Zeder Investments Limited · JSE:ZED
Zeder Investments — FY2022 Earnings Presentation
25 slides from Zeder Investments's earnings presentation, Apr 13, 2022
Slide 1: Full Year Results for the year ended 28 February 2022
FULL YEAR RESULTS FOR THE YEAR ENDED 28 FEBRUARY 2022 PRESENTED BY: JOHANN LE ROUX DATE: 13 APRIL 2022 1
Slide 2: Agenda
AGENDA • Noteworthy transactions • Strategy • Financial results • Portfolio review • Prospects • Questions – email to cosec@zeder.co.za 2
Slide 3: Noteworthy Transactions: Disposal of investment in The Logistics Group
NOTEWORTHY TRANSACTIONS • Disposal of investment in The Logistics Group Disposal of TLG Funds received Earn-out payments Group • Zeder sold its 98.22% • The initial amount • Additional R218m due interest in TLG Group received by Zeder was to Zeder • Disposal at premium R1.35bn • Linked to extensions
Slide 4: Noteworthy Transactions: Unbundling of Kaap Agri shareholding
NOTEWORTHY TRANSACTIONS • Unbundling of Kaap Agri shareholding Unbundling of Kaap Rational for Zeder’s history with Agri unbundling Kaap Agri • Board resolved to • Unbundling was in the • Zeder has been a unbundle Kaap Agri best interest of Zeder shareholder since 2006 shareholding shareholders • In
Slide 5: Noteworthy Transactions: Special dividends
NOTEWORTHY TRANSACTIONS • Special dividends Feb 2020 special Feb 2021 special Feb 2022 special Total special dividend dividend dividend dividends • A special dividend of • A special dividend of • A further special • In total special R2.30 per share was 20c per share was dividend of 92.5c per dividen
Slide 6: Strategy
STRATEGY INVESTMENTS LIMITED
Slide 7: Strategy
STRATEGY • Zeder’s objective remains to maximise shareholder wealth ─ Grow the investee portfolio companies ─ Dividends to shareholders ─ Evaluate disposals when appropriate (timing and price) • The TLG disposal and Kaap Agri unbundling had a positive impact on Zeder’s wealth creation for shareholde
Slide 8: Strategy: value creation over the past 3 years
STRATEGY The recent corporate actions and resultant special dividends had a positive impact on Zeder’s value creation for shareholders over the past 3 years, during the main Covid period. 28 Feb 2019 Transactions/special dividend Post further dividend Interest Unbundling Dividend Interest Company (%
Slide 9: Financial Results
FINANCIAL RESULTS • Covid and Russia-Ukraine conflict • Results Summary • Sum-of-the-parts 9
Slide 10: Financial Results: Covid FY2022
FINANCIAL RESULTS COVID FY2022 • Impact on South Africa and business ─ GDP retraction and significant job losses (increase in unemployment rate recently announced) ─ Economy struggling with constrained trading environment ─ SA Inc remains downgraded with a stable outlook ─ South Africa has however e
Slide 11: Financial Results: Russia-Ukraine Conflict FY2022
FINANCIAL RESULTS RUSSIA-UKRAINE CONFLICT FY2022 • Impact on South Africa and business ─ Increase in oil price and also soft commodity prices ─ Higher inflation environment with acceleration of increases in interest rates expected ─ Brace for serious food inflation in South Africa, margin pressure o
Slide 12: Financial Results: Summary FY2022
FINANCIAL RESULTS SUMMARY FY2022 • Intrinsic value of portfolio impacted by valuation adjustments and special dividends ─ Total Sum-of-the-Parts value increased from R4.33 to R4.66 per share ─ Largely due to increased valuations of TLG Group and Kaap Agri, countered by the 20c special dividend paid
Slide 13: Financial Results: Sum-of-the-Parts FY2022
FINANCIAL RESULTS SUM-OF-THE-PARTS FY2022 Increase in the SOTP value per share to 28 February 2022. As on 4 April, Kaap Agri and the TLG Group no longer part of Zeder, with increased cash on the balance sheet. 28 Feb 2021 28 Feb 2022 4 Apr 2022 Interest Interest Interest Company % Rm % Rm % Rm Zaad
