Mbrf Global Foods Company S.a. · BMFBOVESPA:MBRF3
Mbrf Global Foods — Marfrig Alimentos — Investor Presentation (September 2013)
33 slides from Mbrf Global Foods's investor presentation, September 2013
Slide 1: Investor Presentation September 2013
Investor Presentation September 2013
Slide 2: Marfrig Overview
Marfrig Overview Revenue (R$ mm) (1) Revenue Breakdown for the 1H2013 (1) By Business By Currency By Product 16.516 14% 11% 28% 8.830 42% 7.676 47% 22% 49% 40% 25% 22% 2012 1H2012 1H2013 Marfrig Beef US Dollar Processed Real Moy Park Fresh Euro/Pounds Keystone Other Other Marfrig is an international
Slide 3: Strategy Behind the Sale of Seara and Zenda
Strategy Behind the Sale of Seara and Zenda Reduction of R$5.85 billion of Marfrig’s total debt New Marfrig Group Business Reorganization Revenues of R$16.5 billion for 2012 and R$8.8 billion for the Marfrig transferred Seara Brasil’s and Zenda’s assets to JBS, which 1H2013. Sales could very well su
Slide 4: Corporate Structure and Governance
Corporate Structure and Governance Corporate Structure Shareholder Structure Sergio Rial Controlling Shareholders Free Float 33,2% CFO: Ricardo Florence 47,1% CEO Brazil: Andrew Murchie CEO Southern Cone: BNDES Martín Secco 19,7% Improving Corporate Governance CEO: Frank Ravndal Internal Risk Board
Slide 5: Commitment to Objectives
Commitment to Objectives Guidance – 1Q13 FOLLOW UP – 2Q13 Deleveraging up to R$1.0 billion net debt reduction R$2 billion by 12/31/2013 already in 2Q13 Sale of Seara and Zenda Done Operating improvement in 5 KPIs 4 out of 5 KPIs improved in 2Q13 of Seara Brasil Pressure on beef margins Lower gross m
Slide 6: Business Strategy
Business Strategy
Slide 7: Marfrig Group: More focused and better positioned
Marfrig Group: More focused and better positioned Consolidated World’s 3rd largest beef One of the largest poultry- Business One of the world’s largest Diversified Animal producer and one of South based processed products providers of processed food Description America’s largest lamb suppliers in th
Slide 8: Marfrig Beef: Overview
Marfrig Beef: Overview Simple, Lean and Agile Operation Well Positioned Latam Platform Origin of the Group Slaughtering / Beef Further Processing units Strategic relevance with global reach in the industry Nationwide industrial and distribution footprint 33 plants1 Full range consolidated Opportunit
Slide 9: Marfrig Beef: Growth Strategy
Marfrig Beef: Growth Strategy Improve Channel Distribution Refocus on Food Service Operations 1H2012 1H2013 Increase sales to beef outlets and food service chains which yield higher margins – better segmentation Reduce logistic cost – today at R$ 500 million/year in Brasil 39% 42% Increase product q
Slide 10: Marfrig Beef: Positive Environment in Brazil
Marfrig Beef: Positive Environment in Brazil Cattle Herd (million head) – 2012 Largest cattle inventory for commercial purposes 09-12 Leading Position CAGR 1.5% 3.2% (0.4)% (1.0)% (3.0)% Fastest growing cattle herd in the world and Fastest 324 Recent herd rebuilding as well as genetic and 198 Growin
Slide 11: Marfrig Beef: Beef Cycle
Marfrig Beef: Beef Cycle Brazilian Calf Production 50 52 53 Growing calf production is expected to 45 47 47 44 44 46 47 Increasing Calf sustain adequate levels of cattle for next million Production years Positive trend for available cattle herd in 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 Br
Slide 12: Marfrig Beef: Beef Cycle Action Execution
Marfrig Beef: Beef Cycle Action Execution Increase share of direct sales, eliminating Marfrig Trading’s current role in the UK Simpler beef export model to Europe Leverage synergies with Moy Park’s commercial structure in Europe Closure of feedlot operations in Southern Brazil Close feedlots and sou
Slide 13: Keystone Foods – Overview
Keystone Foods – Overview Key drivers - Food Service strategy Long-lasting relationship with Compelling value proposition for Food service expertise leading QSRs (1) key customers Protein consumption growing APMEA as a key Leading role in innovation globally market for growth Keystone’s Global Footp
Slide 14: Keystone Foods – Global Food Service Supplier
Keystone Foods – Global Food Service Supplier Vast geographic industrial footprint Longlasting relationship with main QSR chains United States Revenues in 2012 US$1,885 million Business Attributes APMEA Solid/predictable cash flow Long tradition of serving “value-added”, brand conscious customers St
Slide 15: Keystone Foods – Growth Strategy
Keystone Foods – Growth Strategy Poultry is main focus for growth – Increase weight of birds in the US – Expand capacity in APMEA to meet customer’s aggressive growth agendas – China strategic sourcing of raw material through JV Partners and other strategic alliances with established grow-out operat
Slide 16: Keystone Foods US: Overview
Keystone Foods US: Overview Office / R&D Center LD Foods Integrated Poultry Complex Jefferson, WI Poultry Further Processing Equity Group Fish Further Processing N. Baltimore, OH Beef Further Processing KEYSTONE FOODS HOME OFFICE West Conshohocken, PA Keystone R&D West Chester, PA 3 integrated poult
