Ridley Corporation Limited · ASX:RIC
Ridley — H1 FY2014 Earnings Presentation
33 slides from Ridley's earnings presentation, March 2014
Slide 1: Ridley Corporation Limited Investor Presentation
RIDLEY CORPORATION LIMITED INVESTOR PRESENTATION 31 DEC 2013 HALF YEAR Australia’s premier livestock feed producer
Slide 2: Safety
SAFETY RIDLEY AGRIPRODUCTS PROPERTY FINANCIALS OUTLOOK Group Injury Frequency Rates Embed proactive behaviours FY13-14 YTD 20 Implement the safety 18 FY13-14 LTIFR management system 16 14 FY13-14 TRFR Develop engineering solutions for 12 physical safety hazards 10 8 6 FY14 LTIFR 5.12 and TRF
Slide 3: Financial Highlights
FINANCIAL HIGHLIGHTS RIDLEY AGRIPRODUCTS PROPERTY FINANCIALS OUTLOOK Consolidated result 1H # 1H FY13 FY12 FY11 Net Operating Profit of $9.9m - in $m FY14 FY13 for period, up from $4.3m EBIT - AgriProducts 20.7 15.5 28.1 27.2 24.9 AgriProducts result of $20.7m, Property costs - up $5.2m (Laverto
Slide 4: Financial Highlights
FINANCIAL HIGHLIGHTS RIDLEY AGRIPRODUCTS PROPERTY FINANCIALS OUTLOOK EBIT result of $20.7m - up $5.2m with contribution from Laverton rendering business not included in comparative result. (1H FY13 result benefited from long positions held in rising raw material markets) Poultry - long term take
Slide 5: Corporate
CORPORATE RIDLEY AGRIPRODUCTS PROPERTY FINANCIALS OUTLOOK Corporate costs - consistent with prior period (management restructure completed just prior to balance date). # Finance costs - reflect lower levels of debt (proceeds of Cheetham Salt sale applied to debt in March 2013) and further reduct
Slide 6: Property – Dry Creek
PROPERTY – DRY CREEK RIDLEY AGRIPRODUCTS PROPERTY FINANCIALS OUTLOOK Salt production - salt operating segment ceased on 1 July 2013 & all Dry Creek activity now included in Property segment. Earnings - prior period earnings of $1.9m in servicing Penrice salt supply agreement compared to $1.8m cu
Slide 7: Property – Other
PROPERTY – OTHER RIDLEY AGRIPRODUCTS PROPERTY FINANCIALS OUTLOOK Major coastal sites at Lara and Moolap (near Geelong): Discussions continuing with relevant State and Federal Government departments to secure land tenure and rezoning approvals. Environmental Effects Statement to commence in 2H
Slide 8: Moolap
MOOLAP RIDLEY AGRIPRODUCTS PROPERTY FINANCIALS OUTLOOK A vision Lara Salt for Moolap N Avalon Fields Airport Avalon air strip CORIO BAY PORT OF GEELONG Geelong CBD <3km 8 88 17
Slide 9: Consolidated Financials
RIDLEY AGRIPRODUCTS PROPERTY FINANCIALS OUTLOOK CONSOLIDATED FINANCIALS 9
Slide 10: Balance Sheet - Assets
BALANCE SHEET - ASSETS RIDLEY AGRIPRODUCTS PROPERTY FINANCIALS OUTLOOK Balance Sheet Dec June 2013 2013 Assets held for sale at 30 June of - in $m $0.7m reclassified to Investment Property (former mill at Assets held for sale - 0.7 Dandenong) Other Current Assets 186.4 169.6 Significant increase
Slide 11: Balance Sheet - Liabilities
BALANCE SHEET - LIABILITIES RIDLEY AGRIPRODUCTS PROPERTY FINANCIALS OUTLOOK Balance Sheet Dec June Current liabilities - decrease - in $m 2013 2013 reflects $23.1m capital return paid in July 2013 and fully accrued as at 30 June 2013. Current liabilities 139.9 165.4 Borrowings - increase in non-
Slide 12: Cash Flow
CASH FLOW RIDLEY AGRIPRODUCTS PROPERTY FINANCIALS OUTLOOK Cash flow in $m 1H FY13 Strong EBITDA performance of core FY14 business compared to prior year 8 Consolidated EBITDA 21.0 39.2 months Cheetham Salt Movement in working capital (19.5) 26.4 Negative movement in working Maintenance capex (5.