Slide 14: Portfolio Review
PORTFOLIO REVIEW INVESTMENTS LIMITED
Slide 15: Zaad is a specialist agricultural seed and agrochemicals company
Zaad is a specialist agricultural seed and agrochemicals company that develops and supplies a broad basket of proprietary seeds and chemicals to emerging markets. 15
Slide 16: Portfolio Review: Zaad Financial Results
PORTFOLIO REVIEW FINANCIAL RESULTS Zaad reported an increase of 23% in RHEPS for the 6-month period ended 31 December 2021 to recurring headline earnings of R139m. Increased debt mainly due to Zeder bridge loan to acquire an interest in EASeeds. Jan 21 Jun 21 Dec 20 Dec 21 Summarised Income Statemen
Slide 17: Portfolio Review: Zaad valuation increased to R2.037bn
PORTFOLIO REVIEW FINANCIAL RESULTS The valuation of Zeder’s interest in Zaad has increased to R2.037bn, as a result of an improved performance during the Covid recovery period. GENERAL COMMENTS VALUATION CONSIDERATIONS • Good performances from Agricol, FarmAg and May Seed • Valuation based on compar
Slide 18: Capespan is an internationally diversified fruit group
Capespan is an internationally diversified group with a primary exposure to fruit farming, marketing, distribution and related services. 18
Slide 19: Portfolio Review: Capespan Financial Results
PORTFOLIO REVIEW FINANCIAL RESULTS Capespan reported a decrease of 29% in recurring earnings for the year ended 31 December 2021 to recurring headline earnings of R54m, largely as a result of increased costs and lower prices realised in the market. Dec 18 Dec 19 Dec 20 Dec 21 Summarised Income State
Slide 20: Portfolio Review: Capespan valuation decreased to R1.053bn
PORTFOLIO REVIEW FINANCIAL RESULTS The valuation of Zeder’s interest in Capespan has decreased to R1.053bn, largely as a result of the continuous supply chain challenges experienced as a result of Covid. GENERAL COMMENTS VALUATION CONSIDERATIONS • Significant supply chain constraints - inefficiencie
Slide 21: Agrivision Africa is a vertically integrated, grain-related food supplier
Agrivision Africa is a vertically integrated, grain-related food supplier that farms, mills and distributes products in the northern region of Zambia and southern parts of the DRC. 21
Slide 22: Portfolio Review: Agrivision Financial Results
PORTFOLIO REVIEW FINANCIAL RESULTS Agrivision reported a significant improved performance and managed to reduce debt during the year from operating cashflows. Dec 18 Dec 19 Dec 20 Dec 21 Summarised Income Statement 12 months 12 months 12 months 12 months Historical $'000 $'000 $'000 $'000 $'000 Reve
Slide 23: Portfolio Review: Agrivision valuation unchanged at R146m
PORTFOLIO REVIEW FINANCIAL RESULTS The valuation of Zeder’s interest in Agrivision has remained unchanged at R146m. GENERAL COMMENTS VALUATION CONSIDERATIONS • Improved results due: • Valuation based on Agrivision Group NAV, adjusted for company specific factors o Access to water at our Mkushi farmi
Slide 24: Prospects
PROSPECTS • Grow and support our existing portfolio ─ Agricultural conditions remain mostly favourable ─ Covid recovery and Russia-Ukraine conflict implications will impact the portfolio ─ Global supply chain challenges and resultant inflation pressure will remain • Approaches received on portfolio
Slide 25: Thank you
Awaiting image… Thank you WE ARE BASED IN STELLENBOSCH, WESTERN CAPE, SOUTH AFRICA. PHYSICAL ADDRESS POSTAL ADDRESS 2ND FLOOR, OU KOLLEGE PO BOX 7403 35 KERK STREET STELLENBOSCH STELLENBOSCH 7599 7600 TEL: 021 831 9559 FOR FURTHER INFORMATION, PLEASE CONTACT US AT INFO@ZEDER.CO.ZA