Slide 17: Keystone Foods US - Poultry
Keystone Foods US - Poultry US Poultry Market Share on QSR’s Poultry Purchases Second largest poultry supplier for McDonald’s in the US 45% + 35% - 45% 3 Fully-integrated grow-out operations 25% - 35% 5 Further processing plants 15% - 25% Processes nearly 181 million chickens annually Further proces
Slide 18: Keystone Foods US - Beef and Fish
Keystone Foods US - Beef and Fish US Beef US Fish Largest of five beef suppliers to LD Foods is one of only two suppliers of fish products to McDonald’s in the US McDonald’s in the US Single facility in North Baltimore, Ohio Single facility in Jefferson, Wisconsin Sold over 100 thousand tons of beef
Slide 19: Keystone Foods APMEA: Overview
Keystone Foods APMEA: Overview Exposure to the Asian Market Keystone Foods is a critical supplier of protein Shanghai products in the Asia region Commercial Center Primary Processing China China China Logistics JV Office China Six further processing plants (5 multi-protein, 1 McKey beef), 1 poultry
Slide 20: Keystone Foods APMEA – China
Keystone Foods APMEA – China Poultry per Capita Consumption in China – (Kg/Year) Revenue Breakdown - 2012 Fish Hog Others 10,7 11,7 12,1 6% 3% 2% 9,4 Total 7,4 7,8 Beef US$ 214 million 15% 2000 2005 2010 2015E 2020E 2025E All proteins Poultry 44.0 48.7 53.0 59.9 66.9 72.9 74% Leading QSR’s Running a
Slide 21: Keystone Foods APMEA
Keystone Foods APMEA Malaysia Thailand Exclusive protein supplier for McDonald’s Exclusive protein supplier for McDonald’s One multi-protein processing unit: Poultry, Beef and Two multi-protein processing units: Poultry, Beef and Fish Pork 250 McDonald’s restaurants served in Malaysia and 180 McDona
Slide 22: Moy Park: Overview
Moy Park: Overview One of the United Kingdom’s largest food companies and one of Europe’s leading poultry suppliers Slaughter Operations in the UK, Ireland, France and the Netherlands Further Processing Eleven processing plants Four slaughter plants Serves over 17,000 restaurants and retail stores M
Slide 23: Moy Park: Growth Strategy
Moy Park: Growth Strategy Integration of Marfrig's business units in Europe (Moy Park, European Keystone Europe and Marfrig Beef) under the leadership of Moy Integration Park, creating a stronger platform to grow Marfrig's international sales in Europe The UK market is presently characterized by a s
Slide 24: Financial Highlights
Financial Highligitg) . > \ > 4
Slide 25: Consolidated Financial Highlights
Consolidated Financial Highlights Net Revenues (R$ mm) Revenues Breakdown – 1H2013 (1) 23.726 Moypark 21.014 25% Marfrig 15.879 16.516 Beef 47% 8.830 7.676 Keystone 2010 2011 2012 2012 (1) 1H2012 (1) 1H2013 (1) 28% EBITDA (R$ mm) and EBITDA Margin (%)(2) EBITDA Breakdown – 1H2013 (2) 10,9% Moypark 9
Slide 26: Leverage and Liquidity
Leverage and Liquidity Leverage Profile (R$ mm) Debt Profile by Currency 4,5x 18% 3,9x 3,6x 3,5x 2Q13 7.900 7.517 5.484 5.771 82% 2010 2011 2012 Proforma (1) (2) LTM2Q2013 Local Curency Foreign Currency Net Debt Net Debt/EBITDA Cash and Debt Breakdown by Currency (R$ mm) Proforma (3) Cash and Debt B
Slide 27: Impact of Seara Divestment in Debt Schedule
Impact of Seara Divestment in Debt Schedule Proforma Debt Amortization Schedule - 2Q2013 (R$mm) Short-Term Debt: - 70% Trade Finance Amortization profile will improve - 30% Other substantially after transferring Seara’s 2,327 2.409 debt 2,196 (19.5% of total debt) Cash position will comfortably cove
Slide 28: Agenda for Margin Expansion
() Agenda for te Margin Expansion
Slide 29: Agenda for Margin Expansion
Agenda for Margin Expansion Marfrig Beef Moy Park • Continuous improvement in working capital • Strong customer and consumer focus management • Consumer insight, food development and • Continue to monitor Argentina innovation • Footprint optimization in Brazil • Effective and efficient organization
Slide 30: Marfrig Group: Optimization of the Group's Financial Management
Marfrig Group: Optimization of the Group’s Financial Management Higher Cash Flow Generation… … Through Enhanced Working Capital Management… • New structure with a dedicated financial director to • Plenty of space to reduce working capital needs in the Marfrig Beef, with focus on cash cycle next year
Slide 31: Final Remarks
Final Remarks Commitment to strengthen the capital structure as proven and to increase profitability Redefined scope reducing integration related risks and undivided focus on execution with a clear goal to expand margins in our international businesses, progress to be measured already in 2014 More p
Slide 32: Disclaimer
Disclaimer This material is a presentation of general information on Marfrig Alimentos S.A. and its subsidiaries (jointly the “Corporation”) prepared as of the date of the presentation. This presentation was summarized and does not purport to be complete and should not be construed as an investment
Slide 33: IR Contacts
IR Contacts Avenida Chedid Jafet, 222 - Bloco A - 3º andar Vila Olímpia - São Paulo/SP - CEP: 04551-065 Tel: +55 (11) 3792-8650/8600 E-mail: ir@marfrig.com.br Website: www.marfrig.com.br/ir 33
Marfrig Alimentos — Investor Presentation (September 2013) on 6ix