Slide 13: Financial Summary
FINANCIAL SUMMARY RIDLEY AGRIPRODUCTS PROPERTY FINANCIALS OUTLOOK Ridley Agriproducts 1H: 1H: FY13 FY12 FY11 FY10 (in $m) FY14 FY13 Sales ($) 443 341 706 626 616 620 EBIT 20.7 15.5 28.1 27.2 24.9 29.0 Depreciation & Amortisation (DA) 6.7 4.3 12.9 8.5 8.6 7.6 EBITDA 27.4 19.8 41.0 35.7 33.5 36.6 Net
Slide 14: Outlook - Dividends
OUTLOOK - DIVIDENDS RIDLEY AGRIPRODUCTS PROPERTY FINANCIALS OUTLOOK Retained profits - after prior year Dry Creek impairments and Cheetham Salt divestment, profit for the half year has more than reversed prior year losses and generated $1.5m of retained profits at 31 December 2013. Ridley divide
Slide 15: Outlook - Operations
OUTLOOK - OPERATIONS RIDLEY AGRIPRODUCTS PROPERTY FINANCIALS OUTLOOK Dairy - retrospective rise in milk price to assist with milk:feed ratio and long term recovery of farmer confidence Customer Value Propositions - to be developed using feedback survey data to enhance Ridley service performance
Slide 16: Outlook - Property
OUTLOOK - PROPERTY RIDLEY AGRIPRODUCTS PROPERTY FINANCIALS OUTLOOK Complete sale of Bowen site Geelong region in Victoria: Conduct marketing campaign for commercially suitable part of Lara site Work with development partner towards formal rezoning event at Moolap Secure approval for Dry Cr
Slide 17: Strategic Initiatives
STRATEGIC INITIATIVES RIDLEY AGRIPRODUCTS PROPERTY FINANCIALS OUTLOOK Rendering - focus on moving up the value chain in 2H: Laverton storage and blending capability acquired Investment in high protein concentrates Mill modernisation - continuing to work on new mill opportunities within Ridle
Slide 18: Investment Highlights
INVESTMENT HIGHLIGHTS RIDLEY AGRIPRODUCTS PROPERTY FINANCIALS OUTLOOK Ridley well positioned for long term growth in the agribusiness feed sector: strong balance sheet, low gearing bank facility rolled over for a further five years long term history of cash conversion independent of harves
Slide 19: Contact Details
CONTACT DETAILS RIDLEY AGRIPRODUCTS PROPERTY FINANCIALS OUTLOOK Tim Hart Managing Director and Chief Executive Officer Ridley Corporation Limited Tel +61 3 8624 6500 ABN 33 006 708 765 Fax +61 3 8624 6514 Level 4, 565 Bourke Street Mobile +61 404 480 542 Melbourne, VIC 3000 Web www.ridley.com.au Aus
Slide 20: Appendices
RIDLEY AGRIPRODUCTS PROPERTY FINANCIALS OUTLOOK APPENDICES 20
Slide 21: Corporate Snapshot
CORPORATE SNAPSHOT RIDLEY AGRIPRODUCTS PROPERTY FINANCIALS OUTLOOK Corporate focus: Australia’s leading supplier of premium quality, high performance animal nutrition solutions ASX – as at close of RIC business on 6 Feb 2014 Share price $0.79 Shares on issue 307.8m Market cap. $243m 52 week range $0
Slide 22: Sector History
SECTOR HISTORY RIDLEY AGRIPRODUCTS PROPERTY FINANCIALS OUTLOOK Sector 1H: 1H: FY12 FY11 FY10 FY09 Outlook FY14 FY13 (kt) (kt) (kt) (kt) (kt) (kt) Poultry 520 441 933 900 764 746 Aqua-feed 25 22 47 50 47 37 Packaged 47 46 85 84 90 98 # Dairy 138 134 260 236 215 293 Pig 90 92 197 224 325 332 Supplemen
Slide 23: Brands & Customers
