Quantum Foods Holdings Ltd · JSE:QFH
Quantum Foods — FY2023 Earnings Presentation
27 slides from Quantum Foods's earnings presentation, September 2023
Slide 1: Results Presentation
Results Presentation For the year ended 30 September 2023
Slide 2: Business overview
Business overview H Lourens A G Financial overview E A Muller N Operational overview D H Lourens A Management focus for 2024 H Lourens Quantum Foods Results Presentation 2023 2
Slide 3: Business overview
Business overview H Lourens Quantum Foods Results Presentation 2023 3
Slide 4: Salient features
Salient features Revenue • Largest Avian Influenza outbreak • Load shedding impact – R67m 15% • Raw material costs peaked during the HEPS year Loss of 17.4c • Negative margin in the egg business Cash flow from • Significant improvement in operating activities 2023 operational performance R276 millio
Slide 5: Avian Influenza outbreak
Avian Influenza outbreak • Estimated 65% of national layer breeder flock affected • Approximately 65% of own commercial laying birds affected • Less than 10% of own broiler breeder flock impacted • Write-offs: • Biological assets R155.3m • Eggs and feed R10.3m • Clean-up costs R4.8m • Further outbre
Slide 6: Management actions
Management actions • Layer parents in rearing moved to dormant Tongaat farm (KwaZulu-Natal) • Utilise capacity of independent layer farmers in lower risk areas • Worked within regulatory framework to either cull layers or use eggs from infected flocks for pasteurisation • Importing of hatching eggs
Slide 7: Financial overview
Financial overview A Muller Quantum Foods Results Presentation 2023 7
Slide 8: Statement of income
Statement of income 2023 2022 For the year ended 30 September Rm Rm Revenue 6 952.6 6 020.6 Operating (loss)/profit* (35.9) 32.5 Income/(loss) from associate 1.1 (0.2) Net finance cost (18.1) (12.1) (Loss)/profit before tax (53.0) 20.3 Tax credit 17.4 3.6 (Loss)/profit for the year (35.6) 23.8 * Ope
Slide 9: Revenue analysis
Revenue analysis Layer and broiler Other African farming countries Animal Feeds Eggs Animal feeds Farming Eggs Other African countries R3 359m R1 829m R1 322m R443m 48% 26% 19% 6% 2022: R2 688m | 45% 2022: R1 588m | 26% 2022: R1 350m | 22% 2022: R394m | 7% Quantum Foods Results Presentation 2023 9
Slide 10: Segment results
Segment results Adjusted operating profit/(loss)* for the year ended 2023 2022 30 September Rm Rm Eggs (42.4) (42.1) Farming (80.3) (15.4) Animal feeds 104.2 93.3 Other African countries (1.4) 18.7 Head office costs (14.8) (17.6) (Loss)/profit for the year (34.7) 36.8 * Adjusted operating profit exc
Slide 11: Statement of financial position
Statement of financial position 2023 2022 As at 30 September Rm Rm Non-current assets 1 420.3 1 416.9 Net working capital (excluding lease liabilities) 811.2 1 042.7 Non-current liabilities (excluding lease liabilities) (243.7) (266.1) Net cash 71.4 (11.1) Total net assets 2 059.2 2 182.4 Lease liab
Slide 12: Statement of cash flows
Statement of cash flows 2023 2022 For the year ended 30 September Rm Rm Cash operating profit 232.2 170.6 Working capital inflow/(outflow) 52.5 (87.1) Cash effect of hedging activities (4.0) 1.1 Income tax paid (4.2) (6.9) Cash flow from operating activities 276.4 77.8 Capital expenditure (142.5) (1
Slide 13: Capital expenditure
