Murray River Organics Pty — FY2020 Earnings Presentation
25 slides from Murray River Organics Pty's earnings presentation, Aug 31, 2020
Slide 1: Investor Presentation
Investor Presentation 31 August 2020
Slide 2: Important notices and disclaimer
Important notices and disclaimer This presentation (Presentation) has been prepared by Murray River Organics Group Limited (ACN 614 651 473) (Company). Any references to "Murray River Organics" or "Group" in this Presentation refer to the Company and its controlled entities. The information in this
Slide 3: Building a business that's better for you
Building a business that’s better for you Murray River Organics is Australia’s leading producer, grower, manufacturer and seller of certified organic dried vine fruit and better-for- you food products. Our ambition is to be a global leader in this $100+ billion market
Slide 4: Contents
Contents • Executive Summary • Who We Are • FY20 In Review • Summary and Outlook
Slide 5: Executive Summary
Executive Summary We have commenced our multi-year transformational journey • In FY20, we grew sales in our Murray River Organics (MRO) branded national retail business by 28%, our ingredients business by over 50% whilst export sales grew by 3% despite severe COVID-19 restrictions in key export mark
Slide 6: Who are we?
Who are we? Murray River Organics is Australia’s leading producer, grower, manufacturer and seller of certified organic dried vine fruit and better-for-you food products. Our ambition is to be a global leader in this $100+ billion market We are growers We are Organic volume a key manufacturers Natio
Slide 7: Our organic positioning is supported by macro food and beverage trends
Our organic positioning is supported by macro food and beverage trends Increase in demand for socially conscious brands • 30% of Millennials say they go out of their way to buy organic or natural products. This is the highest of all generational groups. Rise of plant-based alternatives • Growth in v
Slide 8: Our Vision, Purpose and Beliefs
Our Vision, Purpose and Beliefs We choose Vision Our door is organic Leader in organic and always open better-for-you brands and ingredients. We think size We innovate matters Purpose to regenerate To make organic and better-for-you products, by farming and sourcing world class ingredients because w
Slide 9: Strategic Pillars
Strategic Pillars 1 2 3 4 5 Leverage our Build a global Develop market leading, Disrupt the food Drive process agricultural organic & better for purpose-driven organic market via strong excellence to footprint & flexible you ingredients brands with exceptional relationships with develop best-in-clas
Slide 10: Review of FY20
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Slide 11: Financial performance
Financial performance Earnings impacted by COVID-19, adverse weather, farming asset exit and reduced private label sales Comments $m FY20 FY19 Change % Sales 48.3 60.1 (11.7) (20%) • We have continued to drive growth in branded retail and export, whilst reducing low margin private label contracts. E
Slide 12: Sales Overview
Sales Overview Gross Sales by channel FY20 FY19 % Comments National Retail 28.9 41.3 (30%) • Reduction in annual private label contracts of $13.5m offset by ~28% growth in MRO branded national retail Wholesale ingredients 9.9 6.3 +53% • Continued strong growth despite COVID challenges – strong strat
Slide 13: National Retail achieves major milestones with ranging confirmed for 37 new MRO branded products
National Retail achieves major milestones with ranging confirmed for 37 new MRO branded products MRO to MRO Brand extends confectionery enters with launch of Xmas Confectionery Gifting for WW and Dried Leading MRO Brand Fruit & Nut Organic launched in categories Brand Metcash/IGA with WW MRO Brand f
Slide 14: Our launches are aligned to building a large-scale Organics business
Our launches are aligned to building a large-scale Organics business…. Pantry Snacking Muesli Oils Confectionery Leveraging access to Range of ready-to-eat 100% organic Muesli Healthy cooking Launch of Organic Mylk 100% Organic ingredients single serve and sharing range in 400g canisters with 100% O
Slide 15: Export sales up 3% on prior year, despite being affected by COVID-19 impacts
Export sales up 3% on prior year, despite being affected by COVID-19 impacts • We are capturing a value premium for our finest certified organic products, and expanding our market share with our unique Australian food offering Export Focus • Export sales grew by 19% in H1, but were severely affected
Slide 16: Our Export business is connecting MRO to the international consumer
Our Export business is connecting MRO to the international consumer, building a global brand presence Launching Extended MRW MRO brand healthy snack Our international market development plan focuses on creating and 100% offering launch innovative consumer products that leverage our unique Australian
Slide 17: Wholesale & Ingredients sales up 50% on prior year
Wholesale & Ingredients sales up 50% on prior year, on our way to becoming the leading organics ingredients supplier • Wholesale & Ingredients sales increased to $9.9 million, up 50% on FY19 • Business was challenged by COVID-19 as global freight movements were ~1400 tonnes globally sourced prevente
Slide 18: Major restructure of our farming portfolio in FY20
Major restructure of our farming portfolio in FY20 Farm profitability severely affected by extended drought, extreme summer and low water Yatpool Improved Farm Management & Planning allocation and high spot water pricing • FY19 review resulted in the exit of the Colignan lease in December 2019, redu
Slide 19: Financial Performance: balance sheet
Financial Performance Balance sheet deleveraged by capital raising, asset sales and improved working capital Balance sheet FY20 FY19 Change Comments Working capital 19.61 24.05 (4.44) • Working capital reduced $4.44 m with lower inventories and improved terms Land, PPE, Right of use assets 38.97 71.
Slide 20: Financial performance: cash flow
Financial performance Operating cash flow improved $5.2m, aided by reduction in working capital Cashflow FY20 FY19 Change Comments Underlying EBITDA-SL (10.3) (3.6) (6.7) • Operating losses higher impacted by reduced crops, pricing and investments to build branded vertically integrated organic food
Slide 21: Summary and outlook
Summary and outlook
Slide 22: An organic and better-for-you food business primed for growth
An organic and better-for-you food business primed for growth Outlook • Part way through major restructure and transformation • The demand for clean, sustainable, healthy organic products is on the rise with the global pandemic further accelerating this growth • Focus on core-organic farming to supp
Slide 23: Appendices
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Slide 24: Appendix 1 - Non-IFRS financial measures
Appendix 1 - Non-IFRS financial measures The following unaudited non-IFRS financial measures are included in this report: 1. Net Debt - Net Debt, represents total borrowings less cash and cash equivalents. 2. Net Bank Debt -Net Bank Debt, represents total borrowings (excluding the Colignan property
Slide 25: Valentina Tripp CEO and MD
Valentina Tripp CEO and MD 0414 550 337 vtripp@murrayriverorganics.com.au
Murray River Organics Group — FY2020 Earnings Presentation on 6ix