicator - Finalist Scales – 2016 Annual Shareholders’ Meeting June 2016 3
Slide 4: Introduction to China Resources
INTRODUCTION TO CHINA RESOURCES Scales – 2016 Annual Shareholders’ Meeting June 2016 4
Slide 5: Scales – 2016 Annual Shareholders’ Meeting June 2016
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Slide 7: Scales – 2016 Annual Shareholders’ Meeting June 2016
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Slide 8: Scales – 2016 Annual Shareholders’ Meeting June 2016
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Slide 9: Scales – 2016 Annual Shareholders’ Meeting June 2016
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Slide 10: Scales – 2016 Annual Shareholders’ Meeting June 2016
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Slide 11: Scales – 2016 Annual Shareholders’ Meeting June 2016
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Slide 12: Scales – 2016 Annual Shareholders’ Meeting June 2016
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Slide 16: Scales – 2016 Annual Shareholders’ Meeting June 2016
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Slide 17: Managing Director's Review
MANAGING DIRECTOR’S REVIEW • Year in Review • Scales’ People • Strategy Update • Looking Ahead • Investor Returns and Dividends Scales – 2016 Annual Shareholders’ Meeting June 2016 17
Slide 18: Year in Review
1 YEAR IN REVIEW
Slide 19: Highlights
HIGHLIGHTS We’re Growing: Operational Highlights for 2015 1 Coldstorage Capacity Increased by 19% to 721,600m3: Due to Auckland Coldstore + 2 coldstore leases in Christchurch. Mr Apple own-grown apple volumes up 15% to 3.15m 2 TCEs: Meeting our 2018 production target 3 years early. Own-grown premium
Slide 20: Highlights
HIGHLIGHTS Financial Highlights for 2015 1 Record Underlying EBITDA of $61.4m, 49% ahead of IPO Forecast and 54% ahead of 2014. 2 Record Underlying NPAT of $35.7m, 71% ahead of IPO Forecast and 80% ahead of 2014 (Statutory NPAT of $38.9m). 3 More than $300m Revenue for the first time in Scales histo
Slide 21: 4-Year Performance Trend
4-YEAR PERFORMANCE TREND* Our 2015 Result was made possible by careful investments made over the past 5 years • We’ve been investing in our assets, people, and culture • The financial impact is continuing to be demonstrated in our results • We are continuing to invest in our growth that we will real
Slide 22: Summary Financial Performance
SUMMARY FINANCIAL PERFORMANCE Significantly ahead of IPO forecast and 2014 results • Revenue $301.4m, up 14% on 2014 • Underlying EBITDA $61.4m up 54% on 2014 • Underlying NPAT $35.6m up 80% on 2014 • Net Profit from Continuing Operations $38.9m up 115% on 2014 Income Statement 2015 2014 $ Millions
Slide 23: Divisional EBITDA Trend
DIVISIONAL EBITDA TREND Strong growth in Horticulture and Food Ingredients supported by consistent and predictable contributions from Storage & Logistics Trends in Underlying Divisional EBITDA ($m) Horticulture Storage & Logistics Food Ingredients 5% CAGR 11% $7.6m $40.0m $16.3m CAGR 57% CAGR $14.0m
Slide 24: Strong Balance Sheet
STRONG BALANCE SHEET • We have a large asset base centred around our material investment in land and buildings • Exceeding our Return on Capital Employed targets • We currently have considerable headroom in our banking covenants Financial Position $ millions 2015 2014 Capital Employed 213.7 204.7 Re
Slide 25: Scales' People
2 SCALES’ PEOPLE
Slide 26: People
PEOPLE People first culture • Our people - hard-working and committed. • We’re focused on giving back – developing our people and the communities we operate in: Horticulture apprenticeship scheme Tertiary training Work opportunities: — SEED Programme — Prisoners Release to Work Scheme Litera
Slide 27: Health & Safety
HEALTH & SAFETY Our #1 Priority • Every employee should go home at the end of each day healthy and safe • Extensive training to all managers and staff • Pledge to continue improving Scales – 2016 Annual Shareholders’ Meeting June 2016 27
Slide 28: Strategic Update
3 STRATEGIC UPDATE
Slide 29: Scales' Vision
Scales’ Vision: To be the foremost investor in, and grower of, New Zealand agribusinesses by leveraging our unique insights, experience, and access to collaborative synergies. Our long-term goal: To generate a long-run average 15% Return on Capital employed across our portfolio.* *Calculated as Unde
Slide 30: Developments Through 2015
DEVELOPMENTS THROUGH 2015 A number of structural developments in 2015 securing future growth • Storage & Logistics: Coldstores: — Auckland Coldstore operational November 2015, on time and to budget — Two new coldstore leases in Christchurch Liqueo: — Complementary acquisition of Mersey Street pr
Slide 31: Mr Apple Branding
MR APPLE BRANDING Scales – 2016 Annual Shareholders’ Meeting June 2016 31
Slide 32: The Year Ahead and Investor Returns
4 THE YEAR AHEAD AND INVESTOR RETURNS
Slide 33: Trading Update
TRADING UPDATE • Horticulture: Export harvest (4.1m TCEs) up 1.5% on 2015 (own apples) Mr Apple Harvest & Export Packout ~60% of fruit packed. Packout expected to finish 4.5 90% 4.0 4.1 up on 2015 4.0 84% 81% 81% 80% 78% 3.5 3.4 Slightly more than 1/3rd of crop sold to date 3.5 70% 3.0 60% • S
Slide 34: Dividends
DIVIDENDS • Total of $0.17 per share in cash dividends declared or paid in respect of 2015 $0.13 per share ‘ordinary’ cash dividends, up from $0.10 per share in 2014 Special dividend of $0.04 per share in cash Represents a Gross Dividend Yield of 12.9% on the average daily share price in 2015,
Slide 35: Ordinary Business and Resolutions
ORDINARY BUSINESS AND RESOLUTIONS
Slide 36: Resolution 1
RESOLUTION 1 To record the reappointment of Deloitte as auditor of the Company and to authorise the Directors to fix the auditor’s remuneration for the coming year. Scales – 2016 Annual Shareholders’ Meeting June 2016 36
Slide 37: Resolution 2A
RESOLUTION 2A To re-elect Mark Hutton as a Director. Scales – 2016 Annual Shareholders’ Meeting June 2016 37
Slide 38: Resolution 2B
RESOLUTION 2B To re-elect Alan Isaac as a Director. Scales – 2016 Annual Shareholders’ Meeting June 2016 38
Slide 39: Resolution 3
RESOLUTION 3 That the maximum total pool of Directors’ remuneration be increased from $400,000 to $440,000 per annum taken together, until such time as this amount be altered by a further ordinary resolution of shareholders. Such sum to be divided amongst the Directors at the discretion of the Board
Slide 40: Voting & Questions
VOTING & QUESTIONS
Slide 41: Disclaimer
DISCLAIMER Please do not read this presentation in isolation This presentation supplements our full year results announcement dated 25 February 2016 and Annual Report released on 29 March 2016. It should be read subject to and in conjunction with the additional information in these releases, other m