Capital expenditure 2023 Future For the year ended 30 September Rm Rm RSA Expansion/efficiency 62.4 204.5 – Feed mills 1.4 193.2 – Broiler hatcheries 19.8 4.7 – Farms 0.3 2.2 – Generators 35.0 0.9 – Energy 1.9 3.5 – ERP system 4.0 – Replacement/compliance 45.7 94.0 Africa Expansion/efficiency 24.7 6
Slide 14: Operational overview
Operational overview H Lourens Quantum Foods Results Presentation 2023 14
Slide 15: Operational overview
Operational overview • Feeds business operational efficiencies at a very high level • Improvement in broiler breeder efficiencies • Changes of broiler breed 96% completed at breeder level by September 2023 • Hartbeespoort hatchery expansion completed and in operation • Improvement in broiler perform
Slide 16: Operational overview
Operational overview • Good improvement in efficiencies in rest of Africa business • Costs well managed throughout the business • Change to new ERP system (Sage X3) well executed • Pack station operations performance remained excellent • Nulaid again top egg brand in South Africa Quantum Foods Resul
Slide 17: Management focus for 2024
Management focus for 2024 H Lourens Quantum Foods Results Presentation 2023 17
Slide 18: Priorities for 2024
Priorities for 2024 • Rebuilding the commercial layer pipeline and flock • Commence with R193.5m Malmesbury feed factory expansion • Capitalise on broiler chicks' opportunities from Hartbeespoort hatchery • Complete breed change throughout full broiler business • Continue with farm efficiencies impr
Slide 19: Thank you
Thank you from: rr BERGVLE| Lh eS CHICKS < Y setievue Chix wii ont Quantum’ NEST EGGS & q POULTRY /
Slide 20: Appendix
Appendix Quantum Foods Results Presentation 2023 20
Slide 21: Safex yellow maize Rand per ton
Safex yellow maize Rand per ton R5,300 R5,000 4 205 R4,700 4 113 R4,400 R4,100 R3,800 3 372 R3,500 R3,200 2 749 2 634 R2,900 R2,600 R2,300 R2,000 Sep 18 Mar 19 Sep 19 Mar 20 Sep 20 Mar 21 Sep 21 Mar 22 Sep 22 Mar 23 Sep 23 Safex yellow maize Rand per ton Average for financial period Quantum Foods Re
Slide 22: CBOT US dollar soybean meal
CBOT US dollar soybean meal $550 $525 $500 438 $475 $450 $425 $400 425 $375 390 $350 2977 306 $325 $300 $275 $250 Sep 18 Mar 19 Sep 19 Mar 20 Sep 20 Mar 21 Sep 21 Mar 22 Sep 22 Mar 23 Sep 23 CBOT US dollar soybean meal Average for financial period Quantum Foods Results Presentation 2023 22
Slide 23: Rand: US dollar exchange rate
Rand: US dollar exchange rate R20 R19 R18 18.17 R17 16.22 15.82 R16 14.83 R15 14.34 R14 R13 Sep 18 Mar 19 Sep 19 Mar 20 Sep 20 Mar 21 Sep 21 Mar 22 Sep 22 Mar 23 Sep 23 Rand: US dollar exchange rate Average for financial period Quantum Foods Results Presentation 2023 23
Slide 24: Layer productivity index (completed flocks)
Layer productivity index (completed flocks) 150 140 130 120 110 100 90 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 Quantum Foods Results Presentation 2023 24
Slide 25: Broiler productivity index
Broiler productivity index 150 140 130 120 110 100 90 80 70 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 2020 2021 2022 2023 Quantum Foods Results Presentation 2023 25
Slide 26: South African layer flock
South African layer flock The number of laying hens is predicted to reduce to 17.19 million in December 2024, a national flock size last seen in 2004. Source: South African Poultry Association - Egg production report forecast to December 2024 Quantum Foods Results Presentation 2023 26
Slide 27: QUANTUM.co.za
QUANTUM.co.za fFoopDsSt”™” pa ~ wy = ¢ ‘ . < > Ss oe
Quantum Foods Holdings — FY2023 Earnings Presentation on 6ix