BRANDS & CUSTOMERS RIDLEY AGRIPRODUCTS PROPERTY FINANCIALS OUTLOOK Brand Overview Customers / market position Barastoc offers a range of pellets, meals, concentrates and pre- Bulk customers range from the small mixes specifically formulated to meet the nutritional requirements independents to the la
Slide 24: Locations & Sectors
LOCATIONS & SECTORS RIDLEY AGRIPRODUCTS PROPERTY FINANCIALS OUTLOOK 24
Slide 25: Rendering
RENDERING RIDLEY AGRIPRODUCTS PROPERTY FINANCIALS OUTLOOK Key component of sustainable agriculture One third-one half of every animal produced in Australia for meat, milk, egg & fibre food products is not consumed by humans Process by which low economic value matter from meat & food processing
Slide 26: Growth Opportunities
GROWTH OPPORTUNITIES RIDLEY AGRIPRODUCTS PROPERTY FINANCIALS OUTLOOK Capture market share Long term, cost using innovative protein effective, surety of sources to extend the highest quality supply superior product, safety to provide customer & service offering expansion and capital constraint soluti
Slide 27: Dry Creek
DRY CREEK RIDLEY AGRIPRODUCTS PROPERTY FINANCIALS OUTLOOK 316.1 Ha In prime location with proximity to Adelaide CBD, included within SA Government’s 30 Year Plan Seeking lease surrender to facilitate potential sale of >4,800 Ha of coastal strip north of the former saltfield Delays experienced
Slide 28: Dry Creek
DRY CREEK RIDLEY AGRIPRODUCTS PROPERTY FINANCIALS OUTLOOK Lara Salt Development Avalon of the Dry Creek site is N Fields consistent withAirport Government’s 30 year plan for Adelaide. Ridley is working Former salt with all stakeholders to establish a condensing pathway to address the outstanding pon
Slide 29: Lara & Moolap
LARA & MOOLAP RIDLEY AGRIPRODUCTS PROPERTY FINANCIALS OUTLOOK AVALON AIRSTRIP Larasite 912 hectare Salt at Lara - preliminary Avalon Fields planning and investigations completed Airport Lara redevelopment potential for industrial Melbourne and airport-related uses ~60km 912ha site adjacent to Av
Slide 30: Moolap
MOOLAP INTRODUCTION AGRIPRODUCTS PROPERTY FINANCIALS OUTLOOK AVALON AIRSTRIP Lara Salt Avalon Process to secure rezoning and Port Henry Alcoa smelter Fields redevelopment Airport approvals in progress Melbourne ~60km 912ha site adjacent to Avalon airport, Vic Medium term 1-3 years LARA SITE Former s
Slide 31: Outlook - Risks
OUTLOOK - RISKS RIDLEY AGRIPRODUCTS PROPERTY FINANCIALS OUTLOOK Cyclical fluctuations - diversified portfolio spreads the individual sector risk Influence of domestic harvest - management of raw material price fluctuations through procurement practices and customer ownership of raw materials I
Slide 32: Outlook - Strategy
OUTLOOK - STRATEGY RIDLEY AGRIPRODUCTS PROPERTY FINANCIALS OUTLOOK Business Focus - being Australia’s leading producer of Premium Quality High Performance Animal Nutrition Solutions Strategy - six platforms for delivery: Safety Our People Customer Focus Operational Excellence Community
Slide 33: Investment Highlights
INVESTMENT HIGHLIGHTS RIDLEY AGRIPRODUCTS PROPERTY FINANCIALS OUTLOOK Organic growth through rising populations, land constraints, demand for protein and heightened concerns for food security # Further sector consolidation opportunities Risk mitigation through sector diversification Signific